nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2011‒09‒16
six papers chosen by
Tommaso Reggiani
Universita' di Bologna

  1. The Consequences of Child Market Work on the Growth of Human Capital By Armand A Sim; Daniel Suryadarma; Asep Suryahadi
  2. Human Capital and Productivity in British Columbia By Alexander Murray; Andrew Sharpe
  3. Scarring Effects of Remaining Unemployed for Long-Term Unemployed School-Leavers By Cockx, B.; Picchio, M.
  4. Explaining Income Inequalities in Developing Countries: the Role of Human Capital By Mazhar MUGHAL; Barassou DIAWARA
  5. Bad News: An Experimental Study on the Informational Effects of Rewards By Andrei Bremzeny; Elena Khokhlovaz; Anton Suvorov; Jeroen van de Ven
  6. Are occupations paid what they are worth? An econometric study of occupational wage inequality and productivity By François Rycx; Stephan K. S. Kampelmann

  1. By: Armand A Sim; Daniel Suryadarma; Asep Suryahadi
    Abstract: Child labor is a phenomenon that has attracted a great amount of attention and research. Theoretical propositions suggest that child labor is inefficient if it adversely affects future earning ability. This paper contributes to the literature on the effects of child market work on human capital by focusing on the long-term growth in human capital, which is widely known to significantly affect earning ability. The paper also uses better measures of human capital by focusing on the output of the human capital production function: numeracy skills, cognitive skills, and pulmonary function. Using a rich longitudinal dataset on Indonesia, we find strong negative effects of child labor on the growth of both numeracy and cognitive skills in the next seven years. In addition, we find a strong and negative effect on pulmonary function as measured through lung capacity. Comparing the effects by gender and type of work, we find that female child workers suffer more adverse effects on mathematical skills growth, while male child workers experience much smaller growth in pulmonary function. We also find that child workers who work for pay outside the family bore worse effects compared to child workers who work in the family business.
    Keywords: child labor, human capital, skills, health, Indonesia
    JEL: I12 I21 J13 J22 O15
    Date: 2011
  2. By: Alexander Murray; Andrew Sharpe
    Abstract: This report provides an assessment of human capital development in British Columbia. The province's performance is above average according to the majority of the indicators we analyze, relative to both the rest of Canada and other OECD countries. However, this does not mean that there is no room for improvement. We identify four areas in which improvements would be likely to contribute to productivity growth in British Columbia: the underutilization of the skills of recent immigrants; the poor educational outcomes of Aboriginal people; the below-average production of advanced human capital through graduate training; and the problem of high school non-completion. We provide policy recommendations pertaining to each of these four challenges.
    Keywords: productivity, human capital, immigration, education, aboriginal education gap
    JEL: D24 J24
    Date: 2011–08
  3. By: Cockx, B.; Picchio, M. (Tilburg University, Center for Economic Research)
    Abstract: This study investigates whether and to what extent further unemployment experience for youths who are already long-term unemployed imposes a penalty on subsequent labor market outcomes. We propose a flexible method for analyzing the effect on wages aside of transitions from unemployment and employment within a multivariate duration model that controls for selection on observables and unobservables. We find that prolonging unemployment drastically decreases the chances of finding employment, but hardly affects the quality of subsequent employment. The analysis suggests that negative duration dependence in the job finding rate is induced by negative signaling and not by human capital depreciation.
    Keywords: scarring effect of unemployment duration;employment quality;wage in multivariate duration model;selectivity.
    JEL: C33 C41 J62 J64
    Date: 2011
  4. By: Mazhar MUGHAL; Barassou DIAWARA
    Abstract: Explaining Income Inequalities in Developing Countries: the Role of Human Capital
    Date: 2011–12
  5. By: Andrei Bremzeny (CEFIR and New Economic School); Elena Khokhlovaz (McKinsey&Company); Anton Suvorov (CEFIR and New Economic School); Jeroen van de Ven (University of Amsterdam)
    Abstract: Both psychologists and economists have argued that rewards often have hidden costs. One possible reason is that the principal may have incentives to offer higher rewards when she knows the task to be dificult. Our experiment tests if high rewards embody such bad news and if this is perceived by their recipients. Our design allows us to decompose the overall effect of rewards on effort into a direct incentive and an informational effect. The results show that most participants correctly interpret high rewards as bad news. In accordance with theory, the negative informational effect co-exists with the direct positive effect.
    Keywords: reward, bonus, informational content, motivation, crowdingout, laboratory experiment
    JEL: D82 D83 J33
    Date: 2011–09
  6. By: François Rycx; Stephan K. S. Kampelmann
    Abstract: Labour economists typically assume that pay differences between occupations can be explained with variations in productivity. The empirical evidence on the validity of this assumption is surprisingly thin and subject to various potential biases. The authors use matched employer-employee panel data from Belgium for the years 1999-2006 to examine occupational productivity-wage gaps. They find that occupations play distinct roles for remuneration and productivity: while the estimations indicate a significant upward-sloping occupational wage-profile, the hypothesis of a flat productivity-profile cannot be rejected. The corresponding pattern of over- and underpayment stands up to a series of robustness tests.
    Keywords: Labour productivity; wages; occupations; production function; matched employer-employee data
    JEL: J24 J31 J44
    Date: 2011–08–30

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