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on Labour Economics |
| By: | Benhassine, Najy; Fafchamps, Marcel; Söderbom, Måns |
| Abstract: | Using matched employer-employee data from eleven African countries, we investigate if there is job sorting in African labor markets. We find that much of the wage gap correlated with education is driven by selection across occupations and firms. This is consistent with educated workers being more effective at complex tasks like labor management. In all countries the education wage gap widens rapidly at high low levels of education. Most of the education wage gap at low levels of education can be explained by selection across occupations. We also find that the education wage gap tends to be higher for women, except in Morocco where many poorly educated women work in the export garment sector. A large proportion of the gender wage gap is explained by selection into low wage occupations and firms. |
| Keywords: | Africa; gender wage gap; job selection; manufacturing; return to education |
| JEL: | J24 J31 O14 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:6003&r=lab |
| By: | Ekkehart Schlicht (University of Munich and IZA Bonn) |
| Abstract: | Offering higher wages may enable firms to attract more applicants and screen them more carefully. If firms compete in this way in the labor market, "selection wages" emerge. This note illustrates this wage-setting mechanism. Selection wages may engender unconventional results, such as a pre-tax wage compression induced by the introduction of a progressive wage tax. |
| Keywords: | wage formation, efficiency wage, incentive wage, mobility, job-specific pay, wage-tax |
| JEL: | J31 J41 J62 J63 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2507&r=lab |
| By: | Benoit Dostie (HEC Montréal, CIRANO, CIRPÉE and IZA Bonn) |
| Abstract: | In this article, we estimate age based wage and productivity differentials using linked employer-employee Canadian data from the Workplace and Employee Survey 1999-2003. Data on the firm side is used to estimate production functions taking into account the age profile of the firm’s workforce. Data on the workers’ side is used to estimate wage equations that also depend on age. Results show concave age-wage and age-productivity profiles. Wage-productivity comparisons show that the productivity of workers aged 55 and more with at least an undergraduate degree is lower than their wages. For other groups, we find that wages do not deviate significantly from productivity estimates. |
| Keywords: | wage determination, productivity, production function, linked employer-employee data |
| JEL: | J31 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2496&r=lab |
| By: | Mikael Carlsson; Stefan Eriksson; Nils Gottfries |
| Abstract: | Although search-matching theory has come to dominate labor economics in recent years, few attempts have been made to compare the empirical relevance of search-matching theory to efficiency wage and bargaining theories, where employment is determined by labor demand. In this paper we formulate an empirical equation for net job creation, which encompasses search-matching theory and a standard labor demand model. Estimation on firm-level data yields support for the labor demand model, wages and product demand affect job creation, but we find no evidence that unemployed workers contribute to job creation, as predicted by search-matching theory. |
| Keywords: | job creation, involuntary unemployment, search-matching, labor demand, competitiveness |
| JEL: | E24 J23 J64 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_1866&r=lab |
| By: | Munshi, Farzana (Department of Economics, School of Business, Economics and Law, Göteborg University) |
| Abstract: | This paper provides panel data evidence on openness and wage inequality in Bangladesh. In particular, wage equations for skilled and unskilled workers were estimated using several static and dynamic models. The results from all the estimated models indicate that openness increased real wages of unskilled workers more than that of skilled workers, suggesting a reduction in wage inequality. <p> |
| Keywords: | Bangladesh; openness; wage inequality; models with panel data |
| JEL: | C33 F14 F15 O15 |
| Date: | 2006–12–14 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunwpe:0241&r=lab |
| By: | Eran Yashiv (Tel Aviv University, CEPR and IZA Bonn) |
| Abstract: | The Beveridge curve depicts a negative relationship between unemployed workers and job vacancies, a robust finding across countries. The position of the economy on the curve gives an idea as to the state of the labour market. The modern underlying theory is the search and matching model, with workers and firms engaging in costly search leading to random matching. The Beveridge curve depicts the steady state of the model, whereby inflows into unemployment are equal to the outflows from it, generated by matching. |
| Keywords: | business cycle, job search, matching function, Phillips curve, unemployment, vacancies, wage inflation |
| JEL: | E24 E32 J63 J64 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2479&r=lab |
| By: | Tali Regev |
