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on Labour Economics |
| By: | Hirsch, Barry (Georgia State University) |
| Abstract: | The law of one wage does not strictly hold, nor should it be expected to hold, in contemporary labor markets. The law of one wage, however, provides a surprisingly good first approximation of the structure of U.S. wages. This generalization is drawn from research on a diverse set of topics: the Mincerian wage equation and earnings imputation, union wage differentials, product market regulation and the labor market, wages in male and female jobs, the wage effects of military service, and interarea wages and cost-of-living. |
| Keywords: | wage differentials, imputation, unions, cost-of-living, regulation, wages |
| JEL: | J01 J31 J4 J51 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3375&r=lab |
| By: | Addison, John T. (University of South Carolina); Centeno, Mário (Banco de Portugal); Portugal, Pedro (Universidade Nova de Lisboa) |
| Abstract: | This paper exploits survey information on reservation wages and data on actual wages from the European Community Household Panel to deduce in the manner of Lancaster and Chesher (1983) additional parameters of a stylized structural search model; specifically, reservation wage and transition/duration elasticities. The informational requirements of this approach are minimal, thereby facilitating comparisons between countries. Further, its policy content is immediate insofar as the impact of unemployment benefit rules and measures increasing the arrival rate of job offers are concerned. These key elasticities are computed for the United Kingdom and eleven other European nations. |
| Keywords: | wage offer distributions, reservation wages, arrival rate of job offers, unemployment benefits, probability of reemployment, accepted wages |
| JEL: | J64 J65 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3357&r=lab |
| By: | Boeri, Tito (Bocconi University, Milan); Burda, Michael C. (Humboldt University, Berlin) |
| Abstract: | Standard models of equilibrium unemployment assume exogenous labour market institutions and flexible wage determination. This paper models wage rigidity and collective bargaining endogenously, when workers differ by observable skill and may adopt either individualized or collective wage bargaining. In the calibrated model, a substantial fraction of workers and firms as well as the median voter prefer collective bargaining to the decentralised regime. A fundamental distortion of the separation decision represented by employment protection (a firing tax) is necessary for such preferences to emerge. Endogenizing collective bargaining can significantly modify comparative statics effects of policy arising in a single-regime setting. |
| Keywords: | wage rigidity, employment protection, equilibrium unemployment |
| JEL: | J5 J6 D7 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3365&r=lab |
| By: | Michael Kvasnicka |
| Abstract: | Based on administrative data from the federal employment services in Germany, this paper applies statistical matching techniques to estimate the stepping-stone function to regular employment of temporary help work for unemployed job seekers. Our results show that workers who enter temporary help work from registered unemployment do not enjoy subsequent greater chances of employment outside temporary help work over a four-year period. Neither, however, do they suffer from future greater risks of unemployment. While our results, therefore, do not lend empirical support to a stepping-stone function of temporary help employment for the unemployed, they do neither confirm the existence of adverse effects on the future regular employment and unemployment chances of unemployed job seekers. If anything, temporary help work seems to provide an access-to-work function for the unemployed. |
| JEL: | C31 J40 J62 J64 |
| Date: | 2008–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13843&r=lab |
| By: | Moscarini, Giuseppe (Yale University); Vella, Francis (Georgetown University) |
| Abstract: | Do workers sort more randomly across different job types when jobs are harder to find? To answer this question, we study the mobility of male workers among three-digit occupations in the matched files of the monthly Current Population Survey over the 1979-2004 period. We clean individual occupational transitions using the algorithm proposed by Moscarini and Thomsson (2008). We then construct a synthetic panel comprising annual birth cohorts, and we examine the respective roles of three potential determinants of career mobility: individual ex ante worker characteristics, both observable and unobservable, labor market prospects, and ex post job matching. We provide strong evidence that high unemployment somewhat offsets the role of individual worker considerations in the choice of changing career. Occupational mobility declines with age, family commitments and education, but when unemployment is high these negative effects are weaker, and reversed for college education. The cross-sectional dispersion of the monthly series of residuals is strongly countercyclical. As predicted by Moscarini (2001)’s frictional Roy model, the sorting of workers across occupations is noisier when unemployment is high. As predicted by job-matching theory, worker mobility has significant residual persistence over time. Finally, younger cohorts, among those in the sample for most of their working lives, exhibit increasingly low unexplained career mobility. |
| Keywords: | occupational mobility, business cycle, synthetic cohorts |
| JEL: | J24 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3369&r=lab |
| By: | van der Wiel, Karen M. (Tilburg University) |
| Abstract: | This paper empirically establishes the effect of the employer's term of notice on the wage level of employees. The term of notice is defined as the period an employer has to notify workers in advance of their up-coming dismissal. The wages paid during this period are an important element of firing costs and hence employment protection. To find a causal effect, I exploit the exogenous change in the term of notice that resulted from the introduction of a new Dutch law in 1999. Strong evidence is found that a longer ‘dormant’ term of notice leads to higher wages. In my sample, an additional month of notice increases wages by three percent, ceteris paribus. |
| Keywords: | employment protection, wages, fixed effects |
| JEL: | C23 J31 J38 J63 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3352&r=lab |
| By: | Dupuy, Arnaud (ROA, Maastricht University) |
| Abstract: | This paper reviews the literature on two-sided atomeless assignment models of workers to tasks. Using simple parametric examples, the fundamental differences between the comparative advantage and the scale of operations models are illustrated. Holding the distributions of abilities and tasks and the production function of worker-task pairs constant, the two principles are shown to produce different wage distributions and wage inequality. These models are useful to evaluate the general equilibrium effect of technical change on the wage structure. In all models, skilled-biased technical change that impacts the production function of worker-task pairs lead to rising wage inequality. |
| Keywords: | technical change, wage structure, assignment models |
| JEL: | D3 J3 O3 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3379&r=lab |
| By: | Neumark, David (University of California, Irvine) |
| Abstract: | The principal means by which individuals and families achieve economic self-sufficiency is through labor market earnings. As a consequence, it is natural for policy makers to look to interventions that increase the ability of individuals and families to achieve an adequate standard of living from participating in the labor market – a goal that has become even more prominent in the post-welfare reform era in the United States. This paper discusses some key policies that are used or can be used to increase economic self-sufficiency by increasing earnings, including mandating higher wages, subsidizing work, and increasing skill formation. Specifically, it reviews evidence on some of the main policies currently in place in the United States, including minimum and living wages, the Earned Income Tax Credit, wage subsidies, and school-to-work programs. Finally, it considers alternative policies that have recently been proposed. |
| Keywords: | minimum wages, living wages, earned income tax credit, wage subsidies, school-to-work |
| JEL: | J18 J22 J23 J24 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3355&r=lab |
| By: | Stepan Jurajda; Katherine Terrell |
| Abstract: | Differences in regional unemployment in post-communist economies are large and persistent. We show that inherited variation in human-capital endowment across the regions of four such economies explains the bulk of regional unemployment variation there and we explore potential explanations for this outcome through related capital and labor mobility patterns. The evidence suggests that regions with high inherited skill endowments attract skilled workers as well as FDI. This mobility pattern, which helps explain the lack of convergence in regional unemployment rates, is consistent with the presence of complementarities in skill and capital. Nevertheless, we find no supporting evidence of human capital wage spillovers implied by the complementarities story. Unemployment of the least-skilled workers appears lower in areas with a higher share of college-educated labor and future research is needed to see if this finding as well as the observed migration pattern arise from different adjustments to regional shocks by education level brought about in part by Central European labor-market institutions, such as guaranteed welfare income raising effective minimum wages. |
| Keywords: | Unemployment, Human capital, Regional labor markets, Transition economies, Labor Mobility, Complementarities, Spillovers, Czech Republic, Hungary, Romania, Ukraine. |
| JEL: | E24 J0 J61 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:cer:papers:wp345&r=lab |
| By: | Zenou, Yves (Stockholm University) |
| Abstract: | We develop an urban-search model in which firms post wages. When all workers are identical, the Diamond paradox holds, i.e. there is a unique wage in equilibrium even in the presence of search and spatial frictions. This wage is affected by spatial and labor costs. When workers differ according to the value imputed to leisure, we show that, under some conditions, two wages emerge in equilibrium. The commuting cost affects the land market but also the labor market through wages. Workers’ productivity also affects housing prices and this impact can be positive or negative depending on the location in the city. One important aspect of our model is that, even with positive search costs, wage dispersion prevails in equilibrium, a feature not possible in the non-spatial model. |
| Keywords: | diamond paradox, urban land-use, spatial compensation, search frictions, wage dispersion |
| JEL: | D83 J64 R14 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3339&r=lab |
| By: | Dominique Demougin (European Business School, Wiesbaden); Carsten Helm (Institut für Volkswirtschaftslehre (Department of Economics), Technische Universität Darmstadt (Darmstadt University of Technology)) |
| Abstract: | Several European countries have reformed their labor market institutions. Incentive effects of unemployment benefits have been an important aspect of these reforms. We analyze this issue in a principal-agent model, focusing on unemployment levels and labor productivity. In our model, a higher level of unemployment benefits improves the workers' position in wage bargaining, leading to stronger effort incentives and higher output. However, it also reduces incentives for labor market participation. Accordingly, there is a trade-off. We analyze how changes in the economic environment such as globalization and better educated workers affect this trade-off. |
| Keywords: | Unemployment benefits, incentive contracts, Nash bargaining, moral hazard, globalisation. |
| JEL: | J65 D82 J41 E24 |
| Date: | 2008–03 |
| URL: | http://d.repec.org/n?u=RePEc:tud:ddpiec:191&r=lab |
| By: | Felbermayr, Gabriel (University of Tuebingen); Prat, Julien (University of Vienna); Schmerer, Hans-Jörg (University of Tuebingen) |
