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on Labour Economics |
| By: | Christian Calmès |
| Abstract: | To properly account for the dynamics of key macroeconomic variables, researchers incorporate various internal-propagation mechanisms in their models. In general, these mechanisms implicitly rely on the assumption of a perfect equality between the real wage and the marginal product of labour. The author proposes a theoretical validation of a micro-founded internal-propagation mechanism: he builds a model that features a limited-commitment economy, and derives endogenous self-enforcing labour contracts that produce a different linkage between the real wage and the marginal product of labour. The risk-sharing between the entrepreneur and the worker, both faced with enforcement problems, provides an admissible explanation of the prolonged comovements observed between consumption and labour. Since these co-movements are at the core of the persistence of the impulse response of output to exogenous technology shocks, this persistence can, in turn, be rationalized with the endogenous real rigidity emerging from the economy. The author shows that, in this framework, the persistence ultimately depends on the initial bargaining power and the magnitude of the risk-sharing. |
| Keywords: | Business fluctuations and cycles; Economic models; Labour markets |
| JEL: | E12 E49 J30 J31 J41 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:bca:bocawp:05-1&r=lab |
| By: | Borisov Gleb |
| Abstract: | The study raises the problem of human capital heterogeneity at the Russian labor market caused by non-random distribution of unobservable skills across the population of a transition country. At the beginning of the transition, people who were grown up in different times or cultures have distinct moral norms, behavioral patterns, preferences and the knowledge. This results in the differences in unobservable abilities and earnings capacity of people. We argue that cohort, a pre-transition occupation, an urban place of birth, and nationality might serve as proxies for unobservable skills in the transition. The cohort effects were separated by two ways. According to the first one, the logarithm of the real wages index was used as a proxy for current period. The second one is based on an assumption on the form of age-earnings profiles in Russia. The estimation results reveal the significance of all the proxies for unobservable abilities and the robustness of estimates. At the same time, conditioning of the effects of cohort and pre-transition occupation on gender is discovered. |
| Keywords: | Russia, transition, labor market, human capital, heterogeneity, vintage effect, cohort effect, earnings function, identification problem |
| JEL: | J31 O15 P21 P27 |
| Date: | 2005–02–17 |
| URL: | http://d.repec.org/n?u=RePEc:eer:wpalle:01-151e&r=lab |
| By: | Kupets Olga |
| Abstract: | This paper presents first evidence on the determinants of unemployment duration in Ukraine between 1997 and 2003, using individual-level data from the first wave of the Ukrainian Longitudinal Monitoring Survey (ULMS -2003). It investigates the conditional probability of an individual leaving unemployment to employment or economic inactivity in any particular month of his spell out of work by estimating it in a discrete time independent competing risks framework with flexible baseline hazard rates and gamma-distributed unobserved heterogeneity. The results in all specifications indicate no significant effect of receiving unemployment benefits but significant negative effect of having income from casual activities, subsidiary farming, household income or pension on the hazard of re-employment. Multivariate analysis also suggests that policies to reduce long-term unemployment should focus on older workers, less educated individuals, residents of small towns and rural area in the regions with relatively high unemployment rates. |
| Keywords: | Ukraine, long-term unemployment, unemployment insurance, Ukraine, semiparametric duration analysis, flexible baseline hazard |
| JEL: | J64 J68 P23 |
| Date: | 2005–02–28 |
| URL: | http://d.repec.org/n?u=RePEc:eer:wpalle:05-01e&r=lab |
| By: | Cristina Ferná |
| URL: | http://d.repec.org/n?u=RePEc:fda:fdaddt:2003-06&r=lab |
| By: | Namkee Ahn; Juan Ramón García |
