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on Labour Economics |
| By: | Wiji Arulampalam; Alison Booth; Mark L. Bryan |
| Abstract: | Using harmonised data from the European Union Household Panel, we analyse gender pay gaps by sector across the wages distribution for eleven countries. We find that the mean gender pay gap in the raw data typically hides large variations in the gap across the wages distribution. We use quantile regression techniques to control for the effects of individual and job characteristics at different points of the distribution, and calculate the part of the gap attributable to differing returns between men and women. We find that, first, gender pay gaps are typically bigger at the top of the wage distribution, a finding that is consistent with the existence of glass ceilings. Second, for some countries gender pay gaps are also bigger at the bottom of the wage distribution, a finding that is consistent with sticky floors. Third, the gender pay gap is typically higher at the top than the bottom end of the wage distribution, suggesting that glass ceilings are more prevalent than sticky floors. Fourth, the gender pay gap differs significantly across the public and the private sector wages distribution for each of our EU countries. |
| Keywords: | glass ceilings, sticky floors, quantile regression, public sector, gender pay gaps. |
| JEL: | J16 J31 J7 |
| Date: | 2006–01 |
| URL: | http://d.repec.org/n?u=RePEc:auu:dpaper:510&r=lab |
| By: | Carlsson, Mikael (Research Department, Central Bank of Sweden); Eriksson, Stefan (Department of Economics, Uppsala University); Gottfries, Nils (Department of Economics, Uppsala University) |
| 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 these models we estimate an encompassing equation for net job creation on firm-level data. The results support demand-oriented theories of job creation, whereas we find no evidence in favor of the search-matching theory. |
| Keywords: | Job Creation; Involuntary Unemployment; Search-Matching; Labor Demand |
| JEL: | E24 J23 J64 |
| Date: | 2006–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:rbnkwp:0194&r=lab |
| By: | Muysken, Joan (University of Maastricht, Faculty of Economics); Schim van der Loeff, S. (University of Maastricht, Department of Quantitative Economics); Cheshko, Valeria (London School of Economics) |
| Abstract: | Beyond unobserved heterogeneity in computer wage premiums: Most findings on the (non-)existence of a wage premium on computer use are biased because they are based on single-equation estimation of a wage equation. Controlling for fixed effects ignores the simultaneity problem. Through the introduction of a latent variable, “PC-feasibility”, we tackle the problem of simultaneity and account for unobserved heterogeneity. Due to the simultaneous nature of wage determination and computer use, the premium for computer use becomes dependent on person and job characteristics. Imposing testable restrictions on the reduced form enables us to identify the factors that determine wages and enhance computer use. The model is estimated using German data, 1997-2001 Data on computer use in Germany, 1997 – 2001: This paper describes the GSOEP data, 1997-2001, used in Muysken and Schim van der Loeff (2006). The data contain relevant information on individuals, with a focus on the computer use both at home and at work. The construction of the relevant data set for the period 1997 - 2001 is presented in section 2. A more detailed discussion of the data is presented in section 3 for the 1997 wave. Interesting observations are that most workers who use a computer at work started to use a computer at home simultaneously or later. Also the average number of years of employment for workers exceeds the period of the sample. Moreover there is a huge amount of inertia for computer use at work. This emphasises that fixed effects do not only control for unobserved individual characteristics, but also firm and job related characteristics. Finally, for rather homogenous groups of workers wages do not appear to vary systematically with computer use. |
| Keywords: | Cross-Sectional Models, Wage Differentials by Skill |
| JEL: | J31 C31 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:unumer:2006006&r=lab |
| By: | Susanna Iranzo (University of Sidney); Fabiano Schivardi (Bank of Italy, Economic Research Department); Elisa Tosetti (Cambridge University) |
| Abstract: | We study the relation between workers’ skill dispersion and firm productivity using a unique dataset of Italian manufacturing firms from the early eighties to the late nineties with individual records on all their workers. Our measure of skill is the individual worker’s effect obtained as a latent variable from a wage equation. Estimates of a generalized CES production function that depends on the skill composition show that a firm’s productivity is positively related to skill dispersion within occupational status groups (production and non-production workers) and negatively related to skill dispersion between these groups. Consistently, the variance decomposition shows that most of the overall skill dispersion is within and not between firms. We find no change over time in the share of each component, in contrast with some evidence from other countries, based on less comprehensive data. |
| Keywords: | Matched data, Skills, Productivity, Segregation |
| JEL: | D24 J24 L23 |
| Date: | 2006–02 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:wptemi:td_577_06&r=lab |
| By: | Matthias Weiss (Mannheim Research Institute for the Economics of Aging (MEA)) |
| JEL: | J31 O33 |
