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on Labour Economics |
| By: | Mikael Carlsson (Sveriges Riksbank, Stockholm); Stefan Eriksson (Uppsala University); Nils Gottfries (Uppsala University, CESifo and IZA Bonn) |
| Abstract: | How well do alternative labor market theories explain variations in net job creation? According to search-matching theory, job creation in a firm should depend on the availability of workers (unemployment) and on the number of job openings in other firms (congestion). According to efficiency wage and bargaining theory, wages are set above the market clearing level and employment is determined by labor demand. To compare models, we estimate an encompassing equation for net job creation on firm-level data. The results support demandoriented theories of job creation, whereas we find no evidence in favor of the searchmatching theory. |
| Keywords: | job creation, involuntary unemployment, search-matching, labor demand |
| JEL: | E24 J23 J64 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2024&r=lab |
| By: | J. Ignacio García-Pérez (Department of Economics, Universidad Pablo de Olavide); Juan F. Jimeno (Bank of Spain, Research Division) |
| Abstract: | This paper provides an approximation to the measurement of public sector wage gaps in Spanish regions. By using data from the European Community Household Panel, it is shown that the balance between what private firms pay in the local market and what the public sector pays, differs substantially in different areas of the country. Public sector wage differences among Spanish regions are mostly due to differences in returns, not to differences in characteristics or to selection effects, and are not constant across gender, educational levels, or occupations. Moreover, in those regions where Regional Governments have a higher weight in public employment, public wage gaps are higher and public employers pay higher returns. There also seems to be a cross-regional positive correlation between public wage gaps and unemployment, and a negative one between labour productivity and public wage gaps. Hence, a tentative conclusion is that the incentives to select into the public sector are higher in the low productivity regions, precisely those where scarcity of human capital in the private sector may be the most important factor for explaining economic backwardness. |
| Keywords: | public sector, wage differentials, switching regressions, Spanish regions. |
| JEL: | J31 H73 H83 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:pab:wpaper:06.10&r=lab |
| By: | Claudia Olivetti (Department of Economics, Boston University); Barbara Petrongolo (London School of Economics CEP, CEPR and IZA) |
| Abstract: | There is substantial international variation in gender pay gaps, from 25-30% in the US and the UK, to 10-20% in a number of central and northern EU countries, down to an average of 10% in southern EU. We argue that non-random selection of women into work across countries may explain part of such variation. This ides is supported by the observed variation in employment gaps, from 10% in the US, UK and Scandinavian countries, to 15-25% in northern and central EU, up to 30-40% in southern EU and Ireland. If women who are employed tend to have relatively high-wage characteristics, low female employment rates may become consistent with low gender wage gaps simply because low-wage women would not feature in the observed wage distribution. We explore this idea across the US and EU countries estimating gender gaps in potential wages. In order to do this, we recover information on wages for those not in work in a given year by simply making assumptions on the position of the imputed wage observations with respect to the median, not on the actual level. Imputation is based on wage observations from nearest available waves in the sample and/or observable characteristics of the nonemployed. We estimate median wage gaps on the resulting imputed wage distributions. Our estimates for 1999 deliver higher median wage gaps on imputed rather than actual wage distributions for most countries in the sample, meaning that, as one would have expected, women tend on average to be more positively selected into work than men. However, this di¤erence is tiny or virtually zero in the US and northern and central EU countries (except Ireland), and becomes sizeable in Ireland, France and southern EU, all countries in which gender employment gaps are high. In particular, in Spain, Portugal and Greece the median wage gap on the imputed wage distribution reaches 20 log points, a closely comparable level to that of the UK and other central and northern EU countries. |
| Date: | 2005–03 |
| URL: | http://d.repec.org/n?u=RePEc:bos:wpaper:wp2005-008&r=lab |
| By: | Diego Comin; Erica L. Groshen; Bess Rubin |
