nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2005‒11‒19
25 papers chosen by
Fabio Sabatini
Universitá degli Studi di Roma, La Sapienza

  1. Human Capital, R&D and Competition in Macroeconomic Analysis By Erik Canton; Bert Minne; Ate Nieuwenhuis; Bert Smid; Marc van der Steeg
  2. Shifts and Twists in the Relative Productivity of Skilled Labor By Dupuy,Arnaud; Marey,Philip
  3. Heterogeneity and Learning in Labor Markets By Simon D. Woodcock
  4. The Impact of Parental Income and Education on the Health of their Children By Orla Doyle; Colm Harmon; Ian Walker
  5. The Gender Gap Reloaded: Is School Quality Linked to Labor Market Performance? By Spyros Konstantopoulos; Amelie Constant
  6. How Does Information Technology Really Affect Productivity? Plant-Level Comparisons of Product Innovation, Process Improvement and Worker Skills By Ann P. Bartel; Casey Ichniowski; Kathryn L. Shaw
  7. Technological Complexity, R&D and Education: Some Pleasant Arithmetic By Peter Thompson; Mihaela Pintea
  8. Labour regulation, corporate governance and legal origina: a case of institutional complementarity? By Simon Deakin; Beth Ahlering
  9. Place of Work and Place of Residence: Informal Hiring Networks and Labor Market Outcomes By Patrick Bayer; Stephen L. Ross; Giorgio Topa
  10. Job flows, worker flows and mismatching in Veneto manufacturing. 1982-1996 By Giuseppe Tattara; Marco Valentini
  11. Tenure Profiles and Efficient Separation in a Stochastic Productivity Model By Sebastian Buhai; Coen N. Teulings
  12. New mothers’ labour force participation in Italy: the role of job characteristics By Emilia Del Bono; Massimiliano Bratti; Daniela Vuri
  14. Protected mobility for employment and decent work: Labour market security in a globalised world By Peter Auer
  15. Is the Gender Gap in School Performance Affected by the Sex of the Teacher? By Holmlund, Helena; Sund, Krister
  17. Organizational versus individual responsibility for career management: Complements or substitutes? By De Vos, A.; Buyens, D.
  18. The Effect of Health Changes and Long-term Health on the Work Activity of Older Canadians By Doreen Wing Han Au; Thomas F. Crossley; Martin Schellhorn
  19. Proprietary Income, Entrepreneurial Risk and the Predictability of U.S. Stock Returns By Mathias Hoffmann
  20. The Scarring Effect of Recessions By Min Ouyang
  21. The Determinants of Child Labor: The Role of Primary Product Specialization By Leonardo Becchetti; Giovanni Trovato
  22. Could do Better: The Effectiveness of Incentives and Competition in Schools By Gianni De Fraja; Pedro Landeras
  23. The Role of Turkish Immigrants in Entrepreneurial Activities in Germany By Amelie Constant; Yochanan Shachmurove; Klaus F. Zimmermann
  24. Fertility and Female Labor Supply in Latin America: New Causal Evidence By Guillermo Cruces; Sebastian Galiani
  25. Corporate governance, stake-holding and the nature of employment relations within the firm By Suzanne Konzelmann; Neil Conway; Linda Trenberth; Frank Wilkinson

  1. By: Erik Canton (CPB Netherlands Bureau for Economic Policy Analysis); Bert Minne (CPB Netherlands Bureau for Economic Policy Analysis); Ate Nieuwenhuis (CPB Netherlands Bureau for Economic Policy Analysis); Bert Smid (CPB Netherlands Bureau for Economic Policy Analysis); Marc van der Steeg (CPB Netherlands Bureau for Economic Policy Analysis)
    Abstract: Long-run per capita economic growth is driven by productivity growth. Major determinants of productivity are investments in education and research, and the intensity of competition on product markets. While these ideas have been incorporated into modern growth theories and tested in empirical analyses, they have not yet found their way to applied macroeconomic models used to forecast economic developments. In this paper, we discuss various options to include human capital, R&D and product market competition in a macroeconomic framework. We also study how policy can affect the decisions to build human capital or to perform research, and how competition policy impacts on macroeconomic outcomes. We finally sketch how these mechanisms can be implemented into the large models used at the Netherlands Bureau for Economic Policy Analysis (CPB).
