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on Labour Economics |
| By: | Junankar, P. N. (Raja) (University of Western Sydney and IZA Bonn); Mahuteau, Stéphane (University of Western Sydney) |
| Abstract: | This paper investigates the ease with which recent immigrants to Australia from different countries and with different visa categories enter employment at an appropriate level to their prior education and experience in the source country. Unlike most of the earlier research in this field that studied the labour market status of migrants (probabilities of employment, or unemployment, or participation, or wage equation) this paper focuses on the quality of job that the migrant obtains on arrival in Australia. We provide alternative definitions of what is a good job in terms of objective and subjective criteria. The paper uses two sets of the Longitudinal Survey of Immigrants to Australia data: the first cohort that arrived in 1993-95 and the second cohort that arrived in 1999-2000. In particular we would study how changes in social security legislation in 1997, (two year waiting period for eligibility for benefits) affected the quality of job held by new migrants. In comparing the behaviour of migrants in the labour market with and without access to social security benefits we would study whether migrants are more likely to accept bad jobs after the legislative changes. The paper uses bivariate probit models to estimate the probabilities of holding a good job in terms of the usual human capital and demographic variables (including the visa category for entry into Australia). Our results suggest that the policy change had a positive impact on the probability to find a job but a negative impact to hold a good job. |
| Keywords: | immigrants, immigrant policies, job satisfaction, good jobs, labour market outcomes, bivariate probit |
| JEL: | J61 J68 C25 |
| Date: | 2004–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1434&r=lab |
| By: | Aguayo, Eva; Guisan, Maria-Carmen |
| Abstract: | We analyse the interdependence between non-agrarian employment, real value-added and population in 98 European regions, by means of a pool of data for the period 1985-1995, and in 5 EU countries with a pool for 1961-97. We test causality by means of Hausman´s test in these three equations models. Besides we test causality by means of Granger´s test and with time series of each country for 1961-2000. The main conclusion is that there is some degree of interdependence among the three variable: 1) Population moves towards employment. 2) Production increases with population and with social and institutional factors (human capital and other ones). 3) Employment increases with production and population.. The results agree with the Freeman´s conclusions for regional employment and population movements in the USA. |
| Keywords: | Causality tests, Models of Employment and Population, Models of Employment and Production, European Economic, Regional Development |
| JEL: | C5 C51 J2 O18 O52 R23 |
| Date: | 2004 |
| URL: | http://d.repec.org/n?u=RePEc:eaa:ecodev:80&r=lab |
| By: | Bolvig, Iben (Department of Economics, Aarhus School of Business) |
| Abstract: | Wage mobility among low wage earners has previously been focussing on the <p> characteristics of the low wage earners, whereas the role of the firm has been neglected. The <p> purpose of this study is to focus on the characteristics of the firms when analysing variation in <p> wage mobility. The empirical findings confirm that the characteristics of the employing firm <p> indeed matter for low-wage employees´ likelihood of escaping a low-wage job. Especially does <p> the employing firm affect the destination state – i.e. where a low-wage worker goes after having <p> finished a low-wage job, and the findings enable me to identify three types of firms: career firms <p> with high within-firm upward wage mobility, stepping-stone firms with high between-firm <p> upward wage mobility and dead-end firms with low upward wage mobility. |
| Keywords: | Low wage earners; wage mobility; firm behaviour; employer-employee relations |
| JEL: | J31 J41 J63 M51 M52 |
| Date: | 2004–12–10 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:aareco:2004_011&r=lab |
| By: | Maxim Poletaev (University of Western Ontario); Chris Robinson (University of Western Ontario) |
| Abstract: | Recent papers by Neal (1995) and Parent (2000), using different methods, provided evidence in support of the hypothesis that previously estimated firm tenure effects are, in fact, capturing industry specific human capital investments due to a correlation between firm and industry tenure. This paper uses both methods applied to both US and Canadian data sets to provide evidence in support of an alternative hypothesis that human capital is, for the most part, not narrowly specific to firm or industry. An analysis using either the indirect method of Neal, or the direct approach of Parent, provides evidence against the importance of industry specific capital and in favor of broad skill based specificity. |
| Keywords: | Not available. |
| Date: | 2004 |
| URL: | http://d.repec.org/n?u=RePEc:uwo:hcuwoc:20042&r=lab |
| By: | Adsera, Alicia (University of Illinois at Chicago, University of Chicago and IZA Bonn); Chiswick, Barry R. (University of Illinois at Chicago and IZA Bonn) |
