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on Human Capital and Human Resource Management |
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Issue of 2006‒01‒01
eighteen papers chosen by Fabio Sabatini Universitá degli Studi di Roma, La Sapienza |
| By: | Ingrid Verheul; Andre van Stel; Roy Thurik |
| Abstract: | Using Global Entrepreneurship Monitor data for 29 countries this study investigates the (differential) impact of several factors on female and male entrepreneurship at the country level. These factors are derived from three streams of literature, including that on entrepreneurship in general, on female labor force participation and on female entrepreneurship. The paper deals with the methodological aspects of investigating (female) entrepreneurship by distinguishing between two measures of female entrepreneurship: the number of female entrepreneurs and the share of women in the total number of entrepreneurs. The first measure is used to investigate whether variables have an impact on entrepreneurship in general (influencing both the number of female and male entrepreneurs). The second measure is used to investigate whether factors have a differential relative impact on female and male entrepreneurship, i.e., whether they influence the diversity or gender composition of entrepreneurship. Findings indicate that - by and large - female and male entrepreneurial activity rates are influenced by the same factors and in the same direction. However, for some factors (e.g., unemployment, life satisfaction) we find a differential impact on female and male entrepreneurship. The present study also shows that the factors influencing the number of female entrepreneurs may be different from those influencing the share of female entrepreneurs. In this light it is important that governments are aware of what they want to accomplish (i.e., do they want to stimulate the number of female entrepreneurs or the gender composition of entrepreneurship) to be able to select appropriate policy measures. |
| Keywords: | entrepreneurship, gender, determinants of entrepreneurship |
| JEL: | M13 H10 J16 J23 |
| Date: | 2005–12 |
| URL: | http://d.repec.org/n?u=RePEc:esi:egpdis:2005-39&r=hrm |
| By: | Ingrid Verheul; Martin Carree; Roy Thurik |
| Abstract: | This study investigates the factors explaining the number of hours invested in new ventures, making a distinction between the effect of preference for work time versus leisure time and that of productivity of work time. Using data of 1247 Dutch entrepreneurs, we find that time invested in the business is determined by various aspects of human, financial and social capital, availability of other income, outsourcing, side activities and gender. We show that some of the identified factors relate to preferences and others to productivity. Women appear to invest less time in the business as a result of a range of indirect productivity effects. |
| Keywords: | time allocation, new ventures, gender |
| Date: | 2005–12 |
| URL: | http://d.repec.org/n?u=RePEc:esi:egpdis:2006-01&r=hrm |
| By: | Tuomas Pekkarinen (Nuffeld College, Oxford and IZA Bonn) |
| Abstract: | This paper studies the relationship between the timing of tracking of pupils into vocational and academic secondary education and gender differences in educational attainment and income. We argue that in a system that streams students into vocational and academic tracks relatively late (age 15-16), girls are more likely to choose the academic track than boys because of gender differences in the timing of puberty. We exploit the Finnish comprehensive school reform of the 1970’s to analyze this hypothesis. This reform postponed the tracking of students from the age of 10-11 to 15-16 and was adopted gradually by municipalities so that we can observe members of the same cohorts in both systems. We find that the postponement of the tracking age increased gender differences in the probability of choosing the academic secondary education and in the probability of continuing into academic tertiary education. The reform had particularily negative effects on boys from non-academic family backgrounds. Finally, the reform decreased the gender wage gap in adult income by four percentage points. |
| Keywords: | education, tracking, gender wage gap |
| JEL: | I20 J16 |
| Date: | 2005–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1897&r=hrm |
| By: | Rubio, Marcela; Tinajero, Monica; López-Acevedo, Gladys |
| Abstract: | The authors follow the Hellerstein, Neumark, and Troske (1999) framework to estimate marginal productivity differentials and compare them with estimated relative wages. The analysis provides evidence on productivity and nonproductivity-based determinations of wages. Special emphasis is given to the effects of human capital variables, such as education, experience, and training on wages and productivity differentials. Higher education yields high er productivity. However, highly educated workers earn less than their productivity differentials would predict. On average, highly educated workers are unable to fully appropriate their productivity gains of education through wages. On the other hand, workers with more experience are more productive in the same proportion that they earn more in medium and large firms, meaning they are fully compensated for their higher productivity. Finally, workers in micro and small firms are paid more than what their productivity would merit. Training benefits firms and employees since it significantly increases workers ' productivity and their earnings. |
| Keywords: | Primary Education,Economic Theory & Research,Access & Equity in Basic Education,Labor Markets,Tertiary Education |
| Date: | 2005–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:3791&r=hrm |
| By: | Blom, Andreas; Sohnesen, Thomas Pave |
