nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2011‒01‒23
twenty papers chosen by
Tommaso Reggiani
Universita' di Bologna

  1. Return-to-job during and after maternity leave By Fitzenberger, Bernd; Steffes, Susanne; Strittmatter, Anthony
  2. The extent of occupational segregation in the US: Differences by race, ethnicity, and gender By Olga Alonso-Villar; Coral del Río; Carlos Gradín
  3. The Prospect of Migration, Sticky Wages, and âEducated Unemploymentâ By Stark, Oded; Fan, C. Simon
  4. The Role of Mothers and Fathers in Providing Skills: Evidence from Parental Deaths By Adda, Jérôme; Björklund, Anders; Holmlund, Helena
  5. Welfare regimes and the incentives to work and get educated By Andrés Rodríguez-Pose; Vassilis Tselios
  6. School Composition Effects in Spain By Antonio Di Paolo
  7. Changes in Compulsory Schooling and the Causal Effect of Education on Health: Evidence from Germany By Daniel Kemptner; Hendrik Jürges; Steffen Reinhold
  8. Is Part-Time Employment Beneficial for Firm Productivity? By Nelen, Annemarie; de Grip, Andries; Fouarge, Didier
  9. Job Mobility in Europe, Japan and the U.S. By Borghans Lex; Golsteyn Bart
  10. Why do educated mothers matter? A model of parental help By Luciano Canova; Alessandro Vaglio
  11. Do Highly Educated Immigrants Perform Differently in the Canadian and U.S. Labour Markets? By Bonikowska, Aneta; Hou, Feng; Picot, Garnett
  12. Age and opportunities for promotion By C. Sofia Machado; Miguel Portela
  13. Hours of work and retirement behavior By C. Sofia Machado; Miguel Portela
  14. High-Skilled Immigration Policy in Europe By Martin Kahanec; Klaus F. Zimmermann
  15. Job Mobility in Europe, Japan and the U.S. By Borghans, Lex; Golsteyn, Bart H.H.
  16. Dark Corners in a Bright Economy; The Lack of Jobs for Unskilled Men By Gregory, Robert G.
  17. Minimum Wage and Job Complexity By Samir Amine; Pedro Lages Dos Santos
  18. Inducing Good Behavior: Bonuses versus Fines in Inspection Games By Daniele Nosenzo; Theo Offerman; Martin Sefton; Ailko van der Veen
  19. Executive Pay with Observable Decisions By Marco Celentani; Rosa Loveira; Pablo Ruiz-Verdú
  20. Peers, neighborhoods and immigrant student achievement - evidence from a placement policy By Åslund, Olof; Edin, Per-Anders; Fredriksson, Peter; Grönqvist, Hans

  1. By: Fitzenberger, Bernd; Steffes, Susanne; Strittmatter, Anthony
    Abstract: This paper studies the return-to-job of female employees after first birth based on exceptional longitudinal data from personnel records of a large German company. Given a very long maternity leave coverage, we investigate to what extent data available to management allow to predict the return-to-job during and after maternity leave. Our data show a large heterogeneity in transition patterns, which poses a challenge for management. Maternity leave durations often last for three years or longer. More than 50 percent of those in maternity leave do not return to their job afterwards, either because they leave the company or because they have a second child. At the same time, about 31 percent of female employees return to part-time work during maternity leave, which is often a stepping stone but no guarantee for a return-to-job afterwards. There is mixed evidence as to whether female employees in better job matches are more likely to return to their job in the company. Specifically, we find that the relative wage position, higher tenure, a combination of vocational training and university education, and an above average frequency of previous promotions show a positive association with the return-to-job and a higher employment stability afterwards. At the same time, female employees have their first child, when their careers have been particularly successful in comparison. Among these, a sizeable share does not continue to advance their career and many do not even return to their job. --
    Keywords: female employees,maternity leave,match quality,personnel data
    JEL: J13 J22 M50
    Date: 2010
  2. By: Olga Alonso-Villar (Universidade de Vigo); Coral del Río (Universidade de Vigo); Carlos Gradín (Universidade de Vigo)
    Abstract: By using data from the American Community Survey, this paper studies occupational segregation by ethnicity/race and gender in the US by comparing the distribution of any demographic group with the employment structure of the economy. The analysis shows that occupational segregation is particularly intense in the Hispanic and Asian population groups, even though the performance of the former seems to be more disturbing than that of the latter given its higher concentration in low-paid jobs. As opposed to what happens for African and Native Americans, human capital variables explain a substantive part of Hispanic and Asian segregation. The analysis also reveals that the differential between women and men is not reduced after controlling for human capital characteristics. In addition, segregation disparities are much larger among male groups than among female groups. A distinctive characteristic of Hispanic workers is that segregation is higher for men than for women.
