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on Labour Economics |
| By: | Lia Pacelli; Silvia Pasqua; Claudia Villosio |
| Abstract: | Many studies have been devoted to analyse the effect of maternity on working mothers; they mostly refer to countries where female participation is high. Fewer studies consider Southern European countries. This paper aims at filling the gap analysing the effects of motherhood on women’s working career in Italy, a neat example of Southern European country where female participation is increasing but still low and where the decrease in trade unions’ power increased wage disparities. Our results show that conditional average wages of mothers become significantly lower than those of non-mothers after childbirth, showing no sign of a closing gap 5 years afterward. However, this penalty does not emerge for mothers moving to a part-time job; hence - differently from the existing literature - we highlight the potential role of part-time jobs in mitigating the "reduced effort" effect of childrearing. Furthermore, we estimate a significant increase in the probability of transition from employment to non-employment for new mothers. The probability is higher the lower the pre-childbirth wage. However, this penalty is reduced by the availability of part-time jobs in mothers’ relevant labour market. Hence again it emerges the potential role of part-time jobs in mitigating the negative effect of childbirth on women’s labour market participation. the support for flexibility among the least productive employed workers. The model described provides some new insights on the comparative dynamics of labor market institutions in the U.S. and in Europe over the last few decades, shedding some new light both on the reasons for the original build-up of "Eurosclerosis," and for its the persistence up to the present day. |
| Keywords: | motherhood, part-time jobs, wage penalty, career. |
| JEL: | J13 J31 |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:cca:wplabo:78&r=lab |
| By: | Richard B. Freeman |
| Abstract: | This essay reviews what economists have learned about the impact of labor market institutions, defined broadly as government regulations and union activity on labor outcomes in developing countries. It finds that: 1) Labor institutions vary greatly among developing countries but less than they vary among advanced countries. Unions and collective bargaining are less important in developing than in advanced countries while government regulations are nominally as important. 2) Many developing countries compliance with minimum wage regulations produce spikes in wage distributions around the minimum in covered sectors. Most studies find modest adverse effects of the minimum on employment so that the minimum raises the total income of low paid labor. 3) In many countries minimum wages “spill-over†to the unregulated sector, producing spikes in the wage distributions there as well. 4) Employment protection regulations and related laws shift output and employment to informal sectors and reduce gross labor mobility. 5) Mandated benefits increase labor costs and reduce employment modestly while the costs of others are shifted largely to labor, with some variation among countries. 6) Contrary to the Harris-Todaro two sector model in which rural-urban migration adjust to produce a positive relation between unemployment and wages across regions and sectors, wages and unemployment are inversely related by the “wage curveâ€. 7) Unions affect non-wage outcomes as well as wage outcomes. 8) Cross-country regressions yield inconclusive results on the impact of labor regulations on growth while studies of country adjustments to economic shocks, such as balance of payments problems, find no difference in the responses of countries by the strength of labor institutions. 9) Labor institution can be critical when countries experience great change, as in China’s growth spurt and Argentina’s preservation of social stability and democracy after its 2001-2002 economic collapse. Cooperative labor relations tend to produce better economic outcomes. 10) The informal sector increased its share of the work force in the developing world in the past two decades. The persistence of large informal sectors throughout the developing world, including countries with high rates of growth, puts a premium on increasing our knowledge of how informal sector labor markets work and finding institutions and policies to deliver social benefits to workers in that sector. |
| JEL: | J01 J08 J2 J3 J31 J5 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:14789&r=lab |
| By: | Colin Green |
| Abstract: | Informal job search methods could alleviate short-term labour market difficulties of displaced workers by providing information on job opportu- nities, allowing them to signal their productivity and may mitigate wage losses through better post-displacement job matching. However if dis- placement results from reductions in demand for specific sectors/skills, the use of informal job search methods may increase the risk of job insta- bility. We examine the effect of jobs search methods on post-displacement outcomes. While informal job search methods are associated with shorter unemployment duration, and lower wage losses, they lead to increased job instability and increased risk of subsequent job displacement. |
| Keywords: | Job Displacement, Search Methods, Job Security |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:lan:wpaper:005926&r=lab |
| By: | Heywood, John S. (University of Wisconsin, Milwaukee); Siebert, W. Stanley (University of Birmingham, UK) |
| Abstract: | The paper asks why retirement can be so abrupt in countries such as France (½% of the workforce over 65), yet staged in Japan (8% over 65). We find part of the answer in tax laws that prevent people working and receiving a pension, and make little allowance for fair pension increases if retirement is deferred. While these laws have begun to change, we find another part of the answer in employment protection laws. These laws coupled with inflexible collectively agreed wages make employers choosy about hiring the old. The advent of "age discrimination" law reinforces employment protection and may well reduce older workers' hiring opportunities especially where wages are rigid. |
| Keywords: | mandatory retirement, deferred pay, age discrimination, older workers |
| JEL: | I38 J32 J71 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4033&r=lab |
| By: | Carrillo-Tudela, Carlos (University of Leicester); Smith, Eric (University of Essex) |
| Abstract: | This paper examines wage dispersion and wage dynamics in a stock-flow matching economy with on-the-job search. Under stock-flow matching, job seekers immediately become fully informed about the stock of viable vacancies. If only one option is available, monopsony wages result. With more than one firm bidding, Bertrand wages arise. The initial and expected threat of competition determines the evolution of wages and thereby introduces a novel way of understanding wage differences among similar workers. The resulting wage distribution has an interior mode and prominent, well-behaved tails. The model also generates job-to-job transitions with both wage cuts and jumps. |
| Keywords: | wage dispersion, wage dynamics, job search, stock-flow matching |
| JEL: | J31 J63 J64 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4031&r=lab |
| By: | Danièle Meulders (DULBEA, Université libre de Bruxelles, Brussels); Sîle O'Dorchai (DULBEA, Université libre de Bruxelles, Brussels) |
| Abstract: | Since the 90s European discourse tends to present flexibility as the magic tool to raise employment, even if in a context of crisis, more flexible workers will be dismissed faster. The purpose of this paper is to assess the evolution of working time arrangements in Belgium as of 1992 from a gender perspective. It appears that new innovative forms of flexibility have not spread widely in Belgium but that the basic form of time flexibility, i.e. part time work, has developed (and continues to develop) rapidly amongst women workers. Part-time work is however one of the main causes of existing gender gaps on Belgium’s labour market. |
| Keywords: | Flexibility, working time, gender gaps, part time work |
| JEL: | J71 J2 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:dul:wpaper:09-08rr&r=lab |
| By: | Mariano Bosch (Departamento de Fundamentos del Analisis Economico, Universidad de Alicante); Julen Esteban-Pretel (Faculty of Economics, University of Tokyo) |
| Abstract: | The proportion of informal or unprotected workers in developing countries is large. In developing economies, the fraction of informal workers can be as high as 70% of total employment. For economies with significant informal sectors, business cycle fluctuations and labor market policy interventions can have important effects on the unemployment rate, and also produce large reallocations of workers between "regulated" and "unregulated" jobs. In this paper, we report the main cyclical patterns of one such labor market: Brazil. We then use the empirical regularities found in the data to build, calibrate, and simulate a two-sector search and matching labor market model, in which firms have the choice of hiring workers formally or informally. We find that our model, built in the spirit of traditional search and matching models, can explain well most of the cyclical properties found in the data. We also show that government policies that decrease the cost of formal jobs, or increase the cost of informality, raise the share of formal employment while reducing unemployment. |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:tky:fseres:2009cf613&r=lab |
| By: | Lene Kromann (School of Economics and Management, University of Aarhus, Denmark) |