| Abstract: | Under federal-state law workers who quit a job are not entitled to receive unemployment insurance benefits. To show how the existence of the uninsured affects wages and employment, I extend an equilibrium search model to account for two types of unemployed workers: those who are currently receiving unemployment benefits and for whom an increase in unemployment benefits reduces the incentive to work, and those who are currently not insured. For these, work provides an added value in the form of future eligibility, and an increase in unemployment benefits increases their willingness to work. Incorporating both types into a search model permits me to solve analytically for the endogenous wage dispersion and insurance rate in the economy. I show that, in general equilibrium when firms adjust their job creation margin, the wage dispersion is reduced and the overall effect of benefits can be signed: higher unemployment benefits increase average wages and decrease the vacancy-to-unemployment ratio. |
| Keywords: | Unemployment insurance |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedfwp:2006-48&r=lab |
| By: | William T. Dickens; Lorenz Goette; Erica L. Groshen; Steinar Holden; Julian Messina; Mark E. Schweitzer; Jarkko Turunen; Melanie E. Ward |
| Abstract: | How do the complex institutions involved in wage setting affect wage changes? The International Wage Flexibility Project provides new microeconomic evidence on how wages change for continuing workers. We analyze individuals’ earnings in 31 different data sets from sixteen countries, from which we obtain a total of 360 wage change distributions. We find a remarkable amount of variation in wage changes across workers. Wage changes have a notably non-normal distribution; they are tightly clustered around the median and also have many extreme values. Furthermore, nearly all countries show asymmetry in their wage distributions below the median. Indeed, we find evidence of both downward nominal and real wage rigidities. We also find that the extent of both these rigidities varies substantially across countries. Our results suggest that variations in the extent of union presence in wage bargaining play a role in explaining differing degrees of rigidities among countries. |
| Keywords: | Wages |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedcwp:0620&r=lab |
| By: | Tojerow, Ilan; Rycx, François; Plasman, Robert; Gannon, Brenda |
| URL: | http://d.repec.org/n?u=RePEc:dul:ecoulb:2013-779&r=lab |
| By: | Christina Gathmann (Stanford University and IZA Bonn); Uta Schönberg (University of Rochester and IZA Bonn) |
| Abstract: | Previous studies assume that labor market skills are either fully general or specific to the firm. This paper uses patterns in mobility and wages to analyze how portable specific skills are in the labor market. The empirical analysis combines data on tasks performed in different jobs with a large panel on complete working histories and wages. Our results demonstrate that labor market skills are partially transferable across occupations. We find that individuals move to occupations with similar task requirements and that the distance of moves declines with time in the labor market. Further, tenure in the last occupation affects current wages, and the effect is stronger if the two occupations are similar. Our estimates suggest that taskspecific human capital is the most important source of wage growth for university graduates. For the low- and medium-skilled, returns to task human capital are also sizeable, though smaller than for labor market experience. |
| Keywords: | specific skills, occupations, wage growth, mobility |
| JEL: | J24 J41 J62 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2485&r=lab |
| By: | Ralitza Dimova (Brunel University and IZA Bonn); Ira N. Gang (Rutgers University and IZA Bonn); John Landon-Lane (Rutgers University) |
| Abstract: | With the use of panel data constructed from the 1995 and 1997 Bulgarian Integrated Household Surveys, this paper explores the sectoral reallocation of labour by gender. In Bulgaria, men and women started the transition on an almost equal standing, allowing us to concentrate our attention on the impact of individual and household characteristics in explaining gender differences in the labour market. We find that household characteristics, rather than alternative explanations such as differences in individual characteristics or pure gender discrimination, better explain the observed gender differences in labour market outcomes. |
| Keywords: | employment, mobility, gender, household |
| JEL: | J21 J23 J31 J62 P2 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2476&r=lab |
| By: | Kolm, Ann-Sofie (Dept. of Economics, Stockholm University); Tonin, Mirco (Institute for International Economic Studies) |
| Abstract: | We study the general equilibrium effects of in-work beneifts in a search framework. Introducing in-work benefits reduces equilibrium unemployment, moderate wages, and boost participation and search. Total employment increases as a result. Considering in-work benefits in a general equilibrium setting reveals that employment increases mainly though the impact on job creation. This is in contrast to what is usually stressed, namely that employment increases because individuals are provided with incentives to take a job. |
| Keywords: | In-work benefits; unemployment; participation |
| JEL: | J21 J38 |
