I am a Lead Economist at the School of Education and Social Policy at Northwestern University.

I received my PhD in Economics from the University of Tennessee, Knoxville. Previously, I was a Research Assistant at the Boyd Center for Business and Economic Research at the University of Tennessee. My experience includes nine years of teaching as an instructor/lecturer. I also serve as a Consultant to state and local governments in the U.S. and abroad, and the Inter-American Development Bank.

My research focuses on evaluating the impact of public policies and regulation on households, firms, and government. I study the effects of social programs and conditional cash transfers on labor market outcomes, intergenerational mobility, and human capital formation.

I love economics, and I advocate for using empirical evidence and innovative data to improve public policies, working with experimental and quasi-experimental designs, economic forecasts, data mining, and automation tools to inform policymakers.

Reach out at d.guerrero@northwestern.edu!

🎓Education

PhD in Economics, 2024
The University of Tennessee, Knoxville

MA. in Economics, 2021
The University of Tennessee, Knoxville

MSc. in Applied Economics, 2019
St. Cloud State University

BA. in Liberal Studies, 2013
Universidad Metropolitana

🔋 Research Interests

Public Economics
Labor Economics
Applied Microeconomics
Development Economics
Political Economy

Working Papers

"The Economics of Vocational Rehabilitation: Time Use and Labor Market Payoffs" with Michelle Yin. (R&R)

The Vocational Rehabilitation (VR) program is a central component of U.S. disability employment policy, yet limited research examines how participants allocate their time in VR and its implications for labor market outcomes. This study analyzes the relationship between time use in VR—specifically employment during participation, receipt of funded services, and time spent waiting for services—and post-program employment and earnings. Leveraging administrative records from a state VR agency linked to unemployment insurance data, we assess employment trajectories for transition-age youth. The results indicate that employment during VR is a strong predictor of higher post-closure employment rates, shorter unemployment spells, and higher earnings, whereas extended VR participation without employment is associated with weaker short-term labor market outcomes. The estimated return on investment (ROI) of VR participation peaks at seven quarters but declines thereafter, turning negative beyond 26 quarters due to rising opportunity costs. These findings underscore the importance of embedding work-based learning opportunities within VR to enhance long-term labor market attachment and earnings potential.

"Police Militarization and the Non-Disclosure of Civilian Deaths" with Eunsik Chang and Matthew Harris. (Submitted)

We study the relationship between police departments acquiring military hardware and their transparency regarding violent outcomes. Using established identification methods, we show that police departments that acquire larger stocks of military hardware are more likely to kill civilians, but not disclose their deaths in reports to the federal government. There is also a relationship between police misbehavior in previous year and acquiring military hardware. The former is measured by nondisclosure, civil asset forfeiture, and DOJ allegations of police misconduct. By linking receipts of tactical equipment to underreported civilian deaths, this paper shows that observable indicators of police militarization are likely a signal of more troubling changes including decreased transparency and accountability.

"Business as Usual? Firm responses to the Earned Income Tax Credit." (Link)

This paper presents novel evidence on the impact of the Earned Income Tax Credit (EITC) on wages, employment, and the number of establishments across industries and occupations using establishment survey data. Despite extensive research on the EITC's effects using household surveys, questions remain about how the program shapes firm-level labor market outcomes. I exploit variation from the staggered implementation of state EITC supplements and differences in exposure across industries/occupations. The analysis finds that wages decrease by 8\% in exposed industries and occupations after EITC enactment, but this effect is transitory. There is little evidence of changes in employment levels or number of establishments. The wage effects concentrate in service industries and occupations. While employment effects are inconclusive, the significant temporary wage reductions underscore the program's influence on labor markets. The paper provides new insights into heterogeneous labor market responses to the EITC across different industries and occupations using previously unexplored data sources.

"The Intergenerational Effects of the Earned Income Tax Credit on the Adult Income of Children." (Link)

This paper revisits the evidence on the intergenerational effects of the Earned Income Tax Credit (EITC) on the adult income of individuals whose families received the tax credit during childhood. I build on Bastian and Michelmore (2018) and test new sources of variation and new multigenerational data. Identification exploits an instrument that draws variation from formulaic changes across states and years. The results show that tax credit transfers during childhood increase adult income between 1.5 and 3.4 percent. The effect is concentrated on transfers received between 0 and 5 years old and, contrary to previous studies, transfers during adolescence have no impact on income. The intergenerational impact of the tax credit is driven by children of mothers working the fewest hours in the distribution, suggesting that work conditions offset the benefits of intergenerational poverty alleviation. The paper concludes that intergenerational poverty alleviation requires carefully accounting for the link between work incentives and the development of children.

"Nowcasting Real GDP Growth in The Bahamas" with Jose Luis Saboin and Angelo Mazzocca.