| Abstract: | Job satisfaction is an important part of overall life satisfaction among the working age population. We examine Western Europeans’ overall job satisfaction and the satisfaction levels in several job domains using the European Community Household Panel Survey (1994-2001). With respect to overall job satisfaction, wage is important. Yet, some other factors show equally or more important effects. For example, health turns out to be a single most important determinant of overall job satisfaction. Job match quality, contract type and job status are also important. With respect to the relationship between overall and job domain satisfaction, work type comes out as the most important job domain in all countries, followed by pay, working condition and job security. In analyzing determinants of each job domain satisfaction, we find some interesting results. Female workers declare higher pay satisfaction but lower work hour satisfaction, which are consistent with the hypothesis of low aspiration and greater non-market responsibility among women. Good job matches increase satisfaction levels in all job domains, but in particular with respect to pay and work type. Local unemployment rate has no effects on overall job satisfaction, but it has significant effects in two job domains, job security and work hours. Those in countries or times of high unemployment declare much lower satisfaction with job security, while they declare higher satisfaction with hours of work. Finally, even after controlling many variables which are responsible, directly and indirectly, for overall and each job domain satisfaction, there still remain large country fixed effects. Given the same observed worker and job characteristics, Austrian, Danish and Irish workers declare substantially higher satisfaction in all job domains than the workers in the Mediterranean countries. |
| URL: | http://d.repec.org/n?u=RePEc:fda:fdaddt:2004-16&r=lab |
| By: | Raquel Carrasco; Juan Ramón García; Ana Carolina Ortega |
| Abstract: | Spain is one of the European countries where immigration flows during the last decade have increased noticeably. The Spanish labor market institutions and the Spanish immigration policy exhibit some peculiarities which may be relevant when analyzing the impact of immigration. This paper provides a first approximation to the labor market effects of immigrants in Spain during the second half of the 1990s, the period in which immigration flows to Spain have accelerated. By using alternative datasets, we estimate both the impact of legal and total immigration flows on the employment rates of native workers, with and without the implications of the occupational and geographical mobility of immigrants and native-born workers. Using different samples and estimation procedures, we have not found a significant negative effect of immigration on the employment rates of native workers. The corresponding estimated elasticity is around -0.17, when considering only legal immigrants, and is not significant when considering both legal and illegal immigrants |
| URL: | http://d.repec.org/n?u=RePEc:fda:fdaddt:2004-17&r=lab |
| By: | Juan F. Jimeno |
| Abstract: | After a long period of high unemployment, the EU is about to face a significant change in the demographic structure of its labour force, due to a reduction in fertility rates in the past, and increasing immigration flows. There is a long standing literature of empirical studies aiming at measuring the effects of cohort sizes and of immigration flows on employment and unemployment rates and on the wage profiles of several population groups. And there are some reasons to think that these effects depend on the institutions determining the functioning of the labour market. This paper argues that population ageing may produce a reduction of employment rates in the EU15 over the next two decades, as the share of the older workers in the labour force increase. Then it discusses the reasons why, despite this direct composition effects, there may be another indirect effects of changing composition of the labour supply on population specific employment and unemployment rates. Finally, it uses cross-country data to find how the interaction between the age composition of the labour force and the share of foreign workers in the labour force, on the one hand, and labour market institutions, on the other hand, contribute to explaining international differences in age and gender- specific employment and unemployment rates. |
| URL: | http://d.repec.org/n?u=RePEc:fda:fdaddt:2004-18&r=lab |
| By: | Tito Boeri; J. Ignacio Conde-Ruiz; Vincenzo Galasso |
| Abstract: | We document the presence of a trade-o. between unemployment benefits (UB) and employment protection legislation (EPL) in the provision of insurance against labor market risk. Di.erent countries’ locations along this trade-o. represent stable, hard to modify, politico-economic equilibria. We develop a model in which voters are required to cast a ballot over the strictness of EPL, the generosity of UBs and the amount of redistribution involved by the financing of unemployment Insurance. Agents are heterogeneous along two dimensions: employment status — insiders and outsiders — and skills — low and high. Unlike previous work on EPL, we model employment protection as an institution redistributing among insiders, notably in favour of the low-skill workers. A key implication of the model is that configurations with strict EPL and low UB should emerge in presence of compressed wage structures. Micro data on wage premia on educational attainments and on the strictness of EPL are in line with our results. We also find empirical support to the substantive assumptions of the model on the e.ects of EPL. |