| Date: | 2006–12–21 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sunrpe:2006_0012&r=lab |
| By: | Bart Cockx; Stéphane Robin; Christian Goebel |
| Abstract: | We verify whether an income support policy for part-time workers in Belgium increases the transition from unemployment to non-subsidised, “regular” employment. Using a sample of 8630 long-term unemployed young women, whose labour market history is observed from 1998 to 2001, we implement the “timing of events” approach proposed by Abbring and Van den Berg (2003) to control for selection effects. Our results suggest that the policy has a significantly positive effect on the transition to non-subsidised employment when one does not control for unobserved heterogeneity. This effect remains positive, but becomes insignificant, when one corrects for selection on unobservable characteristics. |
| Keywords: | active labour market policies, evaluation, mixed proportional hazard models |
| JEL: | C41 J64 J68 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_1863&r=lab |
| By: | T. H. Gindling (University of Maryland, Baltimore County); Katherine Terrell (University of Michigan, Ann Arbor and IZA Bonn) |
| Abstract: | To be competitive in the global economy, some argue that Latin American countries need to reduce or eliminate labor market regulations such as minimum wage legislation because they constrain job creation and hence increase poverty. On the other hand, minimum wage increases can have a direct positive impact on family income and may therefore help to reduce poverty. We take advantage of a complex minimum wage system in a poor country that has been exposed to the forces of globalization to test whether minimum wages are an effective poverty reduction tool in this environment. We find that minimum wage increases in Honduras reduce extreme poverty, with an elasticity of -0.18, and all poverty, with an elasticity of -0.10 (using the national poverty lines). These results are driven entirely by the effect on workers in large private sector firms, where minimum wage legislation is enforced. Increases in the minimum do not affect the incidence of poverty in sectors where minimum wages are not enforced (small firms) or do not apply (self-employed and public sector). |
| Keywords: | minimum wage, poverty, Central America, Honduras |
| JEL: | J23 J31 J38 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2497&r=lab |
| By: | Brian McCall; Wei Chi |
| Abstract: | We develop an empirical model to estimate the impact of UI on unemployment duration and reemployment wages. The model estimates the UI receipt, unemployment duration and re-employment wage equations simultaneously and incorporates unobserved heterogeneity variables in each equation and allows them to be correlated. The NLSY79 data is used to estimate the model. Some results are found support of the positive effect of UI on re-employment wages. |
| URL: | http://d.repec.org/n?u=RePEc:hrr:papers:0306&r=lab |
| By: | Robert Drago (Pennsylvania State University); Mark Wooden (University of Melbourne and IZA Bonn); David Black (University of Melbourne) |
| Abstract: | Panel data from Australia are used to study the prevalence of work hours mismatch among long hours workers and, more importantly, how that mismatch persists and changes over time, and what factors are associated with these changes. Particular attention is paid to the roles played by household debt, ideal worker characteristics and gender. Both static and dynamic multinomial logit models are estimated, with the dependent variable distinguishing long hours workers from other workers, and within the former, between "volunteers", who prefer long hours, and "conscripts", who do not. The results suggest that: (i) high levels of debt are mainly associated with conscript status; (ii) ideal worker types can be found among both volunteers and conscripts, but are much more likely to be conscripts; and (iii) women are relatively rare among long hours workers, and especially long hours volunteers, suggesting long hours jobs may be discriminatory. The research highlights the importance of distinguishing conscripts and volunteers to understand the prevalence and dynamics of long work hours. |
| Keywords: | working hours, overwork, preferences, HILDA survey |
| JEL: | J22 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2484&r=lab |
| By: | Sabrina Di Addario (Bank of Italy) |
| 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 a unique panel data set from the Italian Labor Force Survey micro-data, which covers 520 randomly drawn Local Labor Market Areas (66 percent 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 and/or industry localization. The main results indicate that both urbanization and industry localization raise job seekers’ chances of finding employment (conditional on having searched), but neither of them affects non-employed individuals’ search behavior. |
| Keywords: | Labor market transitions, search intensity, urbanization, industry localization. |
| JEL: | J64 R00 J60 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:wptemi:td_605_06&r=lab |
| By: | Laura Hering; Sandra Poncet |