| Abstract: | This paper offers a study of possible favoritism of normal-weight individuals when firms make decisions on hiring, firing and promoting. Most existing studies use a wage equation to document dispersion in wages between normal- and overweight, however little is known about the reason for dispersion. Furthermore, the wage equations do not capture the sorting of workers into different occupations and industries. Using an equilibrium search model, this paper takes search friction and cross-firm differences in factor productivity into account, when looking at firm behavior. Addition- ally, a logit model is used to examine the occupation and industry distribution. Most importantly, we find that wage differences between normal-weight and overweight or obese workers are explained by differential firm behavior, both with respect to the job offer arrival rate and to the probability of being promoted. Further, we find that the trade industry hire overweight workers to a lesser extent than other industries. |
| Keywords: | Overweight, Firm behavior, Equilibrium Search Model, Multinomial Logit |
| JEL: | I10 |
| Date: | 2009–03–09 |
| URL: | http://d.repec.org/n?u=RePEc:aah:aarhec:2009-04&r=lab |
| By: | Guido Menzio (Department of Economics, University of Pennsylvania); Shouyong Shi (Department of Economics, University of Toronto) |
| Abstract: | We build a directed search model of the labor market in which workers’ transitions between unemployment, employment, and across employers are endogenous. We prove the existence, uniqueness and efficiency of a recursive equilibrium with the property that the distribution of workers across employment states affects neither the agents’ values and strategies nor the market tightness. Because of this property, we are able to compute the equilibrium outside the non-stochastic steady-state. We use a calibrated version of the model to measure the effect of productivity shocks on the US labor market. We find that productivity shocks generate procyclical fluctuations in the rate at which unemployed workers become employed and countercyclical fluctuations in the rate at which employed workers become unemployed. Moreover, we find that productivity shocks generate large counter-cyclical fluctuations in the number of vacancies opened for unemployed workers and even larger procyclical fluctuations in the number of vacancies created for employed workers. Overall, productivity shocks alone can account for 80 percent of unemployment volatility, 30 percent of vacancy volatility and for the nearly perfect negative correlation between unemployment and vacancies. |
| Keywords: | Directed search, On the Job Search, Business Cycles |
| JEL: | E24 E32 J64 |
| Date: | 2008–08–11 |
| URL: | http://d.repec.org/n?u=RePEc:pen:papers:09-010&r=lab |
| By: | Tregenna, F. |
| Abstract: | Unemployment and earnings inequality have moved closely together in South Africa in recent years, suggesting that there may not be a trade-off between them as the literature generally suggests. This article explores the relationship between unemployment and earnings inequality in South Africa, specifically investigating the extent to which changes in unemployment can account for changes in earnings inequality. Decomposing overall income inequality by factor source shows the overwhelming importance of earnings in income inequality more generally. Decomposing earnings inequality by employment status reveals the centrality of unemployment in accounting for the level and trend of earnings inequality. The distribution of employment in the formal and informal sectors is found to be of lesser importance in explaining earnings inequality, as is wage dispersion within each of these categories. The findings point to the critical importance of reducing unemployment in South Africa if the extremely high levels of inequality are to be addressed. |
| Keywords: | Inequality, earnings distribution, unemployment, labour market, South Africa. |
| JEL: | D30 E24 J31 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:0907&r=lab |
| By: | Besancenot, Damien (CEPN and University Paris 13); Vranceanu, Radu (ESSEC Business School) |
| Abstract: | This paper analyzes the decision of a migrant to return or stay within the framework of a signaling model with exogenous migratory costs. If employers have only imperfect information about the type of a worker and good workers migrate, bad workers might copy their strategy in order to get the same high wage as the good workers. Employers will therefore reduce the wage they pay to migrants and good workers incur a loss compared to the perfect information setup. In one hybrid equilibrium of the game, the more bad workers migrate, the higher the incentive for good workers to come back. Policy implications follow |
| Keywords: | Temporary Migration; Return Migrants; Hybrid Bayesian Equilibrium; Signalling Model |
| JEL: | D82 F22 J61 |
| Date: | 2008–11 |
| URL: | http://d.repec.org/n?u=RePEc:ebg:essewp:dr-08017&r=lab |
| By: | Maria Knoth Humlum; Rune Majlund Vejlin (School of Economics and Management, University of Aarhus, Denmark) |
| Abstract: | We investigate the effects of financial aid on student employment and academic outcomes in high school. We exploit administrative differences in the amount of financial aid received based on timing of birth to identify the causal effects of interest. Specifically, individuals born early in a quarter receive less financial aid than comparable individuals born late in the previous quarter. We find that receiving less aid induces individuals to work more during high school. However, we do not find any evidence that receiving less financial aid and thereby working more is associated with any adverse outcomes, such as a lower high school grade point average. |
| Keywords: | student grants, high school employment, regression discontinuity |
| JEL: | I28 J22 J24 |
| Date: | 2009–01–28 |
| URL: | http://d.repec.org/n?u=RePEc:aah:aarhec:2009-02&r=lab |
| By: | Baldan, Cristina; Neacsu, Madalina |
| Abstract: | The employment, but also the efficient use of the available work resources is directly connected to the work market. It is an element that cannot be separated from the other elements of the work market, especially from unemployment, because if one deals with them separately, one cannot cover all the aspects, particularities and effects on the work factor. There are many causes for unemployment, causes that are to be found both at the macroeconomic level and at the microeconomic level. In most of the cases, in an analysis that aims at finding the causes that have generated the unemployment, many characteristics of unemployment are taken into account and they are analysed as “types” of unemployment. |
| Keywords: | Employment; Unemployment; Wages; Intergenerational Income Distribution; |
| JEL: | J41 |
| Date: | 2008–05–27 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:13921&r=lab |
| By: | Antecol, Heather (Claremont McKenna College); Steinberger, Michael (Pomona College) |
| Abstract: | Using 2000 U.S. Census data we illustrate the importance of accounting for household specialization in lesbian couples when examining the sexual orientation gap in female labor supply. Specifically, we find the labor supply gap is substantially larger between married women and partnered lesbian women who specialize in market production (primary earners) than between married women and partnered lesbian women who specialize in household production (secondary earners). Using a semi-parametric decomposition approach, we further show that the role of children in explaining the mean labor supply gap by sexual orientation is greatly understated if the household division of labor between household and market production is not taken into account. Finally, we illustrate that controlling for children significantly reduces differences between married women and secondary lesbian earners both in terms of the decision to remain attached to the labor market (the extensive margin), as well as in terms of annual hours of work conditional on working (the intensive margin). Further, the effect of controlling for children is not uniform across the distribution of conditional annual hours; instead it primarily reduces the percentage of secondary lesbian earners working extremely high annual hours. |
| Keywords: | household specialization, female labor supply, sexual orientation |
| JEL: | J22 J24 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4029&r=lab |
| By: | Pavlina R. Tcherneva |
| Abstract: | Job creation is once again at the forefront of policy action, and for advocates of pro-employment policies, President Obama's Keynesian bent is a most welcome change. However, there are concerns that Obama's plan simply does not go far enough, and that a large-scale public investment program may face shortages of skilled labor, put upward pressure on wages, and leave women and minorities behind. Both concerns can be addressed by a simple amendment to the Obama plan that will bring important additional benefits. The amendment proposed here is for the government to offer a job guarantee to all unemployed individuals who are ready, willing, and able to participate in the economic recovery--that is, to target the unemployed directly. |
| Date: | 2009–01 |
| URL: | http://d.repec.org/n?u=RePEc:lev:levypn:09-1&r=lab |
| By: | Carlo Alcaraz; Daniel Chiquiar; Manuel Ramos Francia |
| Abstract: | We estimate wage differentials across different sectors of the Mexican economy. The results suggest that the wage differential between the formal and informal sectors is significant and larger than the differential between industry and services. The findings suggest that significant differences in productivity levels between the formal and informal sectors could exist. This, in turn, might imply that the economy's aggregate productivity could be affected by the increase of the share of informal employment. The results also suggest that the main distortions in the Mexican labor market seem to be related more with labor regulations that affect the allocation of resources between formal and informal activities, than a result of intrinsic characteristics of the production processes in the industrial and service sectors. |