| URL: | http://d.repec.org/n?u=RePEc:fda:fdaddt:2004-26&r=lab |
| By: | Buchinsky, Moshe (UCLA,CREST-INSEE and NBER); Fougère, Denis (CNRS, CREST-INSEE, CEPR and IZA Bonn); Kramarz, Francis (CREST-INSEE, CEPR and IZA Bonn); Tchernis, Rusty (Indiana University) |
| Abstract: | Much of the research in labor economics during the 1980s and the early 1990s was devoted to the analysis of changes in the wage structure across many of the world’s economies. Only recently, has research turned to the analysis of mobility in its various guises. From the life cycle perspective, decreased wage mobility and increased job instability, makes the phenomenon of increasing wage inequality more severe than it appears to be at first sight. In general, workers’ wages may change through two channels: (a) return to their firm-specific human capital (seniority); or (b) inter-firm wage mobility. Our theoretical model gives rise to three equations: (1) a participation equation; (2) a wage equation; and (3) an interfirm mobility equation. In this model the wage equation is estimated simultaneously with the two decision equations. We use the Panel Study of Income Dynamics (PSID) to estimate the model for three education groups. Our main finding is that returns to seniority are quite high for all education groups. On the other hand, the returns to experience appear to be similar to those previously found in the literature. |
| Keywords: | wage mobility, interfirm mobility, returns to seniority, panel data, Markov Chain Monte Carlo methods |
| JEL: | C11 C15 J31 J63 |
| Date: | 2005–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1521&r=lab |
| By: | Cornelißen, Thomas (University of Hannover); Hübler, Olaf (University of Hannover and IZA Bonn) |
| Abstract: | Using data from the German Socio-Economic Panel (GSOEP) effects of being individually affected by downward wage rigidity on layoffs, quits and intra-firm mobility are investigated. We measure the individual extent of wage rigidity within a structural empirical model that allows us to estimate the notional wage growth which is about 1.4 % on average over the whole period. Wage growth is swept up by 3.3 % through wage rigidity and 62 % of the work force are in the real rigid regime. We find negative effects of wage sweep-up on quits, layoffs and promotions. This is consistent with a core-periphery view of the labour force, where a core work force is at the same time protected from layoffs and from wage cuts, whereas a peripheral work force provides a buffer for adjustment and suffers from both flexible wages and more insecure jobs. Reducing promotions for high wage sweep-up workers seems to be strategy of employers to circumvent wage rigidity. This suggests that it is not a pay policy chosen by the employer, but that it is imposed upon the employer through bargaining power. However, decreased promotion opportunities do not seem to fully outweigh the benefit of generous wage growth. |
| Keywords: | wage rigidity, wage sweep up, job mobility, quits, layoffs, promotions |
| JEL: | J31 J63 |
| Date: | 2005–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1523&r=lab |
| By: | Airola, Jim (Naval Postgraduate School); Juhn, Chinhui (University of Houston and IZA Bonn) |
| Abstract: | Using the Mexican Household Income and Expenditure Survey (ENIGH) covering 1984-2000 we analyze wages and employment in Mexico after trade liberalization and domestic reforms. We find that wage inequality and returns to post-secondary schooling increased rapidly during 1984-1994 but stabilized since that period. The end of inequality growth was due to a severe macroeconomic crisis which adversely impacted the better educated, an increase in education levels at the end of the 1990s, and a slowdown in skill demand in the latter half of the 1990s. Between-industry shifts, consistent with trade-based explanations, account for a part of the increase in skill demand during 1984-1994, but these types of movements actually reduced the demand for skill in the latter part of the 1990s. The equalizing impact of trade was offset by within-industry demand shifts which continued to favor more educated workers. The Mexican experience in the 1990s suggests that market-oriented reforms have a sharp initial impact on inequality which dissipates over time. However, the opening of the economy to trade, foreign capital, and global markets also leads to a more long-run increase in the demand for skill. |
| Keywords: | wage inequality, reforms, skill demand |
| JEL: | J31 |
| Date: | 2005–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1525&r=lab |
| By: | Van der Linden, Bruno (Fonds National de la Recherche Scientifique, Université Catholique de Louvain and IZA Bonn) |