This paper introduces a novel real GDP growth nowcasting strategy based on a distribution of nowcast values derived from a large dataset and multiple variable combinations, specifications and estimators. We exploit structured and unstructured data from The Bahamas, using thirteen estimators from the econometrics and machine learning literature. The study begins describing our dataset with over three hundred variables from the national statistics system, satellite nighttime lights data for key geographic locations in the archipelago, and internet search trends. Next, we nowcast the seasonally-adjusted annualized quarter-on-quarter growth rate of real gross domestic product using multiple combinations of variables, specifications and estimators. Overall, the ensemble method produces a distribution of nowcasts that outperform a human-designed benchmark. This paper contributes a novel idea of exploiting a distribution of estimates rather than point-values from a determined specification or estimator.

"Revisiting the political economy of markets and coercion." Book Chapter in The Legacy of James M. Buchanan: Critical Explorations in Political Economy and Social Philosophy (Eds. Rosolino Candela, Alain Marciano, and Mikayla Novak). Lanham: Roman & Littlefield, forthcoming.

This paper examines the distinction between voluntary and coercive exchanges in market domains. The abundant historical examples of market-based coercion are a tension within constitutional political economy traditional view of markets as voluntary exchanges. Using a principal-agent model, this paper explores the definition of coercion and whether markets can be coercive. From the model, I derive the general features of coercion. First, coercion is a choice exercised by one individual (the principal) on another (the agent). Second, coercion is exercised by violence or quasi-violent threats that are communicated to the agent. Third, coercion aims at changing the behavior of another agent by reducing the value of alternative behavior or contracts, presenting with false choices: the wallet or your life is not a choice. Drawing on James Buchanan’s theories, I contrast different market agreements with the inherent coercion in political decisions and explore Samuelson's claim that all forms of constraints, including market constraints, are coercive. The paper concludes that not all constraints are coercive: economic constraints are derived from limited endowments, while coercive constraints arise from the willing exercise of influence onto another that reduces the alternatives or the value of alternatives through violence or the threat of violence. Market processes, however, may include coercive practices when the institutions are not embedded within a liberal market order. In a market economy held by a liberal market order, the market is a process based on exchanging private property rights from free individuals. So long as individuals have autonomy and rights, market interactions require mutual agreement.

Publications

Zanoni, W., Acevedo, P. and Guerrero, D. (2023) "Do slum upgrading programs impact school attendance?." Economics of Education Review 96.

Hernández, I. and Guerrero, D. (2016) "Desafíos petroleros para América Latina y África ante la expansión asiática." Revista CIDOB d'Afers Internacionals.

Book chapters

Guerrero, D. (Forthcoming) "Revisiting the political economy of markets and coercion." In Candela, Rosolino; Marciano, Alain; Novak, Mikayla (Eds.) The Legacy of James M. Buchanan: Critical Explorations in Political Economy and Social Philosophy. Lanham: Roman & Littlefield, forthcoming.

Hernández, I. and Guerrero, D. (2016) "Petroleum challenges for Latin America and Africa in light of the Asian expansion." In Woertz, Eckart (Ed.) Reconfiguration of the Global South.

Policy Reports

"The Economic Imperative of Vocational Rehabilitation." (2025) by Michelle Yin and Diego Guerrero. Policy Brief, Research and Innovation for Social and Economic Inclusion Lab.

"Language Models and Google Trends An Application to Tourism in the Andean Countries." (2024) by Christian Larrahondo, Emily Diaz, and Diego Guerrero. Inter-American Development Bank Technical Note IDB-TN-2882.

"Knox Promise and Nashville Grad: An Early Look at College Outcomes." (2023) by Celeste K. Carruthers, William F. Fox, Diego Guerrero, Emily Pratt. Boyd Center for Business and Economic Research.

"Regional Economic Outlook." (2021) by Lawrence M. Kessler, Vickie C. Cunningham, Diego A. Guerrero, and Timothy A. Kuhn. Boyd Center for Business and Economic Research.

"College Enrollment and the Access to Opportunity in St. Cloud, Minnesota." (2018) by Monica Garcia-Perez, Diego A. Guerrero, and Robert Johnson. Access to Opportunity Program

"Energy in Figures 2014. Oil and Gas Sector." by Igor Hernandez, Armando Romero, Diego A. Guerrero, Maria Alejandra De Francesco. Center for International Energy and Environment IESA.

Non peer-reviewed

Guerrero, D. and Romero, A. (2016) "The Case of Oil Income Management in Venezuela: Industry Investment versus Social Expenditure." Latin American Policy Journal 76.

Hernández, I. and Guerrero, D. (2015) "El Petróleo y Venezuela: Algunas cifras relevantes." Debates IESA.

Page updated

Google Sites

Report abuse