| Keywords: | Informal Sector, Productivity, Labor Market Distortions |
| JEL: | J24 J31 O17 |
| Date: | 2008–07 |
| URL: | http://d.repec.org/n?u=RePEc:bdm:wpaper:2008-06&r=lab |
| By: | Muñoz de Bustillo, Rafael; Carrera, Miguel; Antón, José-Ignacio |
| Abstract: | This article analyses the immigrant-native wage differentials in Spain, which only recently has become a host country. The paper exploits the Earnings Structure Survey 2006, which is the first nationally representative sample of both foreigner and Spaniard employees. Using the Machado-Mata econometric procedure, wage differentials between locals and foreigners are decomposed into the gap related to characteristics and that due to different returns to endowments (i.e., discrimination). We found that, in absolute terms, the latter component grows across wage distribution, reflecting the existence of a kind of glass ceiling consistent with the evidence of over-education found by previous research. |
| Keywords: | immigration; wage differentials; Spain; quantile regression |
| JEL: | F22 J71 |
| Date: | 2009–02–25 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:13928&r=lab |
| By: | de Grip, Andries (ROA, Maastricht University); Lindeboom, Maarten (Free University Amsterdam); Montizaan, Raymond (ROA, Maastricht University) |
| Abstract: | This paper assesses the impact of a dramatic reform of the Dutch pension system on mental health, savings behavior and retirement expectations of workers nearing retirement age. The reform means that public sector workers born on January 1, 1950 or later face a substantial reduction in their pension rights while workers born before this threshold date may still retire under the old, more generous rules. We employ a unique matched survey and administrative data set comprising male public sector workers born in 1949 and 1950 and find strong ex ante effects on mental health for workers who are affected by the reform. This effect increases as birth dates approach the threshold date. Furthermore, the effects differ in accordance with worker characteristics. Finally, we find that the response of those affected by the reform is to work longer and to save more. |
| Keywords: | mental health, retirement, pension reform, causal effect |
| JEL: | I12 J08 J14 J26 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4034&r=lab |
| By: | David Johnson (Wilfrid Laurier University) |
| Abstract: | This study concludes that (i) stoppages can be shown to have a strong negative impact on student learning outcomes in Grade 6; the overall impact of stoppages on Grade 3 pupils appears to be much smaller, perhaps zero, although there is a noticeable, negative effect on achievement in mathematics; and, work stoppages have much greater adverse effects on students in both Grade 3 and Grade 6 in schools where more students come from disadvantaged backgrounds. |
| Keywords: | elementary teacher strikes or lockouts, education, work stoppages |
| JEL: | H75 I21 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:cdh:ebrief:74&r=lab |
| By: | Vassiliki Koutsogeorgopoulou |
| Abstract: | The Australian education system fares well in international comparison with regards to PISA test scores and the higher education system attracts an increasing number of foreign students. Vocational education and training (VET) is an important part of the post–secondary education system, equipping individuals with the skills to enter or re–enter the labour force and offering a pathway to further education. However, a number of challenges need to be addressed. Reducing complexity and fragmentation and tackling issues of under–supply and under–representation of children from disadvantaged groups in the early childhood education and care system is of major importance, given the beneficial impact of early education on outcomes later in life. A key challenge for the school sector is to reduce the achievement gaps of the lowest performing students, while improving overall literacy and numeracy outcomes. Greater autonomy at the school level and improvements in teaching quality would help in this regard. Enhancing the capacity of the VET system to address skill shortages is another key priority. The low rate of completion of training courses is an additional policy issue facing the sector. Finally, moving towards a less rigid policy framework for higher education would enhance flexibility and diversity, making the system more responsive to labour market needs and globalisation challenges. The promotion of a highquality education system that responds swiftly to changing skill needs is a top priority of the new government. The “Education Revolution”, backed by the Council of Australian Governments (COAG), pursues reforms across all sectors of the education system, an important objective being the closing of the gap for the indigenous population.<P>Améliorer les résultats dans le domaine de l’éducation en Australie<BR>L’Australie est relativement bien placée dans les comparaisons internationales des systèmes d’enseignement, à en juger notamment par les notes obtenues aux épreuves du PISA, et ses établissements d’enseignement supérieur attirent un nombre croissant d’étudiants étrangers. L’enseignement et la formation professionnels jouent un rôle important dans la formation postsecondaire et les qualifications qu’ils confèrent permettent aux intéressés de s’insérer ou de se réinsérer dans l’emploi ou bien d’accéder à un autre cycle de formation. Mais un certain nombre de problèmes subsistent. Il importe au premier chef de rendre le système moins complexe et moins compartimenté et de s’attaquer à la question des carences de l’offre et de la sous-représentation des enfants issus de milieux défavorisés dans le dispositif d’éducation et d’accueil des plus jeunes, compte tenu du rôle que jouent les premières années de formation dans la suite du parcours scolaire. L’un des défis majeurs consiste à réduire le retard des élèves moins performants, tout en améliorant le niveau global de maîtrise de l’écrit et du calcul. À cet égard, une plus grande autonomie des établissements et une amélioration de la qualité pédagogique pourraient se révéler utiles. Le renforcement de la capacité du système d’enseignement et de formation professionnels de faire face au manque de main-d’oeuvre qualifiée représente un autre objectif prioritaire. Le faible taux d’achèvement des cours de formation est un autre enjeu auquel est confronté ce secteur. Enfin, l’assouplissement du cadre d’action des autorités publiques dans le domaine de l’enseignement supérieur pourrait favoriser la flexibilité et la diversité en permettant à ce système de prendre davantage en compte les besoins du marché de l’emploi et les problèmes posés par la mondialisation. Le nouveau gouvernement considère comme hautement prioritaire l’action à mener pour promouvoir un système éducatif de haut niveau, en mesure de réagir rapidement à l’évolution des besoins en matière de qualifications. La « Révolution de l’éducation », soutenu par le Conseil des gouvernements australiens (COAG), vise à introduire des réformes dans tous les secteurs du système ; elle se propose notamment de réduire la fracture scolaire dont souffre la population autochtone. |
| Keywords: | human capital, education, capital humain, éducation, child care, early childhood education, PISA, PISA, éducation primaire, Educational Finance, financement de l’éducation, autonomy, autonomie, quality, teaching, universal access, student income support, crèche, accès universel, qualité de l'enseignement, garantie de ressources pour les étudiants |
| JEL: | I20 I21 I22 I28 J24 |
| Date: | 2009–03–03 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:678-en&r=lab |
| By: | Koch, Alexander K. (University of Aarhus); Morgenstern, Albrecht (Federal Ministry of Finance) |
| Abstract: | To innovate, employees need to develop novel ideas and coordinate with each other to turn these ideas into better products and services. Work outcomes provide signals about employees' abilities to the labor market, and therefore career concerns arise. These can both be 'good' (enhancing incentives for effort in developing ideas) and 'bad' (preventing voluntary coordination). Our model shows how the firm designs its explicit incentive system and organizes work processes to take these conflicting forces into account. The comparative statics results suggest a link between the increased use of teams and recent changes in labor market returns to skills. |
| Keywords: | career concerns, group incentives, knowledge work, reputation, teams |
| JEL: | D86 J30 L14 L20 M12 O30 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4039&r=lab |
| By: | Fabio Berton |
| Abstract: | A higher job creation is a common result by many theoretical approaches trying to model marginal labor market reforms. In the framework proposed by Berton and Garibaldi [2006], in particular, the equilibrium arrival rate of temporary job offers is expected to be higher than the arrival rate of permanent ones. In this paper I use a sample of prime aged male workers from WHIP in a competing risks framework in order to compare the duration of unemployment spells terminated by jobs that only di¤er in their formal duration. I fnd that the arrival rate of fixed term jobs is actually larger than the arrival rate of permanent ones; this result is robust to the main sources of unobserved heterogeneity. However, the average duration of unemployment in Italy is still very high and the liberalization of flexible contracts as a policy to reduce it did not completely solve the problem. |
| Keywords: | temporary jobs, unemployment duration, competing risks. |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:cca:wplabo:76&r=lab |
| By: | Alka Obadić (Faculty of Economics and Business, University of Zagreb) |