| Abstract: | Has greater turbulence among firms fueled rising wage instability in the United States? Earlier research by Gottschalk and Moffitt shows that rising earnings instability was responsible for one-third to one-half of the rise in wage inequality during the 1980s. These growing transitory fluctuations remain largely unexplained. To help fill this gap, this paper further documents the recent rise in transitory fluctuations in compensation and investigates its linkage to the concurrent rise in volatility of firm performance documented in research by Comin and Mulani and others. ; After examining models that explain the relationship between firm and wage volatility, we investigate this linkage in three complementary panel data sets, each with its own virtues and limitations: the Panel Study of Income Dynamics (detailed information on workers, but no information on employers), COMPUSTAT (detailed firm information, but only average wage and employment levels about workers), and the Federal Reserve Bank of Cleveland's Community Salary Survey (wages and employment for specific occupations for identified firms). We find support for the hypothesis in all three data sets. We can rule out straightforward compositional churning as an explanation for the link to firm performance in high-frequency (over spans of five years) wage volatility, although not in more persistent fluctuations (between successive five-year averages). We conclude that the rise in firm turbulence explains about 60 percent of the recent rise in high-frequency (five-year) wage volatility. |
| Keywords: | Wages ; Corporate profits |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fednsr:238&r=lab |
| By: | Catherine Weinberger (University of California, Santa Barbara); Peter Kuhn (University of California, Santa Barbara and IZA Bonn) |
| Abstract: | Using Census and Current Population Survey data spanning 1959 through 1999, we assess the relative contributions of two factors to the decline in the gender wage gap: changes across cohorts in the relative slopes of men’s and women’s age-earnings profiles, versus changes in relative earnings levels at labor market entry. We find that changes in relative slopes account for about one-third of the narrowing of the gender wage gap over the past 40 years. Under quite general conditions, we argue that this provides an upper bound estimate of the contribution of changes in work experience and other post-school investments (PSIs) to the decline of the gender wage gap. |
| Keywords: | women, United States, experience, wages |
| JEL: | J7 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2007&r=lab |
| By: | Fabien Postel-Vinay (University of Bristol, CREST-INSEE and IZA Bonn); Hélène Turon (University of Bristol and IZA Bonn) |
| Abstract: | Individual labor earnings observed in worker panel data have complex, highly persistent dynamics. We investigate the capacity of a structural job search model with i.i.d. productivity shocks to replicate salient properties of these dynamics, such as the covariance structure of earnings, the evolution of individual earnings mean and variance with the duration of uninterrupted employment, or the distribution of year-to-year earnings changes. Specifically, we show within an otherwise standard job search model how the combined assumptions of on-the-job search and wage renegotiation by mutual consent act as a quantitatively plausible "internal propagation mechanism" of i.i.d. productivity shocks into persistent wage shocks. The model suggests that wage dynamics should be thought of as the outcome of a specific acceptance/rejection scheme of i.i.d. productivity shocks. This offers an alternative to the conventional linear ARMA-type approach to modelling earnings dynamics. Structural estimation of our model on a 12-year panel of highly educated British workers shows that our simple framework produces a dynamic earnings structure which is remarkably consistent with the data. |
| Keywords: | job search, individual shocks, structural estimation, covariance structure of earnings |
| JEL: | J41 J31 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2006&r=lab |
| By: | Wolfgang Franz (ZEW and University of Mannheim); Friedhelm Pfeiffer (ZEW, University of Mannheim and IZA Bonn) |
| Abstract: | This study investigates institutional and economic reasons for downward wage rigidity regarding three occupational skill groups. Based on a survey of 801 firms in Germany and an econometric analysis, we find strong support for explanations based on the effects of labour union contracts and efficiency wages that differ between skill groups. Survey respondents indicate that labour union contracts and implicit contracts are important reasons for wage rigidity for the (less) skilled. Specific human capital and negative signals for new hires are causes of the stickiness of wages for the highly skilled. Compared with US evidence, German firms seem to attach more importance to labour union contracts and specific human capital. |
| Keywords: | wage rigidity, labour union contracts, efficiency wage theory, implicit contract theory, regulation of labour |
| JEL: | J41 J51 K31 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2017&r=lab |
| By: | Thomas Moutos (AUEB and CESifo) |
| Abstract: | The effects of technological change on wage inequality are usually studied under the assumption of exogenous supplies of skilled and unskilled workers. Moreover, in these studies there is no distinction between the stock (number of workers) and the flow (hours of work) dimension of labour services. In the present paper we construct a model in which hours of work and technological change affect both the (relative) demand and supply of unskilled workers. The labour supply of unskilled workers (numbers of persons) is derived from a model of household labour supply in which households differ regarding the disutility suffered when both household members work. Combining together the (relative) supply and demand parts of the model we are able to study the effects of technological change on wage and income inequality and to provide an explanation of recent trends more consistent with the stylized facts. |