| Abstract: | This paper evaluates counselling programmes in an equilibrium matching model where workers are heterogeneous in skill levels. Job search effort, labour demand and wages are endogenous. When wages are bargained over, raising the effectiveness of or the access to counselling programmes pushes wages upwards and leads to lower search effort among nonparticipants. The effects of increasing the access of the low-skilled are evaluated numerically by enlarging successively the set of endogenous behaviours. Induced effects outweigh substantial positive micro effects on low-skilled employment when all `margins' are taken into account. The inter-temporal utility of the low-skilled nevertheless increases because search effort declines. On the contrary, when the net wage of the low-skilled is a fixed proportion of the one bargained by the high-skilled, raising the access to counselling programmes has small positive effects on all criteria. |
| Keywords: | active programmes, labour market policies, evaluation, equilibrium search |
| JEL: | J63 J64 J65 J68 |
| Date: | 2005–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1526&r=lab |
| By: | Zoghi, Cindy (U.S. Bureau of Labor Statistics); Levenson, Alec (University of Southern California); Gibbs, Michael (University of Chicago GSB and IZA Bonn) |
| Abstract: | In this paper we study job design. Will an organization plan precisely how the job is to be done ex ante, or ask workers to determine the process as they go? We first model this decision and predict complementarity between these job attributes: multitasking, discretion, skills, and interdependence of tasks. We argue that characteristics of the firm and industry (e.g., product and technology, organizational change) can explain observed patterns and trends in job design. We then use novel data on these job attributes to examine these issues. As predicted, job designs tend to be ‘coherent’ across these characteristics within the same job. Job designs also tend to follow similar patterns across jobs in the same firm, and especially in the same establishment: when one job is optimized ex ante, others are more likely to be also. There is some evidence that firms may segregate different types of job designs across different establishments. |
| Keywords: | job design, organization design, specialization, job enrichment, intrinsic motivation |
| JEL: | M5 M50 J2 J24 L23 |
| Date: | 2005–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1529&r=lab |
| By: | Robert S. Huckman; Jason Barro |
| Abstract: | The impact of labor turnover on productivity has received a great deal of attention in the literature on organizations. We consider the impact of cohort turnover %u2013 the simultaneous exit of a large number of experienced employees and a similarly sized entry of new workers %u2013 on productivity in the context of teaching hospitals. In particular, we examine the impact of the annual July turnover of house staff (i.e., residents and fellows) in American teaching hospitals on levels of resource utilization (measured by risk-adjusted length of hospital stay) and quality (measured by risk-adjusted mortality rates). Using patient-level data from roughly 700 hospitals per year over the period from 1993 to 2001, we compare monthly trends in length of stay and mortality for teaching hospitals to those for non-teaching hospitals, which, by definition, do not experience systematic turnover in July. We find that the annual house-staff turnover results in increased resource utilization (i.e., higher risk-adjusted length of hospital stay) for both minor and major teaching hospitals and decreased quality (i.e., higher risk-adjusted mortality rates) for major teaching hospitals. Further, these effects with respect to mortality are not monotonically increasing in a hospital%u2019%u2019s reliance on residents for the provision of care. In fact, the most-intensive teaching hospitals manage to avoid significant effects on mortality following this turnover. We provide a preliminary examination of the roles of supervision and worker ability in explaining the ability of the most-intensive teaching hospitals to reduce turnover%u2019%u2019s negative effect on performance. |
| JEL: | I1 J0 |
| Date: | 2005–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11182&r=lab |
| By: | Robert E. Hall |
| Abstract: | I consider three views of the labor market. In the first, wages are flexible and employment follows the principle of bilateral efficiency. Workers never lose their jobs because of sticky wages. In the second view, wages are sticky and inefficient layoffs do occur. In the third, wages are also sticky, but employment governance is efficient. I show that the behavior of flows in the labor market strongly favors the third view. In the modern U.S. economy, recessions do not begin with a burst of layoffs. Unemployment rises because jobs are hard to find, not because an unusual number of people are thrown into unemployment. |
| JEL: | E24 E32 J64 |
| Date: | 2005–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11183&r=lab |