| Abstract: | Lifelong learning is increasingly being recognized as a primary factor for knowledge diffusion and productivity growth. However, little economic evidence exists on the economic value of lifelong learning for the individual, especially in developing countries. This paper contributes to remedy this shortfall. It investigates one aspect of lifelong learning: returns to formal education across ages. In the absence of long-term longitudinal data, the paper estimates rates of return for simulated re-entry into the education system. The estimations use the method of internal rate of return and are based on observed education-age-earnings profiles from the Colombian national household survey. It finds that rates of return to all levels of education are only slightly smaller for 35 year olds than for young people, thus confirming the profitability of investment in adult education. Tertiary education continues to attract a positive return until late in life, 45-50 years, whereas the economic value of re-entering primary and secondary education is positive up till the age of 40-45. So, formal lifelong learning seems to remain a profitable investment for at least half of life. But lack of part-time work, high tuition fees, and prolonged study time reduce the return. The findings suggest that adult formal education initiatives should focus on the 20 to 40 year olds and be designed flexibly to allow learners to work part time. |
| Keywords: | Access & Equity in Basic Education,Teaching and Learning,Gender and Education,Primary Education,Tertiary Education |
| Date: | 2005–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:3800&r=hrm |
| By: | Abhijit Banerjee; Shawn Cole; Esther Duflo; Leigh Linden |
| Abstract: | Many efforts to improve school quality by adding school resources have proven to be ineffective. This paper presents the results of two experiments conducted in Mumbai and Vadodara, India, designed to evaluate ways to improve the quality of education in urban slums. A remedial education program hired young women from the community to teach basic literacy and numeracy skills to children lagging behind in government schools. We find the program to be very effective: it increased average test scores of all children in treatment schools by 0.14 standard deviations in the first year, and 0.28 in the second year, relative to comparison schools. A computer-assisted learning program provided each child in the fourth grade with two hours of shared computer time per week, in which students played educational games that reinforced mathematics skills. The program was also very effective, increasing math scores by 0.35 standard deviations the first year, and 0.47 the second year. These results were not limited to the period in which students received assistance, but persisted for at least one year after leaving the program. Two instrumental variable strategies suggest that while remedial education benefited the children who attended the remedial classes, their classmates, who did not attend the remedial courses but did experience smaller classes, did not post gains, confirming that resources alone may not be sufficient to improve outcomes. |
| JEL: | O11 I21 |
| Date: | 2005–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11904&r=hrm |
| By: | Lisa Barrow; Cecilia Elena Rouse |
| Abstract: | Educators and policy makers are increasingly intent on using scientifically-based evidence when making decisions about education policy. Thus, education research today must necessarily be focused on identifying the causal relationships between education inputs and student outcomes. In this paper we discuss methodologies for estimating the causal effect of resources on education outcomes; we also review what we believe to be the best evidence from economics on a few important inputs: spending, class size, teacher quality, the length of the school year, and technology. We conclude that while the number of papers using credible identification strategies is thin, the body of credible research on causal relationships is growing, and we have started to gather evidence that some school inputs matter while others do not. |
| Keywords: | Education - Economic aspects ; Technology - Economic aspects |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedhwp:wp-05-15&r=hrm |
| By: | Esther Duflo; Rema Hanna |
| Abstract: | In the rural areas of developing countries, teacher absence is a widespread problem. This paper tests whether a simple incentive program based on teacher presence can reduce teacher absence, and whether it has the potential to lead to more teaching activities and better learning. In 60 informal one-teacher schools in rural India, randomly chosen out of 120 (the treatment schools), a financial incentive program was initiated to reduce absenteeism. Teachers were given a camera with a tamper-proof date and time function, along with instructions to have one of the children photograph the teacher and other students at the beginning and end of the school day. The time and date stamps on the photographs were used to track teacher attendance. A teacher's salary was a direct function of his attendance. The remaining 60 schools served as comparison schools. The introduction of the program resulted in an immediate decline in teacher absence. The absence rate (measured using unannounced visits both in treatment and comparison schools) changed from an average of 42 percent in the comparison schools to 22 percent in the treatment schools. When the schools were open, teachers were as likely to be teaching in both types of schools, and the number of students present was roughly the same. The program positively affected child achievement levels: a year after the start of the program, test scores in program schools were 0.17 standard deviations higher than in the comparison schools and children were 40 percent more likely to be admitted into regular schools. |
| JEL: | I20 I21 J13 J30 |
| Date: | 2005–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11880&r=hrm |
| By: | Stephen D. Smith; Larry D. Wall |