    Keywords: occupational segregation, local segregation, race, ethnicity, gender.
    JEL: J15 J16 J71 D63
    Date: 2010
  3. By: Stark, Oded; Fan, C. Simon
    Abstract: An increase in the probability of work abroad, where the returns to schooling are higher than at home, induces more individuals in a developing country to acquire education, which leads to an increase in the supply of educated workers in the domestic labor market. Where there is a sticky wage-rate, the demand for labor at home will be constant. With a rising supply and constant demand, the rate of unemployment of educated workers in the domestic labor market will increase. Thus, the prospect of employment abroad causes involuntary âeducated unemploymentâ at home. A government that is concerned about âeducated unemploymentâ and might therefore be expected to encourage unemployed educated people to migrate will nevertheless, under certain conditions, elect to restrict the extent of the migration of educated individuals.
    Keywords: Labor and Human Capital, E24, F22, J24, O15,
    Date: 2011–01
  4. By: Adda, Jérôme (European University Institute); Björklund, Anders (SOFI, Stockholm University); Holmlund, Helena (CEP, London School of Economics)
    Abstract: This paper evaluates the long-term consequences of parental death on children’s cognitive and noncognitive skills, as well as on labor market outcomes. We exploit a large administrative data set covering many Swedish cohorts. We develop new estimation methods to tackle the potential endogeneity of death at an early age, based on the idea that the amount of endogeneity is constant or decreasing during childhood. Our method also allows us to identify a set of death causes that are conditionally exogenous. We find that the loss of either a father or a mother on boys' earnings is no higher than 6-7 percent and slightly lower for girls. Our examination of the impact on cognitive skills (IQ and educational attainment) and on noncognitive skills (emotional stability, social skills) shows rather small effects on each type of skill. We find that both mothers and fathers are important, but mothers are somewhat more important for cognitive skills and fathers for noncognitive ones.
    Keywords: family background, cognitive and noncognitive skills, parental death
    JEL: J12 J17 J24
    Date: 2011–01
  5. By: Andrés Rodríguez-Pose (IMDEA Social Sciences Institute); Vassilis Tselios (University of Newcastle upon Tyne)
    Abstract: This paper examines whether differences in welfare regimes shape the incentives to work and get educated. Using microeconomic data for more than 100,000 European individuals, the results show that welfare regimes make a difference for wages and education. First, people- and household-based effects (internal returns to education and household wage and education externalities) generate socioeconomic incentives for people to get an education and work, which are stronger in countries with the weakest welfare systems, i.e. those with what is known as 'Residual' welfare regimes (Greece, Italy, Spain and Portugal). Second, place-based effects, and more specifically differences in regional wage per capita and educational endowment and in regional interpersonal income and educational inequality, also influence wages and education in different ways across welfare regimes. Place-based effects have the greatest incidence in the Nordic Social-Democratic welfare systems. These results are robust to the inclusion of a large number of people- and place-based controls.
    Keywords: education; employment; wages; welfare; regions; European Union
    JEL: H53 H75 I31 I38 J38
    Date: 2011–01–05
  6. By: Antonio Di Paolo (Departament d'Economia Aplicada, Universitat Autònoma de Barcelona (UAB); Campus de Bellaterra, Edifici B 08193 Bellaterra (Cerdanyola), Spain. Institut d’Economia de Barcelona, Universitat de Barcelona)
    Abstract: Drawing on PISA data of 2006, this study examines the impact of socio-economic school composition on science test score achievement for Spanish students in compulsory secondary schools. We define school composition in terms of the average parental human capital of students in the same school. These contextual peer effects are estimated using a semi-parametric methodology, which enables the spillovers to affect all the parameters of the educational production function. We also deal with the potential problem of self-selection of student into schools, using an artificial sorting that we argue to be independent from unobserved student’s abilities. The results indicate that the association between socio-economic school composition and test score results is clearly positive and significantly higher when computed with the semi-parametric approach. However, we find that the endogenous sorting of students into schools plays a fundamental role, given that the spillovers are significantly reduced when this selection process is ruled out from our measure of school composition effects. Specifically, the estimations suggest that the contextual peer effects are moderately positive only in those schools where the socio-economic composition is considerably elevated. In addition, we find some evidence of asymmetry of how the external effects and the sorting process actually operate, which seem affect in a different way males and females as well as high and low performance students.
