Hello!
I am Samuel Leyton (Sam)
About Me
I am an Assistant Professor in the Department of Economics at Sophia University in Tokyo.
I received my Ph.D. in Public Economics from the National Graduate Institute for Policy Studies (GRIPS) in Japan, and I spent one year as a Postdoctoral Fellow at the Institute of Economics, Academia Sinica (IEAS) in Taiwan. I also hold a B.A. and an M.A. in Economics from the Pontifical Catholic University of Chile (PUC), where I spent over two years working as a researcher.
You're welcome to explore my previous and ongoing projects in the research section of this website and to access my CV below.
My Research
My research interests lie in macroeconomics, with a focus on political economy and labor economics. My current projects examine the political economy causes of employment informality and its impact on human capital accumulation, the gender wage gap, and employment.
Job Market Paper: "Labor Informality and Redistribution: A Political Economy Equilibrium"
Current draft (May 2024)
This paper proposes a political economy explanation for high labor informality in developing countries, focusing on the prevalence of jobs without social security coverage: politicians choose not to enforce formality for personal benefit. Our two-period OLG model features heterogeneous agents and two policies determined through probabilistic voting: the amount of a non-contributory basic pension for low-income retired workers funded with income taxes and the degree of enforcement of contributions to a mandatory provident fund (compulsory savings). Due to uncertainty about voters’ ideology, politicians choose policy instrument levels to maximize the weighted welfare of voters. In response to income inequality, politicians increase the basic pension for retired low-income workers, discouraging active workers from saving for retirement. Aligning with worker preferences, politicians relax enforcement of contributions to the provident fund, resulting in a lower labor formality rate. Empirical analysis validates the models' predictions. We highlight the case of Chile's public-sector employees, where a substantial portion is exempt from pension contributions. Additionally, using a panel spanning 65 countries from 1999 to 2019, we establish a robust negative correlation, both cross-country and over time, linking inequality with the labor formality rate.
Working Paper #1: "Life Cycle Wage Growth in a Developing Economy: Does Formality Matter?" (with Minchung Hsu)
A new draft is coming soon
While the pattern of wage growth over the life cycle is a crucial factor in understanding individual behaviors and economic features, it is less understood in developing economies. The study builds on recent research on international comparisons of wage-experience profiles (Lagakos et al., 2018, and Jedwab et al., 2023), which finds that wage growth is significantly lower in developing economies. We aim to provide a deeper insight into this issue by using data from the Chilean EPS panel survey (from 2002 to 2015) merged with administrative pension contribution records. This is the longest panel dataset available for a developing country, with which we provide a comprehensive analysis of how formal and informal employment experiences contribute to workers' wage growth over the life cycle. We propose a human capital accumulation model, that we extend to a life cycle model with endogenous employment choices. We use the models to guide our empirical strategy. We find that both human capital accumulation and the return to human capital are higher in formal employment. This study contributes to the literature by improving the accuracy of estimated experience and investigating the on-the-job human capital accumulation driven by sector-specific experiences. It provides a possible mechanism that may lead to the international disparity in life-cycle wage growth and a fundamental for modeling human capital accumulation in a developing economy with a life cycle framework.
Working Paper #2 (R&R Labour Economics): "Inequality in Pension Contribution Gaps" (with Salvador Valdes-Prieto)
Gaps in pension contribution histories reduce contributory pensions and have other negative impacts. We use a 14-year survey panel and a 35-year administrative panel from Chile. Considering all types of gaps together, their frequency falls from 91% for the lowest decile of relative earnings to about 35% for the highest decile. Analyzing separately the gaps exhibited by earners, we find that low-wage workers and women bear disproportionately larger cuts to their contributory pensions. For low-wage women, an increase in wages to the third decile or more is expected to reduce their gaps significantly. For low-wage men, the same increase in wages is predicted to be about half as effective in reducing gaps. Unobserved characteristics that raise the persistence of gaps among men keep their gaps higher even if their wages rise. Earner gap levels estimated from cross-sections are found to be downward biased by about a third. We show that vesting requirements like those in the U.S.A. and Spain lead to underestimating gaps if data from pensioners is used alone. A puzzle that remains is that although many gaps occur among earners who could pay, politicians invest little in reducing statutory exemptions and raising enforcement.
Work in Progress
“Gender Wage Gap in an Economy with Large Informal Emplyment: Evidence from Chile” (with Minchung Hsu)
“General Equilibrium Effects of Enforcing Employment Formality: Theory and Evidence for Chile” (with Salvador Valdes-Prieto & Francisco Parro)
"Why Does Informality Persist Despite Economic Growth? A Political Economy Perspective"
"Development, Growth and Population Ageing: A Political Economy Analysis" (with Been-Lon Chen & Minchung Hsu)