| Abstract: | The paper uses the 1994-2000 waves of the European Community Household Panel to conduct a systematic analysis of the earnings of immigrants as compared to native workers, in particular to test whether there is any systematic variation in the labor market performance of immigrants across gender related to duration in the destination, schooling, age at immigration, country of origin, or country of destination. We find a significant negative effect of immigrant status on individual earnings of around 40% at the time of arrival in the pooled sample, although the difference is somewhat smaller for women. Those differences, however, vary greatly across countries with migrants in Germany and Portugal faring best relative to natives, and those in Sweden, Denmark, Luxembourg or Spain the worst, particularly among non-EU born migrants. Gender differences are more important among those born outside the European Union, with women doing relatively better than men. Among men, those from Asia, Latin-America and Eastern Europe receive the lowest earnings. Latin- American and Eastern European women are at the bottom of the women’s distribution. Earnings increase with duration in the destination and the foreign born "catch-up" to the native born, others variables being the same, at around 18 years in the destination among both men and women. Education matters more for women in terms of explaining earnings, whereas language skills are relatively more important for men. |
| Keywords: | immigrants, earnings, gender, countries of birth and destination, language |
| JEL: | J1 J61 F22 |
| Date: | 2004–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1432&r=lab |
| By: | Velamuri, S. Ramakrishna (IESE Business School); Venkataraman, Sankaran (Darden Graduate School of Business Administration) |
| Abstract: | We explore the relationship between the probability of a transition from paid work to self-employment and three explanatory variables: paid income, predicted income, and income for ability. We use panel data for heads of households from the PSID SRC sample for eight pairs of years. Our results show that therelationship between paid income and self-employment is not linear. We then break up paid income into two components: a)predicted income based on human capital, demographic, and locational variables, and b) income for ability. Again, we find nolinear relationship between self-employment and either predicted income or income for ability. We then test for curvilinear relationships between these three variables (i.e., paid income, predicted income, and income for ability) and the transition to self-employment. We find that individuals with low incomes are more likely to take up self-employment. Further, income for ability is a stronger predictor of the transition to self-employment than predicted income. We show that the relationship between ability and self-employment is U shaped: very low ability and very high ability individuals are more likely to take up self-employment than medium ability individuals. We use prospect theory to explain this result. |
| Keywords: | Entrepreneurship; self-employment; opportunity costs; value creation; |
| Date: | 2004–10–21 |
| URL: | http://d.repec.org/n?u=RePEc:ebg:iesewp:d-0575&r=lab |
| By: | Dustmann; Christian (University College London, CEPR, IFS London and IZA Bonn); Schönberg, Uta (University of Rochester and IZA Bonn) |
| Abstract: | This paper tests the hypothesis that unions, through imposing wage floors that lead to wage compression, increase on-the-job training. Our analysis focuses on Germany which provides an interesting context to test this hypothesis, due to its large scale apprenticeship programme and its collective bargaining system that is based on voluntary union recognition. To guide the empirical analysis, we first develop a model of firm-financed training. A novel feature of our model is that a unionised and non-unionised sector coexist, and only unionized firms are bound by union wages. The model creates a rich set of empirical implications regarding apprenticeship training, layoffs, wage cuts, and wage compression in unionized and nonunionised firms. Our empirical analysis is based on firm panel data matched with administrative employee data, and provides strong support for our model. Our main results are that unionisation increases training, and that wage floors and wage compression play a more important role in unionised than in non-unionised firms. |
| Keywords: | training, unions, wage compression, matched firm-worker data |
| JEL: | J24 J40 J51 I2 |
| Date: | 2004–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1435&r=lab |
| By: | Norberg-Schönfeldt, Magdalena (Department of Economics, Umeå University) |
| Abstract: | In this paper, data from Statistics Sweden about students entering upper secondary school (10th grade) in 1994 and graduating in 1996 or 1997, along with socioeconomic characteristics from the 1990 census, are used to explore the relationship between the market work by mothers and fathers in Sweden and their children’s educational achievement, measured as Grade Point Average. The results show, in line with previous research, that there is a positive relationship between parental income and child GPA. When it comes to the number of hours of work that the parents perform in the labour market, the results differ between mothers and fathers. If the mother works less then full time, preferably even less then halftime, it has positive effects on the child’s grades. There are no significant effects of the father’s hours of work, as long as he works a positive amount of time. The lack of effects from the father’s hours of work may, however, be due to lack of variation in data. |
| Keywords: | Time allocation; labour-force participation; educational achievements; child GPA |
| JEL: | D10 I20 J22 |
| Date: | 2004–12–15 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:umnees:0645&r=lab |
| By: | Eckhard Hein (WSI in der Hans Boeckler Stiftung); Thorsten Schulten (WSI in der Hans Boeckler Stiftung); Achim Truger (WSI in der Hans Boeckler Stiftung) |
| Abstract: | Based on a post-Keynesian model of the relationship between wages, prices and employment, this paper begins by studying the extent to which unit labour cost trends have been responsible for disinflation and deflationary tendencies in Germany and Europe. Thereafter, the reasons for the deflationary development of unit labour costs in recent years, in particular in Germany, are analysed. Finally, the impact of deflationary wage policies on German and European stagnation are discussed and it is concluded that the excessive wage restraint in Germany not only exacerbates stagnation and deflationary tendencies in Germany but might also have a deflationary impact on the other EMU countries. |