| Abstract: | We study the effect of geography and in particular of market access on wages by working with individual data from 56 Chinese cities in 11 different provinces. By applying the theory of the New Economic Geography on individual survey data, we contribute to the explanation of growing disparities within the country, and even within provinces. We examine to what extent proximity to markets can explain inter-individual wage heterogeneity and growing wage disparities within Chinese provinces. Using a New Economic Geography style model, we derive an econometric specification relating wages to market access. The latter is calculated as a transport cost weighted sum of the surrounding locations’ market capacities. Based on data from 1995 on around 10,000 Chinese workers, and after controlling for individual skills and factor endowments, we find that a significant fraction of inter-individual differences in terms of return to labor can be explained by the geography of access to markets. Moreover, our study investigates whether the relationship between market access and wages holds for all types of workers equally and shows that the magnitude of the impact depends on the firm type and the level of qualification. |
| Keywords: | Economic geography; international trade; regional integration; wage China; inequality |
| JEL: | F12 F15 R11 R12 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:cii:cepidt:2006-23&r=lab |
| By: | Benoit Dostie (HEC Montréal, CIRANO, CIRPÉE and IZA Bonn); David E. Sahn (Cornell University) |
| Abstract: | In this paper, we estimate a model of labor market dynamics among individuals in Romania using panel data for three years, 1994 to 1996. Our motivation is to gain insight into the functioning of the labor market and how workers are coping during this period of economic liberalization and transformation that began in 1990. Our models of labor market transitions for men and women examine changing movements in and out of employment, unemployment, and self-employment, and incorporate specific features of the Romanian labor market, such as the social safety net. We take into account demographic characteristics, state dependence, and individual unobserved heterogeneity by modeling the employment transitions with a dynamic mixed multinomial logit. |
| Keywords: | employment dynamics, Romania, multinomial logit, initial conditions, random effects |
| JEL: | P2 P3 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2511&r=lab |
| By: | Korpi, Martin (Institute for Futures Studies) |
| Abstract: | The question addressed in this paper is twofold: (i) does wage inequality increase with local population size, and if so, (ii) what are possible factors behind this increase? In a cross-section analysis of Swedish local labour markets using full population data, the paper shows that urban scale, i.e. size of local population, has significant positive effects on wage inequality. Testing for potential explanations, labour market diversification, human capital and population size are shown to be significantly associated with inequality. Given these effects, the paper raises the question of how to understand and incorporate scale effects into models of long-term change in wage inequality. |
| Keywords: | Wage inequality; local labour markets; urban size; business diversification |
| JEL: | D63 J31 J40 R12 |
| Date: | 2006–10 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifswps:2006_011&r=lab |
| By: | Glenda Quintini; Sébastien Martin |
| Abstract: | Despite the fact that today’s young cohorts are smaller in number and better educated than their older counterparts, high youth unemployment remains a serious problem in many OECD countries. This reflects a variety of factors, including the relatively high proportion of young people leaving school without a basic educational qualification, the fact that skills acquired in initial education are not always well adapted to labour market requirements, as well as general labour market conditions and problems in the functioning of labour markets. The paper highlights the trends in youth labour market performance over the past decade using a wide range of indicators. It also presents new evidence on i) the length of transitions from school to work; ii) the wages, working conditions and stability of jobs performed by youth; and iii) the degree of so-called “over-education”, i.e. the gap between the skills of young people and the jobs they get. <BR>Même si les cohortes des jeunes d’aujourd’hui sont moins nombreuses et mieux éduquées que leurs aînés, le taux de chômage élevé des jeunes demeure un sérieux problème dans beaucoup de pays de l'OCDE. Ceci tient à un ensemble de facteurs, comme la proportion relativement élevée de jeunes sortant de l'école sans qualification élémentaire, le fait que les qualifications acquises dans l'éducation initiale ne sont pas toujours bien adaptées aux exigences du marché du travail, tout comme les conditions générales et les problèmes de fonctionnement des marchés du travail. Ce papier met en lumière les tendances de la performance du marché du travail des jeunes au cours de la dernière décennie en utilisant une large variété d’indicateurs. Il présente aussi de nouveaux éléments sur i) la durée des transitions de l'école à l'emploi ; ii) les salaires, les conditions de travail et la stabilité des emplois des jeunes; et iii) le degré de « surqualification », c.-à-d. la différence entre les qualifications des jeunes et les emplois qu’ils occupent. |