| Date: | 2005–09–14 |
| URL: | http://d.repec.org/n?u=RePEc:xrs:meawpa:05099&r=lab |
| By: | Matthias Weiss; Alfred Garloff (Mannheim Research Institute for the Economics of Aging (MEA)) |
| Abstract: | In this paper, we study the effect of skill-biased technological change on unemployment when benefits are linked to the evolution of average income and when this is not the case. In the former case, an increase in the productivity of skilled workers and hence their wage leads to an increase in average income and hence in benefits. The increased fallback income, in turn, makes unskilled workers ask for higher wages. As higher wages are not justified by respective productivity increases, unemployment rises. More generally, we show that skill-biased technological change leads to increasing unemployment of the unskilled when benefits are endogenous. The model provides a theoretical explanation for diverging developments in wage inequality and unemployment under different social benefits regimes: Analyzing the social legislation in 14 countries, we find that benefits are linked to the evolution of average income in Continental Europe but not in the U.S. and the UK. Given this institutional difference, our model predicts that skill-biased technological change leads to rising unemployment in Continental Europe and rising wage inequality in the U.S. and the UK. |
| JEL: | E24 J31 O30 |
| Date: | 2005–09–14 |
| URL: | http://d.repec.org/n?u=RePEc:xrs:meawpa:05100&r=lab |
| By: | Anu Rammohan; Stephen Whelan |
| Abstract: | Using data from the HILDA (Household Income and Labour Dynamics), this paper examines the implications of child care costs on maternal employment status by distinguishing between full-time and part-time work. Our empirical approach uses an ordered probit model taking into account the endogeneity associated with both wages and child care costs. Results indicate that child care costs have a statistically insignificant effect on the decision to work either full time or part time. Moreover, the reported elasticities of part-time and full-time work with respect to child care costs are relatively low. This suggests that the significant subsidies paid to users of child care may have a limited role in increasing the labour market activity of married mothers. |
| Keywords: | female labour supply, child care, part-time, full-time |
| JEL: | D13 J12 J13 J16 |
| Date: | 2006–04 |
| URL: | http://d.repec.org/n?u=RePEc:auu:dpaper:517&r=lab |
| By: | Nathalie Havet (GATE CNRS) |
| Abstract: | The paper focuses on the effects of formal and informal on-the-job training on wages and promotions for men and women. For that purpose, we use the 1999-2000 Canadian Worplace and Employee Survey (WES). Using a simulated maximum likelihood, we estimate a recursive trivariate probit that simultaneously models the both decisions to follow formal and infomal on-the-job training and their impact on promotion process. We evaluate the returns of promotions and of the two kinds of on-the-job training through a Mincer wage equation using instruments for these variables. |
| JEL: | J16 J24 J31 C35 |
| Date: | 2006–02 |
| URL: | http://d.repec.org/n?u=RePEc:gat:wpaper:0602&r=lab |
| By: | Seshan, Ganesh; Anos Casero, Paloma |
| Abstract: | Do public sector workers earn a wage premium in Djibouti and are the returns to education different across the sectors? The authors estimate private and public sector wage earnings using 1996 household survey data, while controlling for selectivity using Heckman ' s two stage approach. They find that Djiboutian public sector employees earn a wage premium, independent of their personal attributes and human capital endowments, and are more likely to be males and have parents in the public sector. Workers in the public sector earn higher private rates of return to education than do private sector workers with post-secondary schooling. These results raise concerns about current government hiring and wage-setting practices that generate distortions in the labor market and are not efficiently allocating labor and public resources. |
| Keywords: | Labor Markets,Public Sector Economics & Finance,Public Sector Management and Reform,Education For All,Education and Digital Divide |
| Date: | 2006–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:3923&r=lab |
| By: | Marc-Andreas Muendler (University of California, San Diego and CESifo); Sascha O. Becker (University of Munich, CESifo and IZA Bonn) |
| Abstract: | Multinational labor demand responds to wage differentials at the extensive margin, when a multinational enterprise (MNE) expands into foreign locations, and at the intensive margin, when an MNE operates existing affiliates across locations. We derive conditions for parametric and nonparametric identification of an MNE model to infer elasticities of labor substitution at both margins, controlling for location selectivity. Prior studies have rarely found foreign wages or operations to affect employment. Our strategy detects salient adjustments at the extensive margin for German MNEs. With every percentage increase in German wages, German MNEs allocate 2,000 manufacturing jobs to Eastern Europe at the extensive margin and 4,000 jobs overall. |
| Keywords: | multinational enterprise, location choice, sample selectivity, labor demand, translog cost function, nonparametric estimation |
| JEL: | F21 F23 C14 C24 J23 |
| Date: | 2006–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2131&r=lab |
| By: | Michael Rosholm (University of Aarhus, AKF Copenhagen and IZA Bonn); Marianne Røed (Institute for Social Research, Oslo); Pål Schøne (Institute for Social Research, Oslo) |