| Abstract: | Objective of this paper is to analyse the most recent changes of the interplay between the flexibility of the employment relationship on the one hand, and labour market and social policy, on the other. This article examines the new policy concept of "flexicurity" in view of the emerging flexibility-security approach that the European Union, national governments, sector of industry, individual companies and workers are currently facing. The flexicurity approach provides important answers to the question of how to meet modern labour market challenges and at the same time improve security. The special interest is concentrated on the so-called "golden triangle" of the Danish labour market successful flexicurity model. |
| Keywords: | labour market, flexibility, security, flexicurity, "Danish" model |
| JEL: | J0 J8 |
| Date: | 2009–02–25 |
| URL: | http://d.repec.org/n?u=RePEc:zag:wpaper:0904&r=lab |
| By: | Wang, Xiaojun (University of Hawaii at Manoa); Fleisher, Belton M. (Ohio State University); Li, Haizheng (Georgia Tech); Li, Shi (Beijing Normal University) |
| Abstract: | We apply a semi-parametric latent variable model to estimate selection and sorting effects on the evolution of private returns to schooling for college graduates during China's reform between 1988 and 2002. We find that there were substantial sorting gains under the traditional system, but they have decreased drastically and are negligible in the most recent data. We take this as evidence of growing influence of private financial constraints on decisions to attend college as tuition costs have risen and the relative importance of government subsidies has declined. The main policy implication of our results is that labor and education reform without concomitant capital market reform and government support for the financially disadvantaged exacerbates increases in inequality inherent in elimination of the traditional "wage-grid." |
| Keywords: | return to schooling, selection bias, sorting gains, heterogeneity, financial constraints, comparative advantage, China |
| JEL: | J31 J24 O15 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4030&r=lab |
| By: | Marc-Andreas Muendler; Sascha O. Becker |
| Abstract: | Employment at multinational enterprises (MNEs) responds to wages at the extensive margin, when an MNE enters a foreign location, and at the intensive margin, when an MNE operates existing affiliates. We present an MNE model and conditions for parametric and nonparametric identification. Prior studies rarely found wages to affect MNE employment. We document a complementarity bias when the extensive margin is excluded and detect salient labor substitution at both margins for German manufacturing MNEs. With a one-percent increase in home wages, for instance, MNEs add 2,000 jobs in Eastern Europe at the extensive margin and 4,000 jobs overall; a converse one-percent drop in Eastern European wages removes 730 German MNE jobs. |
| JEL: | C14 C24 F21 F23 J23 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:14776&r=lab |
| By: | Silke Anger; Guido Heineck |
| Abstract: | Complementing prior research on income mobility and educational transmission, we provide evidence on the intergenerational transmission of cognitive abilities using data from the German Socio-Economic Panel Study. Our estimates suggest that individuals¿ cognitive skills are positively related to the abilities of their parents, even when educational attainment and family background is controlled for. We differentiate between mothers¿ and fathers¿ IQ transmission and find different effects on the cognition of sons and daughters. We show that cognitive skills which are based on past learning are more strongly transmitted from parents to children than cognitive skills which are related to innate abilities. Our findings are not compatible with a pure genetic model, but rather point to the importance of parental investments for the cognitive outcomes of children. |
| Keywords: | Cognitive abilities, intergenerational IQ transmission, skill formation |
| JEL: | J10 J24 I20 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp156&r=lab |
| By: | Nguyen, Quang |
| Abstract: | One of the most prominent features of remuneration in the Hawaii’s longline fisheries industry has been the norm of share contract regimes. This paper investigates whether the use of share contract regime is positively correlated to increased economic returns. The principal-agent framework is applied to develop a theoretical model for the remuneration choice. Empirical estimation is conducted using a switching regression model that accounts for certain vessel characteristics effects on revenue, depending on remuneration regime used (i.e., share contract or flat wage), as well as the potential selection bias in the vessels’ contractual choice. Key findings from counterfactual simulations indicate: (1) a negative selection into choosing share contracts, and (2) that flat wage vessels would experience significantly higher revenues if they switch to share contracts. Thus, even though the labor market in Hawaii’s longline fisheries relies upon foreign crew members, the results suggest that it would benefit owners of flat wage vessels to apply share contracts to increase their revenues. |
| Keywords: | Remuneration Regime; Longline Fisheries; Hawaii; Commercial Fisheries; Lay System; Crew Shares; Labor Contracts; Incentive Systems |
| JEL: | B21 J33 C21 |
| Date: | 2009–03–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:13792&r=lab |
| By: | Ferre, Celine |
| Abstract: | Completing additional years of education necessarily entails spending more time in school. There is naturally a rather mechanical effect of schooling on fertility if women tend not to have children while continuing to attend high school or college, thus delaying the beginning of and shortening their reproductive life. This paper uses data from the Kenyan Demographic and Health Surveys of 1989, 1993, 1998, and 2003 to uncover the impact of staying one more year in school on teenage fertility. To get around the endogeneity issue between schooling and fertility preferences, the analysis uses the 1985 Kenyan education reform as an instrument for years of education. The authors find that adding one more year of education decreases by at least 10 percentage points the probability of giving birth when still a teenager. The probability of having one's first child before age 20, when having at least completed primary education, is about 65 percent; therefore, for this means a reduction of about 15 percent in teenage fertility rates for this group. One additional year of school curbs the probability of becoming a mother each year by 7.3 percent for women who have completed at least primary education, and 5.6 percent for women with at least a secondary degree. These results (robust to a wide array of specifications) are of crucial interest to policy and decision makers who set up health and educational policies. This paper shows that investing in education can have positive spillovers on health. |
| Keywords: | Population Policies,Health Monitoring&Evaluation,Adolescent Health,Primary Education,Education For All |
| Date: | 2009–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:4833&r=lab |
| By: | Kahanec, Martin; Zimmermann, Klaus F |
| Abstract: | The 2004 and 2007 enlargements of the European Union were unprecedented in a number of economic and policy aspects. This essay provides a broad and in-depth account of the effects of the post-enlargement migration flows on the receiving as well as sending countries in three broader areas: labour markets, welfare systems, and growth and competitiveness. Our analysis of the available literature and empirical evidence shows that (i) EU enlargement had a significant impact on migration flows from new to old member states, (ii) restrictions applied in some of the countries did not stop migrants from coming but changed the composition of the immigrants, (iii) any negative effects in the labour market on wages or employment are hard to detect, (iv) post-enlargement migration contributes to growth prospects of the EU, (v) these immigrants are strongly attached to the labour market, and (vi) they are quite unlikely to be among welfare recipients. These findings point out the difficulties that restrictions on the free movement of workers bring about. |
| Keywords: | EU Eastern enlargement; free movement of workers; migration; migration effects |
| JEL: | F22 J16 J61 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:7200&r=lab |
| By: | Jos van Ommeren (VU University Amsterdam); Eva Gutièrrez-i-Puigarnau (VU University Amsterdam) |
| Abstract: | We hypothesize, and test for, a negative effect of the length of the commute on worker’s productivity, by examining whether the commute has a positive effect on worker’s absenteeism. Our estimates for Germany indicate that commuting distance induces absenteeism with an elasticity of about 0.07. On average, absenteeism would be about 16 percent less if all workers would have a negligible commute. These results are consistent with urban efficiency wage models. |
| Keywords: | absenteeism; commuting; productivity |
| JEL: | R23 J22 J24 |
| Date: | 2009–02–19 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:uvatin:20090014&r=lab |
| By: | David E. Card; Jochen Kluve (RWI-Essen); Andrea Weber |
| Abstract: | This paper presents a meta-analysis of recent microeconometric evaluations of active labor market policies. Our sample consists of 199 program estimates drawn from 97 studies conducted between 1995 and 2007. In about one-half of these cases we have both a short-term impact estimate (for a one-year post-program horizon) and a medium-term estimate (two-year horizon). We characterize the program estimates according to the type and duration of the program, the characteristics of the participants, and the evaluation methodology. Heterogeneity in all three dimensions affects the likelihood that an impact estimate is significantly positive, significantly negative, or statistically insignificant. Comparing program types, subsidized public sector employment programs have the least favorable impact estimates. Job search assistance programs have relatively favorable short-run impacts, whereas classroom and on-the-job training programs tend to show better outcomes in the medium-run than the short-run. Programs for youths are less likely to yield positive impacts than untargeted programs, but there are no large or systematic differences by gender. Methodologically, we find that the outcome variable used to measure program effectiveness matters. Evaluations based on registered unemployment durations are more likely to show favorable short-term impacts. Controlling for the outcome measure, and the type of program and participants, we find that experimental and non-experimental studies have similar fractions of significant negative and significant positive impact estimates, suggesting that the research designs used in recent non-experimental evaluations are unbiased. |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:jku:nrnwps:2009_02&r=lab |