| JEL: | J21 J22 J31 J68 |
| Date: | 2006–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:oec:elsaab:39-en&r=lab |
| By: | Russell Cooper; John Haltiwanger; Jonathan L. Willis |
| Abstract: | This paper studies worker and job flows at the establishment and aggregate levels. The paper is built around a set of facts concerning the variability of unemployment and vacancies in the aggregate, the distribution of net employment growth and the comovement of hours and employment growth at the establishment level. A search model with frictions in hiring and firing is used as a framework to understand these observations. Notable features of this search model include non-convex costs of posting vacancies, establishment level profitability shocks and a contracting framework that determines the response of hours and wages to shocks. We specify and estimate the parameters of the search model using simulated method of moments to match establishment-level and aggregate observations. |
| Keywords: | Employment ; Unemployment ; Hours of labor |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedkrw:rwp06-14&r=lab |
| By: | Wasmer, Etienne |
| Abstract: | Unlike many other contracts, employment contracts are subject to various external administrative procedures governing separations, ranging from compulsory severance payments and advance notice periods (usually seniority based), to collective layoff procedures (usually depending on the firm's size), and other forms of protections against arbitrary dismissal. These external constraints may raise the wellbeing of workers if everything remains constant, but may fail to do so once other economic channels are accounted for. Here, we explore the effect of such legislation on the firm's attitude towards insiders (i.e. protected workers), notably worker monitoring, working environment, and ultimately what we could term harassment. We show that during downturns, harassing workers in order to induce a quit is a substitute for greater dismissal freedom, and that intense monitoring and depreciated working conditions will occur. Thus, a more protected workforce may loose more than it gains from non-pecuniary pressures exerted by the firm. We test these mechanisms using data from a panel of Canadian individuals (the National Public Health Survey) including details on work-related stress and the consumption of various medications, including anti-depressants. By exploiting cross-province differences in employment protection legislation (EPL), we cannot reject the theoretical hypothesis: we even find positive links between individual employment protection and some dimensions of stress, and weaker but positive links between employment protection, depression and the consumption of various psychotropic drugs. Tenure and firm size information from another dataset is then used to generate further variance in EPL by imputation. This confirms the previous results, as well as falsification exercises: family stress for instance is not correlated with regional EPL, while financial stress is negatively correlated with EPL. |
| Keywords: | employment protection; personnel economics; stress at work |
| JEL: | J41 J53 J81 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5991&r=lab |
| By: | Brian Krogh Graversen (Danish National Institute of Social Research); Jan C. van Ours (Tilburg University, CentER, CEPR and IZA Bonn) |
| Abstract: | This paper investigates how a mandatory activation program in Denmark affects the job finding rate of unemployed workers. The activation program was introduced in an experimental setting where about half of the workers who became unemployed in the period from November 2005 to March 2006 were randomly assigned to the program while the other half was not. It appears that the activation program is very effective. The median unemployment duration of the control group is 14 weeks, while it is 11.5 weeks for the treatment group. The analysis shows that the job finding rate in the treatment group is 30% higher than in the control group. This result is mainly driven by the more intensive contacts between the unemployed and the public employment service. |
| Keywords: | unemployment insurance, unemployment duration, experiment |
| JEL: | C41 H55 J64 J65 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2504&r=lab |
| By: | Johansson, Kerstin (IFAU - Institute for Labour Market Policy Evaluation) |
| Abstract: | This study examines if the flow rate from open unemployment to labor market programs affect the labor-force participation rate. This question is relevant because Swedish labor-force participation is expected to decline due to the age distribution in the population. A new dataset, with monthly data from Swedish municipalities between 1991:08 and 2002:10, has been constructed. The results show that increased probability of moving from open unemployment to labor market programs has positive effects on the labor-force participation rate. Positive effects are found for different age groups. The estimated effect of the flow rate from open unemployment into labor market programs is countercyclical. The participation rate is procyclical, and counter-cyclical labor market programs could be used to prevent discouraged workers from leaving labor force. The effects of flow rates from programs to open unemployment, and from the job destruction rate are negative, as expected. Income and labor market tightness have positive effects, except for older participants. This is because it is a spurios negative correlation in data for the older participants. In general, the long run levels are achieved after about nine years, and most of the adjustment takes place during the first four years. |