| Abstract: | We introduce search unemployment à la Pissarides into Melitz’ (2003) model of trade with heterogeneous firms. We allow wages to be individually or collectively bargained and analytically solve for the equilibrium. We find that the selection effect of trade influences labor market outcomes. Trade liberalization lowers unemployment and raises real wages as long as it improves aggregate productivity net of transport costs. We show that this condition is likely to be met by a reduction in variable trade costs or the entry of new trading countries. On the other hand, the gains from a reduction in fixed market access costs are more elusive. Calibrating the model shows that the positive impact of trade openness on employment is significant when wages are bargained at the individual level but much smaller when wages are bargained at the collective level. |
| Keywords: | trade liberalization, unemployment, search model, firm heterogeneity |
| JEL: | F12 F15 F16 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3363&r=lab |
| By: | Langot, François (University of Le Mans); Quintero Rojas, Coralia (University of Le Mans) |
| Abstract: | Since 1960, the dynamics of the aggregate hours of market work exhibit dramatic differences across industrialized countries. Before 1980, these differences seem to come from the hours worked per employee (the intensive margin). However, since 1980 a notable feature of the data is that the divergence across countries responds to quantitatively important differences along the employment rate (the extensive margin). In this paper we develop an equilibrium matching model where both margins are endogenous. The model is rich enough to account for the behavior of the two margins of the aggregate hours when we include the observed heterogeneity across countries of both the taxes and the labor market institutions such as the unemployment benefits and the bargaining power. Because these findings come from an unified framework, they also give a strong support to the matching models. |
| Keywords: | hours worked, intensive and extensive margins, taxation, labor market institutions, matching model |
| JEL: | E2 J2 J6 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3364&r=lab |
| By: | Basu, Kaushik (Cornell University); Felkey, Amanda J. (Lake Forest College) |
| Abstract: | This paper uses efficiency wage theory and the existence of community-based sharing to hypothesize that labor markets in developing countries have multiple equilibria – the same economy can be stuck at different levels of unemployment with different levels of wages. The model is meant for developing economies where wage-productivity links are discernible and income-sharing among the poor is prevalent. It seems reasonable to posit that in such an economy more unemployment leads to more income sharing. The main results are generated combining this claim with a theoretical demonstration of the fact that more sharing increases unemployment rates. As corollaries, we show that (1) within the same society, two different racial groups that may be ex ante identical can have different levels of unemployment and wages in equilibrium and (2) the imposition of a legal minimum wage can raise employment. |
| Keywords: | unemployment, efficiency wage, minimum wage law, racial differences, South Africa |
| JEL: | J60 O12 D40 |
| Date: | 2008–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3381&r=lab |
| By: | Runli Xie |
| Abstract: | A large body of literature explains the inferior position of unskilled workers by imposing a structural shift in the labor force skill composition. This paper takes a different approach by emphasizing the connection between cyclical variations in skilled and unskilled labor markets. Using a stylized business cycle model with search frictions in the respective sub-markets, I find that imperfect substitution between skilled and unskilled labor creates a channel for the variations in the sub-markets. Together with a general labor augment- ing technology shock, it can generate downward sloping Beveridge curves. Calibrating the model to US data yields higher volatilities in the unskilled labor markets and reproduces stylized business cycle facts. |
| Keywords: | business cycle, search frictions, skill specific unemployment, skill substitutability |
| JEL: | E24 E32 J63 |
| Date: | 2008–03 |
| URL: | http://d.repec.org/n?u=RePEc:hum:wpaper:sfb649dp2008-024&r=lab |
| By: | Ingo Geishecker; Holger Görg; Jakob Roland Munch |
| Abstract: | This paper studies the impact of outsourcing on individual wages in three European countries with markedly different labour market institutions: Germany, the UK and Denmark. To do so we use individual level data sets for the three countries and construct comparable measures of outsourcing at the industry level, distinguishing outsourcing by broad region. Estimating the same specification on different data show that there are some interesting differences in the effect of outsourcing across countries. We discuss some possible reasons for these differences based on labour market institutions. |
| Keywords: | International outsourcing, individual wages, labour market institutions |
| JEL: | F16 J31 C23 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:kie:kieliw:1404&r=lab |
| By: | Sessions, John G. (University of Bath); Theodoropoulos, Nikolaos (University of Cyprus) |
| Abstract: | We investigate the relationship between the slope of the wage-tenure profile and the level of monitoring across two cross sections of matched employer-employee British data. Our theoretical model predicts that increased monitoring leads to a decline in the slope of the wage-tenure profile. Our empirical analysis provides strong support for this prediction. |
| Keywords: | monitoring, tenure, efficiency wages |
| JEL: | J33 J41 J54 |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3307&r=lab |
| By: | Gabriele, CARDULLO (UNIVERSITE CATHOLIQUE DE LOUVAIN, Department of Economics) |
| Abstract: | In this paper, I construct a general equilibrium model in which the labour market exhibits search frictions, whereas Cournot competition is assumed in the goods market. The properties of the long run free-entry equiibrium show that a more competitive product market raises employment, but it has ambiguous effects both on the real wage and on the utility of the employees. Moreover, from a normative viewpoint, the level of employment and the degree of competition may be inefficiently high. Numerical results based on Belgian data are finally performed. |
| Keywords: | product market competition, search matching equilibrium, barriers to entry |
| JEL: | E24 J64 L16 |
| Date: | 2008–02–20 |
| URL: | http://d.repec.org/n?u=RePEc:ctl:louvec:2008007&r=lab |
| By: | Boeri, Tito (Bocconi University, Milan); Macis, Mario (University of Michigan) |
| Abstract: | According to recent and largely untested theories, unemployment benefits (UBs) could improve the extent and quality of job reallocation even at the cost of increasing unemployment. Using yearly panel data from a large number of countries, we evaluate empirically the relationship between unemployment benefits and structural change. Unlike previous work assessing the effects of UBs on labor market stocks, we focus on flows and rely on policy "experiments", notably the introduction from scratch of unemployment benefits in many countries. We exploit the longitudinal nature of our data to lessen the potentially important selection, endogeneity and omitted variables problems. We find a positive, sizable and significant effect of the introduction of UBs on job reallocation, arising mainly from the job destruction margin although this effect fades away over time. UBs are also found to induce more sectoral shifts from agriculture to services. These findings appear to be robust to changes in the countries in the sample, control variables or estimation methods. We discuss to which extent our results are consistent with equilibrium matching models with or without endogenous sorting of workers into jobs providing entitlement to UBs and stochastic job matching. |
| Keywords: | unemployment benefits, job reallocation, matching models |
| JEL: | J6 J65 O15 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3371&r=lab |
| By: | KUNDU, AMIT |
| Abstract: | Domestic workers, most of whom arefemale are hired to work in private households. But their work remains unrecognised as a legitimate form of activity. This paper through micro level study shows that young married women coming from distant places with higher number of children, with low and uncertain income ofother family members, prefer part-time domestic work to supplement their family income. Through Engel's ratio, it is identified that the standard of living is slightly better than that of part-time domestic workers. But most of the domestic workers of West Bengal are deprived of over time pay, public holidays and timely payment of salaries. |
| Keywords: | Domestic Worker, Labour Laws, Conditions of Work, Rights, |
| JEL: | J40 |
| Date: | 2008–03–07 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:7539&r=lab |
| By: | Bosch, Nicole (CPB Netherlands Bureau for Economic Policy Analysis); Deelen, Anja (CPB Netherlands Bureau for Economic Policy Analysis); Euwals, Rob (CPB Netherlands Bureau for Economic Policy Analysis) |
| Abstract: | To balance work and family responsibilities, the Netherlands have chosen a unique model that combines a high female employment rate with a high part-time employment rate. The model is likely to be the result of (societal) preferences as the removal of institutional barriers, like lower marginal tax rates for partners and better childcare facilities, has not led to more working hours. It is, however, an open question whether the model is here to stay or whether younger generations of women will choose full-time jobs in the near future. We investigate the development of working hours over successive generations of women using the Dutch Labour Force Survey 1992-2005. We find evidence of an increasing propensity to work part-time over the successive generations, and a decreasing propensity to work full-time for the generations born after the early 1950s. Our results are in line with results of studies on social norms and attitudes as they find a similar pattern over the successive generations. It therefore seems likely that without changes in (societal) preferences the part-time employment model is indeed here to stay for some more time. |
| Keywords: | female labour supply, working hours |
| JEL: | J16 J22 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3367&r=lab |
| By: | Brown, Martin (Swiss National Bank); Falk, Armin (University of Bonn); Fehr, Ernst (University of Zurich) |
| Abstract: | When unemployment prevails, relations with a particular firm are valuable for workers. As a consequence, a worker may adhere to an implicit agreement to provide high effort, even when performance is not third-party enforceable. But can implicit agreements – or relational contracts – also motivate high worker performance when the labor market is tight? We examine this question by implementing an experimental market in which there is an excess demand for labor and the performance of workers is not third-party enforceable. We show that relational contracts emerge in which firms reward performing workers with wages that exceed the going market rate. This motivates workers to provide high effort, even though they could shirk and switch firms. Our results thus suggest that unemployment is not a necessary device to motivate workers. We also discuss how market conditions affect relational contracting by comparing identical labor markets with excess supply and excess demand for labor. Long-term relationships turn out to be less frequent when there is excess demand for labor compared to a market characterized by unemployment. Surprisingly though, this does not compromise market performance. |
| Keywords: | relational contracts, involuntary unemployment |
| JEL: | D82 J3 J41 E24 C9 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3345&r=lab |
| By: | Gould, Eric D. (Hebrew University, Jerusalem); Kaplan, Todd R. (University of Exeter) |
| Abstract: | This paper examines the issue of whether workers learn productive skills from their co-workers, even if those skills are unethical. Specifically, we estimate whether Jose Canseco, one of the best baseball players in the last few decades, affected the performance of his teammates. In his autobiography, Canseco claims that he improved the productivity of his teammates by introducing them to steroids. Using panel data on baseball players, we show that a player’s performance increases significantly after they played with Jose Canseco. After checking 30 comparable players from the same era, we find that no other baseball player produced a similar effect. Clearly, Jose Canseco had an unusual influence on the productivity of his peers. These results are consistent with Canseco’s controversial claims, and suggest that workers not only learn productive skills from their co-workers, but sometimes those skills may derive from unethical practices. These findings may be relevant to many workplaces where competitive pressures create incentives to adopt unethical means to boost productivity and profits. |