| By: | Ambra Poggi |
| Abstract: | According to Sen’s capability approach, objective working conditions can be seen as functionings (i.e. things experienced by the individuals). The corresponding capability set includes all sets of alternatives working conditions existing in the society for a given kind of job. Observing the existing capability set of working conditions, individuals formulate expectations about their own working conditions. These expectations might create biases in the realistic perceptions of job satisfaction. Our aim is to study the determinants of worker perceptions of quality of work in EU Countries. In particular, we shed light on the complex relationship that exists between job satisfaction, objective working conditions and workers expectations. First, we determine which objective working conditions impact on the level of job satisfaction. Second, we test the existence, and the signs, of biases in the realistic perception of job satisfaction due to the existence of expectations. Third, we test if expectations are affected by the working conditions actually experienced in the job place. From a technically point of view, we estimate a two-tiered stochastic frontier model. We find that expectations biases exist. High expectations have stronger effects in reducing job satisfaction than low expectation in increasing job expectations. Finally, expectations are affected by the working conditions actually experienced by the workers. |
| Keywords: | Job satisfaction, working conditions, expectations, two-tiered stochastic frontier model. |
| JEL: | J81 J28 I31 |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:cca:wplabo:74&r=lab |
| By: | Bandiera, Oriana; Guiso, Luigi; Prat, Andrea; Sadun, Raffaella |
| Abstract: | We provide evidence on the match between firms, managers and incentives using a new survey designed for this purpose. The survey contains information on a sample of executives' risk preferences and human capital, on the explicit and implicit incentives they face and on the firms they work for. We model a market for managerial talent where both firms and managers are heterogeneous. Following the sources of heterogeneity observed in the data, we assume that firms differ by ownership structure and that family firms, though caring about profits, put relatively more weight on benefits of direct control than non-family firms. Managers differ in their degree of risk aversion and talent. The entry of firms and managers, the choice of managerial compensation schemes and the manager-firm matching are all endogenous. The model yields predictions on several equilibrium correlations that find support in our data: (i) Family firms use managerial contracts that are less sensitive to performance, both explicitly through bonus pay and implicitly through career development; (ii) More talented and risk-tolerant managers are matched with firms that offer steeper contracts. (iii) Managers who face steeper contracts work harder, earn more and display higher job satisfaction. Alternative explanations may account for some of these correlations but not for all of them jointly. |
| Keywords: | family firms; incentives; managers; matching; risk aversion |
| JEL: | D21 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:7207&r=lab |
| By: | Rogers, F. Halsey; Vegas, Emiliana |
| Abstract: | Expanding and improving basic education in developing countries requires, at a minimum, teachers who are present in the classroom and motivated to teach, but this essential input is often missing. This paper describes the findings of a series of recent World Bank and other studies on teacher absence and incentives for performance. Surprise school visits reveal that teachers are absent at high rates in countries such as India, Indonesia, Uganda, Ecuador, and Zambia, reducing the quality of schooling for children, especially in rural, remote, and poor areas. More broadly, poor teacher management and low levels of teacher accountability afflict many developing-country education systems. The paper presents evidence on these shortcomings, but also on the types of incentives, management, and support structures that can improve motivation and performance and reduce avoidable absenteeism. It concludes with policy options for developing countries to explore as they work to meet Education for All goals and improve quality. |
| Keywords: | Tertiary Education,Primary Education,Education For All,Teaching and Learning,Secondary Education |
| Date: | 2009–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:4847&r=lab |
| By: | Zhelyazkova, Nevena (PhD fellow at Maastricht Graduate School of Governance, The Netherlands); Valentova, Marie (researcher at CEPS/INSTEAD, Luxembourg) |
| Abstract: | The paper aims to examine the effect of the transition from a socialist regime to democracy and liberal economy on women’s perceptions of the consequences of breaks in labour market participation due to childcare on their further careers in seven post-socialist countries. More precisely, it investigates whether women in Central and Eastern Europe who gave birth to at least one child after 1987 were more likely to experience negative consequences for their further professional life as a result of career interruptions due to childcare than women who had their children during the socialist era. The analysis is conducted in two steps. In the first step, the effect of the political transition is examined in the Central European region as a whole, thus on the pooled data including all the seven countries. In the second step, the paper tests whether the effect of the transition varies significantly from country to country, and if yes, in which countries it had the biggest impact. In both steps, the effect of the transition is examined while controlling for selected individual characteristics that are mentioned in the literature as possible predictors of subjective evaluation of consequences of career breaks on women’s further professional development. In the paper we use data from the 2004 European Social Survey. |
| Keywords: | female emloyement; labour market inactivity ; child care ; subjective indicators |
| Date: | 2009–01 |
| URL: | http://d.repec.org/n?u=RePEc:irs:iriswp:2009-01&r=lab |
| By: | Barrera-Osorio, Felipe; Linden, Leigh L. |
| Abstract: | This paper presents the evaluation of the program Computers for Education. The program aims to integrate computers, donated by the private sector, into the teaching of language in public schools. The authors conduct a two-year randomized evaluation of the program using a sample of 97 schools and 5,201 children. Overall, the program seems to have had little effect on students'test scores and other outcomes. These results are consistent across grade levels, subjects, and gender. The main reason for these results seems to be the failure to incorporate the computers into the educational process. Although the program increased the number of computers in the treatment schools and provided training to the teachers on how to use the computers in their classrooms, surveys of both teachers and students suggest that teachers did not incorporate the computers into their curriculum. |
| Keywords: | Tertiary Education,Primary Education,Secondary Education,Teaching and Learning,Education For All |
| Date: | 2009–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:4836&r=lab |
| By: | Francis Green |
| Abstract: | Using new job requirements data for Britain I show that there has been a rise in various forms of communication tasks: influencing and literacy tasks have grown especially fast, as have self-planning tasks. External communication tasks, and numerical tasks have also become more important, but physical tasks have largely remained unchanged. Although the classification of tasks as programmable or otherwise is found to be problematic, computer use accounts for much of the changed use of generic skills. Going beyond the technology, I investigate whether organisational changes requiring greater employee involvement explain some of the new skill requirements. Using either industry or occupation panel analyses, I find that employee involvement raises the sorts of generic skills that human resource management models predict, in particular three categories of communication skills and self-planning skills. These effects are found to be independent of the effect of computers on generic skills. |
| Keywords: | communication skill; literacy; numeracy; computers; autonomy |
| JEL: | J21 J23 J24 J29 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:ukc:ukcedp:0903&r=lab |
| By: | Marigee Bacolod; John DiNardo; Mireille Jacobson |