| By: | Adriana Kugler adkugler@uh.edu (University of Houston, Universitat Pompeu Fabra, NBER, CEPR and IZA); Giovanni Pica (University of Southampton, University of Salerno and CSEF) |
| Abstract: | This paper uses the Italian Social Security employer-employee panel to study the effect of a reform that introduced a cost for unjust dismissals only for firms below 15 employees, while leaving firing costs unchanged for bigger firms. We find that the increase in dismissal costs decreased accessions and separations in small relative to big firms, the more so in sectors with higher employment volatility. Moreover, the reform reduced firms’ entry rates while increasing the exit rate. We also find evidence that higher EPL flattened employment policies over the cycle |
| Keywords: | Costs of Unjust Dismissals, European Unemployment, Firms’ Entry and Exit, Employment Volatility |
| JEL: | E24 J63 J65 |
| Date: | 2005–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:sef:csefwp:135&r=lab |
| By: | Andrew Sharpe; Jeremy Smith |
| Abstract: | The objective of this paper is to examine labour market seasonality in Canada over the past three decades in order to shed light on what policies might be best suited to address seasonal economies. The main findings are as follows. The seasonality of the Canadian economy has declined since 1976 according to a wide range of output and labour market variables. However, since 1996 unemployment rate seasonality has increased. Seasonality – both in employment and the unemployment rate – is much higher for the young than for older workers and much higher for men than for women. Canada’s level of employment seasonality was more than three times higher than that in the United States in 2003. However, unemployment rate seasonality was perhaps surprisingly the same in the two countries. Relative to OECD countries, Canada has average unemployment rate seasonality, but very high employment seasonality. Atlantic Canada has higher levels of employment and unemployment rate seasonality than the other provinces reflecting a greater importance of primary industries and greater propensity of employers to hire part-year workers. Seasonal unemployment represents a much more important public policy issue than seasonal employment. The basic problem is an underlying lack of employment opportunities in rural and remote areas where seasonal unemployment is concentrated, not seasonal unemployment itself. An economic development strategy that ensures that all persons who want full year work can obtain it must be the most important element in any attempt to reduce seasonal unemployment. But such a strategy might need to be supplemented, at least in the short-to-medium term, by out-migration, particularly in very high unemployment regions, and incentives for firms to transform seasonal work into full-year work, or at least into near full-year work. Since unrestricted benefits for seasonal EI repeaters will not reduce seasonal unemployment, a strong case can be made that long-term income support for the seasonally unemployed is not in the long-run in the best interest of the beneficiaries, high unemployment regions, and the country, although reducing such benefits is politically difficult. |
| Keywords: | seasonality, seasonal employment, seasonal unemployment, unemployment, Atlantic Canada, Canada |
| JEL: | E24 J23 J65 R58 O51 |
| Date: | 2005–02 |
| URL: | http://d.repec.org/n?u=RePEc:sls:resrep:0501&r=lab |
| By: | Takao Kato; Cheryl Long |
| Abstract: | This paper provides the first systematic evidence on compensation for executives of firms listed in China’s emerging stock market (currently the eighth largest of the world with market capitalization of over $550 billion). Specifically, using comprehensive financial and accounting data on China’s listed firms from 1998 to 2002 (data modeled after Compustat and CRSP in the U.S.), augmented by unique data on executive compensation, we find for the first time statistically significant sensitivities and elasticities of annual cash compensation (salary and bonus) for top executives with respect to shareholder value in China. The size of the estimated sensitivities imply that a 1000 RMB increase in shareholder value yields a 0.020 RMB to 0.053 RMB increase in annual cash compensation, whereas the size of the estimated elasticities suggest that a 10 percent increase in shareholder value results in 3.7 to 4.0 percent increase in annual cash compensation for top executives. The estimated sensitivities and elasticities of cash compensation for top executives in China’s listed firms are greater than what has been reported for Japan and the U.S. However, we also find that state ownership of China’s listed firms is weakening executive pay-performance link and thus possibly making China’s listed firms less effective in solving the agency problem. As such, ownership restructuring may be needed for the “shareholding experiment” to fully succeed in transforming China’s emerging listed firms to efficient modernized corporations and for the overall successful economic transition of China. Finally, we find that sales growth is significantly linked to executive compensation and that Chinese executives are penalized for making negative profit although they are neither penalized for declining profit nor rewarded for rising profit insofar as it is positive. |