| Keywords: | peer effects, corruption, crime, externalities |
| JEL: | J24 |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3328&r=lab |
| By: | Chiswick, Barry R. (University of Illinois at Chicago); Miller, Paul W. (University of Western Australia) |
| Abstract: | Using data from the 2001 Australian Census of Population and Housing, on adult men in full-time employment, this paper augments a conventional human capital earnings function with information on occupations. It also estimates models of occupational attainment. The results from both the earnings function and model of occupational attainment indicate that the limited international transferability of human capital skills results in immigrants entering into relatively low status occupations when they first enter the Australian labour market. Comparison with similar research for the US suggests that the different immigrant selection regimes (primarily family reunion in the US, skill-based immigration in Australia) do not impact on the negative association between occupational status and pre-immigration labour market experience. |
| Keywords: | earnings, occupation, immigrants |
| JEL: | J24 J31 J F22 |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3316&r=lab |
| By: | Siegfried Geyer; Kambiz Norozi; Reiner Buchhorn; Armin Wessel |
| Abstract: | It was examined whether women and men (17-45 years) with operated congenital heart disease (CHD) differ with respect to chances of employment. Patients were compared with the general population. Patients (N=314) were classified by type of surgery (curative, reparative, palliative) as indicator of initial severity of disease. The second classification was performed according to a system proposed by the New York Heart Association in order to take subjectively reported impairments into account. Controls (N=1165) consisted of a 10% random sample drawn from the German Socio-Economic Panel. Chances of full- time employment decreased as disease severity increased. Chances of part- time and minor employment were higher in patients than among controls. These general effects were due to male patients, while the employment patterns of women did not differ from the control group. Independently of patient status women were more likely to have lower rates of full- time employment, and the rates of part- time and minor employment were higher. Long- term adaptation to impairments due to congenital heart disease differs between women and men with respect to employment status. While female patients do not differ from the general population, males may lower their engagement in paid work. |
| Keywords: | Congenital heart disease, employment, unemployment, gender |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp91&r=lab |
| By: | Luca, MARCHIORI (UNIVERSITE CATHOLIQUE DE LOUVAIN, Department of Economics) |
| Abstract: | A transition from pay-as-you-go pension systems to more private funded systems is often suggested as a solution to finance pension systems threatened by ageing. This paper analyses alternative potential remedies linked to changes in labour market characteristics, within an international computable overlapping-generations model of the world economy. A prolongation of the working life of skilled or unskilled individuals, an increase in the demand of skills, a rise in the education levels and increased skilled or unskilled immigration have very different outcomes in North-America and in Europe. In the latter region, a postponement in the retirement age of unskilled individuals has the most beneficial effect in relieving the fiscal pressure on pensions systems, because the proportion of unskilled workers is relatively larger in Europe than in North-America. In North-America, where skilled labour is more abundant, an acceleration in skill-biased technical change has the biggest impact on pensions systems, as it raises the productivity of skilled workers. |
| Keywords: | OLG-CGE Model, ageing, labour market, migration |
| JEL: | C68 H55 O30 J26 J61 |
| Date: | 2008–02–15 |
| URL: | http://d.repec.org/n?u=RePEc:ctl:louvec:2008001&r=lab |
| By: | Dolton, Peter (Royal Holloway, University of London); Makepeace, Gerry (Cardiff University) |
| Abstract: | This paper examines the impact of the Pay Review Bodies (PRBs) on the public sector pay of their remit groups. We compare the real weekly earnings of groups of workers in occupations covered by PRBs, in the remainder of the public sector and in the private sector using LFS data from 1993 to 2006 for 10 occupational sub-groups. We describe how the pattern of relative occupational pay varies over time and by gender and can be interpreted as compensating pay differentials. In several public sector occupations, men incur a much larger earnings penalty than women. Our difference- in-difference impact estimation method relies on comparison of the difference between any specific PRB group and other (non-PRB) public sector workers over time. For the most part we find that the PRBs have had little or no practical impact on earnings over and above that of comparable public sector workers not covered by the PRBs. |
| Keywords: | Public Sector Pay Review Bodies |
| JEL: | J45 J48 J31 J38 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3373&r=lab |
| By: | Fitzenberger, Bernd (University of Frankfurt); Kohn, Karsten (University of Frankfurt); Lembcke, Alexander C. (CEP, London School of Economics) |
| Abstract: | Collective bargaining in Germany takes place either at the industry level or at the firm level; collective bargaining coverage is much higher than union density; and not all employees in a covered firm are necessarily covered. This institutional setup suggests to explicitly distinguish union power as measured by net union density (NUD) in a labor market segment, coverage at the firm level, and coverage at the individual level. Using linked employer-employee data and applying quantile regressions, this is the first empirical paper which simultaneously analyzes these three dimensions of union influence on the structure of wages. Ceteris paribus, a higher share of employees in a firm covered by industry-wide or firm-level contracts is associated with higher wages. Yet, individual bargaining coverage in a covered firm shows a negative impact both on the wage level and on wage dispersion. A higher union density reinforces the effects of coverage, but the effect of union density is negative at all points in the wage distribution for uncovered employees. In line with an insurance motive, higher union density compresses the wage structure and, at the same time, it is associated with a uniform leftward movement of the distribution for uncovered employees. |
| Keywords: | linked employer-employee data, quantile regression, wage structure, collective bargaining coverage, union density, Structure of Earnings Survey 2001, Germany |
| JEL: | J31 J51 J52 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3356&r=lab |
| By: | Ericson, Thomas (Department of Economics, School of Business, Economics and Law, Göteborg University) |
| Abstract: | By using a sample of Swedish dual-earner households, this paper investigates how a transfer of time spent on paid work from the man to the woman influences their allocation of unpaid household work. It is found that their total time engaged in household work decreases. This result suggests that dual-earner households who equalize their paid working hours, will spend less time on work chores in the household that traditionally have been done by women. The conclusion is that women’s dual role as breadwinner and provider of work and care in the household is associated with an increased workload for women.<p> |
| Keywords: | Labour supply; household work; intra-household time allocation; Sweden |
| JEL: | D13 J22 |
| Date: | 2008–03–10 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunwpe:0291&r=lab |
| By: | Grimalda, Gianluca |
| Abstract: | The contrasting effects of labour market rigidity on efficiency are investigated in a model where technological change is non-general purpose and different types of skills are available to workers. Ex ante efficiency calls for high labour market rigidity, as this favours workers’ acquisition of specific skills which have higher productivity in equilibrium. Ex post efficiency calls for low market rigidity, as this allows more workers to transfer to the innovating sector of the economy. The trade-off between these two mechanisms results in an inverse-U shaped relationship between output and labour market rigidity, which implies that a positive level of labour market rigidity is in general beneficial for the economy. |
| Keywords: | Non-general purpose technology; labour market rigidity; specific and general human capital. |
| JEL: | J31 O30 J24 |
| Date: | 1971–12–30 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:7722&r=lab |
| By: | Catalina Amuedo-Dorantes (Department of Economics, San Diego State University); Jean Kimmel (Department of Economics, Western Michigan University) |
| Abstract: | Using data from the 1979 National Longitudinal Survey of Youth, we examine the cyclicality of moonlighting by gender. We estimate a random effects Tobit model of moonlighting among working men and women and find that, while male moonlighting behavior does not fluctuate significantly with the business cycle, female moonlighting does. The cyclicality of female moonlighting has, nonetheless, varied over the course of the past 35 years. Female moonlighting seemed to behave counter-cyclically during much of the 1980s and early 1990s, confirming the popular media belief that moonlighting is more likely to occur during periods of economic distress. Yet, this counter-cyclical behavior disappears during the 1993-99 period to become pro-cyclical by the early twentieth century. The recent pro-cyclicality of female moonlighting supports the idea that female workers respond to a need for “just-in-time” employment following the economic upturn of the mid to late 1990s. |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:sds:wpaper:0028&r=lab |
| By: | Catalina Amuedo-Dorantes (Department of Economics, San Diego State University); Sara de la Rica (Depto. Fundamentos del Análisis Económico II, Universidad del País Vasco & IZA) |
| Abstract: | Using data from the Spanish Labor Force Survey (Encuesta de Población Activa) from 1999 through 2007, we explore the role of employment opportunities in explaining the growing immigrant flows of recent years. Subsequently, we investigate whether immigrant inflows have helped reduce regional employment disparities. Our results indicate that immigrants choose to reside in regions with higher employment rates for their particular skills. However, perhaps owing to its recent nature or the ability of the production infrastructure to absorb the increase in immigrant labor, immigration does not seem to have significantly helped employment convergence across regions. |
| Date: | 2007–11 |
| URL: | http://d.repec.org/n?u=RePEc:sds:wpaper:0029&r=lab |
| By: | Marian Dinga |
| Abstract: | This paper investigates the impact of a large territorially concentrated FDI inflow on local labor market outcomes using district panel data from the Czech Republic. Toyota- Peugeot´s joint investment in Kolín is used to quantify the effect of FDI on the district unemployment outflow and inflow rates, the aggregate unemployment exit hazard rates, and subsequently both the unemployment rate and the employment rate. Using difference-in-differences analysis, labor market performance of `treatment' and `control' districts for two periods (before and after the investment) are compared. Placebo simulations reveal that conventional least squares estimates lead to serious underestimation of standard errors. Therefore, in order to account for serial correlation, the block bootstrapping technique is used to compute consistent standard errors. The results indicate a positive significant impact of the investment on the local unemployment outflow rate driven mainly by increases in the aggregate unemployment hazard rates for durations less than nine months. However, the impact on longer unemployment durations remained negligible. Consequently, the local unemployment rate decreased and the employment rate increased in the `treated' district. |
| Keywords: | Labor market, unemployment, employment, foreign direct investment. |
| JEL: | F21 J21 J61 J64 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:cer:papers:wp348&r=lab |
| By: | Caliendo, Marco (IZA) |