| Abstract: | New technologies and new work practices have been introduced and implemented over a broad range in the production process in most advanced industrialised countries during the last two decades. New work organisation practices like team organisation and job rotation require interpersonal communication to a larger extent compared to the traditional assembly line types of production. In addition to handling the formal language, communication in this respect includes country-specific skills related to understanding social and cultural codes, unwritten rules, implicit communication, norms etc. In this paper we analyse whether these developments - by increasing the importance of communication and informal human capital - have had a negative effect on employment opportunities of immigrants. The results show that firms that use PCs intensively and firms that give their employees broad autonomy employ fewer non-Western immigrants who have not been raised in Norway (i.e. arrived as adults). Furthermore, the negative relationships are especially strong for low-skilled non- Western immigrants. These results may add support to the hypothesis stating that new technologies and (some) new work practices are biased against non-Western immigrant workers, and especially those with low formal skills. |
| Keywords: | immigrants, employment, new work practices, new technology |
| JEL: | J61 J71 |
| Date: | 2006–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2135&r=lab |
| By: | Eklöf, Matias (Department of Economics); Hallberg, Daniel (Department of Economics) |
| Abstract: | We model retirement behavior in Sweden during the 1990ies with focus on voluntary early retirement where there is an option for “buy-outs”. An employer can offer the employees generous pension programs if the employee agrees on early retirement. Earlier studies have neglected such offers, but in doing so, estimates of the individuals’ responses to financial incentives in a retirement decision are likely to be biased upward. We propose an estimation strategy where the retirement decision and the accesses to early retirement pension offers are estimated in a simultaneous equation system, yielding unbiased estimates of the model parameters. We apply the model using detailed Swedish register data. Our results indicate that the marginal effects in retirement probability w.r.t. a change in financial incentives is less pronounced if early retirement pensions are accounted for. Further, we illustrate that the early retirement probabilities would decrease by 10-30 percent if early retirement pension offers were absent. |
| Keywords: | Retirement; early retirement pension; golden handshakes; occupational pension; demand for old workers |
| JEL: | J14 J21 |
| Date: | 2006–05–17 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:uunewp:2006_013&r=lab |
| By: | Hendrik Jürges (Mannheim Research Institute for the Economics of Aging (MEA)) |
| Abstract: | The paper studies the relevance of gender ideology for the geographic mobility of families using data from the German Socio-economic Panel. The analysis proceeds in two steps. First, it is shown single men and women – who are in some sense "unconstrained" optimizers – reveal identical mobility patterns. There are no fundamental gender differences in the inter-regional mobility of German singles. Second, I focus on dual-earner households and split this group into "traditional" and "egalitarian" couples using information on their factual division of housework rather than their reported gender ideology. Separate migration analyses for both groups reveal important differences indicating the significance of gender ideology in families' migration behavior: job-related characteristics of men statistically dominate those of women in traditional couples, whereas in egalitarian couples, male and female characteristics have the same effect on family migration behavior, i.e. there is no gender bias. Failure to account for the heterogeneity in gendered family roles across families thus misses an important explanatory factor in migration research. |
| Date: | 2005–06–30 |
| URL: | http://d.repec.org/n?u=RePEc:xrs:meawpa:05090&r=lab |
| By: | Aydogan Ulker |
| Abstract: | What does the around-the-clock economic activity mean for workers’ health? Despite the fact that non-standard work accounts for an increasing share of the job opportunities, relatively little is known about the potential consequences for health and the existing evidence is ambiguous. In this paper I examine the relationship between non-standard job schedules and workers’ physical and mental health outcomes using longitudinal data from the Household, Income and Labour Dynamics in Australia (HILDA). Specifically, the four health indicators considered are self-rated health and the SF-36 health indices for general health, mental health and physical functioning. In terms of direction of the effects, overall results generally suggest a negative relationship between non-standard work schedules and better health for both males and females. Regarding the statistical significance and magnitudes of the effects, however, we observe apparent differences between males and females. Among females, most of the coefficients in all models are statistically insignificant, which implies very small magnitudes in terms of the correlation between non-standard working hours and health. These results apply uniformly to all health measures investigated. Among males, on the other hand, the negative relationship is more noticeable for self-rated health, general health and physical functioning than for mental health. The pooled OLS and random effects coefficients are usually larger in magnitude and more significant than the fixed effects parameters. Nonetheless, even the more significant coefficients, fortunately, do not imply large effects in absolute terms. |