| Keywords: | technological change, inequality, household labour supply, work sharing |
| JEL: | D33 E25 J22 J31 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:inq:inqwps:ecineq2006-30&r=lab |
| By: | Simon Luechinger (University of Zurich); Alois Stutzer (University of Zurich and IZA Bonn); Rainer Winkelmann (University of Zurich and IZA Bonn) |
| Abstract: | Sorting of people on the labor market not only assures the most productive use of valuable skills but also generates individual utility gains if people experience an optimal match between job characteristics and their preferences. Based on individual data on reported satisfaction with life it is possible to assess these latter gains from matching. We introduce a two-equation ordered probit model with endogenous switching and study self-selection into government and private sector jobs. We find considerable gains from matching amounting to an increase in the fraction of very satisfied workers from 53.8 to 58.8 percent relative to a hypothetical random allocation of workers to the two sectors. |
| Keywords: | matching, ordered probit, public sector employment, selection, switching regression, subjective well-being |
| JEL: | D60 I31 J24 J45 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2019&r=lab |
| By: | Sabrina Di Addario |
| Abstract: | I analyze empirically the effects of both urban and industrial agglomeration on men`s and women`s search behavior and on the efficiency of matching. The analysis is based on the Italian Labor Force Survey micro-data, which covers 520 randomly drawn Local Labor Market Areas (66 per cent of the total) over the four quarters of 2002. I compute transition probabilities from non-employment to employment by jointly estimating the probability of searching and the probability of finding a job conditional on having searched, and I test whether these are affected by urbanization, industry localization, labor pooling and family network quality. In general, the main results indicate that urbanization and labor pooling raise job seekers` chances of finding employment (conditional on having searched), while industry localization and family network quality increase only men`s. Moreover, neither urban nor industrial agglomeration affect non-employed indvidiual`s search behavior; although men with thicker family networks search more intensively. |
| Keywords: | Labour Market Transitions, Search Intensity, Urbanization, Industrial Localization |
| JEL: | J64 R00 J60 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:235&r=lab |
| By: | Alicia Sasser |
| Abstract: | In this report I review the arguments on both sides of the issue. In doing so, I discuss and critique, where applicable, the evidence presented in the two reports that have been issued on either side of the debate. I also produce my own projection of the likely impact of raising the minimum wage on aggregate employment and wages. These calculations use the two reports as a baseline, modifying some of the assumptions to better reflect evidence supported by the economic literature. According to my estimates, the current proposal to increase the minimum wage could have a negative impact on employment ranging from 2,100 to 10,500 jobs, or 1 to 4 percent of workers whose wages would be affected by the bill. On net, the combined impact of the two wage increases would raise aggregate wages by approximately $255 million. |
| Keywords: | Minimum wage - Massachusetts |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbcr:06-1&r=lab |
| By: | J. Ignacio García-Pérez (Department of Economics, Universidad Pablo de Olavide & Fundación Centro de Estudios Andaluces); Yolanda Rebollo Sanz (Department of Economics, Universidad Pablo de Olavide) |
| Abstract: | We study the use of permanent and temporary contracts across Spanish regions during the period 1995-2001. First we show that there are significant differences among the regional rates of permanent employment and that these differences tend to persist over time. To understand the underlying factors behind these observed differences we estimate a binary choice model for the individual probability of having a permanent contract, taking advantage of the panel data dimension of the Spanish Labour Force Survey. Our main results are that unit labour cost differentials, and thus labour productivity and total labour cost differentials, partially explain the divergence of regional permanent employment rates. Moreover, compared to the influence of regional fixed effects and other possible explanations such as sector specialisation or the presence of small firms in the region, unit labour costs explain more than two thirds of the observed variance in the permanent employment rate across Spanish regions, once all the relevant heterogeneity is taken into account. |
| Keywords: | Temporary Employment, Unit Labour Costs, Random Effects, Spanish Regions. |
| JEL: | C23 J23 J31 J41 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:pab:wpaper:06.11&r=lab |
| By: | Robert Shimer; Iván Werning |