| Abstract: | "Accountability mandates" -- the explicit linking of school funding, resources, and autonomy to student performance on standardized exams -- have proliferated in the last 10 years. In this paper, we examine California's accountability system, which for several years financially rewarded schools based on a deterministic function of test scores. The sharp discontinuity in the assignment rule -- schools that barely missed their target received no funding -- generates "as good as random" assignment of awards for schools near their eligibility threshold and enables us to estimate the (local average) treatment effect of California's financial award program. This design allows us to explore an understudied aspect of accountability systems -- how schools use their financial rewards. Our findings indicate that California's accountability system significantly increased resources allocated to some schools. In the 2000 school year, the average value of the award was about 60 dollars per student and 50 dollars in 2001. Moreover, we find that the total resources flowing to districts with schools that received awards increased more than dollar for dollar. This resource shift was greatest for districts with schools that qualified for awards in the 2000 school year,the first year of the program, increasing total per pupil revenues by roughly 5 percent. Despite the increase in revenues, we find no evidence that these resources increased student achievement. Schools that won awards did not purchase more instructional material, such as computers, which may be inputs into achievement. Although the awards were likely paid out as teacher bonuses, we cannot detect any effect of these bonuses on test scores or other measures of achievement. More worrisome, we also find a practical effect of assigning the award based in part on the performance of "numerically significant subgroups" within a school was to reduce the relative resources of schools attended by traditionally disadvantaged students. |
| JEL: | H0 I0 I2 J0 J24 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:14775&r=lab |
| By: | Nattavudh Powdthavee; |
| Abstract: | This paper documents evidence that rejects the paradox of dissatisfied union members. Using eleven waves of the BHPS, it studies the past, contemporaneous, and future effects of union membership on job satisfaction. By separating union "free riders" from other nonmembers in the fixed effects equations, I find significant anticipation effects to joining a unionized firm for both prospective union members and covered nonmembers of both genders. Workers go on to report, on average, a significant increase in job satisfaction at the year of union coverage. Nonetheless, adaptation to unionism is complete within the first few years of joining a unionized firm. |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:yor:yorken:09/04&r=lab |
| By: | Souma, Wataru; Ikeda, Yuichi; Iyetomi, Hiroshi; Fujiwara, Yoshi |
| Abstract: | The distribution of labour productivity is investigated by analyzing the longitudinal micro-level data set which contains detailed financial condition of large numbers of Japanese companies over the period 1996–2006. The generalized beta function of the second kind is applied to explain the distribution. We calculate marginal labour productivity by using the fitting parameters, and show that the economy in the labour market is not in equilibrium. By comparing parameters characterizing high productivity range and low productivity range, we show that inequality of low productivity range is larger than that of high productivity range. In addition, it is shown that the change of inequality in low productivity has strong correlation with GDP. |
| Keywords: | Labour productivity, marginal labour productivity, inequality |
| JEL: | C16 E23 L60 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwedp:7481&r=lab |
| By: | Tregenna, F. |
| Abstract: | This paper develops a methodology and uses household and labour survey data to analyse the extent of intersectoral outsourcing of the employment of specific labour-intensive activities in South Africa from 1997-2007. It is shown that the relatively high growth in services employment is driven by an expansion of employment of cleaners and security guards and an outsourcing-type reallocation of these activities from manufacturing and the public sector towards private services. These activities have limited scope for cumulative productivity increases. The analysis has implications for understanding changes in the sectoral structure of middle income economies. |
| Keywords: | Outsourcing, employment, manufacturing, services, public sector, South Africa |
| JEL: | J21 L24 L33 L60 L80 M55 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:0906&r=lab |
| By: | Paglayan, Agustina |
| Abstract: | This study looks more closely at Argentina’s early childhood education policy, to determine whether it “ensures quality education and equal opportunities, without regional disparities and socio-economic inequities” –the main purpose of education policy in that country. In particular, the study examines how public kindergartens’ effect on children’s early literacy development compares to the effect of their alternative, private kindergartens. Panel data collected between 2004 and 2006 by Argentina’s urban household survey is used to estimate a logit model for the probability of knowing how to read and write by the end of first grade. Estimations take into consideration the complex design of the survey data employed. The validity of the results obtained is further checked by the use of quasi-experimental econometric techniques. The study finds that, net of important individual, family, community and geographic characteristics, attending a public kindergarten has some effect on the probability that a child will know how to read and write by the end of first grade, but attending a private kindergarten has a more substantial effect on this probability. In turn, the analysis finds that knowing how to read and write by the end of first grade reduces the probability of repeating that grade. Perhaps more worryingly, the quality gap between public and private kindergartens is found to be larger in the poorest regions of the country, as well as among the poorest families. These findings are relevant to education policymaking in Argentina, where efforts have focused on expanding the coverage of preschool services, largely disregarding that there is a fundamental problem of unequal opportunities among children in terms of access to high-quality early childhood education. Specific policy recommendations that could improve the quality of public preschools are suggested, taking into account the political difficulty to introduce profound reforms in the education system. |
| Keywords: | early childhood education; Argentina; education quality; public preschool; private preschool; education inequality |
| JEL: | I2 I21 I28 |
| Date: | 2008–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:13875&r=lab |
| By: | Bell, David N.F. (University of Stirling); Blanchflower, David G. (Dartmouth College) |
| Abstract: | This paper considers the issue of unemployment one of the most pressing issues facing the UK and other governments, as the current recessions deepens. It begins by trying to accurately date the beginning of the current downturn in the British economy, arguing that it is clear that the recession commenced in the 2nd quarter of 2008. It then examines whether this recession is substantively different from past downturns in the UK and argues that, although the extreme rationing up of credit marks the current recession as different, some of the labour market consequences, such as the concentration of unemployment among the young and other disadvantaged groups, is typical of past experience. The paper reviews past literature on the causes of unemployment, arguing that the origin of the present difficulties lies with a collapse in demand rather than with frictions in the labour market caused by institutional inflexibilities. There is a large literature on the negative impact of unemployment both on society and on individuals. The adverse societal consequences are reviewed in the next section, while we discuss some of our own research on the adverse consequences on the individual in Section 6. Just as in previous recessions, it is becoming clear that some groups will suffer a much higher incidence of unemployment during this downturn and therefore suffer to a greater than average extent the adverse individual effects that we discussed in Section 6. The evidence on the composition of these groups is reviewed and presented along with some of our own research on this issue in the following section. One of the key groups who are likely to be affected by the recession is the young. In Section 8, we review the particular difficulties faced by them in trying to secure a footing in the labour market. In the last two decades many governments have introduced policies (collectively described as Active Labour Market Policies or ALMPs) for direct intervention in the labour market to improve outcomes for particular groups and for the young in particular. The next section reviews the evidence on the success of these policies. The final section discusses some policy proposals which we offer to alleviate what we believe will be the very serious adverse consequences of the likely increase in unemployment in the UK over the short to medium term. |
| Keywords: | unemployment, youth unemployment |
| JEL: | J21 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4040&r=lab |
| By: | Brian Silverstone (University of Waikato); Victoria Wall (New Zealand Department of Labour) |
| Abstract: | The now widespread use of the internet as a source of information on job vacancies may have undermined the usefulness of newspaper advertisements - and possibly surveys - as the traditional sources of timely, cost-effective and accurate information on labour market openings. This paper outlines the New Zealand Department of Labour job vacancy series. This is followed by selected international illustrations, measurement options, job vacancy reporting and an assessment of the Department of Labour’s experience with vacancy monitoring. The overall aims of this paper are to raise the awareness, in principle, of job vacancy data as a useful indicator of labour market conditions and the challenges, in practice, of creating appropriate series. |
| Keywords: | job ads; job vacancies; internet advertising; vacancy statistics |
| JEL: | J63 |
| Date: | 2009–01–31 |
| URL: | http://d.repec.org/n?u=RePEc:wai:econwp:09/01&r=lab |