| Keywords: | Non-standard work, physical health, mental health |
| JEL: | J22 J28 J81 I10 I1 |
| Date: | 2006–04 |
| URL: | http://d.repec.org/n?u=RePEc:auu:dpaper:518&r=lab |
| By: | Kelly Edmiston |
| Abstract: | Workers’ Compensation reforms have been on the table in virtually every state over the last several years, and many states have launched comprehensive reforms. At least nine states undertook major reforms of their workers’ compensation systems in 2004 alone, and the reforms were driven largely by claims that higher workers’ compensation costs are driving away businesses and the employment that comes with them. Given the nearly universal assertion by promoters of workers’ compensation reforms that high cost states lose jobs to relatively low cost states, one would expect that substantial research exists to back up the claims. In fact, however, although a voluminous literature exists that explores behavioral aspects of workers’ compensation insurance, including effects on injury rates, number of claims, and duration of claims, there has been no systematic study of the relationship between workers’ compensation costs and economic growth. This paper sets out to help fill the intellectual void by examining the relationship between workers’ compensation costs and employment growth across U.S. states from 1976 – 2000. Workers’ compensation costs are found to have a statistically significant negative impact on employment and wages, but the elasticities are very small, suggesting that workers’ compensation costs are not a likely cause of jobs woes in most states. |
| Keywords: | Employment |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedkcw:2005-04&r=lab |
| By: | Zon, Adriaan van (United Nations University, Maastricht Economic and social Research and training centre on Innovation and Technology); Kiiver, Hannah (Utrecht School of Economics) |
| Abstract: | In this paper we discuss the impact of malnutrition on the distribution of abilities and income in a simple overlapping generations framework. Workers are distributed uniformly over a low-ability and a high-ability range. If workers earn below subsistence wages, the probability that their children will have low abilities is higher than with above subsistence wages due to the malnutrition resulting from low incomes. Using a nested Ethier production function we find that there is an optimal share of low-ability workers in the economy which maximizes output. Due to the intergenerational propagation of low abilities resulting from malnutrition, economies may however get trapped in sub-optimal equilibria with too large shares of low-ability workers. Distributing food coupons financed by taxes of the parent generation to the offspring of these low-ability workers will increase the likelihood that they will be in the high-ability range, permanently increasing output for future generations. Using a numerical example, we show that this type of redistributive policy is welfare improving if the parent generation alive during the initiation of the policy is reimbursed for their loss in utility due to taxes. |
| Keywords: | Income Distribution, Wage Differentials, Skills |
| JEL: | D31 J31 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:unumer:2006013&r=lab |
| By: | Anders Frederiksen (CCP, Aarhus School of Business and IZA Bonn); Rikke Ibsen (CCP, Aarhus School of Business); Michael Rosholm (University of Aarhus, AKF Copenhagen and IZA Bonn); Niels Westergaard-Nielsen (CCP, Aarhus School of Business and IZA Bonn) |
| Abstract: | This paper tests the signalling hypothesis using detailed flow-based employer-employee data from Denmark. The primary focus is to explore how the conditions in the pre-displacement firm affect the duration of unemployment. The empirical analysis is conducted within a competing risk framework, with destinations into reemployment and inactivity, which yields more plausible estimates of the signalling effect. It is established that the positive ability signal of being displaced due to a plant closure is significant but also that the signal of displacement from severe downsizing is important. Issues that have previously been ignored in the empirical analysis of the signalling hypothesis such as local labour market conditions, the sector of employment and the duration of the previous employment match are established to be important determinants for the time spent in unemployment. The heterogeneity of the signalling effect across various employee subgroups in the economy is also explored. These findings emphasize that individuals’ reemployment prospects are heavily influenced by the labour market history and in particular by the conditions in the firms in which they were previously employed. |
| Keywords: | unemployment duration, signalling, plant closure |
| JEL: | J64 J65 J68 |
| Date: | 2006–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2132&r=lab |
| By: | Hendrik Jürges (Mannheim Research Institute for the Economics of Aging (MEA)) |
| Abstract: | I compare current and one-year retrospective data on unemployment in the German SOEP. 13 percent of all unemployment spells are not reported one year later, and another 7 percent are misreported. The ratio of retrospective to current unemployment (as a measure of unemployment salience) has increased in recent years and it is related to the loss in life satisfaction associated with unemployment. Individuals with weak labor force attachment, e.g. women with children or individuals close to retirement, have the largest propensity to underreport unemployment retrospectively. The data are consistent with evidence on retrospective bias found by cognitive psychologists and survey methodologists. |