    Keywords: Human capital, R&D, competition, applied macroeconomic models
    Date: 2005–08
  2. By: Dupuy,Arnaud; Marey,Philip (ROA rm)
    Abstract: Skill-biased technical change is usually interpreted in terms of the efficiency parameters of skilled and unskilled labor. This implies that the relative productivity of skilled workers changes proportionally in all tasks. In contrast, we argue that technical changes also affect the curvature of the distribution of relative productivity. Building on Rosen''s (1978) tasks assignment model, this implies that not only the efficiency parameters of skilled and unskilled workers change, but also the elasticity of substitution between skill-types of labor. Using data for the United States between 1963 and 2002, we find significant empirical support for a decrease in the elasticity of substitution at the end of the 70s followed by an increase at the beginning of the 90s. This pattern of the elasticity of substitution has contributed to the labor productivity slowdown in the mid 70s through the 80s and to a speedup in the 90s.
    Keywords: education, training and the labour market;
    Date: 2005
  3. By: Simon D. Woodcock (Simon Fraser University)
    Abstract: This paper examines the role of agent heterogeneity and learning on wage dispersion and employment dynamics. In the first half of the paper, I present an equilibrium matching model where heterogeneous workers and firms learn about match quality and bargain over wages. The model generalizes Jovanovic (1979) to the case of heterogeneous workers and firms. Equilibrium wage dispersion arises due to productivity differences across workers, technological differences across firms, and heterogeneity in beliefs about match quality. Under a simple CRS technology, the equilibrium wage is additively separable in worker- and firm-specific components, and in the posterior mean of beliefs about match quality. This parallels the 'person and firm effects' empirical specification of Abowd et. al. (1999, AKM) and others. It consequently provides a theoretical context for the AKM model, and a formal economic interpretation of their empirical person and firm effects. The model also yields an assortative matching result that predicts a negative correlation between estimated person and firm effects, which is consistent with most empirical evidence. Finally, the model makes novel predictions about the relationship between the person and firm effects and separation behavior, job duration, and firm size. In the second half of the paper, I test the model's empirical predictions. I estimate fixed and mixed effects specifications of the equilibrium wage function on the LEHD database. The mixed effect specifications generalize the earlier work of AKM and others. The learning component of the matching model implies a specific structure for the error covariance. I exploit this structure to test whether earnings residuals are consistent with Bayesian learning, and to estimate structural parameters of the matching model. I find considerable support for the matching model in these data.
    Keywords: matching, learning, heterogeneity, longitudinal linked data, mixed model
    JEL: J31 D83 C23
    Date: 2005–11–15
  4. By: Orla Doyle (Geary Institute, University College Dublin); Colm Harmon (University College Dublin, CEPR and IZA Bonn); Ian Walker (University of Warwick, Institute for Fiscal Studies and IZA Bonn)
    Abstract: This paper investigates the robustness of recent findings on the effect of parental background on child health. We are particularly concerned with the extent to which their finding that income effects on child health are the result of spurious correlation rather than some causal mechanism. A similar argument can be made for the effect of education - if parental education and child health are correlated with some common unobservable (say, low parental time preference) then least squares estimates of the effect of parental education will be biased upwards. Moreover, it is very common for parental income data to be grouped, in which case income is measured with error and the coefficient on income will be biased towards zero and there are good reasons why the extent of bias may vary with child age. Fixed effect estimation is undermined by measurement error and here we adopt the traditional solution to both spurious correlation and measurement error and use an instrumental variables approach. Our results suggest that the income effects observed in the data are spurious.
    Keywords: child health, intergenerational transmission
    JEL: I1
    Date: 2005–11
  5. By: Spyros Konstantopoulos (Northwestern University and IZA Bonn); Amelie Constant (IZA Bonn)
    Abstract: This study examines the gender gap in wages of young adults in the late 1970s, mid 1980s, and 2000, in the middle and the tails of the wage distribution using quantile regression. We also examine the importance of school quality indicators in predicting future labor market performance. We conduct analyses for three major racial groups in the US: Whites, Blacks, and Hispanics. We employ base year and follow up data from two rich longitudinal studies: the National Longitudinal Study (NLS) of high school seniors in 1972 and the National Education Longitudinal Study (NELS) of eighth graders in 1988. Our results indicate that school quality is an important predictor of and positively associated to future wages for Whites, but it is less so for the two minority groups. We confirm significant gender disparities in wages favoring men across three surveys in the 1970s, 1980s, and 2000 that are unaccounted for. While the unexplained gender gap is evident across the entire wage distribution, it is more pronounced for Whites and less pronounced for Blacks and Hispanics. Overall, the gender gap in wages is more pronounced in higher paid jobs (top 10 percent) for all groups, indicating the presence of a n alarming "glass ceiling."