    Keywords: Educational Attainments, Peer Effects, PISA, Spain
    JEL: I20 I21 I29
    Date: 2010–12
  7. By: Daniel Kemptner; Hendrik Jürges; Steffen Reinhold (Mannheim Research Institute for the Economics of Aging (MEA))
    Abstract: In this paper we investigate the causal effect of years of schooling on health and health-related behavior in West Germany. We apply an instrumental variables approach using as natural experiments several changes in compulsory schooling laws between 1949 and 1969. These law changes generate exogenous variation in years of schooling both across states and over time. We find evidence for a strong and significant causal effect of years of schooling on long-term illness for men but not for women. Moreover, we provide somewhat weaker evidence of a causal effect of education on the likelihood of having weight problems for both sexes. On the other hand, we find little evidence for a causal effect of education on smoking behavior. Overall, our estimates suggest significant non-monetary returns to education with respect to health outcomes and not necessarily with respect to health-related behavior.
    JEL: I12 I21
    Date: 2010–07–05
  8. By: Nelen, Annemarie (ROA, Maastricht University); de Grip, Andries (ROA, Maastricht University); Fouarge, Didier (ROA, Maastricht University)
    Abstract: This paper analyzes whether part-time employment is beneficial for firm productivity in the service sector. Using a unique dataset on the Dutch pharmacy sector that includes the work hours of all employees and a “hard” physical measure of firm productivity, we estimate a production function including heterogeneous employment shares based on work hours. We find that a larger part-time employment share leads to greater firm productivity. Additional data on the timing of labor demand show that part-time employment enables firms to allocate labor more efficiently. First, firms with part-time workers can bridge the gap between opening hours and a full-time work week. Second, we find that during opening hours part-time workers are scheduled differently than full-timers. For example, we find that part-time workers enable their full-time colleagues to take lunch breaks so that the firm can remain open during these times.
    Keywords: heterogeneous labor, matched employer-employee data, allocation of labor, timing of labor demand
    JEL: J24 L23 L25
    Date: 2011–01
  9. By: Borghans Lex; Golsteyn Bart (ROA rm)
    Abstract: Evidence about job mobility outside the U.S. is scarce and difficult to compare crossnationallybecause of non-uniform data. We document job mobility patterns of collegegraduates in their first three years in the labor market, using unique uniform datacovering 11 European countries and Japan. Using the NLSY, we replicate the informationin this survey to compare the results to the U.S. We find that (1) U.S. graduates hold morejobs than European graduates. (2) Contrasting conventional wisdom, job mobility inJapan is only somewhat lower than the European average. (3) There are large differencesin job mobility within Europe.
    Keywords: education, training and the labour market;
    Date: 2011
  10. By: Luciano Canova (Enrico Matei School); Alessandro Vaglio (University of Bergamo)
    Abstract: The paper investigates the role of mothers in affecting childrens' performance at school. It develops a theoretical model in which household is treated as an individual, whose utility depends on the performance at school of the student and on consumption. The model focuses on the possibilities through which mother’s help may affect pupil's performance in terms of time devoted to supervision and spillover effects. Empirical evidence, using Italian PISA 2006, shows that highly educated mothers have a positive impact on students' score only when they are highly qualified in the job market.
    Keywords: Education; PISA; quantile regressions; parental help
    JEL: J12 J24 I21
    Date: 2010–12
  11. By: Bonikowska, Aneta; Hou, Feng; Picot, Garnett
    Abstract: This paper compares changes in wages of university-educated new immigrant workers in Canada and in the U.S. over the period from 1980 to 2005, relative to those of their domestic-born counterparts and to those of high school graduates (university wage premium). Wages of university-educated new immigrant men declined relative to those of domestic-born university graduates over the entire study period in Canada, but rose between 1990 and 2000 in the U.S. The characteristics of entering immigrants underwent more change in Canada than in the U.S. over the 1980-to-2005 period; as a result, compositional changes in the immigrant population had a larger negative effect on the outcomes of highly educated immigrants in Canada than in the U.S. However, even after accounting for such compositional shifts, most of the discrepancy in relative earnings outcomes between immigrants to Canada and immigrants to the U.S. persisted. The university premium for new immigrants was fairly similar in both countries in 1980, but by 2000 was considerably higher in the U.S. than in Canada, especially for men.
