Essays in applied microeconomics

Shamsi, Javad (2025) Essays in applied microeconomics. PhD thesis, London School of Economics and Political Science.

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Abstract

This thesis investigates how significant external shocks-namely digital disruption, immigration, and international sanctions-affect labour markets, shape firm dynamics, and ultimately alter political landscapes. Employing different empirical strategies, including quasi-experimental methods, machine learning, and text-based computational analyses, it sheds light on the multifaceted ways in which these shocks reverberate throughout economies and societies. The first chapter, Digital Disruption and Entrepreneurial Opportunities, is based on my job market paper. It explores how online food delivery platforms such as UberEats and Deliveroo have transformed the UK restaurant industry. By compiling a unique dataset and leveraging a staggered rollout of platform entry, this study uses a dynamic difference-in-differences approach to identify causal effects. The findings demonstrate that digital platforms reduce traditional barriers to entry, facilitating a 35% growth in restaurant numbers-predominantly independent and minority-owned enterprises-and broadening the diversity of cuisines offered. This chapter underscores how digital technologies, rather than always favoring large incumbents, can also create inclusive pathways for smaller, diverse entrepreneurs to thrive. The second chapter, Understanding Multi-Layered Sanctions: A Firm-Level Analysis, investigates how Iranian firms adapt to complex sanctions regimes. By applying computational linguistics to corporate transcripts, the study constructs a firm-level measure of sanctions exposure, revealing that sanctions not only harm politically connected firms, but also more extensively burden non-connected firms given their larger market presence. The analysis finds that heightened sanction exposure depresses firm valuations, sales, and investment, driven predominantly by lost export opportunities and higher import costs. These results challenge the notion of “smart” sanctions, highlighting the broad and often unintended consequences for the wider economy. The third chapter, Immigration and Political Realignment, examines the influx of migrants following the EU’s 2004 enlargement and its implications for the UK’s political fabric. Through a shift-share instrumental variable design that exploits industry-level migration flows and regional employment structures, the chapter shows that heightened immigration exposure contributes to greater support for right-wing, anti-immigration parties and the 2016 Brexit Leave vote, at the expense of traditional Labour support. Although immigration bolsters local economies by increasing activity and employment, cultural and identity-based considerations overshadow economic benefits, propelling a shift in voter alignment and political discourse.

Item Type:	Thesis (PhD)
Additional Information:	© 2025 Javad Shamsi
Library of Congress subject classification:	H Social Sciences > HB Economic Theory
Sets:	Departments > Economics
Supervisor:	Besley, Timothy and Michaels, Guy and Jaravel, Xavier
URI:	http://etheses.lse.ac.uk/id/eprint/4865

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