| Keywords: | Labor market flow; labor-force participation; labor market program |
| JEL: | J21 |
| Date: | 2006–12–08 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2006_017&r=lab |
| By: | Holger Görg (GEP, University of Nottingham and IZA Bonn); Michael Henry (Aston Business School, Aston University); Eric Strobl (Ecole Polytechnique Paris and IZA Bonn); Frank Walsh (University College Dublin) |
| Abstract: | This paper investigates the link between nationality of ownership and wage elasticities of labour demand at the level of the plant. In particular, we examine whether labour demand in multinationals becomes less elastic with respect to the wage if the plant has backward linkages with the local economy. Our empirical evidence, based on a rich plant level dataset, shows that the extent of local linkages indeed generally reduces the wage elasticity of labour demand. This result is economically important and holds for a number of different specifications. |
| Keywords: | labour demand, elasticities, linkages, multinational companies |
| JEL: | F23 J23 L23 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2506&r=lab |
| By: | Constant, Amelie; Gataullina, Liliya; Zimmermann, Klaus F |
| Abstract: | The European Union’s strategy to raise employment is confronted with very low work participation among many minority ethnic groups, in particular among immigrants. This study examines the potential of immigrants’ identification with the home and host country ethnicity to explain that deficit. It introduces a two-dimensional understanding of ethnic identity, as a combination of commitments to the home and host cultures and societies, and links it to the labour market participation of immigrants. Using unique German survey data, the paper identifies marked gender differences in the effects of ethnic identification on the probability to work controlling for a number of other determinants. While ethnically assimilated immigrant men outperform those who are ethnically separated and marginalized, they are not different from those with openness to both cultures. Assimilated immigrant women do better than those separated and marginalized, but those who develop an attachment to both cultures clearly fare the best. |
| Keywords: | acculturation; ethnic identity; ethnicity; gender; immigrant assimilation; immigrant integration; work |
| JEL: | F22 J15 J16 Z10 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5983&r=lab |
| By: | Andrea Bassanini; Giorgio Brunello |
| Abstract: | According to Becker [1964], when labour markets are perfectly competitive, general training is paid by the worker, who reaps all the benefits from the investment. Therefore, ceteris paribus, the greater the training wage premium, the greater the investment in general training. Using data from the European Community Household Panel, we compute a proxy of the training wage premium in clusters of homogeneous workers and find that smaller premia induce greater incidence of off-site training, which is likely to impart general skills. Our findings suggest that the Becker model provides insufficient guidance to understand empirical training patterns. Conversely, they are not inconsistent with theories of training in imperfectly competitive labour markets, in which firms may be willing to finance general training if the wage structure is compressed, that is, if the increase in productivity after training is greater than the increase in pay. <BR>Dans la théorie de Becker [1964], lorsque le marché du travail est en concurrence parfaite, seuls les salariéss investissent dans la formation générale, car ils sont les seuls à pouvoir s’approprier les retombées bénéfiques de la formation. Par conséquent, toutes choses égales par ailleurs, plus la prime salariale à la formation est élevée et plus l’investissement en formation est importante. Sur la base des données du Panel Communautaire des Ménages, nous calculons une proxy de la prime salariale à la formation pour des groupes homogènes de salariés et nous trouvons une relation inverse entre cette proxy et l’incidence de la formation hors site, qui concerne, selon toute vraisemblance, des compétences relativement générales. Nos résultats suggèrent que le modèle de Becker ne fournit pas une clé interprétative suffisante pour comprendre les tendances empiriques de la formation. Par contre, la distribution de la formation ne semble pas être en contradiction avec les théories de la formation qui prévoient que, lorsque le marché du travail est en concurrence imparfaite, les entreprises peuvent être disposées à investir en formation si l’augmentation de la productivité qui en découle est supérieure à l’augmentation du salaire. |
| JEL: | J24 J31 J41 |
| Date: | 2006–12–05 |
| URL: | http://d.repec.org/n?u=RePEc:oec:elsaab:41-en&r=lab |
| By: | Dittrich, Dennis; Kocher, Martin |