| Abstract: | We study the optimal design of unemployment insurance for workers sampling job opportunities over time. We focus on the optimal timing of benefits and the desirability of allowing workers to freely access a riskless asset. When workers have constant absolute risk aversion preferences, it is optimal to use a very simple policy: a constant benefit during unemployment, a constant tax during employment that does not depend on the duration of the spell, and free access to savings using a riskless asset. Away from this benchmark, for constant relative risk aversion preferences, the welfare gains of more elaborate policies are minuscule. Our results highlight two largely distinct roles for policy toward the unemployed: (a) ensuring workers have sufficient liquidity to smooth their consumption; and (b) providing unemployment benefits that serve as insurance against the uncertain duration of unemployment spells. |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedmsr:366&r=lab |
| By: | Donghoon Lee (Department of Economics, New York University); Kenneth I. Wolpin (Department of Economics, University of Pennsylvania) |
| Abstract: | In this paper, we present a unified treatment of and explanation for the evolution of wages and employment in the U.S. over the last 30 years. Specifically, we account for the pattern of changes in wage inequality, for the increased relative wage and employment of women, for the emergence of the college wage premium and for the shift in employment from the goods to the service-producing sector. The underlying theory we adopt is neoclassical, a two-sector competitive labor market economy in which the supply of and demand for labor of heterogeneous skill determines spot market skill-rental prices. The empirical approach is structural. The model embeds many of the features that have been posited in the literature to have contributed to the changing U.S. wage and employment structure including skill-biased technical change, capital-skill complementarity, changes in relative product-market prices, changes in the productivity of labor in home production and demographics such as changing cohort size and fertility. |
| Keywords: | Male-Female Wage Differential, Wage Inequality, College Wage Premium |
| JEL: | E24 J2 J3 |
| Date: | 2005–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:pen:papers:06-005&r=lab |
| By: | Mary Gregory; Sara Connolly |
| Abstract: | Part-time work has been a major area of employment growth for women in the UK over recent decades. Almost half the women in employment now work part-time and two-thirds have worked part-time for some part of their working lives. Part-time employment is welcomed by many women as a means of maintaining labour market participation particularly during the childcare years. However many part-time jobs are low paid and offer little opportunity for career advancement. This leads to conflicting views of the role of part-time work: allowing a full-time career to be maintained or as a dead-end trap for women`s careers. This paper examines this issue using cohort data which follows women`s labour market involvement up to age 42. The pathways followed through full-time employment, part-time employment and non-employment are found to be complex and highly varied. Using several estimation methods (pooled multinomial logits, dynamic random effects binary choice logits and selection-corrected random effects probits) on a 20-year panel we examine the relative roles of heterogeneity in characteristics and state dependence in explaining the choice of labour market state. Our major finding is that a woman`s labour market history reveals itself as the major determinant of subsequent labour market state, dominating the role of characteristics. Part-time work serves two different functions. Women whose past history involves full-time work even in conjunction with spells of part-time work or non-employment, revert to full-time work. Women whose labour market history combines spells in part-time work with non-employment are unlikely subsequently to take up full-time work. |
| Keywords: | Female Employment, Part-time Work, Persistence, Life-cycle, Dynamic Panel, Discrete Choice |
| JEL: | C23 C25 C33 C35 J16 J22 J62 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:245&r=lab |
| By: | Sabrina Di Addario; Eleonora Patacchini |
| Abstract: | We analyze empirically the impact of urban agglomeration on Italian wages. Using micro-data from the Bank of Italy`s Survey of Household Income and Wealth for the years 1995, 1998, 2000 and 2002 on more than 22,000 employees distributed to 242 randomly drawn local labor markets (30 percent of the total), we test whether the structure of wages varies with urban scale. We find that every additional 100 employees per square kilometer (100,000 inhabitants) in the local labor market raises earnings by 0.4-0.6 percent (0.1 percent) and that employees working in large cities earn, on average, 2-3 percent higher wages than those in the rest of the economy. The application of spatial data analysis techniques enables us to state that this effect is present only in the large cities surrounded by low-populated areas. We also find that urbanization does not affect returns to experience and that it reduces returns to education and to tenure with current firm, while providing a premium to managers, worker supervisors, and office workers. |
| Keywords: | Wage Differentials, Urbanization, Agglomeration Externalities, Population Clustering, Spatial Autocorrelation |
| JEL: | R12 J31 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:243&r=lab |
| By: | Alberto Behar |