| Abstract: | The German government has spent between 7bn and 11bn Euro per year on active labor market policies (ALMP) in East Germany in the last decade. The effectiveness of the most important programs (in terms of participants and spending) such as job-creation schemes and vocational training has been evaluated quite thoroughly in recent years. The results are disappointing, indicating that nearly all of these ‘traditional’ programs have to be rated as a failure. In light of these findings, policies to encourage unemployed people to become self-employed gained increasing importance. We present first evidence on the effectiveness of two start-up programs in East Germany. Our findings – even though partly preliminary – are rather promising, showing that these programs increase employment chances and earnings of participants. Hence, start-up subsidies might work even in a labor market with structural problems such as the one in East Germany. |
| Keywords: | start-up subsidies, evaluation, effectiveness, East Germany, self-employment |
| JEL: | I21 Z13 J24 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3360&r=lab |
| By: | Golo Henseke (University of Rostock and Rostock Centre for the Study of Demographic Change, Germany); Pascal Hetze (Rostock Centre for the Study of Demographic Change, Germany); Thusnelda Tivig (University of Rostock and Rostock Centre for the Study of Demographic Change, Germany) |
| Abstract: | Population aging translates into aging of the labor force. However, the impact of the former on the latter is neither straightforward nor uniform over specific groups. The reason is that economic decisions concerning, for example, duration of schooling or labor-market participation of women and those aged 60+ as well as industry-specific requirements on the demand side affect age-specific employment rates and thus the age structure of labor. In this paper we describe and use different measures of aging to obtain a picture of the aging process in selected German industries and professions between 1980 and 2000. Our results reveal pronounced differences in the age structure, timing and dynamics of aging. However, we find that aging is, in general, subject to convergence towards a homogenous age composition: Subgroups that were relatively young in 1980 aged faster, and vice versa. |
| JEL: | J21 J11 J01 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:ros:wpaper:42&r=lab |
| By: | Marco LILLA (Universita' Politecnica delle Marche, Dipartimento di Economia) |
| Abstract: | This paper analyses income inequality and its changes over the period 1993-2000 for a set of 13 Countries in European Community Household Panel (ECHP) survey. Focusing on wages and incomes of workers in general, inequality is related to education as a proxy of individual abilities, skills. Estimation of education premia is performed by quantile regressions to stress dikerences in income distribution and questioning the true impact of education. The same estimates are used to decompose income inequality and show the rise in residual inequality. |
| Keywords: | education premium, inequality, quantile regression |
| JEL: | D31 J24 J31 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:anc:wpaper:311&r=lab |
| By: | Goerke, Laszlo (University of Tuebingen); Pannenberg, Markus (Bielefeld University of Applied Sciences) |
| Abstract: | In an open-shop model of trade union membership with heterogeneity in risk attitudes, a worker's relative risk aversion can affect the decision to join a trade union. Furthermore, a shift in risk attitudes can alter collective bargaining outcomes. Using German panel data (GSOEP) and three novel direct measures of individual risk aversion, we find evidence of a significantly positive relationship between risk aversion and the likelihood of union membership. Additionally, we observe a negative correlation between bargained wages in aggregate and average risk preferences of union members. Our results suggest that an overall increase in risk aversion contributes to wage moderation and promotes employment. |
| Keywords: | employment, membership, risk aversion, trade union |
| JEL: | J51 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3351&r=lab |
| By: | Gonzalez, Libertad (Universitat Pompeu Fabra); Ortega, Francesc (Universitat Pompeu Fabra) |
| Abstract: | In recent years, Spain has received unprecedented immigration flows. Between 2001 and 2006 the fraction of the population born abroad more than doubled, increasing from 4.8% to 10.8%. For Spanish provinces with above-median inflows (relative to population), immigration increased the high school dropout population by 24%, while only increasing the number of college graduates by 11%. We study the different channels by which regional labor markets have absorbed the large increase in the relative supply of low educated (foreign-born) workers. We identify the exogenous supply shock using historical immigrant settlement patterns by country of origin. Using data from the Labor Force Survey and the decennial Census, we find a large expansion of employment in high immigration regions. Specifically, most industries in high-immigration regions experienced a large increase in the share of low-education employment. We do not find an effect on regions’ sectoral specialization. Overall, and perhaps surprisingly, Spanish regions have absorbed immigration flows in the same fashion as US local economies. |
| Keywords: | immigration, open economies, Rybcszynski, instrumental variables |
| JEL: | J2 F1 O3 |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3311&r=lab |
| By: | Catalina Amuedo-Dorantes (Department of Economics, San Diego State University); Miguel Á. Malo (Universidad de Salamanca) |
| Abstract: | Using Spanish establishment level data on temporary and permanent job and worker flows, we examine firms’ relative usage of fixed-term contracts in response to changes in their prior net employment expectations for the short-run and the long-run –viewed as proxies of how a wide variety of future shocks are ultimately perceived by establishments. The employment response of establishments to changing net employment expectations for the short-run is, primarily, suggestive of their reliance on fixed-term contracts as a buffer to cushion short-run changes in demand as well as to shield permanent workers from downward workforce adjustments. In contrast, their response to changes in net employment expectations for the long-run mostly hints on the use of fixed-term contracts as a screening device. Therefore, policies providing financial incentives to convert fixed-term into permanent contracts –thus targeting firms’ using fixed-term contracts as a screening device, are likely to only have limited effectiveness. |
| Date: | 2007–08 |
| URL: | http://d.repec.org/n?u=RePEc:sds:wpaper:0026&r=lab |
| By: | Mark Aguiar; Erik Hurst |
| Abstract: | This paper examines the changing allocation of time within the United States that has occurred between 1965 and 2003-2005. We find that the time individuals have allocated to leisure has increased in the U.S. for both men and women during this period, with almost the entire gain occurring prior to 1985. We also find that post 1985 there has been a substantial increase in leisure inequality, particularly for men. Over the last 20 years, less educated men increased the time they allocated to leisure while more educated men recorded a decrease in leisure time. While the relative decline in the employment rate of less educated men is important, trends in employment status explain less than half of the increase in the leisure gap. |
| JEL: | E24 J22 |
| Date: | 2008–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13837&r=lab |
| By: | Clauss, Markus; Schnabel, Reinhold |
| Abstract: | We estimate the effects of the reform of the German Unemployment Insurance that replaced the wage related Unemployment Assistance with an income maintenance program and stronger means testing. We model the tax-benefit system and use the Socio-Economic Panel. We estimate a discrete labour supply model and simulate the behavioural and distributional effects using the pseudo-distribution method. Poverty and inequality decline overall, since households with children and low income gain, while those who used to earn high wages and received high unemployment transfers lose most. The behavioural responses mitigate the redistributive impact of the reform. |
| Keywords: | distribution analysis, household labour supply, microsimulation, poverty, Germany |
| JEL: | D31 H31 I32 I38 J22 |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:7017&r=lab |
| By: | Petrongolo, Barbara (London School of Economics); Pissarides, Christopher A. (London School of Economics) |
| Abstract: | In this paper we study the contribution of inflows and outflows to the dynamics of unemployment in three European countries, the United Kingdom, France and Spain. We compare performance in these three countries making use of both administrative and labor force survey data. We find that the impact of the 1980s reforms in Britain is evident in the contributions of the inflow and outflow rates. The inflow rate became a bigger contributor after the mid 1980s, although its significance subsided again in the late 1990s and 2000s. In France the dynamics of unemployment are driven virtually entirely by the outflow rate, which is consistent with a regime with strict employment protection legislation. In Spain, however, both rates contribute significantly to the dynamics, very likely as a consequence of the prominence of fixed-term contracts since the late 1980s. |
| Keywords: | unemployment dynamics, job finding rates, job separation rates |
| JEL: | E24 E32 J6 |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3315&r=lab |
| By: | Salazar, C |
| Abstract: | The aim of this paper is to present evidence of the main factors that influence the voluntary decision of the assurance of unemployment in Chile. To carry out this purpose, a model Logit Binomial was estimated using information of the Survey of Socioeconomic Characterization (CASEN) 2003. The results support some theoretical arguments that influence this type of decisions. The individuals who present smaller probability of taking an insurance are workers with an educational low level and without formal training, individuals in advanced age, individuals with fewer family responsibilities, with a major seniority, individuals who can generate another type of income, workers who receive a major level of social assistance, workers who belong to the micro and small enterprise and those that work in Transport and Communications and Commercial Sector. These results are interesting, because the persons that have some of these characteristics could confront larger unemployment risk. In this context, it is necessary the intervention of the authority across incentives or forcing to the people to take insurance in order that the more vulnerable persons adopt this mechanism for social protection. |
| Keywords: | Assurance of Unemployment; Unemployment; Voluntary Affiliation. |
| JEL: | J65 J64 J68 |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:7693&r=lab |
| By: | Luechinger, Simon (University of Zurich); Meier, Stephan (Federal Reserve Bank of Boston); Stutzer, Alois (University of Basel) |
| Abstract: | High rates of unemployment entail substantial costs to the working population in terms of reduced subjective well-being. This paper studies the importance of individual economic security, in particular job security, in workers’ well-being by exploiting sector-specific institutional differences in the exposure to economic shocks. Public servants have stricter dismissal protection and face a lower risk of their organization’s bankruptcy than private sector employees. The empirical results for individual panel data for Germany and repeated cross-sectional data for the United States and the European Union show that the sensitivity of subjective well-being to fluctuations in unemployment rates is much lower in the public sector than in the private. This suggests that increased economic insecurity constitutes an important welfare loss associated with high general unemployment. |
| Keywords: | unemployment, life satisfaction, job security, public sector |
| JEL: | E24 I31 J30 J45 J64 |
| Date: | 2008–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3385&r=lab |
| By: | Schnepf, Sylke V. (University of Southampton) |
| Abstract: | Literature examining immigrants’ educational disadvantage across countries focuses generally on average differences in educational outcomes between immigrants and natives disguising thereby that immigrants are a highly heterogeneous group. The aim of this paper is to examine educational inequalities among immigrants in eight high immigration countries: Australia, Canada, Germany, New Zealand, Sweden, Switzerland, UK and USA. Results indicate that for almost all countries immigrants’ educational dispersion is considerably higher than for natives. For most countries higher educational dispersion derives from very low achieving immigrants. Quantile regression results reveal that at lower percentiles language skills impact more on educational achievement than at the top of the achievement distribution. Results are presented separately for immigrants of different age cohorts, varying time of immigrants’ residence in the host country and subject examined (maths and reading) highlighting thereby the different patterns found by immigrant group and achievement measure. |