| Keywords: | transition economies, China, executive compensation, firm performance, corporate governance, and ownership structure. |
| JEL: | P31 P34 M52 M12 G30 G15 J33 O53 |
| Date: | 2004–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2004-690&r=lab |
| By: | Ralitza Dimova; Ira N. Gang |
| Abstract: | Using Bulgarian Integrated Household Surveys for 1995, 1997 and 2001 this paper explores determinants of labor force status – not working, public sector employment, private sector employment and self-employment – and earnings for each of the three employment sectors. We find that while skilled labor’s pattern of reallocation into the public sector remains roughly the same over time, the inflow of highly educated laborers into the private sector and selfemployment increases. These changes coincide with the erosion of the returns to observed skills in the private sector and self-employment, while the public sector continues to reward all types of education at higher than the elementary level. |
| Keywords: | employment selection, earnings, Bulgaria |
| JEL: | J21 J23 J31 |
| Date: | 2004–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2004-699&r=lab |
| By: | T.H. Gindling; Katherine Terrell |
| Abstract: | This paper contributes to our understanding of the impact of institutions on incomes of workers in developing countries by rigorously addressing the question as to whether changes in minimum wages can change the inequality of the distribution of earnings. More specifically, we analyze whether changes in Costa Rica’s complex institution of multiple minimum wages in the 1980s and 1990s acted as a countervailing force to the unequalizing effect of globalization. Using annual data on workers from the 1987-1997 household surveys, it is shown that changes in the legal minimum wages did indeed have an effect on wage inequality and that these changes would not have been captured using the simple interpretation of minimum wages found in much of the literature. |
| Keywords: | minimum wages, employment, wages, Costa Rica |
| JEL: | J23 J31 J38 |
| Date: | 2004–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2004-700&r=lab |
| By: | T.H. Gindling; Katherine Terrell |
| Abstract: | This paper investigates the effects of legal minimum wages on wages, employment, hours worked and monthly earnings among workers covered by minimum wage legislation as well as those for whom it does not apply (the uncovered sector) in Costa Rica. This country’s large uncovered sector and complex minimum wage policy, which has for decades set numerous wages throughout the wage distribution, provide a stimulating counterpoint to the U.S. framework for the analysis of the impact of minimum wages. We find that legal minimum wages have a significant positive effect on the wages of workers in the covered sector (with an elasticity of 0.10) but no effect on wages of workers in the uncovered sector. We also find that a 10% increase in minimum wages lowers employment in the covered sector by 1.09% and decreases the average number of hours worked of those who remain in the covered sector by about 0.6%. Finally, we show that despite the wide range of minimum wages, the largest impact on the wages and employment of covered sector workers is in the lower half of the distribution. |
| Keywords: | minimum wages, employment, wages, Costa Rica |
| JEL: | J23 J31 J38 |
| Date: | 2004–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2004-701&r=lab |
| By: | Belton M. Fleisher; Klara Sabirianova Peter; Xiaojun Wang |
| Abstract: | We explore the pace of increase in returns to schooling during the transition from planning to market over time across a number of Central and Eastern European countries, Russia, and China. We use metadata from 33 studies of 10 transition economies covering a period from 1975 through 2002. Our empirical model is an attempt to account for cross-section and over-time variation in rates of return as a function of the timing, speed, and volatility of reform processes as well as estimation methods used and sample characteristics. Our principal aim is to investigate the relative strength of two hypotheses: (1) the speed of economic transformation from planning to market represent the relaxation of legal, regulatory, and institutional constraints on wage-setting behavior, leading directly to adjustment returns to schooling to market rates; 2) the rapid increase in returns to schooling during the early reform period reflects the ability of highly-educated individuals to respond to changing opportunities in a disequilibrium situation. We find that both the speed of reforms and the degree of economic disequilibrium as reflected in macroeconomic volatility help to explain cross-country differences in the time paths of the returns to schooling. We report the systematic effects of sample characteristics, estimation methods, and model specifications on estimated returns to schooling. |