    Keywords: wages, gender differences, school quality, school effects, quantile regression
    JEL: J16 J24 J31
    Date: 2005–11
  6. By: Ann P. Bartel; Casey Ichniowski; Kathryn L. Shaw
    Abstract: This study presents new empirical evidence on the relationship between investments in new computer-based information technology (IT) and productivity by investigating several plant-level mechanisms through which IT could promote productivity growth. We have assembled a data set on plants with a common production technology in a narrowly defined industry - valve manufacturing - to study the effects of new IT on product innovation, production process improvements, employee skills and work practices. The homogeneity of the plants' production processes within this narrowly defined industry together with the estimation of longitudinal models eliminate many sources of unmeasured heterogeneity that could confound productivity comparisons in more aggregate data and in broader samples. The three main results of this study highlight how the adoption of new IT-enhanced machinery involves much more than just the installation of new equipment on the factory floor. We find that adoption of new IT-enhanced equipment (1)alters business strategies, moving valve manufacturers away from commodity production based on long production runs to customized production in smaller batches; (2)improves the efficiency of all stages of the production process with reductions in setup times supporting the change in business strategy and (3)increases the skill requirements of workers while promoting the adoption of new human resource practices.
    JEL: O33 J24 L25
    Date: 2005–11
  7. By: Peter Thompson; Mihaela Pintea (Economics Florida International University)
    Abstract: Persistent trends in R&D intensity and educational attainment, in conjunction with the absence of any trend in per capita income growth, are inconsistent with the predictions of most growth models. Jones (2002) has made a strong point that the data are consistent with out-of-steady state predictions of his semi-endogenous growth model. He concludes that when secular increases in R&D intensity and educational attainment will come to an end, income growth can be expected to decline dramatically. In this paper we suggest an alternative explanation that predicts no such collapse. We assume that increases in productivity can result from formal R&D effort and from learning by doing. However, during the latter half of the 20th century, increased technological complexity has made passive learning more difficult. We argue that firms have consequently substituted R&D for learning and, because skilled workers can overcome the challenges of learning in a more complex environment more readily than can unskilled workers, the relative demand for skill has risen. The consequent increase in the returns to skill in turn has induced an increase in educational attainment. Our theory explains how increases in R&D intensity and educational attainment can be equilibrium responses to changing conditions that make growth more difficult. Despite greater complexity, R&D and educational attainment must, as in Jones (2002), eventually cease to grow. But, in stark contrast to Jones, our theory does not imply that income and productivity growth will collapse once the new steady state is reached. We formalize these ideas with a general equilibrium model of R&D and learning in the spirit of earlier work by Young (1991, 1993), Lucas (1993), and Parente (1994). For simplicity we assume that R&D is not necessary to develop new product generations, which arrive to each firm randomly according to an exogenous Poisson process. Instead, R&D is assumed to influence the productivity of a new product at the time it is launched, and the more R&D that is conducted, the less there is left to learn. Skilled labor is a necessary input into R&D, and it also enhances a firm’s ability to learn in production. We further assume that the value of skilled labor in learning increases the more difficult learning is. Thus, we show that an increase in the difficulty of learning raises the demand for skilled workers in R&D and in production. The immediate effect is to increase the price of skill. The initial increase in wages of skilled workers is offset over time by an induced rise in the supply of skills. To sustain an increased supply of skills in the long run wage inequality must remain higher than before the increase in the difficulty of learning. These dynamic responses are obtained in a setting in which the aggregate rate of growth is constant. Thus, a reversal in the difficulty of learning would induce a decline in R&D and in the returns to skill, but no decline in economic growth.