| Keywords: | education, educational inequalities, immigration, PISA, TIMSS, PIRLS |
| JEL: | I21 J15 O15 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3337&r=lab |
| By: | Danacica, Daniela-Emanuela; Babucea, Ana-Gabriela |
| Abstract: | In this paper are presented the results of the ASO international project “The Role of Education for the Duration of Unemployment” for Gorj County. Using techniques to estimate models for duration data, like the Kaplan Meier method and Cox’s proportional hazard model, this project answer to the following question: does the education level influence the duration of unemployment in Gorj County? The influences of age and gender on duration of unemployment spells are also estimated |
| Keywords: | unemployment education level labour market gender |
| JEL: | J45 J40 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:7570&r=lab |
| By: | Ph. Monfort; Hylke Vandenbussche; E. Forlani |
| Abstract: | In this paper we study the effect of import competition from China on the Belgian textiles sector. Our analysis comprises both trade data and firm-level data. We study the evolution of the unit values in textiles exported from China into the EU versus textiles exported from Belgium to the rest of the EU over the past ten years. We clearly find evidence of a widening price gap between Chinese and Belgian textiles export prices. Chinese textiles seem to become relatively cheaper over time. These findings are in line with Schott (2004; 2007) who argues that capital abundant countries in the US and Europe use their endowment advantage to produce product varieties that are superior in quality compared to labour intensive countries like China. Next we use firm-level data on Belgian textiles firms in search of evidence of quality and skill upgrading in Belgian textiles exports. We study the evolution of firm-level variables such as R&D outlays, the proportion of skilled and unskilled labour used in production and capital intensity. Both China’s entry into the WTO and the end of the Multi- Fibre Agreement significantly seem to cause important shifts in firm level production processes. A very robust result that emerges from the analysis is the one of skill upgrading. While over the past ten years total employment in the Belgian textiles sector has substantially decreased, the ratio of skilled versus unskilled workers has gone up significantly. The evidence is indicative that the Belgian textile sector has been undergoing substantial changes. It is becoming smaller but at the same time seems to be responding to the competition from a low-wage country like China by increasing the skill-content of its products and moving up the quality ladder. |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:lic:licosd:19808&r=lab |
| By: | Emilio Colombo; Luca Stanca |
| Abstract: | This paper investigates the e®ects of training on labor productiv- ity using a unique nationally representative panel of Italian ¯rms for the period 2002 to 2005. We ¯nd that training has a positive and signi¯cant e®ect on productivity. Using a variety of panel estimation techniques, we show that failing to account for unobserved heterogene- ity leads to overestimate the impact of training on productivity, while failing to account for endogeneity leads to substantially underestimate it. Training also has a positive and signi¯cant impact on wages, but this e®ect is about half the size of the e®ect on productivity. Within occupational groups, the e®ect of training on productivity is large and signi¯cant for blue-collars, but small and not signi¯cant for white collars. |
| Keywords: | On-the-Job-Training; Productivity; Wages; Panel Data |
| JEL: | C23 D24 J31 |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:mib:wpaper:134&r=lab |
| By: | Schnabel, Claus (University of Erlangen-Nuremberg); Kohaut, Susanne (IAB, Nürnberg); Brixy, Udo (IAB, Nürnberg) |
| Abstract: | Using a linked employer-employee dataset and taking the perspective of individuals rather than firms, this paper analyzes some effects of joining start-ups. We show that entrants in new firms differ from those joining incumbent firms, and we use a matching approach to compare a group of employees joining new firms in 1995/96 with a control group entering incumbent firms. Our results indicate that individuals’ employment stability was higher in incumbent than in newly founded firms while their risk of becoming unemployed was lower. In particular in eastern Germany, joining firms that were older than six years was the best strategy. |
| Keywords: | linked employer-employee data, newly founded firms, unemployment, employment, Germany |
| JEL: | J63 J64 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3353&r=lab |
| By: | Enriqueta Camps |
| Abstract: | This essay deals with the reasons explaining children’s work in 19th century textile factories and their removal during the first part of the 20th century. The inadequacy of the structure of incomes and expenditures of the household and the very low economic incentives to educate children can explain why children were in the factories and not in the school. Moreover, the marginal economic contribution to the economy of the household of a child was the same as that of his mother. This normally implied that women and children were perfect substitutes. When the family had a child at working age this allowed to replace the paid work input of the mother. With the beginnings of the 20th century a set of changes leading to the increase of women’s productivity and hourly real wages, switched the situation and involved the new incorporation of women into paid work and the investment in children’s human capital. |
| Keywords: | Children's work, Women's Work, Household Budgets, Education |
| JEL: | I2 I3 J3 J4 N3 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:upf:upfgen:1073&r=lab |
| By: | van Ours, Jan C. (Tilburg University); Veenman, Justus (Erasmus University Rotterdam) |
| Abstract: | The allocation of Moluccan immigrants across towns and villages at arrival in the Netherlands and the subsequent formation of interethnic marriages resemble a natural experiment. The exogenous variation in marriage formation allows us to estimate the causal effect of interethnic marriages on the educational attainment of children from such marriages. We find that children from Moluccan fathers and native mothers have a higher educational attainment than children from ethnic homogeneous Moluccan couples or children from a Moluccan mother and a native father. |
| Keywords: | interethnic marriages, educational attainment |
| JEL: | I21 J15 |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3308&r=lab |
| By: | Coral del Río (Universidade de Vigo); Olga Alonso-Villar (Universidade de Vigo) |
| Abstract: | This paper aims to analyze occupational and industrial segregation in the Spanish labor market by using the alternative tools proposed by Alonso-Villar and Del Río (2007), along with some new extensions put forward here. In particular, two decompositions of their segregation curves are proposed. The approach followed in this article allows measuring segregation of women and men separately, since the distribution of each group of workers across occupations and industries is compared with the distribution of total employment. To analyze industrial segregation, an aggregated classification of industries in four large groups (agriculture-fishing, industry, construction and services) and another by branches of activity are considered while to study occupational segregation, several partitions of individuals and of occupations are included. |
| Keywords: | Occupational and industrial segregation; Segregation curves; Gender |
| JEL: | J71 J16 D63 |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:inq:inqwps:ecineq2008-84&r=lab |
| By: | Michéle V.K. Belot; Timothy J. Hatton |
| Abstract: | The selection of immigrants by skill and education is a central issue in the analysis of immigration. Since highly educated immigrants tend to be more successful in host country labour markets and less of a fiscal cost it is important to know what determines the skill-selectivity of immigration. In this paper we examine the proportions of highly educated among migrants from around 80 source countries who were observed as immigrants in each of 29 OECD countries in 2000/1. We develop a variant of the Roy model to estimate the determinants of educational selectivity by source and destination country. We also estimate the determinants of the share of migrants from different source countries in each destination country’s immigrant stock. Two key findings emerge. One is that the effects of the skill premium, which is at the core of the Roy model, can be observed only after we take account of poverty constraints operating in source countries. The other is that cultural links and distance are often more important determinants of the proportion of high educated immigrants in different OECD countries than wage incentives or policy. |
| Keywords: | immigration, migrant selection, migrant skills |
| JEL: | F22 J24 J61 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:auu:dpaper:571&r=lab |
| By: | Halliday, Timothy (University of Hawaii at Manoa) |
| Abstract: | We use panel data from El Salvador and investigate the intra-household allocation of labor as a risk-coping strategy. Adverse agricultural productivity shocks both increased male migration to the US and male agricultural labor supply. This is not a contradiction if there were non-monotonic effects on shadow wages within the survey period. In contrast, damage sustained from the 2001 earthquakes exclusively stunted female migration. This is consistent with the earthquakes increasing the demand for home production. |
| Keywords: | migration, labor supply, insurance, intra-household allocation |
| JEL: | J22 J61 |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3322&r=lab |
| By: | Jason M. Fletcher; Barbara L. Wolfe |
| Abstract: | The question of whether giving birth as a teenager has negative economic consequences for the mother remains controversial despite substantial research. In this paper, we build upon existing literature, especially the literature that uses the experience of teenagers who had a miscarriage as the appropriate comparison group. We show that miscarriages are not random events, but rather are likely correlated with (unobserved) community-level factors, casting some doubt on previous findings. Including community-level fixed effects in our specifications lead to important changes in our estimates. By making use of information on the timing of miscarriages as well as birth control choices preceding the teenage pregnancies we construct more relevant control groups for teenage mothers. We find evidence that teenage childbearing likely reduces the probability of receiving a high school diploma by 5 to 10 percentage points, reduces annual income as a young adult by $1,000 to $2,400, and may increase the probability of receiving cash assistance and decrease years of schooling. |
| JEL: | J13 J24 |
| Date: | 2008–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13847&r=lab |
| By: | Senik, Claudia (University of Paris IV Sorbonne, PSE); Verdier, Thierry (PSE) |
| Abstract: | This paper studies the interaction between labor market integration, the evolution of “work values” and entrepreneurial capital inside minority communities. A simple model of labor market segmentation with ethnic capital and endogenous transmission of cultural values inside the minority group is presented. It emphasizes the role of entrepreneurial capital as an important driver of labor market integration and as a promoter of meritocratic work values inside the community. The case of South European and North African second generation immigrants in France is then empirically studied as an example, contrasting strongly how the differential economic and cultural integration in the labor market correlates with the differential level of entrepreneurial capital of the two communities. |
| Keywords: | social capital, ethnic segmentation, work values, labor discrimination |
| JEL: | J15 J61 J7 Z13 |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3319&r=lab |
| By: | Raouf BOUCEKKINE (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES)); Patricia, CRIFO; Claudio, MATTALIA |