| Keywords: | returns to schooling, skills, speed of reforms, meta-analysis, transition, Central and Eastern Europe, China, Russia. |
| JEL: | J31 J24 O15 P2 P3 P5 |
| Date: | 2004–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2004-703&r=lab |
| By: | Belton M. Fleisher; Xiaojun Wang |
| Abstract: | We estimate returns to schooling using a retrospective work history survey covering more than 4,000 workers over the period 1950 to 1994, with particular emphasis to the returns to schooling for workers who attended institutes of higher education and who graduated from college. We find evidence that schooling returns declined throughout the period leading up to the Cultural Revolution (CR), with returns for workers who did not attend college becoming negligible. Returns to those with some college education remained positive, but low compared to other countries. Consistent with other studies, we find that returns to schooling did not recover from their CR low until the 1990s. Increases in the return to schooling during the transition following the CR were not associated directly with workers changing jobs or with taking “new-economy” jobs but appear to have occurred for most workers across all ownership categories. Workers most likely to leave jobs in the traditional ownership sector for jobs in the private or jointventure categories were those who entered the labor force prior to 1967. We do not find evidence supporting other studies’ finding that schooling returns for college graduates increased more than for workers with lower levels of schooling attainment. |
| Keywords: | returns to schooling, skills, China |
| JEL: | J31 J24 O15 |
| Date: | 2004–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2004-704&r=lab |
| By: | Sumon Kumar Bhaumik; Klaus Meyer; Saul Estrin |
| Abstract: | Foreign investors are expected to contribute to economic development through a variety of channels. However, many foreign investment operations are small, and almost insignificant in their impact on the local environment. An important indication of the potential contribution of foreign investors is thus their employment growth. Employees working for, and trained by, a multinational enterprise may become carriers of new technology and business practices. The more employees receive access to new knowledge, the more they in turn may spread the knowledge across the economy, for instance by setting up their own businesses. In this paper, we make a first step in investigating the determinants of this important mediating variable, employment growth. For a dataset covering four diverse emerging economies, we find that wholly-owned FDI operations have higher employment growth, while local industry characteristics moderate the growth effect. |
| Keywords: | MNE, employment growth, control, institutions, FDI policy |
| JEL: | O13 O33 J21 F23 |
| Date: | 2004–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2004-707&r=lab |
| By: | Swati Basu; Saul Estrin; Jan Svejnar |
| Abstract: | Using large firm-level data sets from the Czech Republic, Slovakia, Poland and Hungary, we show that the wage behavior of firms changed considerably as these economies launched their transitions to a market system. We find evidence of worker sharing in their enterprise rents and losses at the end of the communist period in some economies and within a year after the launching of the transition, we find rent sharing in all of them. Using the Czech and Slovak data we show that the state-owned enterprises (SOEs) that existed under communism and survived allow for less worker rent-sharing than other firms. We also test for the presence of a wage curve and with the exception of Slovakia we do not find a significant association between local unemployment and wages. Finally, we do not find significant effects of firm ownership on wages. |
| Date: | 2004–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2004-717&r=lab |
| By: | Yuriy Gorodnichenko; Klara Sabirianova Peter; |
| Abstract: | n Russia and Ukraine (1985-2002). There has been an increase in returns to schooling in both countries but the increase is much bigger in Russia than in Ukraine. The intriguing question is why returns to schooling in Russia and Ukraine diverged so much over the transition period while the skill composition of employment did not. Our approach in analyzing the sources of cross-country differences in returns to schooling is to compare the Mincerian earnings functions between the two countries and then to employ decomposition techniques. Using semiparametric methods, we construct counterfactual wage distributions for university and secondary school graduates for Ukraine using the distributions of Russian characteristics, returns to characteristics, and unobservables. This allows us to decompose differences in returns to schooling between the two countries due to differences in the labor market returns (price effect), differences in unobservables (residual effect), and differences in the labor force composition (composition effect). We conclude that of these three effects the price effect makes a major contribution to the observed differences in the returns to schooling. |
