Sergio Salgado

ssalgado1I am a Ph.D. candidate in the Department of Economics at the University of Minnesota.

I will be available for interviews at the 2018 ASSA Meeting in Philadelphia, PA.


Phone: +1 (612) 636-7332

Curriculum Vitae

Fields:  Macroeconomics, Labor Economics

 Working Papers

Abstract: The proportion of entrepreneurs in the US working-age population has declined over recent decades. Over the same period, there has been a substantial increase in the returns to highly educated workers. This paper relates these two facts. First, I document that the decrease in the overall share of entrepreneurs is largely explained by the decline in entrepreneurship among college graduates. Then, I build a dynamic entrepreneurial choice model in which individuals’ occupation depends on their skill level, assets, and entrepreneurial ability. In this model, the rapid increase in the wages of high skill workers reduces the relative value of becoming an entrepreneur, thereby explaining the decline in the share of entrepreneurs in the population. I find that the increase in the wages of high skill workers accounts for a large fraction of the decline in entrepreneurship experienced by the US economy.

Full paper pending Social Security Administration clearance (Presented at Duke University, University of Chicago, Stanford University, and FRB of Minneapolis)

Abstract: This paper studies how the distribution of the growth rate of macro- and micro level variables change over the business cycle. At the micro level, we use firm panel data for more than 30 countries to show that skewness is strongly procyclical, driven by a large left tail of negative growth rates during recessions. At the macro level, analyzing the growth rates of GDP and stock market returns, we find a similar phenomenon of procyclical skewness. These results are robust to different selection criteria, across countries, industries, and measures, suggesting that a widening left tail—and, consequently, a more negative skewness—is a basic stylized fact of business cycles.

Abstract: Top wealth inequality in the United States has increased dramatically since the 1980s. This paper documents that part of this increase relates to the rise of superstar firms. We build a novel owner-firm matched panel dataset using information from the official records of the Securities and Exchange Commission, Forbes, and Compustat. Using this data we document that: (i) firms at the upper end of the market value distribution are disproportionately controlled by individuals at the top of the wealth distribution, (ii) these individuals invest a large fraction of their net worth in one or two main firms which we interpret as evidence of lack of asset diversification, and (iii) the output, employment, and market value shares accounted for by these firms has increased substantially over the last 30 years.

Work in Progress

Abstract: This paper characterizes the dynamics of wealth at the top of the distribution in the United States. Using data from the Forbes Magazine and other publicly available sources, we construct a novel panel data set of the richest individuals in the United States, covering the period 1982-2016. Using these data we find that: i) the Super-Rich exhibit a hump-shaped age profile of wealth which features explosive growth at younger ages, and ii) their wealth growth is highly cyclical, with substantial downside risk during recessions.