    Keywords: economic growth, R&D, learning
    JEL: O40
    Date: 2005–11–11
  8. By: Simon Deakin; Beth Ahlering
    Abstract: We explore the finding of La Porta et al. that differences in Ôlegal originÕ account for part of cross-national diversity in labour regulation and corporate governance. We suggest that the finding needs a better historical grounding and that a mechanism which might explain it has not been adequately spelled out. In search of an explanation we focus on the role of complementarities between legal and economic institutions, and in particular the part played by the distinctive Ôlegal culturesÕ of the common law and civil law in setting national systems on separate pathways to economic development.
    Keywords: legal origin, complementarities, legal cultures, labour law, corporate governance.
    JEL: G38 K22 K31 J53 J83
  9. By: Patrick Bayer (Economic Growth Center, Yale University); Stephen L. Ross (Economics Department, University of Connecticut); Giorgio Topa (Federal Reserve Bank of New York)
    Abstract: We use a novel dataset and research design to empirically detect the effect of social interactions among neighbors on labor market outcomes. Specifically, using Census data that characterize residential and employment locations down to the city block, we examine whether individuals residing in the same block are more likely to work together than those in nearby blocks. We find evidence of significant social interactions operating at the block level: residing on the same versus nearby blocks increases the probability of working together by over 33 percent. The results also indicate that this referral effect is stronger when individuals are similar in sociodemographic characteristics (e.g., both have children of similar ages) and when at least one individual is well attached to the labor market. These findings are robust across various specifications intended to address concerns related to sorting and reverse causation. Further, having determined the characteristics of a pair of individuals that lead to an especially strong referral effect, we provide evidence that the increased availability of neighborhood referrals has a significant impact on a wide range of labor market outcomes including employment and wages.
    Keywords: Neighborhood Effects, Job Referrals, Social Interactions, Social Interactions, Social Networks, Labor Supply
    JEL: J2 J3 J6
  10. By: Giuseppe Tattara (University of Venice, Dept economics); Marco Valentini (University of Venice, Dept statistics)
    Abstract: This research exploits a large employer-level panel dataset in order to analyse employment and worker flows for all establishments in a highly industrialized region in the North- East of Italy, the Veneto. Our results have relevance for models of job creation, job destruction and labour excess reallocation. The relation between separations from and accessions to existing jobs and between worker flows and job flows is scrutinized. Excess reallocation, the difference between worker flows and job flows at the plant level, is substantial. Mortality for new job matches is quite high and many new accessions are mismatched and lead to separations. Worker flows are very high for young workers to reduce drastically for workers after 35 years of age. The time series behaviour of worker flows and job excess reallocation from 1982 to 1996 is examined; worker level heterogeneity and employer level heterogeneity are discussed in determining the cyclical pattern of such flows and their rapid increment in more recent years. On this the paper makes progress in respect to the previous literature where turnover and excess reallocation are examined mainly in a static framework.
    Keywords: Regional Labour Markets; Job Flows; Worker Flows; Reallocation; Matched employer-employee panel data.
    JEL: R23 J21 J44
    Date: 2005–11–17
  11. By: Sebastian Buhai (Erasmus Universiteit Rotterdam, and Aarhus School of Business); Coen N. Teulings (Universiteit van Amsterdam)
    Abstract: This paper provides a new way of analyzing tenure profiles in wages, by modelling simultaneously the evolution of wages and the distribution of tenures. Starting point is the observation that within-job log wages for an individual can be described by random walk. We develop a theoretical model based on efficient bargaining, where both log outside wage and log wage in the current job follow a random walk. This setting allows the application of real option theory. We derive the efficient separation rule, which stipulates that workers switch jobs when the difference between the outside wage and the wage in the current job reaches a threshold. The model fits well the observed distribution of job tenures. Since we observe outside wages only at job start and job separation, our empirical analysis of with job wage growth is based on expected wage growth conditional on the outside wages at both dates. Our modelling allows testing of the efficient bargaining hypothesis. The model is estimated on the PSID.