| By: | Giuseppe Moscarini; Fabien Postel-Vinay |
| Abstract: | We provide new evidence that large firms or establishments are more sensitive than small ones to business cycle conditions. Larger employers shed proportionally more jobs in recessions and create more of their new jobs late in expansions, both in gross and net terms. The differential growth rate of employment between large and small firms varies by about 5% over the business cycle. Omitting cyclical indicators may lead to conclude that, on average, these cyclical effects wash out and size does not predict subsequent growth (Gibrat's law). We employ a variety of measures of relative employment growth, employer size and classification by size. We revisit two statistical fallacies, the Regression and Reclas- sification biases, that can affect our results, and we show empirically that they are quantitatively modest given our focus on relative cyclical behavior. We exploit a va- riety of (mostly novel) U.S. datasets, both repeated cross-sections and job flows with employer longitudinal information, starting in the mid 1970’s and now spanning four business cycles. The pattern that we uncover is robust to different treatments of entry and exit of firms and establishments, and occurs within, not across broad industries, regions and states. Evidence on worker flows suggests that the pattern is driven at least in part by excess layoffs by large employers in and just after recessions, and by excess poaching by large employers late in expansions. We find the same pattern in similar datasets in four other countries, including full longitudinal censuses of employers from Denmark and Brazil. Finally, we sketch a simple firm-ladder model of turnover that can shed light on these facts, and that we analyze in detail in companion papers. |
| Keywords: | business cycle , employment, firm size. |
| JEL: | J21 E32 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:bri:uobdis:09/609&r=lab |
| By: | BONDOC, Maria-Daniela; RADU, Florea |
| Abstract: | In this article, the authors sought to study the efficiency of the staff costs and its reflection upon the main economic and financial indicators of a company. In the performed study, the application of the factor analysis models was made at the level of an industrial trading company the social object of which is manufacturing automotive subassemblies. The efficiency of the wage costs was monitored by the correlation between the average wage and the labour efficiency as well as by means of the indicators used for the general expression of their efficiency, such as: staff costs at an operating income, turnover or added value of 1,000 Lei. Moreover, highlighting the economic and financial consequences of their modification on the main key performance indicators of the company was considered. The conclusions that were drawn are useful for the management company for the substantiation of the decisions related to the improvement of the usage of the human resources, with direct positive consequences upon the reduction of the wage costs to 1,000 Lei and of the wage costs per product unit, as well as upon the profit increase. |
| Keywords: | staff costs; efficiency; labour efficiency; average wage |
| JEL: | J41 J3 G3 J24 M12 |
| Date: | 2008–04 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:14008&r=lab |
| By: | Bell, David N. F.; Blanchflower, David G. |
| Abstract: | This paper considers the issue of unemployment one of the most pressing issues facing the UK and other governments, as the current recessions deepens. It begins by trying to accurately date the beginning of the current downturn in the British economy, arguing that it is clear that the recession commenced in the 2nd quarter of 2008. It then examines whether this recession is substantively different from past downturns in the UK and argues that, although the extreme rationing up of credit marks the current recession as different, some of the labour market consequences, such as the concentration of unemployment among the young and other disadvantaged groups, is typical of past experience. The paper reviews past literature on the causes of unemployment, arguing that the origin of the present difficulties lies with a collapse in demand rather than with frictions in the labour market caused by institutional inflexibilities. There is a large literature on the negative impact of unemployment both on society and on individuals. The adverse societal consequences are reviewed in the next section, while we discuss some of our own research on the adverse consequences on the individual in Section 6. Just as in previous recessions, it is becoming clear that some groups will suffer a much higher incidence of unemployment during this downturn and therefore suffer to a greater than average extent the adverse individual effects that we discussed in Section 6. The evidence on the composition of these groups is reviewed and presented along with some of our own research on this issue in the following section. One of the key groups who are likely to be affected by the recession is the young. In Section 8, we review the particular difficulties faced by them in trying to secure a footing in the labour market. In the last two decades many governments have introduced policies (collectively described as Active Labour Market Policies or ALMPs) for direct intervention in the labour market to improve outcomes for particular groups and for the young in particular. The next section reviews the evidence on the success of these policies. The final section discusses some policy proposals which we offer to alleviate what we believe will be the very serious adverse consequences of the likely increase in unemployment in the UK over the short to medium term. |
| Keywords: | youth unemployment; recession; fiscal intervention; ALMP |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:stl:stledp:2009-06&r=lab |
| By: | Booth, Alison L. (Australian National University); Nolen, Patrick J. (University of Essex) |
| Abstract: | Using a controlled experiment, we examine the role of nurture in explaining the stylized fact that women shy away from competition. Our subjects (students just under 15 years of age) attend publicly-funded single-sex and coeducational schools. We find robust differences between the competitive choices of girls from single-sex and coed schools. Moreover, girls from single-sex schools behave more like boys even when randomly assigned to mixed-sex experimental groups. Thus it is untrue that the average female avoids competitive behaviour more than the average male. This suggests that observed gender differences might reflect social learning rather than inherent gender traits. |
| Keywords: | competitive behaviour, experiment, gender, piece-rate, tournament |
| JEL: | C91 C92 J16 J33 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4027&r=lab |
| By: | Jennifer L. Steele; Richard J. Murnane; John B. Willett |
| Abstract: | This study capitalizes on a natural experiment that occurred in California between 2000 and 2002. In those years, the state offered a competitively allocated $20,000 incentive called the Governor's Teaching Fellowship (GTF) aimed at attracting academically talented, novice teachers to low-performing schools and retaining them in those schools for at least four years. Taking advantage of data on the career histories of 27,106 individuals who pursued California teaching licenses between 1998 and 2003, we use an instrumental variables strategy to estimate the unbiased impact of the GTF on the decisions of recipients to begin working in low-performing schools within two years after licensure program enrollment. We estimate that GTF recipients would have been less likely to teach in low-performing schools than observably similar counterparts had the GTF not existed, but that acquiring a GTF increased their probability of doing so by 28 percentage points. Examining retention patterns, we find that 75 percent of both GTF recipients and non-recipients who began working in low-performing schools remained in such schools for at least four years. |
| JEL: | I2 I22 I28 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:14780&r=lab |
| By: | Alexander K. Koch; Albrecht Morgenstern; Philippe Raab (School of Economics and Management, University of Aarhus, Denmark) |
| Abstract: | Holmström’s (1982/99) career concerns model has become a workhorse for analyzing agency issues in many fields. The underlying signal jamming argument requires players to use information in a Bayesian way, which is difficult to directly test with field data: typically little is known about the information that individuals base their decisions on. Our laboratory experiment provides prima facie evidence: i) the signal jamming mechanism successfully creates incentives on the labor supply side; ii) decision errors take time to decrease; iii) while subjects’ average beliefs are remarkably consistent with play, a mild winner’s curse arises on the labor demand side. |
| Keywords: | Incentives, Reputation, Career concerns, Signal jamming, Experiments |
| JEL: | C91 D83 L14 |
| Date: | 2009–01–09 |
| URL: | http://d.repec.org/n?u=RePEc:aah:aarhec:2009-01&r=lab |
| By: | Muñoz de Bustillo, Rafael; Anton, José-Ignacio |
| Abstract: | This paper explores for the first time the relationship between immigration and poverty in Spain. Using the EU Statistics on Income and Living Conditions 2006, we find that both moderate and severe poverty are more acute among migrants than among nationals and social transfers play no substantial role in reducing poverty in the former case. In addition, using an econometric non-linear decomposition, we show the gap in deprivation incidence is fully explained by the different effects of household characteristics on poverty reduction for immigrants and locals. |
| Keywords: | Immigration; Poverty; Spain; Non-linear decomposition |
| JEL: | F22 O15 I32 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:13848&r=lab |
| By: | Geraint Johnes; T Agasisti |