| Abstract: | Innovative workplace practices based on multi-tasking and ICT that have been diffusing in most OECD countries since the 1990s have strong consequences on working conditions. Available data show together with the emergence of new organizational forms like multi-tasking, the increase in the proportion of workers employed in managerial occupation and the increase in skill requirements. This paper proposes a theoretical model to analyze the coordination costs between workers and between tasks. Firms can reduce coordination costs by assigning more workers to human resources management. Human capital is endogenously accumulated by workers. The model reproduces pretty well the regularities observed in the data. In particular, exogenous technological accelerations tend to increase both the number of tasks performerd and the skill requirements, and to raise the fraction of workers devoted to management. |
| Keywords: | Information Technology, Organizational Change, Human Capital, Multi-Tasking |
| JEL: | J22 J24 L23 O33 C62 |
| Date: | 2008–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:ctl:louvec:2007047&r=lab |
| By: | Bratti, Massimiliano (University of Milan); Checchi, Daniele (University of Milan); de Blasio, Guido (Bank of Italy) |
| Abstract: | This paper studies the role of the expansion of higher education (HE) in increasing the equality of tertiary education opportunities. It examines Italy’s experience during the 1990s, when policy changes prompted HE institutions to offer a wider range of degrees and to open new sites in neighbouring provinces. Our analysis focuses on non-mature full-time students and the results suggest that the expansion might have had only limited effects in terms of reducing existing individual inequality in HE achievement as the greater availability of courses had a significantly positive impact only on the probability of university enrolment but not on that of obtaining a university degree. |
| Keywords: | family background, higher education, Italy |
| JEL: | I2 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3361&r=lab |
| By: | Paul Heaton |
| Abstract: | Beginning in 1959 the public schools in Prince Edward County, Virginia were closed for five years in opposition to court-ordered integration. The author combines data from numerous administrative sources to examine the effects of the school closings on the educational attainment and economic outcomes of affected Black children. Although exposed students obtained an average of one fewer year of schooling than peers in surrounding counties, they do not exhibit substantially worse material, health, and incarceration outcomes. These findings may result from 1) the provision of substitute educational opportunities for many students and 2) flat returns at levels of educational attainment typical for southern Virginia Blacks during this period. |
| Keywords: | education, discrimination, Virginia |
| JEL: | J15 I20 |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:ran:wpaper:552&r=lab |
| By: | Hervé Boulhol (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, Ecole d'économie de Paris - Paris School of Economics - Université Panthéon-Sorbonne - Paris I) |
| Abstract: | There is ample evidence that a country's labour market institutions are important determinants of unemployment. This study generalises Davis' (1998) idea according to which the institutions of the trade partners matter also for a country's equilibrium unemployment rate as they generate comparative advantages. Moreover, the empirical investigation provides some evidence that the interactions between bilateral trade and relative labour market regulations affect the equilibrium unemployment rate. Given data limitations in this area, the ambition of this paper is merely to draw the attention to the general relevance of these interactions as complementing factors to other explanations of unemployment. Another interesting finding is that a fairly low regulated country like Canada can be negatively affected because its main trading partner is even less regulated, while a high regulated country like Germany appears rather sheltered because its trading partners are also highly regulated. |
| Keywords: | Unemployment; trade; labour market institutions. |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:papers:halshs-00261478_v1&r=lab |
| By: | Cáceres-Delpiano, Julio (Universidad Carlos III, Madrid); Giolito, Eugenio P. (Universidad Carlos III, Madrid) |
| Abstract: | Using U.S. Census data for the years 1960-1980, we study the impact of unilateral divorce on outcomes of children (age 6-15) and their mothers. We find that the reform increased mothers’ divorce, decreased family income and increased the fraction of mothers below the poverty line. For children, we find not only negative results on investment, measured as the probability that a child goes to a private school, but also on child outcomes, measured by the likelihood of children aged 0-4 being held back in school at the time of the reform. We then analyze outcomes of the same cohorts of children 10 years later, by studying young men and women aged 16-25 using the 1970-1990 U.S. Census. We find an increase in marginality for these cohorts, measured as the probability of living in an institution (men) or the probability of being below the poverty line (women). We find that the impact in outcomes is particularly important for black children and young adults. |
| Keywords: | unilateral divorce, child outcomes |
| JEL: | J12 J13 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3342&r=lab |
| By: | Patacchini, Eleonora (University of Rome La Sapienza); Zenou, Yves (Stockholm University) |
| Abstract: | We analyse the effect of strong and weak ties on the individual probability of finding a job. Using the dynamic model of Calvó-Armengol and Jackson (2004), two results are put forward: (i) the individual probability of finding a job is increasing in the number of strong and weak ties; (ii) the longer the length of ties, the lower is this effect. We approximate the social space by the geographical space. Ethnicity is the chosen dimension along which agents’ social contacts develop and, as a result, we use ethnic population density to capture social interactions within the given ethnic group. Using a panel of local authority-level data in England between 1993 and 2003, we find that (i) the higher the percentage of a given ethnic group living nearby, the higher the employment rate of this ethnic group; (ii) this effect decays very rapidly with distance, losing significance beyond approximately 90 minutes travel time. |
| Keywords: | ethnic minorities, social interactions, population density, weak and strong ties |
| JEL: | A14 C33 J15 R23 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3331&r=lab |
| By: | Deborah A. Cobb-Clark |
| Abstract: | Like their counterparts elsewhere, more young Australians than ever are delaying the move to establish residential independence from their parents. This paper reviews the developing economics literature surrounding young people’s decisions to continue living in their parents’ homes in order to begin to assess the causes and consequences of this decision. In particular, co-residence with parents appears to be an important form of intergenerational support for young adults. It is important to understand the extent to which young people rely on this form of support as they complete their education, enter the labour market, and establish themselves as independent adults. Specific attention is paid to the ways in which Australian income-support, education, and housing policies may influence these patterns. |
| Keywords: | Economics of the family, Household decision-making |
| JEL: | J11 J13 |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:auu:dpaper:568&r=lab |
| By: | O'Brien, Martin (University of Wollongong); Valadkhani, Abbas (University of Wollongong); Townsend, Keith (Griffith University) |
| Abstract: | Both global and domestic economic growth remained robust in 2007 resulting in historically low unemployment and high labour force participation in Australia. However, these favourable labour force statistics were overshadowed for much of the year by a number of other issues such as the continuing drought, high oil and petrol prices and associated inflation and interest rate pressures, a November federal election, and the first full year of the operation of the Work Choices legislation. This article will address each of these issues by presenting an analysis of the macroeconomy and labour market, and reviewing the labour market implications of the Work Choices legislation in Australia. |
| Keywords: | economic performance; industrial relations legislation; labour market; Work Choices |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:uow:depec1:wp08-01&r=lab |
| By: | Jason M. Fletcher; Barbara L. Wolfe |
| Abstract: | The question of whether giving birth as a teenager has negative economic consequences for the mother remains controversial despite substantial research. In this paper, we build upon existing literature, especially the literature that uses the experience of teenagers who had a miscarriage as the appropriate comparison group. We show that miscarriages are not random events, but rather are likely correlated with (unobserved) community-level factors, casting some doubt on previous findings. Including community-level fixed effects in our specifications lead to important changes in our estimates. By making use of information on the timing of miscarriages as well as birth control choices preceding the teenage pregnancies we construct more relevant control groups for teenage mothers. We find evidence that teenage childbearing likely reduces the probability of receiving a high school diploma by 5 to 10 percentage points, reduces annual income as a young adult by $1,000 to $2,400, and may increase the probability of receiving cash assistance and decrease years of schooling. |
| Keywords: | teen pregnancy, economic consequences, human capital |
| JEL: | J24 J13 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:auu:dpaper:573&r=lab |
| By: | Kato, Takao (Colgate University); Shu, Pian (MIT) |
| Abstract: | We provide some of the first rigorous evidence on performance spillovers and social network in the workplace. The data we use are rather extraordinary – weekly data for rejection rates (proportion of defective output) for all weavers in a firm during a 12 months (April 2003-March 2004) period, more than 10,000 observations. Our fixed effect estimates first point to significant spillovers of performance from high-ability weavers to low-ability weavers. On the other hand, we find no evidence for performance spillovers from low-ability to high-ability weavers. The findings are consistent with the knowledge sharing hypothesis that low-ability workers learn from high-ability workers but not vice versa. Second, by exploiting the well-documented fact that an exogenously-formed sharp divide between urban workers and rural migrant workers exists in firms in Chinese cities, we find that performance spillovers/knowledge sharing take place only within the confines of social network. Specifically rural low-ability weavers are found to improve their performance as their high-ability teammates (who are also rural migrants) improve their performance while they do not benefit from performance improvement of their high-ability teammates who are urban residents. Such heterogeneous performance interdependence of workers within the same team suggests that our evidence for performance spillovers is less likely to be a result of team specific demand shocks that generate spurious performance interdependence of all team members. |
| Keywords: | knowledge sharing, performance spillovers, social network |
| JEL: | M5 J24 L2 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3340&r=lab |
| By: | KUNDU, AMIT |
| Abstract: | In this interlinked contract land market is tied with labour market. The landlord leases-out small size of land to the landless agricultural labour households under fixed rent system prior to agricultural peak season on the basis of their commitment to work under his field through out that season. A household can bind itself in such a contract if and only if it has certain number of family labour force. But which households can ultimately tie them in such a contract is totally decided by the market force in that village economy where the family labour force is the determining factor. The paper also shows that this interlinked contract may generate involuntary unemployment in the agricultural labour market and under certain conditions the tied households can not only cross the reservation level of income but also can cross the poverty line. |
| Keywords: | Family Farming; Agricultural Labour Market; Interlinked Contract; Poverty |
| JEL: | J43 I3 |
| Date: | 2007–10–26 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:7615&r=lab |