    Keywords: random productivity growth; efficient bargaining; job tenure; wage growth; wage-tenure profiles; option theory
    JEL: C51 C52 J63
    Date: 2005–10–21
  12. By: Emilia Del Bono; Massimiliano Bratti; Daniela Vuri
    Abstract: In this paper we use newly available individual-level data from the Longitudinal Survey of Italian Households to investigate the factors affecting female labour force participation after the birth of the first child. We focus on the effects of pre-marital job characteristics and find that working without a contract has a negative effect on new mothers' participation, while working in the public sector or in a large private firm increases the probability of participation after childbearing. We suggest that these effects could be at least partly attributed to differences in the level of job protection and employment stability enjoyed by workers. This implies that in Italy women with highly protected and stable jobs find it easier to combine career and family, while those who are less sheltered by the legislation are more likely to withdraw from the labour force after becoming mothers.
    Keywords: childbirth, employment, informal sector, job protection, private, public
    JEL: J13 J21 J23 O17 C3
    Date: 2004–05
  13. By: Sarbajit Chaudhuri (Dept. of Economics, Calcutta University)
    Abstract: The present paper makes an attempt to examine theoretically the impact of emigration of skilled labour from developing countries on the level of welfare of the non-migrants and the level of urban unemployment of unskilled labour in a three sector Harris-Todaro model. The analysis suggests that in a reasonable production structure for a developing economy a brain drain of skilled labour raises urban unemployment of unskilled labour. The paper also shows that an emigration of skilled labour may raise the welfare of the non-migrants in a tariff-distorted economy if it imports the specialized manufacturing product or the labour-intensive good. However, if the economy imports the traditional manufacturing product, the welfare of the non-emigrating workers is likely to deteriorate.
    Keywords: Emigration of skilled labour; unskilled labour; Harris-Todaro framework; welfare of the non-migrants; urban unemployment
    JEL: F2 F F22 J64
    Date: 2005–11–11
  14. By: Peter Auer (International Labour Office, Employment Strategy Department)
    Abstract: The paper finds that a cluster of OECD countries that might be called "numerically flexible" does in fact demonstrate good labour market results: employment rates overall and rates for relevant groups (young/female/older) are higher and unemployment is lower than in countries with less numerical flexibility as measured by employment tenure and tenure distribution. However, when considering indicators of job quality (measured by wages, perceived employment security, access to training, etc.) the picture is mixed, with some countries exhibiting low shares of good quality employment and some others high shares. The discriminating variable seems to be labour market institutions and policies. If they are extensive there is "protected flexibility", and job quality as well as perceived job security are high. In the absence of such policies, job quality and job security suffer. A conclusion is that if efficiency and equity are sought in labour markets in open economies then institutions and policies for “protected mobility” should exist. Institution building (or transformation of existing institutions) is important on several accounts. Firstly, globalisation and technical change transforms employment relations and entail more volatility and less security, because employers cannot maintain the same degree of employment protection as in less exposed economies. Secondly, collective bargaining agendas have to be extended to include labour market policies, as employers’ demands for more adjustment flexibility will increasingly be accompanied by worker representatives’ demands for better security in change. In other words: reduced employment protection has to be compensated by labour market security if decent work is a target. Protected mobility by sound labour market policies might result in real “flexicurity” (adaptability for firms and security for workers) and become a common objective of both sides of industry while also reconfirming an enhanced role for the State.
    Keywords: numerical flexibility, labour market policy, labour market institutions, tenure, job quality
    Date: 2005–01–10
  15. By: Holmlund, Helena (Swedish Institute for Social Research, Stockholm University); Sund, Krister (Swedish Institute for Social Research, Stockholm University)
    Abstract: Girls outperform boys in school. We investigate whether the gender performance gap can be attributed to the fact that the teacher profession is female dominated, that is, is there a causal effect on student outcomes from having a same-sex teacher? Using data on uppersecondary school students and their teachers from the municipality of Stockholm, Sweden, we find that the gender performance differential is larger in subjects where the share of female teachers is higher. We argue, however, that this effect can not be interpreted as causal, mainly due to teacher selection into different subjects and nonrandom student-teacher matching. Exploring the fact that teacher turnover and student mobility give rise to variation in teacher’s gender within student and subject, we estimate the effect on student outcomes of changing to a teacher of the same sex. We find no strong support for our initial hypothesis that a same-sex teacher improves student outcomes.