| Date: | 2005–06–30 |
| URL: | http://d.repec.org/n?u=RePEc:xrs:meawpa:05089&r=lab |
| By: | Malcolm Brynin (Institute for Social and Economic Research); Beate Lichtwardt (Institute for Social and Economic Research); Simonetta Longhi (Institute for Social and Economic Research) |
| Abstract: | A large empirical literature suggests that a proportion of employees are over-educated (overqualified) for the jobs that they do. It also estimates the impact of this mismatch on wages. The empirical results suggest that having more education than is needed for a job generates a premium relative to the job but at the same time a penalty relative to the qualification. This mismatch is often explained either by variation in skills or by a slow start to career. Both explanations are compatible with human capital theory. We measure the incidence of overqualification in four European countries: Britain, Italy, Germany and Norway at differing educational levels, to show that overqualification is most common at the lower levels where careers tend to be flatter. The inclusion of a measure of computer skills also seems to make little difference to the relationship between overqualification and wages. However, one issue which is important is the degree of voluntarism that is associated with progression through education. Overqualification is traditionally measured through years of education required for the job and years spent in education, but this can be separated into a part that reflects the achievement of certificates and a part that reflects the passage of time. The latter is strongly influenced by individual motivation which determines final choices and by institutional factors which might either enhance or constrain these. We isolate the number of excess years a person spends in education without reaching the next qualification level in order to use this as an instrument for over-education. Our results suggest that the impact of over-qualification on wages is rather small, and becomes even smaller when the excess years spent in education are used as instrument for over-education. Overqualification can on these results never be interpreted as a labour-market choice which provides some sort of human-capital premium. |
| Date: | 2006–05 |
| URL: | http://d.repec.org/n?u=RePEc:ese:iserwp:2006-17&r=lab |
| By: | Melanie Beresford (Department of Economics, Macquarie University); Andrea Chareunsy (Department of Economics, Macquarie University) |
| Abstract: | Only 19 per cent of academic staff in the Economics Department at Macquarie University are women, a proportion that has not improved over the last decade. We investigate the reasons for this gender imbalance, focusing particularly on why it is that few qualified women have applied for positions. Declining numbers of economics graduates is a national phenomenon, but data from Macquarie show that this is a trend that particularly affects women. We found, from our surveys of staff and students in the Department, that the relative shortage of women is primarily related to attitudes and decisions taken either prior to the commencement of university studies or due to external influences such as pressure of family commitments. Interestingly, however, a higher proportion of female than male third-year students showed an interest in pursuing an academic career. While attitudes of staff were generally found to be gender neutral, we found some evidence that staff members could do more to encourage these students. |
| Keywords: | Gender equity, women economists, undergraduate and postgraduate economics, economics teaching, Macquarie University |
| JEL: | A11 A14 A2 I21 J16 |
| Date: | 2006–05 |
| URL: | http://d.repec.org/n?u=RePEc:mac:wpaper:0601&r=lab |
| By: | Gautam Hazarika (University of Texas at Brownsville and IZA Bonn); Arjun S. Bedi (Institute of Social Studies, The Hague) |
| Abstract: | It is widely held that work by children obstructs schooling, so that working children in impoverished families will find it difficult to escape poverty. If children’s school attendance and work were highly substitutable activities, it would be advisable to quell work in the interest of schooling and, if less child work were desirable for its own sake, to boost school attendance so as to reduce child work. Hence, this article examines the effects of schooling costs upon both children’s propensities to work and to attend school in rural northern India in a bid to assess the extent of trade-off between the activities. Analyses of data from Uttar Pradesh and Bihar, two Northern Indian states, reveal a positive relation between child work and schooling costs, a negative relation between school enrollment and schooling costs, and that the decrease in the probability of child work from a decrease in schooling costs is comparable in magnitude to the corresponding increase in the probability of school enrollment, implying children’s work and school attendance are strongly substitutable activities. Thus, unlike recent studies of child work in India’s South Asian neighbors of Bangladesh and Pakistan, this paper uncovers evidence of substantial trade-off between child work and school attendance. |
| Keywords: | child labor, schooling costs, India |
| JEL: | J22 O12 |
| Date: | 2006–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2136&r=lab |