| Abstract: | Commentators claim that a shortage of skills in South Africa is constraining output and that a rise in skill supply would benefit less skilled occupations. This assumes or implies skilled and unskilled labour are complements. Hicks Elasticities of Complementarity and elasticities of factor price are estimated between capital and five occupations. The results show that skilled/artisanal and unskilled labour are complements while semi-skilled and unskilled labour are substitutes. These results allow for imperfectly elastic product demand, rigid wages and inference on highly non-linear elasticities. Aggregated estimates suggest More skilled labour complements Less skilled labour. |
| Keywords: | Hicks Elasticity of Complementarity, South Africa, Training, Skill |
| JEL: | J23 J31 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:244&r=lab |
| By: | Lex Borghans (ROA, Maastricht University and IZA Bonn); Bart H.H. Golsteyn (ROA, Maastricht University) |
| Abstract: | After graduation many students start working in sectors not related to their field of study or participate in training targeted at work in other sectors. In this paper, we look at mobility immediately after graduation from the perspective that educational choices have been made when these pupils had little experience of the actual working life in these professions. We develop a model where students accumulate partially transferable human capital but also learn about their professional preferences at the university and during the first years in the labor market. As a consequence of this newly acquired insight, these young workers might realize that working in another occupational field would better fit their preferences, although they are better equipped to work in their own field. The empirical analysis reveals that if wages are 1% lower due to lower skill transferability, the probability that a graduate who regrets his choice actually switches decreases by 2.2 percentage points, while those who switch on average take 0.3 months additional education. |
| Keywords: | regret, mobility, skill transfer, training |
| JEL: | J24 J44 J62 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2021&r=lab |
| By: | Andrea Patacconi; Florian Ederer, MIT |
| Abstract: | This paper argues that the prevalence of compensation systems which reward winners without explicitly identifying losers can be rationalized by workers` concern for relative payoffs. If the workers` participation constraints are binding, the firm must compensate its employees for the disutility that they may derive from low status. It follows that profit-maximizing employers may be particularly reluctant to penalize or give poor performance evaluation to employees. The theory also sheds light on many other puzzling features of incentive schemes in practice, such as small salary premia, rat races, job title proliferation, the gender wage gap, the gender/happiness paradox and the widespread use of tournaments as a sorting device. |
| Keywords: | Reference-Dependent Preferences, Status, Ambition, Expectations, Tournaments |
| JEL: | J31 J41 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:222&r=lab |
| By: | Nabanita Datta Gupta (Danish National Institute of Social Research and IZA Bonn); Nina Smith (Aarhus School of Business and IZA Bonn); Mette Verner (Aarhus School of Business) |
| Abstract: | The Nordic countries have remarkably high participation rates of mothers and a moderate decrease of fertility rates compared to other western countries. This has been attributed to the fact that the welfare state model and, especially, the family friendly policies chosen in the Nordic countries are unique. The availability of generous parental leave schemes including high compensation rates makes it possible for mothers to take a considerable time out of work in connection with childbirths and to return to their previous jobs afterwards, thanks to the high provision of public daycare. In this paper we evaluate family-friendly policies in the ‘Nordic model’ with respect to the two modes of child care i.e. either parental care facilitated by maternal and parental leave schemes or non-parental publicly provided care. Our questions for discussion are: Is there a ‘Nordic model’, and is it worth the cost if effects on child development and welfare are included? Is there a trade-off between family-friendly policies and family welfare, and are there serious negative boomerang effects of familyfriendly policies on women’s position in the labor market? Is the ‘Nordic model’ a model to aspire to? |
| Keywords: | family friendly policies, labour supply, gender wage gap, fertility, public expenditures |
| JEL: | J1 J2 D1 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2014&r=lab |
| By: | Mark Aguiar; Erik Hurst |
| Abstract: | In this paper, we use five decades of time-use surveys to document trends in the allocation of time. We document that a dramatic increase in leisure time lies behind the relatively stable number of market hours worked (per working-age adult) between 1965 and 2003. Specifically, we document that leisure for men increased by 6-8 hours per week (driven by a decline in market work hours) and for women by 4-8 hours per week (driven by a decline in home production work hours). This increase in leisure corresponds to roughly an additional 5 to 10 weeks of vacation per year, assuming a 40-hour work week. We also find that leisure increased during the last 40 years for a number of sub-samples of the population, with less-educated adults experiencing the largest increases. Lastly, we document a growing “inequality” in leisure that is the mirror image of the growing inequality of wages and expenditures, making welfare calculation based solely on the latter series incomplete. |