| Keywords: | Wage trends, deflation, collective bargaining |
| JEL: | E31 E50 |
| Date: | 2004–12–10 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpma:0412008&r=lab |
| By: | JS Armstrong (The Wharton School - University of Pennsylvania) |
| Abstract: | Author's Note: The following was sent to the Wharton faculty in November, 1989, challenging a set of proposals by the Wharton Teaching Committee.1 The committee's proposal was presented as an 'all or nothing' choice. Despite a substantial amount of support for the position stated below, the Wharton Committee recommendations were passed as originally proposed; this includes punitive measures for faculty who get low ratings (referred to below as the committee's Proposal #1). The proposals said that for tenure or promotion, a faculty member must get better than an 'average' rating (3.0 on a five point scale). The vote was close. It seems likely that Proposal #1 would have been defeated had a secret ballot been conducted on this item alone. Action was not taken on any of the nine proposals in my paper, and neither of the proposals on process were accepted. Since that time, faculty from other schools have read the memo and suggested that it be reprinted in Almanac in order to gain further faculty comment. They are concerned that similar events in their schools may affect the quality of the educational environment. |
| Keywords: | teaching, teaching standards |
| JEL: | A |
| Date: | 2004–12–10 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpgt:0412019&r=lab |
| By: | Kathleen Beegle; Rajeev Dehejia; Roberta Gatti |
| Abstract: | Although there is an extensive literature on the determinants of child labor and many initiatives aimed at combating it, there is limited evidence on the consequences of child labor on socio-economic outcomes such as education, wages, and health. We evaluate the causal effect of child labor participation on these outcomes using panel data from Vietnam and an instrumental variables strategy. Five years subsequent to the child labor experience, we find significant negative impacts on school participation and educational attainment, but also find substantially higher earnings for those (young) adults who worked as children. We find no significant effects on health. Over a longer horizon, we estimate that from age 30 onward the forgone earnings attributable to lost schooling exceed any earnings gain associated with child labor and that the net present discounted value of child labor is positive for discount rates of 11.5 percent or higher. We show that child labor is prevalent among households likely to have higher borrowing costs, that are farther from schools, and whose adult members experienced negative returns to their own education. This evidence suggests that reducing child labor will require facilitating access to credit and will also require households to be forward looking. |
| JEL: | D19 J22 J82 O15 Q12 |
| Date: | 2004–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:10980&r=lab |
| By: | Matthias Weiss (Mannheim Research Institute for the Economics of Aging (MEA)) |
| Abstract: | This paper studies the employment effects of technological change when benefits are endogenous. If the (i) level of welfare aid depends on the general income level in the economy and (ii) wages for unskilled workers cannot fall below the level of welfare aid, there is a link between the wage for unskilled labor and the productivity of skilled labor. An increase in the latter will lead to an increase in average income and hence the level of welfare aid. This in turn leads unions to ask for higher wages for unskilled workers. Technological change is shown to have employment effects (only) if it is skill-biased and if this link exists. |
| Date: | 2004–01–22 |
| URL: | http://d.repec.org/n?u=RePEc:xrs:meawpa:0443&r=lab |
| By: | William J. Collins (Department of Economics, Vanderbilt University); Robert A. Margo (Department of Economics, Vanderbilt University) |
| Abstract: | Between 1964 and 1971, hundreds of riots erupted in American cities, resulting in large numbers of injuries, deaths, and arrests, as well as in considerable property damage that was concentrated in predominantly black neighborhoods. There have been few studies of a systematic, econometric nature that examine the impact of the riots on the relative economic status of African Americans, or on the cities and neighborhoods in which the riots took. We present two complementary empirical analyses. The first uses aggregate, city-level data on income, employment, unemployment, and the area's racial composition from the published volumes of the federal censuses. We estimate the "riot effect" by both ordinary least squares and two-stage least squares. The second empirical approach uses individual-level census data from the Integrated Public Use Microdata Series for 1950, 1970, and 1980. The findings suggest that the riots had negative effects on blacks' income and employment that were economically significant and that may have been larger in the long run (1960-1980) than in the short run (1960-1970). We view these findings as suggestive rather than definitive for two reasons. First, the data are not detailed enough to identify the precise mechanisms at work. Second, the wave of riots may have had negative spillover effects to cities that did not experience severe riots; if so, we would tend to underestimate the riots' overall effect. |
| Keywords: | Civil disturbances, Watts |
| JEL: | J15 R0 |
| Date: | 2003–12 |
| URL: | http://d.repec.org/n?u=RePEc:van:wpaper:0324&r=lab |