| Abstract: | We estimate a variety of models to evaluate costs in US higher education institutions. A novel feature of our approach involves the estimation of latent class and random parameter stochastic frontier models of the multiproduct cost function. This allows us fully to accommodate both the heterogeneity of institutions and the presence of technical inefficiencies. Our findings suggest that global economies could be achieved by effecting a reduction in the number of institutions providing undergraduate instruction, while increasing the number of institutions engaged in postgraduate activity. |
| Keywords: | costs, efficiency, stochastic frontier, latent class, random parameter. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:lan:wpaper:005930&r=lab |
| By: | Paloma López-García (Banco de España); Sergio Puente (Banco de España); Ángel Luis Gómez (Banco de España) |
| Abstract: | Despite the relevance in terms of policy, we still know little in Spain about where and by whom jobs are created, and how that is affecting the size distribution of firms. The main innovation of this paper is to use a rich database that overcomes the problems encountered by other firm-level studies to shed some light on the employment generation of small firms in Spain. We find that small firms contribute to employment disproportionately across all sectors of the economy although the difference between their employment and job creation share is largest in the manufacturing sector. The job creators in that sector are both new and established firms whereas only new small firms outperform their larger counterparts in the service sector. The large annual job creation of the small firm size class is shifting the firm size distribution towards the very small production units, although not uniformly across industries of different technology intensity. |
| Keywords: | Firm-level data, employment creation and destruction, and firm size distribution |
| JEL: | L11 L53 J21 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:bde:opaper:0903&r=lab |
| By: | Sugimoto, Yoshiaki; Nakagawa, Masao |
| Abstract: | This paper argues that the introduction of compulsory schooling in early industrialization promoted the growth process that eventually led to a vicious cycle of population aging and negative pressure on education policy. In the early phases of industrialization, public education was undesirable for the young poor who relied on child labor. Compulsory schooling therefore discouraged childbirth, while the accompanying industrialization stimulated their demand for education. The subsequent rise in the share of the old population, however, limited government resources for education, placing heavier financial burdens on the young. This induced further fertility decline and population aging, and the resulting cycle may have delayed the growth of advanced economies in the last few decades. |
| Keywords: | Compulsory Education; Fertility; Generational Conflict; Growth. |
| JEL: | H50 J10 C70 O40 J20 |
| Date: | 2009–03–07 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:13835&r=lab |
| By: | Brown, W. |
| Abstract: | The British National Minimum Wage was introduced in 1999 under the guidance of a Low Pay Commission constructed on a basis of ‘social partnership’. The paper analyses its conduct over its first ten years from diary data. Key challenges were for it to be independent of government, to have its advice accepted by government, and to maintain internal unanimity. The changing internal dynamics of the Commission, and its major negotiations over the level of the Minimum Wage, are described and analysed. Conclusions are drawn for the social partnership process. |
| Keywords: | minimum wage; social partnership; bargaining relationship; mediation. |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:0904&r=lab |
| By: | Saraswata Chaudhuri; Elaina Rose |
| Abstract: | Instrumental variables estimates of the effect of military service on subsequent civilian earnings either omit schooling or treat it as exogenous. In a more general setting that also allows for the treatment of schooling as endogenous, we estimate the veteran effect for men who were born between 1944 and 1952 and thus reached draft age during the Vietnam era. We apply a variety of state-of-the-art econometric techniques to gauge the sensitivity of the estimates to the treatment of schooling. We find a significant veteran penalty. |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:udb:wpaper:uwec-2009-07&r=lab |
| By: | Francisco Henríquez; Alejandra Mizala; Andrea Repetto |
| Abstract: | This paper analyzes the success of Chile’s Sociedad de Instrucción Primaria (SIP) in providing high quality primary school education to low income children. The paper shows that SIP students’ results in national standardized tests are not due to selection or observables. Interviews with principals of SIP schools and of schools that compete with them suggest that differences may be related to having student achievement as the primary goal, a clear and shared methodology, the systematic use of the information provided by teachers’ and students’ evaluations, the selection of directors and teachers through competition, and the assignment of resources to leveling children that lag behind, among other factors. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:edj:ceauch:258&r=lab |
| By: | Philip Babcock; Julian R. Betts |
| Abstract: | Do smaller classes boost achievement mainly by helping teachers impart specific academic skills to students with low academic achievement? Or do they do so primarily by helping teachers engage poorly behaving students? The analysis uses the grade 3 to 4 transition in San Diego Unified School District as a source of exogenous variation in class size (given a California law funding small classes until grade 3). Grade 1 report cards allow separate identification of low-effort and low-achieving students. Results indicate that elicitation of effort or engagement, rather than the teaching of specific skills, may be the dominant channel by which small classes influence disadvantaged students. |
| JEL: | I2 I21 I22 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:14777&r=lab |
| By: | Booth, Alison L; Nolen, Patrick |
| Abstract: | Women and men may differ in their propensity to choose a risky outcome because of innate preferences or because pressure to conform to gender-stereotypes encourages girls and boys to modify their innate preferences. Single-sex environments are likely to modify students' risk-taking preferences in economically important ways. To test this, we designed a controlled experiment in which subjects were given an opportunity to choose a risky outcome - a real-stakes gamble with a higher expected monetary value than the alternative outcome with a certain payoff - and in which the sensitivity of observed risk choices to environmental factors could be explored. The results of our real-stakes gamble show that gender differences in preferences for risk-taking are indeed sensitive to whether the girl attends a single-sex or coed school. Girls from single-sex schools are as likely to choose the real-stakes gamble as much as boys from either coed or single sex schools, and more likely than coed girls. Moreover, gender differences in preferences for risk-taking are sensitive to the gender mix of the experimental group, with girls being more likely to choose risky outcomes when assigned to all-girl groups. This suggests that observed gender differences in behaviour under uncertainty found in previous studies might reflect social learning rather than inherent gender traits. |
| Keywords: | coeducation; controlled experiment; gender; identity; risk attitudes; risk aversion; single-sex schooling |
| JEL: | C9 C91 C92 J16 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:7198&r=lab |
| By: | Alexandra Schroeter (Friedrich Schiller University Jena, Faculty of Economics and Business Administration) |
| Abstract: | Empirical analyses show that the employment effects of start-ups are highest in agglomerations, whereas moderately congested areas exhibit only modest effects, and weak or even no significant effects could be found in rural regions. This paper will set out to show that these discrepancies arise from specific characteristics of urban areas. The magnitude of the employment effects of entry in agglomerations can, therefore, be regarded as a further kind of agglomeration benefit which has not been discussed in the literature yet. In particular, it is explained how the distinct characteristics of urban areas contribute to the emergence of high-quality start-ups that are known to cause larger employment effects than other types of new businesses. In addition, this paper argues that the relatively intense competition in urban areas further stimulates the economic effects of new business formation in agglomerations. |
| Keywords: | Entrepreneurship, new business formation, regional development, entrepreneurship policy |
| JEL: | M13 O1 O18 R11 |
| Date: | 2009–03–05 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2009-019&r=lab |
| By: | Ivan O. Kitov (Russian Academy of Science) |
| Abstract: | A microeconomic model is developed, which accurately predicts the shape of personal income distribution (PID) in the United States and the evolution of the shape over time. The underlying concept is borrowed from geo-mechanics and thus can be considered as mechanics of income distribution. The model allows the resolution of empirical and definitional problems associated with personal income measurements. It also serves as a firm fundament for definitions of income inequality as secondary derivatives from personal income distribution. It is found that in relative terms the PID in the US has not been changing since 1947. Effectively, the Gini coefficient has been almost constant during the last 60 years, as reported by the Census Bureau. |
| Keywords: | personal income, modelling, mechanics, the US |
| JEL: | D01 D31 E01 O12 C81 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:inq:inqwps:ecineq2009-110&r=lab |