| Keywords: | returns to schooling, earnings function, semiparametric approach, decomposition, counterfactual, cross-country analysis, retrospective data, transition, Russia, Ukraine |
| JEL: | C14 I20 J31 O15 O57 P50 |
| Date: | 2004–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2004-719&r=lab |
| By: | Rita Hansberry; ; |
| Abstract: | This paper examined the male-female differentials in hourly earnings in Russia from 1996 to 2002. The gender wage gap did not alter significantly in the earlier years, a period characterized by economic instability, but as the economy recovered, the differential in earnings increased initially. This trend reversed in 2002 and while the gender wage gap in mean earnings fell to its previous level the differential increased at the lower percentiles. Throughout all years, most of the gender wage differential is accounted for by differences in rewards rather than differences in observable characteristics. Occupational segregation continues to be a salient feature of the labor market with women clustered in professional, clerical and service occupations while men are more predominantly employed in blue-collar jobs. |
| Keywords: | Russia, economic transition, gender wage gap, occupational segregation |
| JEL: | J16 J31 P31 |
| Date: | 2004–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2004-720&r=lab |
| By: | Jay Stewart (U.S. Bureau of Labor Statistics) |
| Abstract: | Although male nonworkers have become a larger fraction of the population since the late 1960s, labor economists know very little about them. Using data from several sources--the March CPS, the National Longitudinal Survey of Youth, and the 1992-94 University of Maryland Time Diary Study--this paper fills that void. The picture that emerges is that there is a small cadre of marginal workers who often do not work for periods of a year or more and tend to work relatively few weeks in the years that they do work. The vast majority of nonworking men (men who do not work at all during the year) receive unearned income from at least one source, and the amount of unearned income received varies significantly by reason for not working. Family members provide an important alternative source of support for nonworking men who have little or no unearned income of their own. For the most part, these nonworking men are not substituting nonmarket work for market work. Most of the time that is freed up by not working is spent in leisure activities and sleep. |
| Keywords: | male nonworkers, time use, unearned income |
| JEL: | J11 J22 |
| Date: | 2004–04 |
| URL: | http://d.repec.org/n?u=RePEc:bls:wpaper:ec040010&r=lab |
| By: | Sabrina Wulff Pabilonia (U.S. Bureau of Labor Statistics); Cindy Zoghi (U.S. Bureau of Labor Statistics) |
| Abstract: | Workers who use computers earn more than those who do not. Is this a productivity effect or merely selection? Using the Canadian Workplace and Employee Survey, we control for selection and find a wage premium of 3.8% for the average worker upon adopting a computer. This premium, however, obscures important differences in returns to computer adoption across education and occupation groups. We find that long-run returns to computer use are over 5% for most workers. Differences between short-run and long-run returns may suggest that workers share training costs through sacrificed wages. |
| Keywords: | Computers, training, technological change |
| JEL: | J31 O30 |
| Date: | 2004–06 |
| URL: | http://d.repec.org/n?u=RePEc:bls:wpaper:ec040030&r=lab |
| By: | Kalenkoski, Charlene Marie (Ohio University); Sabrina Wulff Pabilonia (U.S. Bureau of Labor Statistics) |
| Abstract: | College students may participate in market work to finance their college educations. Using data from the NLSY97, three hypotheses are tested. First, smaller parental transfers lead to more hours worked while in school. Second, an increase in the net price of schooling leads to an increase in hours worked. Finally, an increase in hours worked leads to a decrease in a student's GPA. The results indicate that the number of hours a student works per week is unaffected by the schooling-related financial variables and that the number of hours worked per week does not affect a student's GPA. |
| Keywords: | schooling, educational finance, grades, college students |
| JEL: | J22 D1 |
| Date: | 2004–07 |
| URL: | http://d.repec.org/n?u=RePEc:bls:wpaper:ec040040&r=lab |