Maksym Khomenko is a candidate in economics, specializing in public economics, labor economics, and applied microeconomics at the University of Gothenburg in Sweden. He was also a visiting PhD student at the University of Oxford. His current research includes studies on the effects of inheritance taxes, private information in unemployment insurance, and health insurance markets. Prior to entering the PhD program, Khomenko earned two master’s degrees, one in mathematical economics and another in economic development and growth. He is one of several high-caliber participants in this year’s Summer Schools on Socioeconomic Inequality.
I have never been to a Chicago event before, and I’m really looking forward to the experience. My expectation is that it will be an amazing event for both professional and project development. I am especially happy to be a part of this particular HCEO event because my research interests and general decision to pursue a research career in economics were heavily influenced by a number of the speakers and organizers.
Maks, where are you from, and what made you want to study socioeconomic inequality?
I was born in Ukraine, which is where I earned both an undergraduate and a master’s degree in mathematical economics. I have always been fascinated with how society works – with limited resources, how do we make social choices? I’m happy I decided to pair math with my social and economic interests; it’s a very useful tool to help answer important economic questions.
Can you explain why studying economics in the context of social inequality is important?
This area of research is important because we know that inequalities contribute to many different kinds of social conflicts and are closely linked to the question of “fairness.” I suspect that most people, if given the chance, would prefer to be born into a society with equal opportunities for basic education, healthcare, jobs, etc. As researchers, we are most often interested, not in equality per se, but rather equal opportunities, such that certain people are not at a disadvantage because of their initial life conditions, like wealth, health, gender, or race. There is a flipside though – we must face efficiency-equality trade-offs because reducing inequality and social unfairness often has economic costs. Finding this balance, in my view, is what makes this area of research particularly fascinating and challenging.
Can you summarize your current research on inheritance and estate taxation?
This project studies US inheritance and estate tax reforms. Given a widely shared negative opinion of these taxes, there are a variety of arguments for abolishing them (e.g., unfair, bad for the economy, etc.). This research argues that inheritance taxation has an important effect on human capital investment decisions made by parents. Preliminary results show that abolishing the tax may lead to decreases in how much parents invest in children because it becomes easier and more cost effective to leave them a tax-free bequest. We have also found that the tax might have an important effect on labor supply and capital accumulation decisions. Overall, the role of the tax in addressing inequality is shown to be ambiguous, since it depends on initial conditions of intergenerational mobility in society, including access to education, healthcare, etc.
You have several other ongoing projects as well. One of them considers unemployment insurance in Sweden. What is the motivation behind this study, and do you have any preliminary findings you can share?
Sure. This research benefitted from the previous works of Nathaniel Hendren from Harvard University and Raj Chetty from Stanford University. My contribution is aimed at understanding how private information, like advanced knowledge of when one might be unemployed for example, affects social welfare. I am studying the Swedish system, in which any eligible person can freely choose whether or not to be enrolled. Very preliminary findings suggest that people have various levels of private information that the insurance funds do not have. For example, I may know when I will become unemployed. I also know what level of effort I put into keeping my job – perhaps having insurance results in less effort. Insurers do not have this information. I am interested in the policy implications and how we might take this information into account to design an optimal insurance provision.
What are your expectations for the upcoming Summer School on Socioeconomic Inequality?
I have never been to a Chicago event before, and I’m really looking forward to the experience. My expectation is that it will be an amazing event for both professional and project development. I am especially happy to be a part of this particular HCEO event because my research interests and general decision to pursue a research career in Economics were heavily influenced by a number of the speakers and organizers. James Heckman (HCEO director and Nobel Memorial Prize winning economist), Raj Chetty (HCEO network member), Christopher Taber (HCEO member, SSSI speaker), Nathaniel Hendren (HCEO member, SSSI speaker), and Steven Durlauf (HCEO director, SSSI speaker) were all very influential in shaping my research interests, and it is such a great opportunity to meet most of them in one place.
On July 31, Maks wrote in with his post-SSSI impressions:
The Summer School on Socioeconomic Inequality definitely met my expectations; it was a great event. I benefited enormously from the lectures, which highlighted various important parts of inequality research, with special attention given to the methodological advances and complementarities of different approaches to studying various questions of economic inequality.
I met many researchers from all over the world who are interested in similar questions. We had a lot of discussions and great time together. I really look forward to keeping in touch with them.
Finally, throughout the week, I had opportunities to talk to many people who inspired my research. It was great to talk to them, as well as hear more specific feedback on my work.
Additionally, the SSSI is special because it brings together people from many different areas to study the causes and effects of inequality. It is a great opportunity to exchange ideas with famous researchers and students from economics, sociology, psychology, and policy. I am also looking forward to hearing feedback on my own research and gaining fresh perspectives on what I’m studying.
Held over the summer across three international sessions, the 2016 Human Capital and Economic Opportunity Global Working Group Summer Schools on Socioeconomic Inequality provide a state-of-the-art overview on the study of inequality and human flourishing. The summer schools are one of a host of summer research activities highlighted in this series. To learn more, please visit our summer research hub.