| Abstract: | This paper provides a theory of debt and hedging based on human capital. We distinguish human capital from physical capital in two ways: (1) human capital is inalienable and can exercise a one-sided option to leave the firm, and (2) human capital is not perfectly replaceable. We show that a firm may reach the first best solution while issuing debt or equity to outsiders provided that either the insiders receive a senior claim or that the firm hedges. We then show that, given asymmetric information concerning costs, the only viable solution has the firm issuing debt to outsiders and hedging. |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedawp:2005-30&r=hrm |
| By: | Lagerlöf, Nils-Petter (York University); Tangerås, Thomas (The Research Institute of Industrial Economics) |
| Abstract: | We present a growth model where agents divide time between rent seeking in the form of resource competition; and working in a human capital sector, interpreted as trade or manufacturing. Rent seeking exerts negative externalities on the productivity of human capital, generating multiple steady states. Adding shocks to the model -- in the form of violence in the rent seeking process, and changes in the size of the contested resource base -- the model can replicate a long phase with stagnant incomes and high levels of rent seeking, interrupted by small failed growth spurts; this is eventually followed by a permanent transition to a sustained growth path where rent seeking vanishes in the limit. We illustrate the workings of the model with simulations and argue that the results, and what drives them, fit with some broad historical facts about growth, rent seeking, and the so-called natural resource curse. |
| Keywords: | Conflict; Long-Run Growth; Rent Seeking |
| JEL: | D74 N10 O15 |
| Date: | 2005–10–19 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0656&r=hrm |
| By: | Lorenz Goette (University of Zurich, CEPR and IZA Bonn); David Huffman (IZA Bonn) |
| Abstract: | In this chapter we propose a new, dual-process model of labor supply, which incorporates both cognitive and affective aspects of decision-making. Consistent with evidence from neuroscience, the worker may experience conflicting cognitive and affective motivations during the workday. In particular, the affective system values effort more highly as long the worker’s performance is below a personal goal, or income target, and becomes increasingly aroused as the goal approaches. As a result, affect can distort effort decisions relative to a fully cognitive benchmark, in a way that is consistent with evidence on loss aversion, and with the so-called goal-gradient effect, a tendency for animals and humans to increase effort as a goal approaches. In contrast to a standard model of labor supply, our model can predict a goal gradient, and predicts that workers may actually lower total daily effort in response to a temporary increase in the wage. Also, within-day windfall gains may have an impact on a worker's effort profile over the workday. The second part of the chapter tests this latter prediction using data from two bicycle messenger firms. At both firms, a windfall gain in the morning has the predicted impact. A lucky messenger works harder than other messengers over the first part of the afternoon, and the difference is increasing, consistent with a goal gradient. Later in the afternoon, a lucky messenger works significantly less hard than the others, consistent with having surpassed a personal earnings goal earlier in the day and having less affective motivation. |
| Keywords: | affect, emotion, labor supply, loss aversion, income targeting, goal gradient |
| JEL: | J22 L2 B49 |
| Date: | 2005–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1890&r=hrm |
| By: | V. Joseph Hotz; Mo Xiao |
| Abstract: | We examine the impact of minimum quality standards on the supply side of the child care market, using a unique panel data set merged from the Census of Services Industries, state regulation data, and administrative accreditation records from the National Association of Education for Young Children. We control for state-specific and time-specific fixed effects in order to mitigate the biases associated with policy endogeneity. We find that the effects of quality standards specifying the labor intensiveness of child care services are strikingly different from those specifying staff qualifications. Higher staff-child ratio requirements deter entry and reduce the number of operating child care establishments. This entry barrier appears to select establishments with better quality into the market and alleviates competition among existing establishments: existing establishments are more likely to receive accreditation and higher profits, and are less likely to exit. By contrast, higher staff-education requirements do not have entry-deterrence effects. They do have the unintended effects of discouraging accreditation, reducing owners' profits, and driving firms out of businesses. |
| JEL: | L5 L8 |
| Date: | 2005–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11873&r=hrm |
| By: | Frank G. van Oort; Erik Stam |
| Abstract: | Although there is growing evidence on the role of agglomeration economies in the formation and growth of firms, both the concepts of agglomeration economies and entrepreneurship tend to be ambiguously defined and measured in the literature. In this study, we aim to improve the conceptualisations and measures of agglomeration economies and entrepreneurship. Indicators of agglomeration economies are analysed in clearly defined urban regimes on three spatial scales in the Netherlands – national zoning, labour market connectedness, and urban size. This is done in order to uncover their effect on two entrepreneurial phases in the firm life cycle - new firm formation and the growth of incumbent firms in the relatively new ICT industry in the Netherlands. In comparison with new firm formation, the growth of incumbent firms is not so much related to spatial clustering of the ICT industry and other localized sources of knowledge economies associated with urban density. Instead, knowledge as an input for growth of incumbent firms is associated with more endogenous (firm internal) learning aspects, reflected by a significant correlate with R&D-investments. Also the effect of local ICT firm competition differs between the two types of firms: a positive effect on new firm formation, but a negative effect on incumbent firm growth. In general, agglomeration economies have stronger effects on the formation of ICT firms than on the growth of ICT firms. |