| Abstract: | We present an experimental test of a shirking model where monitoring intensity is endogenous and effort a continuous variable. Wage level, monitoring intensity and consequently the desired enforceable effort level are jointly determined by the maximization problem of the firm. As a result, monitoring and pay should be complements. In our experiment, between and within treatment variation is qualitatively in line with the normative predictions of the model under selfishness assumptions. Yet, we also find evidence for reciprocal behavior. The data analysis shows, however, that it does not pay for the employer to rely on the reciprocity of employees. |
| Keywords: | efficiency wages; experiment; incentive contracts; incomplete contracts; reciprocity; supervision |
| JEL: | C91 J31 J41 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5962&r=lab |
| By: | Barbara Hanel (University of Erlangen-Nuremberg); Regina T. Riphahn (University of Erlangen-Nuremberg and IZA Bonn) |
| Abstract: | We use reforms in the Swiss public retirement system to identify the responsiveness of retirement timing to financial incentives. A permanent reduction of retirement benefits by 3.4 percent induces more than 70 percent of females to postpone their retirement. The responsiveness of male workers, who undergo a different treatment, is lower. |
| Keywords: | retirement insurance, incentives, social security, labor force exit, natural experiment, Switzerland |
| JEL: | J26 H55 J14 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2492&r=lab |
| By: | Fredrik Andersson; Elizabeth E. Davis; Matthew L. Freedman; Julia I. Lane; Brian P. McCall; L. Kristin Sandusky |
| Abstract: | This paper uses matched employer-employee data from the Longitudinal Employer Household Dynamics database to investigate the contribution of worker and firm reallocation to within industry changes in wage inequality between 1992 and 2003. We find that the entry and exit of firms and the sorting of workers and firms based on underlying worker "skills" are important determinants of changes in industry earnings distributions over time. Our results suggest that the underlying dynamics of earnings inequality are complex and are due to factors that cannot be measured in standard crosssectional data. |
| URL: | http://d.repec.org/n?u=RePEc:hrr:papers:0106&r=lab |
| By: | Bernhard Ebbinghaus (MZES, University of Mannheim); Werner Eichhorst (IZA Bonn) |
| Abstract: | The paper provides an overview of institutional provisions and reforms regarding employment protection, active and passive labor market policies in Germany as well as of actors' responsibilities in these areas. It covers the period between the early 1990s and the most recent Hartz reforms. Empirical data on labor market outcomes with respect to the levels and structures of both employment and unemployment complements this study. |
| Keywords: | employment protection, active labor market policy, unemployment insurance, Germany |
| JEL: | J60 J68 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2505&r=lab |
| By: | Panu Poutvaara (University of Helsinki and IZA Bonn) |
| Abstract: | This paper analyzes public provision of internationally applicable and country-specific education, when job opportunities available to those with internationally applicable education are uncertain. Migration provides a market insurance in case labor market opportunities in the home country are poor. An increasing international applicability of a given type of education encourages students to invest more effort when studying. Governments, on the other hand, face an incentive to divert the provision of public education away from internationally applicable education toward country-specific skills. This would mean educating too few engineers, economists and doctors, and too many lawyers. |
| Keywords: | public education, migration, brain drain and brain gain, European Union, common labor market |
| JEL: | H52 I28 F22 J24 J61 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2478&r=lab |
| By: | Almeida, Rita; Carneiro, Pedro |
| Abstract: | This paper investigates how enforcement of labour regulation affects the firm's use of informal labour, firm size and firm performance. Using firm level data on employment, capita, and output, census data on informal employment at the city level, and administrative data on enforcement of regulation at the city level, we show that in areas where law enforcement is stricter firms employ a smaller proportion of informal workers. Furthermore, by reducing the firm's access to unregulated labour stricter enforcement is also associated with smaller firms, less fluid labour markets, and (possibly) lower labour productivity. We control for different regional and firm characteristics, and we instrument enforcement with the distance between firm location and the location of an enforcement office, a measure of access of labour inspectors to firms. Taken together, our findings suggest that increased access to labour flexibility frees the firm from growth constraints, and it is likely to contribute to an improvement in productivity. |
| Keywords: | employment; informal sector; labour demand; labour markets; productivity; regulation |
| JEL: | H00 H10 J50 K20 L50 L60 O17 O40 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5976&r=lab |