    Keywords: Ethnic diversity and immigration, Education, training and learning, Population and demography, Educational attainment, Mobility and migration, Immigrants and non-permanent residents, Outcomes of education
    Date: 2011–01–14
  12. By: C. Sofia Machado (Instituto Politécnico do Cávado e do Ave); Miguel Portela (Universidade do Minho - NIPE and IZA)
    Abstract: Using a panel of new firms and their employees, this paper studies the promotion opportunities for older workers within the same firm. Survival analysis suggests that younger employees experience shorter times to promotion than older workers and, therefore, the latter face a smaller likelihood of promotion. Although men are promoted more often than women, empirical results show that women have shorter survival times to promotion than men. Also, previous promotions are stronger determinants of subsequent ones and this finding provides support to the evidence on promotion “fast-tracks”.
    Keywords: aging, older workers, employment relationships, promotion
    JEL: J14 J21 D21 J62
    Date: 2011
  13. By: C. Sofia Machado (Instituto Politécnico do Cávado e do Ave); Miguel Portela (Universidade do Minho - NIPE and IZA)
    Abstract: Using a novel dataset from the 2006 Portuguese Labor Force Survey this paper examines the impact of a voluntary reduction in hours of work, before retirement, on the moment of exit from the labor force. If, as often suggested, flexibility in hours of work is a useful measure to postpone retirement, then a reduction in working hours should be associated with retirement at later ages. Results prove otherwise suggesting that reducing hours of work before retirement is associated with early exits from the labor force. A reduction in hours of work seems to signal the worker’s wish to retire sooner rather than to announce the desire of remaining in the labor market.
    Keywords: aging, retirement, working hours, older workers.
    JEL: J14 J26 J22 J21
    Date: 2011
  14. By: Martin Kahanec; Klaus F. Zimmermann
    Abstract: Whether Europe will be able to stand up to its internal and external challenges crucially depends on its ability to manage its internal mobility and inflows of international migrants. Using a unique expert opinion survey, we document that Europe needs skilled migrants, and skill mismatch is to be expected. A review of current immigration policies shows that despite a number of positive recent developments Europe lacks a consistent strategy to address this challenge effectively, paralyzed by the notion of "fortress" Europe, which we argue should be abandoned. Since significant political tensions can be expected between native actors that favor and disfavor further immigration, improving European immigration policies and procedures is a formidable challenge. This task involves the need to improve Europe's image among potential migrants, especially the high-skilled ones.
    Keywords: High-skilled migration, mobility, immigration policy, Europe, European Union
    JEL: F22 J61
    Date: 2011
  15. By: Borghans, Lex (Dept. of Economics and the Research Centre for Education and the Labour Market (ROA)); Golsteyn, Bart H.H. (Swedish Institute for Social Research, Stockholm University)
    Abstract: Evidence about job mobility outside the U.S. is scarce and difficult to compare cross-nationally because of non-uniform data. We document job mobility patterns of college graduates in their first three years in the labor market, using unique uniform data covering 11 European countries and Japan. Using the NLSY, we replicate the information in this survey to compare the results to the U.S. We find that (1) U.S. graduates hold more jobs than European graduates. (2) Contrasting conventional wisdom, job mobility in Japan is only somewhat lower than the European average. (3) There are large differences in job mobility within Europe.
    Keywords: Job Mobility; Graduates; Europe; Japan; U.S.
    JEL: J24 J31
    Date: 2010–12–17
  16. By: Gregory, Robert G.
    Abstract: This paper discusses the large reductions in full-time employment among unskilled Australian males that began in the 1970's and continued over the next three to four decades. Over this period, each recession led to large falls in the male full-time employment-population ratio and during each economic recovery the employment ratio failed to move back to previous levels. Unemployment fell during each output recovery, not in response to employment gains, but in response to large scale withdrawals from the labour market into the welfare system. The loss of unskilled jobs for men has been associated with falling marriage rates and increasing use of the welfare system by single women. The paper concludes by briefly assessing some of the impacts of the new resource boom on these long run labour market and welfare trends and discusses the potential for different labour market outcomes emerging across mineral and non-mineral states.