| Keywords: | Leisure ; Hours of labor |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbwp:06-2&r=lab |
| By: | N H Dimsdale (The Queen's College, Oxford); N Horsewood (Department of Economics, University of Birmingham); A van Riel (Social Policy, Netherlands Economic Institute, Rotterdam) |
| Abstract: | This paper contributes to the debate on the causes of unemployment in interwar Germany. It applies the Layard-Nickell model of the labour market to interwar Germany, using a new quarterly data set. The basic model is extended to capture the effects of the tariff wage under the Weimar Republic and the Nazis. The estimated equations suggest that demand shocks, combined with nominal inertia in the labour market, were important in explaining unemployment. In addition real wage pressures due the political processes of wage determination were a major influence on unemployment. Negative demand shocks appear to have been initially domestic and to have started before the impact of the World Depression. Both negative developments on the demand side of the economy and pressures coming from the supply side raised unemployment in the slump. In the recovery the wage policies of the Nazis and the revival of demand both contributed to the fall in unemployment. The mutual reinforcement of these factors may help to explain the severity of the interwar cycle in Germany. It also serves to emphasize the close connection between political and economic processes in this important episode in macroeconomic history. |
| Keywords: | Great Depression, Germany, real wages, unemployment |
| JEL: | N14 E24 E32 |
| Date: | 2006–03–16 |
| URL: | http://d.repec.org/n?u=RePEc:nuf:esohwp:_056&r=lab |
| By: | Bas Jacobs |
| Abstract: | This paper explains the theoretical background, the analytical methods, calibrations, assumptions and computations of the skill inputs for the WorldScan analysis on the skills targets of the Lisbon agenda. The Lisbon skills targets are implemented in WorldScan using most recent theoretical and empirical research in human capital theory. In particular, a satellite model for WorldScan is developed which disaggregates high skilled labour in S&E and non-S&E workers, and low skilled labour in workers with primary education (or less), lower secondary education, and higher secondary levels of education. In addition, workers can acquire skills through on-the-job training. The quality of the workforce may also increase by a higher quality of initial education. Finally, a stylised cohort model is developed to capture the time-lag between changes in policies and the eventual impact on the labour force. In implementing the skills targets we take heterogeneity between various EU countries into account with respect to the following skill variables: initial average levels of education, the returns to education, graduation rates in upper-secondary education, participation in on-the-job training, and the graduation shares in S&E education. |
| Keywords: | human capital; training; education; literacy; labor markets; Lisbon agreement; general equilibrium modeling |
| JEL: | D50 H50 I20 J20 J30 |
| Date: | 2005–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpb:memodm:135&r=lab |
| By: | Jochen Kluve (RWI Essen and IZA Bonn) |
| Abstract: | Measures of Active Labor Market Policy are widely used in European countries, but despite many econometric evaluation studies no conclusive cross-country evidence exists regarding "what program works for what target group under what (economic and institutional) circumstances?". This paper results from an extensive research project for the European Commission aimed at answering that question using a meta-analytical framework. The empirical results are surprisingly clear-cut: Rather than contextual factors such as labor market institutions or the business cycle, it is almost exclusively the program type that matters for program effectiveness. While direct employment programs in the public sector appear detrimental, wage subsidies and "Services and Sanctions" can be effective in increasing participants' employment probability. |
| Keywords: | Active Labor Market Policy, program evaluation, meta analysis |
| JEL: | J00 J68 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2018&r=lab |
| By: | Scott M. Fuess, Jr. (University of Nebraska-Lincoln and IZA Bonn) |
| Abstract: | Japan is famous for long working hours. For decades the Japanese government has tried to influence how people spend their free time. In 5-yearly surveys since 1986, the government has surveyed "quality of life" by gauging how much time people spend daily in various "noneconomic" activities. Using results from the 1986, 1991, 1996, and 2001 surveys, this study determines whether time spent daily on leisure activities has actually changed. Controlling for labor market forces, in recent years Japanese adults have not experienced more leisure time overall. They have increased time spent, one hour per week, in media-oriented leisure; this increase, however, comes at the expense of more outgoing amusements like hobbies, playing sports, or socializing with friends. There is a significant gender gap for leisure time. Shorter work schedules do encourage a more active leisure lifestyle. Leisure is directly related to regular income, but is stifled by bonus pay. |
| Keywords: | time allocation, leisure time and working hours, country studies, Japan |
| JEL: | J20 J22 J40 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2002&r=lab |