| Keywords: | agglomeration economics, spatial externalities, entrepreneurship, location, urban regimes, ICT industry |
| JEL: | D21 L25 L63 L86 M13 O18 R12 R30 |
| Date: | 2005–03 |
| URL: | http://d.repec.org/n?u=RePEc:egu:wpaper:0508&r=hrm |
| By: | Eric French; Bhashkar Mazumder; Christopher Taber |
| Abstract: | We examine the key components that determine an individual's early career wage growth and how these factors have changed for less skilled workers over the last twenty years. In particular, we examine the relative importance of accumulating work experience as compared to the quality of job matches in influencing wage growth. Our main finding is that over this period, the vast majority of the variation in wage growth is due to variability in the return to experience. |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedhwp:wp-05-24&r=hrm |
| By: | Alfonso Arpaia (Directorate-General Economic & Financial Affairs, European Commission); Gilles Mourre (Directorate-General Economic & Financial Affairs, European Commission) |
| Abstract: | This paper presents a selective survey of the recent literature on labour market institutions. It describes the different empirical approaches used to explore the nexus between labour market institutions and labour market performance. It stresses that the effect of institutions is complex in both stock and flow models and that it is also crucial to take into account the interactions they generate among themselves and with macroeconomic shocks. While their importance in explaining labour market performances is uncontroversial, there is no full consensus on their actual impact and the precise transmission channels. In addition, rather than taking institutions for granted, a new branch of research attempts to understand them as the result of an endogenous process. The paper also briefly discusses the relationships between the efficiency of the redistributive policies (via taxation) and the type of protection provided (on the job or in the market). Lastly, the paper examines the key issue of efficient policy design both at the macro- and micro-level. |
| Keywords: | Labour market institutions, Endogenous institutions, Labour market reforms, |
| JEL: | J |
| Date: | 2005–12–19 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpla:0512011&r=hrm |
| By: | Nicola Pavoni; Giovanni L. Violante |
| Abstract: | A Welfare-to-Work (WTW) program is a mix of government expenditures on “passive” (unemployment insurance, social assistance) and “active” (job search monitoring, training, wage taxes/subsidies) labor market policies targeted to the unemployed. This paper provides a dynamic principal-agent framework suitable for analyzing the optimal sequence and duration of the different WTW policies, and the dynamic pattern of payments along the unemployment spell and of taxes/subsidies upon re-employment. First, we show that the optimal program endogenously generates an absorbing policy of last resort (that we call “social assistance”) characterized by a constant lifetime payment and no active participation by the agent. Second, human capital depreciation is a necessary condition for policy transitions to be part of an optimal WTW program. Whenever training is not optimally provided, we show that the typical sequence of policies is quite simple: the program starts with standard unemployment insurance, then switches into monitored search and, finally, into social assistance. Only the presence of an optimal training activity may generate richer transition patterns. Third, the optimal benefits are generally decreasing or constant during unemployment, but they must increase after a successful spell of training. In a calibration exercise based on the U.S. labor market and on the evidence from several evaluation studies, we use our model to analyze quantitatively the features of the optimal WTW program for the U.S. economy. With respect to the existing U.S. system, the optimal WTW scheme delivers sizeable welfare gains, by providing more insurance to skilled workers and more incentives to unskilled workers. |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedmem:143&r=hrm |
| By: | Jakob Roland Munch (Department of Economics, University of Copenhagen); Jan Rose Skaksen (Copenhagen Business School) |
| Abstract: | This paper studies the impact of outsourcing on individual wages. In contrast to the standard approach in the literature, we focus on domestic outsourcing as well as foreign outsourcing. By using a simple theoretical model, we argue that, if outsourcing is associated with specialization gains arising from an increase in the division of labor, domestic outsourcing tends to increase wages for both unskilled and skilled labor. We use a panel data set of workers in Danish manufacturing industries to show that domestic and foreign outsurcing affect wages as predicted by the theory. |
| Keywords: | outsourcing; comparative advantage; specialization; wages |
| JEL: | F16 J31 C23 |
| Date: | 2005–12 |
| URL: | http://d.repec.org/n?u=RePEc:kud:kuiedp:0528&r=hrm |
| By: | Fabio Sabatini (University of Rome La Sapienza, Department of Public Economics) |
| Abstract: | This paper carries out an assessment of the influence that different kinds of social ties exert on labour precariousness, on the state of health of urban environments and on the economic performance in Italy. Overall, the empirical evidence shows that weak ties connecting members of voluntary organizations positively affect the economic performance and the quality of urban ecosystems, differently from strong ties connecting family members and close friends, which, on the other side, are proved to reduce labour precariousness. |
| Keywords: | Social capital, Social networks, Civil society, Economic development, Labour precariousness, Structural Equations Modelling |
| JEL: | J |
| Date: | 2005–12–22 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpla:0512012&r=hrm |