    Keywords: -
    Date: 2005–11–04
  16. By: Mario Raposo (Universidade da Beira Interior); Helena Alves (Universidade da Beira Interior)
    Abstract: Facing a growing competitive environment, higher education institutions have increased dramatically the competition for recruiting and retaining students providing a high quality service as a solution to compete. Frequently, researchers who have studied the service quality and client satisfaction have measured it by comparing consumers’ expectations with their perception of the provided service. This study was undertaken to provide data for analysing students’ expectations when they enter University, as well as to know which influences origin those expectations at the beginning of undergraduate studies. Then these expectations were compared with student’s service perceptions after one year of study. An analysis between expected service and service received is maid and the results shown that the gap between those, is great in aspects mainly directly related to educational service. A factorial analysis shows that service expectations are mainly formed around the dimensions related to aspects of learning and career, reputation of the University and how the support services are delivered by staff.
    Keywords: Service expectations, service quality, higher education, marketing
    JEL: A20 A23 M31
    Date: 2005–11–15
  17. By: De Vos, A.; Buyens, D.
    Abstract: This paper explores the relationship between organizational career management and career self-management and addresses their impact on employee outcomes. The results of a study among employees and linemanagers are presented, which partly support our hypotheses. The interaction between organizational and individual career management in explaining employee outcomes is discussed.
    Date: 2005–10–05
  18. By: Doreen Wing Han Au; Thomas F. Crossley; Martin Schellhorn
    Abstract: Using longitudinal data from the Canadian National Population Health Survey (NPHS), we study the relationship between health and employment among older Canadians. We focus on two issues: (1) the possible problems with self-reported health, including endogeneity and measurement error, and (2) the relative importance of health changes and long-term health in the decision to work. We contrast estimates of the impact of health on employment using self- assessed health, an objective health index contained in the NPHS - the HUI3, and a "purged" health stock measure. Our results suggest that health has an economically significant effect on employment probabilities for Canadian men and women aged 50 to 64, and that this effect is underestimated by simple estimates based on self- assessed health. We also corroborate recent U.S. and U.K. findings that changes in health are important in the work decision.
    Keywords: health, health changes, employment, older workers
    JEL: I12 J26
    Date: 2005–10
  19. By: Mathias Hoffmann (Economics University of Dortmund)
    Abstract: The paper contributes to a recent empirical and theoretical literature that suggests that proprietors are an important group of stockholders and that entrepreneurial risk could therefore help explain time-varying risk premia on the aggregate stock market. I use the intertemporal budget constraint of the average U.S. household to derive a cointegrating relationship between consumption and income from proprietary and non-proprietary wealth. I call this cointegrating relationship the cpy -residual. I interpret cpy as an entrepreneurial risk factor, because it mainly reflects cyclical fluctuations in proprietary income and because it is highly correlated with cross-sectional measures of idiosyncratic entrepreneurial risk. The cpy residual turns out to be a potent predictor of excess returns on the aggregate stock market in postwar U.S. data. However, this predictive power has started to decline since the beginning of the 1980s as stock market participation has widened with the advent of tax-deferable employer-sponsored pension plans and as proprietary income risk has become more easily diversifiable in the wake of state level bank deregulation
    Keywords: Non-insurable background risk, entrepreneurial income, equity premium, long-horizon predictability, consumption risk sharing
    JEL: E32 G12
    Date: 2005–11–11
  20. By: Min Ouyang (Economics University of Maryland at College Park)
    Abstract: This paper explores the role that recessions play in resource allocation. The conventional cleansing view, advanced by Schumpeter in 1934, argues that recessions promote more efficient resource allocation by driving out less productive units and freeing up resources for better uses. However, empirical evidence is at odds with this view: average labor productivity is procyclical, and jobs created during recessions tend to be short-lived. This paper posits an additional "scarring" effect: recessions "scar" the economy by killing off "potentially good firms". By adding learning to a vintage model, I show that as a recession arrives and persists, the reduced profitability limits the scope of learning, makes labor less concentrated on good firms, and thus pulls down average productivity. Calibrating my model using data on job flows from the U.S. manufacturing sector, I find that the scarring effect is likely to dominate the conventional cleansing effect, and can account for the observed pro-cyclical average labor productivity
    Keywords: Business Cycles, Cleansing Effect, Scarring Effect, Creative Destruction, Learning, Job Flows
    JEL: E32 L16 C61
    Date: 2005–11–11
  21. By: Leonardo Becchetti (University of Rome II - Faculty of Economics); Giovanni Trovato (University of Rome II - Faculty of Economics)
    Abstract: The paper tests predictions of a traditional intra-household bargaining model which, under reasonable assumptions, shows that lack of bargaining power in the value chain significantly reduces the capacity of obtaining benefits from increased product demand arising from trade liberalization and therefore is positively associated with child labor. Cross-sectional and panel negative binomial estimates in a sample of emerging countries support this hypothesis showing that proxies of the labor force bargaining power in the international division of labor (such as the share of primary product exports) are significantly related to child labor, net of the effect of traditional controls such as parental income, the quality of education, international aid and trade liberalization. The positive impact of the share of primary product exports on child labor outlines a potential paradox. The paradox suggests that trade liberalisation has not always straightforward positive effects on social indicators and that its short run effects on income distribution and distribution of skills and market power across countries need to be carefully evaluated.