| By: | Ian Dew-Becker; Robert J. Gordon |
| Abstract: | Throughout the postwar era until 1995 labor productivity grew faster in Europe than in the United States. Since 1995, productivity growth in the EU-15 has slowed while that in the United States has accelerated. But Europe's productivity growth slowdown was largely offset by faster growth in employment per capita, leaving little difference in growth of output per capita between the EU and US going back to 1980. This paper is about the strong negative tradeoff between productivity and employment growth within Europe. We document this tradeoff in the raw data, in regressions that control for the two-way causation between productivity and employment growth, and we show that there is a robust negative correlation between productivity and employment growth across countries and time. Our primary explanatory variables to explain both the revival of EU employment growth and the slowdown in productivity growth include six policy and institutional variables. We find that several of these variables have significant negative effects on employment per capita, both before and after 1995. We also find a significant time effect, that the increase in European employment per capita increased after 1995 for reasons that go beyond our six explanatory variables, and we link this time effect to a secular increase in the labor-force participation of women, particularly in southern European countries. We conclude by suggesting that evaluations of alternative policy reforms in Europe should take into account any offsetting effects on employment and productivity by examining the ultimate impact on changes in income per capita. |
| JEL: | E0 E23 E24 E60 J20 J21 J23 |
| Date: | 2008–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13840&r=lab |
| By: | Chiswick, Barry R. (University of Illinois at Chicago) |
| Abstract: | This paper is concerned with trends over the post-WWII period in the employment of American Jews as College and University teachers and in their receipt of the PhD. The empirical analysis is for PhD production from 1950 to 2004 and Jews are identified by the Distinctive Jewish Name (DJN) technique. Descriptive statistics and multiple regression analyses are reported. Central roles are played in the regression analysis by variables for military conscription, the Korean and Vietnam Wars, and US government funding for research and development. Among the DJNs, the simple data show that male PhD graduates increased in number in the post-war period up to early 1970s, and declined thereafter. Among DJN women, however, annual PhD production increased throughout the period. The ratio of DJN to all PhDs declined throughout the period for both men and women. Other variables the same, male DJN PhD production increased to about 1967 and then declined, while for DJN females it increased throughout the period. The ratio of DJN to all PhDs started to decline among men in the 1950s and continued thereafter, while among women the DJN share increased until about 1979, and then declined. These data are consisted with the hypothesis that discrimination against Jews in salaried professional occupations declined in the post-WWII period earlier in College and University teaching than in other sectors of the economy that do not require a PhD degree for employment. |
| Keywords: | American Jews, education, discrimination, gender |
| JEL: | I21 J71 J44 |
| Date: | 2008–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3384&r=lab |
| By: | Constant, Amelie (DIW DC, Georgetown University and IZA); D'Agosto, Elena (University of Rome Tor Vergata) |
| Abstract: | This paper studies the major determinants that affect the country choice of the talented Italian scientists and researchers who have at least a bachelor’s from Italy and live abroad. There are three alternative country choices: the US/Canada, the UK, and other EU countries. On average, the brainy Italians exhibit a higher predicted probability to go to the US. Ceteris paribus, both push and pull factors are important. While having a Ph.D. from outside Italy predicts the UK choice, having extra working experience from outside Italy predicts migration to other EU countries. Those who stay abroad temporarily for two to four years are definitely more likely to go to the UK. Specialization in the fields of humanities, social sciences, and health are strong determinants of migration to the UK. For the move to the US, while the humanities area is a significant deterrent, health is a positive deciding factor. Lack of funds in Italy constitutes a significant push to the US. |
| Keywords: | brain drain, skilled migration, Italy, push-pull factors |
| JEL: | J61 J24 F22 |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3325&r=lab |
| By: | Canaday, Neil; Tamura, Robert |
| Abstract: | We present a model of public provision of education for blacks in two discriminatory regimes, white plantation controlled, and white town controlled. We show that the ability to migrate to a non-discriminating district constrains the ability of both types of whites to discriminate. The model produces time series of educational outcomes for whites and blacks that mimic the behavior seen in Post Reconstruction South Carolina to the onset of the Civil Rights Act. It also fits the Post World War II black-white income differentials. |
| Keywords: | discriminatory education provision; black-white education differences |
| JEL: | J71 J24 J42 |
| Date: | 2007–07–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:7723&r=lab |
| By: | Leuven, Edwin (University of Amsterdam); Oosterbeek, Hessel (University of Amsterdam); Sonnemans, Joep (University of Amsterdam); van der Klaauw, Bas (Free University of Amsterdam) |
| Abstract: | A vast body of empirical studies lends support to the incentive effects of rank-order tournaments. Evidence comes from experiments in laboratories and non-experimental studies exploiting sports or firm data. Selection of competitors across tournaments may bias these non-experimental studies, whereas short task duration or lack of distracters may limit the external validity of results obtained in lab experiments or from sports data. To address these concerns we conducted a field experiment where students selected themselves into tournaments with different prizes. Within each tournament the best performing student on the final exam of a standard introductory microeconomics course could win a substantial financial reward. A standard non-experimental analysis exploiting across tournament variation in reward size and competitiveness confirms earlier findings. We find however no evidence for effects of tournament participation on study effort and exam results when we exploit our experimental design, indicating that the non-experimental results are completely due to sorting. Treatment only affects attendance of the first workgroup meeting following the announcement of treatment status, suggesting a difference between short-run and long-run decision making. |
| Keywords: | tournaments, incentives, sorting, field experiments |
| JEL: | J33 C93 M52 |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3326&r=lab |
| By: | Grossmann, Volker (University of Fribourg); Stadelmann, David (University of Fribourg) |
| Abstract: | This paper theoretically and empirically analyzes the interaction of emigration of highly skilled labor, an economy’s income gap to potential host economies of expatriates, and optimal public infrastructure investment. In a model with endogenous education and R&D investment decisions we show that international integration of the market for skilled labor aggravates between-country income inequality by harming those which are source economies to begin with while benefiting host economies. When brain drain increases in source economies, public infrastructure investment is optimally adjusted downward, whereas host economies increase it. Evidence from 77 countries well supports our theoretical hypotheses. |
| Keywords: | brain drain, cross-country evidence, educational choice, public infrastructure investment, R&D investment |
| JEL: | F22 O30 H40 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3366&r=lab |
| By: | Bachmann, Ronald (RWI Essen); Burda, Michael C. (Humboldt University, Berlin) |
| Abstract: | This paper analyzes the interaction between structural change and labor market dynamics in West Germany, during a period in which industrial employment declined by more than 30% and service sector employment more than doubled. Using transition data on individual workers, we document a marked increase in structural change and turbulence, in particular since 1990. Net employment changes resulted partly from an increase in gross flows, but also from an increase in the net transition “yield" at any given gross worker turnover. In growing sectors, net structural change was driven by accessions from nonparticipation rather than unemployment; contracting sectors reduced their net employment primarily via lower accessions from nonparticipation. While gross turnover is cyclically sensitive and strongly procyclical, net reallocation is countercyclical, meaning that recessions are associated with increased intensity of sectoral reallocation. Beyond this cyclical component, German reunification and Eastern enlargement appear to have contributed significantly to this accelerated pace of structural change. |
| Keywords: | gross worker flows, sectoral and occupational mobility, turbulence |
| JEL: | J63 J64 J62 |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3324&r=lab |
| By: | Peter Havlik (The Vienna Institute for International Economic Studies, wiiw); Sebastian Leitner (The Vienna Institute for International Economic Studies, wiiw); Robert Stehrer (The Vienna Institute for International Economic Studies, wiiw) |
| Abstract: | The collapse of communist regimes in Central and Eastern Europe marked a historical event for the countries on both sides of the iron curtain. Using the recently released EU KLEMS database on detailed sectoral growth and employment measures, we analyse the productivity performance in the period after 1995 for five transition economies, i.e. the Czech Republic, Hungary, Poland, the Slovak Republic and Slovenia, and compare their performance with a group of European core economies and partly Austria as a neighbouring small open economy. Our analysis reveals a strong catching-up process with the Western European economies in terms of productivity and sectoral structures. The factors driving this convergence process, however, differ across countries and industries. Apart from an analysis at the aggregate or broad sectoral performance we devote special emphasis to the detailed industry level and in particular to the manufacturing industry, which has served as the main driver in growth and productivity. We demonstrate that the Central and Eastern European countries have successfully specialized in higher-tech industries while maintaining gaps, albeit diminishing, in services. As the strong productivity catching-up was accompanied by low employment growth in the period 1995-2004 - despite high unemployment levels - we also investigate the labour market structures and the changes in patterns of employment. |
| Keywords: | economic transition, restructuring, growth, multifactor productivity, labour demand |
| JEL: | D24 P52 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:wii:spaper:statr:3&r=lab |
| By: | Halliday, Timothy (University of Hawaii at Manoa); Kwak, Sally (University of Hawaii at Manoa) |
| Abstract: | We employ a standard identification strategy from the peer effects literature to investigate the importance of network definitions in estimation of endogenous peer effects. We use detailed information on friends in the Adolescent Longitudinal Health Survey (Add Health) to construct two network definitions that are less ad hoc than the school-grade cohorts commonly used in the educational peer effects literature. We demonstrate that accurate definitions of the peer network seriously impact estimation of peer effects. In particular, we show that peer effects estimates on educational achievement, smoking, sexual behavior, and drinking are substantially larger with our more detailed measures than with the school-grade cohorts. These results highlight the need to further understand how friendships form in order to fully understand implications for policy that alters the peer group mix at the classroom or cohort level. |
| Keywords: | peer effects, education, adolescent health |
| JEL: | I12 I20 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3335&r=lab |
| By: | Bruce Chapman; Mark Rodrigues; Chris Ryan |