    Keywords: Employment, Unskilled jobs
    Date: 2010–12
  17. By: Samir Amine; Pedro Lages Dos Santos
    Abstract: This article aims to understand how public policies affect the behavior of agents in term of selectivity. In other words, we explain how the state of the labour market and, in particular qualification level of workers, affects technological choices of firms. Using a matching model in which workers are vertically differentiated and where the nature of jobs is endogenous, we show that an increase in minimum wage can enhance the recruiting of skilled workers by making firms more selective and jobs more complex. <P>Cet article vise à mieux comprendre comment les régulations publiques modifient le comportement des agents en termes de sélectivité et comment les entreprises adaptent les caractéristiques de leurs emplois en fonction de l’état du marché du travail et, notamment du niveau de qualification de la population active. En utilisant un modèle d’appariement dans lequel les travailleurs sont différenciés verticalement et la nature des emplois est endogène, nous montrons que la revalorisation du salaire minimum peut favoriser l’embauche des qualifiés en rendant les entreprises plus sélectives et les emplois plus complexes.
    Keywords: Minimum Wage, Productivity, Participation. , Salaire minimum, productivité et participation.
    JEL: J64 J65
    Date: 2011–01–01
  18. By: Daniele Nosenzo (School of Economics, University of Nottingham); Theo Offerman (CREED, Department of Economics, University of Amsterdam); Martin Sefton (School of Economics, University of Nottingham); Ailko van der Veen (CREED, Department of Economics, University of Amsterdam)
    Abstract: We examine the effectiveness of bonuses and fines in an ‘inspection game’ where an employer can learn the effort of a worker through costly inspection. Standard game theoretic analysis predicts that fines discourage shirking, whereas bonuses encourage shirking. In contrast, ownpayoff effects suggest that both fines and bonuses discourage shirking. In an experiment we find that fines are more effective than bonuses in reducing shirking. However, we do not find that bonuses encourage shirking. Behavioral theories based on Impulse Balance Equilibrium or Quantal Response Equilibrium provide a good account of deviations from Nash equilibrium predictions.
    Keywords: Inspection Games; Costly Monitoring; Rewards and Punishments; Bonuses and Fines; Quantal Response Equilibrium; Impulse Balance Equilibrium; Experiment
    JEL: C70 C72 C92
    Date: 2010–12
  19. By: Marco Celentani; Rosa Loveira; Pablo Ruiz-Verdú
    Abstract: We propose a model of delegated expertise designed to analyze executive compensation. An expert has to pick one of two possible decisions. By exerting effort the expert can obtain private information on these decisions. The expert’s decision and its ultimate performance realization are publicly observed, but the expert’s information is not. In other words, the principal observes the expert’s decision and its realization, but does not know whether the expert expended effort to obtain information and whether he made an efficient decision conditional on the information he received. We characterize the optimal compensation contract among those that give the expert incentives to obtain information to determine the efficient decision and to make the decision that is efficient contingent on the obtained information. We show that: 1) It is generically optimal to make pay contingent on the decision made by the expert, not only on performance; 2) The expert is often rewarded for choosing alternatives that are ex-ante inefficient. 3) When decisions differ in their complexity, optimal pay-performance may be zero if the expert chooses the complex alternative. Our model highlights novel factors that should be considered in the design of executive compensation contracts, sheds light on existing compensation practices, such as rewarding executives for acquisitions, and suggests mechanisms to promote managerial innovation.
    Date: 2010–12
  20. By: Åslund, Olof (Institute for Labour Market Policy Evaluation (IFAU)); Edin, Per-Anders (IFAU, UCLS); Fredriksson, Peter (Stockholm University, IZA, UCLS); Grönqvist, Hans (Swedish Institute for Social Research, Stockholm University)
    Abstract: We examine to what extent immigrant school performance is affected by the characteristics of the neighborhoods that they grow up in. We address this issue using a refugee placement policy which provides exogenous variation in the initial place of residence in Sweden. The main result is that school performance is increasing in the number of highly educated adults sharing the subject’s ethnicity. A standard deviation increase in the fraction of high-educated in the assigned neighborhood raises compulsory school GPA by 0.9 percentile ranks. Particularly for disadvantaged groups, there are also long-run effects on educational attainment.
    Keywords: Peer effects; Ethnic enclaves; Immigration; School performance
    JEL: I20 J15 Z13
    Date: 2010–11–11

This nep-hrm issue is ©2011 by Tommaso Reggiani. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.