Sebastian Brown

Biography

Sebastian Brown is a recent PhD graduate in economics from the University of California, Santa Barbara. His research combines techniques from applied microeconomics and insights from behavioral economic theory to study key issues in labor economics, focusing on the role of information and learning in the labor market. His current projects cover a variety of topics, including behavioral job search and the economic impacts of state-level labor legislation.

Job Market Paper Title

“How Much Can I Make? Insights on Belief Updating in the Labor Market”

Abstract

We use a nationally representative survey to study how people update their wage expectations. Using a recently developed excess belief movement test (Augenblick and Rabin, 2021), we find strong evidence of non-Bayesian learning at the aggregate level. We find that the average belief movement is 518% of the average uncertainty reduction in their beliefs, 418% more than the Bayesian benchmark. Our simulations show that this result is unlikely to be explained solely by measurement error. We also find evidence of asymmetric updating, where individuals update their beliefs more when they receive higher wage offers than expected.

JEL codes: D83, D84, D90, J64