| Abstract: | The public vocational education and training (VET) system is now one of the few areas in Australia’s tertiary education system where students are required to pay up-front fees without access to loan assistance. These arrangements may lead to sub-optimal educational outcomes to the extent that prospective students reject a VET education on the basis of short-term financial constraints. In this paper we analyse some of the important issues related to the adoption of FEE-HELP (a 2005 Federal Government financial instrument based on the Higher Education Contribution Scheme (HECS)). It is argued that income contingent loans of this kind are associated with the advantages of both default-protection and consumption smoothing. Using data from the first three waves of the Household Income and Labour Dynamics in Australia (HILDA) survey, we examine various empirical issues associated with the adoption of FEE-HELP in VET, including the extent of private salary returns to VET qualifications. As well, we explore issues related to the public subsidies inherent in the adoption of FEE-HELP in VET, and illustrate the time periods involved in loan repayments for various assumptions concerning the size of the charge and the future income of VET graduates. Administrative issues are considered, as are the implications for the Commonwealth Government with respect to potential subsidies associated with the design parameters. |
| Keywords: | educational finance, educational economics, vocational education |
| JEL: | I22 I28 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:auu:dpaper:570&r=lab |
| By: | Dan Andrews; Andrew Leigh |
| Abstract: | We investigate the relationship between inequality and intergenerational mobility. Proxying fathers’ earnings with using detailed occupational data, we find that sons who grew up in countries that were more unequal in the 1970s were less likely to have experienced social mobility by the late-1990s. |
| Keywords: | intergenerational mobility, income distribution, equality of opportunity |
| JEL: | D31 J62 N30 |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:auu:dpaper:566&r=lab |
| By: | Aleksynska, Mariya |
| Abstract: | This paper employs the European Social Survey and the World Values Survey to empirically investigate civic participation of immigrants from fifty-four countries of origin to the European Union. Three sets of issues are addressed in this paper. First, the paper aims at understanding what factors determine civic participation of immigrants at large. Second, it seeks to shed light on differences and similarities between participation outcomes of immigrants and natives. The main part of the paper is dedicated to testing culture transmission and culture assimilation hypothesis with respect to civic participation. Culture assimilation is analysed within the traditional synthetic cohort methodology, and also by testing whether the levels of immigrants’ civic participation depend on the levels of natives’ civic participation in the same countries. Culture transmission is looked at by relating the levels of participation of nonmigrants in countries of origin to participation outcomes of those who migrate. In addition, the effect of other country of origin and country of destination characteristics on immigrants’ civic participation is investigated. The issue of immigrants’ self-selection is addressed by matching immigrants to otherwise similar natives and compatriots who did not migrate. The study finds limited evidence for the transmission of participation culture across borders, although certain home country characteristics continue influencing participation behaviour of individuals after migration: it is those from industrialized, net immigration, culturally more homogeneous countries who tend to participate more. On the other hand, the culture of current place of residence matters most in that by observing higher (lower) participation patterns among natives immigrants tend to participate more (less). |
| Keywords: | immigration; civic participation; social assimilation; culture transmission |
| JEL: | F22 Z10 O15 J61 Z13 |
| Date: | 2007–04 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:4594&r=lab |
| By: | Fougère, Denis (CREST-INSEE); Safi, Mirna (CREST-INSEE) |
| Abstract: | Naturalization is usually regarded as an important sign of civic and political integration amongst immigrants, but it can also be seen as a factor of their economic integration. The aim of this study is to analyze the naturalization phenomenon in France and examine its link with the immigrants’ labor force status. We use longitudinal data from the “Echantillon Démographique Permanent” (EDP) sample. The EDP is a panel dataset by which we can follow almost 1% of the French population from 1968 to 1999 through information contained in the 1968, 1975, 1982, 1990 and 1999 French census. The sample we use (N = 36,685) is limited to immigrants who declared themselves non-naturalized at the time they first appeared in the panel. This makes it possible for us to observe possible changes of nationality between two census dates and their potential consequences on the employment probability at the second date. In our study, the probability of naturalization between two census dates not only depends on observable individual characteristics of immigrants (country of birth, age, marital situation, occupation, human capital, etc.), but also on a number of contextual variables related to the role of the community in the assimilation process (size of the community and number of foreigners in the region of residence). We compare the differential rates of naturalization between the various ethnic groups and try to answer the following question: are there differences between the naturalized immigrant population and the immigrant population as a whole? In the second stage, we analyze the effect of naturalization on the individual employment probability by estimating a univariate probit model. To control for the potential endogeneity of the naturalization process, we also estimate a bivariate probit model. With both models, we find that naturalization has a significant positive effect on immigrants’ employability and that this effect is particularly high for groups of immigrants who have a low probability of employment in the host country. |
| Keywords: | immigration, naturalization, citizenship, employment |
| JEL: | F22 J15 J61 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3372&r=lab |
| By: | Steven G. Prus; Robert L. Brown |
| Abstract: | Objectives -- The study has two primary goals. First, to test the hypothesis that higher levels of income inequality are related to lower levels of population health with updated data from around year 2000. Second, to examine the inequality-health relationship across the life course with particular focus on old age when income distributions often shift dramatically. Design -- Correlation techniques were used to assess the relationship between income inequality (Gini ratio) at ages 0+, 25+, 65+, 75+, and 85+ and life expectancy at corresponding ages (0, 25, 65, 75, 85) by sex, before and after adjusting for average population income. Analyses were conducted on two sets of data: 18 wealthy countries and 28 wealthy and non-wealthy countries.<br> Data sources -- International cross-sectional data on income and life expectancy from about year 2000 were derived from the Luxembourg Income Study and the United Nations Demographic Yearbook respectively.<br> Results -- Among wealthy countries the negative effect of income inequality on life expectancy at birth becomes insignificant after controlling for average absolute income: the correlation coefficient changes from -0.603 to -0.207 for men and -0.605 to 0.024 for women. A similar pattern is observed at age 25. By contrast, the effect becomes increasingly positive and significant across old age, notably for males, regardless of adjustments for average population income or countries of observation.<br> Conclusions -- These updated results do not support the inequality-health hypothesis. The relationship between income inequality and life expectancy at earlier ages in wealthy countries can be explained by the confounding effect of average absolute income. In old age the data are entirely contrary to the hypothesis. More research is needed to understand the mechanisms that facilitate the increasing positive effect of income inequality on life expectancy in late life. |
| Keywords: | Cross-national; Income Inequality; Population Health; Life Expectancy; Age |
| JEL: | I10 D63 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:mcm:sedapp:229&r=lab |
| By: | Dasgupta, Indraneel (University of Nottingham); Maitra, Pushkar (Monash University); Mukherjee, Diganta (affiliation not available) |
| Abstract: | We model the consequences of parental control over choice of wives for sons, for parental incentives to educate daughters, when the marriage market exhibits competitive dowry payments and altruistic but paternalistic parents benefit from having married sons live with them. By choosing uneducated brides, some parents can prevent costly household partition. Paternalistic self-interest consequently generates low levels of female schooling in the steady state equilibrium. State payments to parents for educating daughters fail to raise female schooling levels. Policies (such as housing subsidies) that promote nuclear families, interventions against early marriages, and state support to couples who marry against parental wishes, are however all likely to improve female schooling. We offer evidence from India consistent with our theoretical analysis. |
| Keywords: | arranged marriage, dowry, bride price, female literacy, marriage markets, stable marriage allocation |
| JEL: | D10 D91 J12 J16 |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3336&r=lab |
| By: | Osipian, Ararat |
| Abstract: | Russian higher education is in the process of reforming. Introduction of the standardized computer-graded test and educational vouchers was intended to increase accessibility of higher education, make its funding more effective, and reduce corruption in admissions to public colleges. The idea of vouchers failed while the test faces furious opposition and crises. This paper considers vouchers, standardized tests, educational loans, and privatization as related to educational corruption. The test is criticized by many for being a cause of the further increase in educational corruption. However, the test is needed to replace the outdated admissions policy based on the entry examinations. This paper considers the growing de facto privatization of the nation’s higher education as a fundamental process that should be legalized and formalized. It suggests further restructuring of the higher education industry, its decentralization and privatization, and sees educational loans as a necessary part of the future system of educational funding. |
| Keywords: | corruption; education; loans; privatization; reform; Russia; vouchers |
| JEL: | D73 P36 |
| Date: | 2007–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:7595&r=lab |
| By: | Greenwood, Jeremy (University of Pennsylvania); Guner, Nezih (Universidad Carlos III, Madrid) |
| Abstract: | Since World War II there has been: (i) a rise in the fraction of time that married households allocate to market work, (ii) an increase in the rate of divorce, and (iii) a decline in the rate of marriage. It is argued here that labor-saving technological progress in the household sector can explain these facts. This makes it more feasible for singles to maintain their own home, and for married women to work. To address this question, a search model of marriage and divorce, which incorporates household production, is developed. An extension looks back at the prewar era. |
| Keywords: | marriage, divorce, hours worked, household production, household size, technological progress |
| JEL: | E13 J12 J22 O11 |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp3313&r=lab |
| By: | Pinotti, Paolo |
| Abstract: | Financial markets and pay-as-you-go social security are two alternative ways to provide for retirement. Voting over the size of social security programs could therefore be partly determined by financial development. In this paper I allow for this possibility in an OLG model where financial development may be hindered by frictions. The main implication of the model is that greater financial frictions lead to lower financial investment and higher social security transfers in the political-economy equilibrium. To explore this model implication empirically, I use countries’ legal origin as a proxy of frictions that may hold back financial development. The empirical analysis yields a strong and robust negative effect of financial development on the size of social security transfers. |
| Keywords: | social security; financial development; legal origins. |
| JEL: | H55 D91 G10 |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:7599&r=lab |