    Keywords: child labor, distribution and growth, trade liberalisation
    JEL: D1 F1 F4
    Date: 2004–10–13
  22. By: Gianni De Fraja (University of York (UK) - Department of Economics; Centre for Economic Policy Research (CEPR)); Pedro Landeras (University of Cantabria - Department of Economics)
    Abstract: This paper studies the effects of incentive mechanisms and of the competitive environment on the interaction between schools and students, in a set-up where the students' educational attainment depends on their peer group, on their effort, and on the quality of the school's teaching. We show that increasing the power of the incentive scheme and the effectiveness of competition may have the counterintuitive effect of lowering the students' effort, with ambiguous effects on their attainment. In a simple dynamic set-up, where the reputation of the schools affects recruitment, we show that increased competition leads to segregation of pupils by ability.
    Keywords: Students effort, Schools quality, Peer-group effect, Incentives
    JEL: I20 H42
    Date: 2004–02–18
  23. By: Amelie Constant (IZA Bonn); Yochanan Shachmurove (Department of Economics, University of Pennsylvania); Klaus F. Zimmermann (Bonn University, IZA and DIW Berlin)
    Abstract: This paper addresses a central issue to migration the role of immigrants in entrepreneurial activity. In particular, the paper focuses on the determinants of the decision to become an entrepreneur for Turks living in Germany. The paper provides some important benchmarks, including the self-employment behavior of natives. The paper utilizes a comprehensive and reliable data base, the German Socioeconomic Panel to undertake systematic econometric analyses using appropriate statistical methods. The findings are that observable characteristics play different roles in the self-employment choice of immigrants and natives, whereas age-earnings profiles are similar for native and immigrant entrepreneurs.
    Keywords: Entrepreneurship, Self-employment, Immigration, Guest-workers, Turkey, Germany, European Union, German Socioeconomic Panel Data, Binomial Logit, Treiman international occupational prestige scale.
    JEL: J0 C23 C25 F22 J23 J61
    Date: 2005–10–01
  24. By: Guillermo Cruces (ECLAC & STICERD); Sebastian Galiani (Universidad de San Andres)
    Abstract: We study the effect of fertility on maternal labor supply in Argentina and Mexico exploiting a source of exogenous variability in family size first introduced by Angrist and Evans (1998) for the United States. We find that the estimates for the US can be generalized both qualitatively and quantitatively to the populations of two developing countries where, compared to the US, fertility is known to be higher, female education levels are much lower and there are fewer formal facilities for childcare.
    JEL: J13 J22
    Date: 2005–11–11
  25. By: Suzanne Konzelmann; Neil Conway; Linda Trenberth; Frank Wilkinson
    Abstract: This paper investigates the effect of different forms of corporate governance on the structure and nature of stakeholder relationships within organizations and the consequent impact on employment relations within the firm. In this, HRM assumes a dual role in delivering improvements in production efficiency and in fostering employee commitment to the organization and its objectives. However, different forms of corporate governance prioritise stakeholder interests in ways that may bring these two objectives into conflict. To address these questions, we examine the interrelationship between corporate governance, HRM practices and HRM outcomes in a comparative analysis of companies operating under alternative forms of governance, including private sector, public sector and family-owned firms. The empirical analysis is based on the UK Work and Employment Relations Survey (WERS98).
    Keywords: corporate governance, human resource management, stakeholding, employment, relations and Work and Employment Relations Survey
    JEL: J24 J53 L21 L23 M12 M5

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