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on Labour Economics |
| By: | Fouarge Didier; Baaijens Christine (ROA rm) |
| Abstract: | Previous research has pointed to the existence of hours constraints on the labour market: not all employees’ preferences with respect to the length of the working week seem to be fulfilled, and changes in the number of working hours often coincide with job mobility. In this paper, we test whether or not a recently introduced Dutch legislation providing employees with the right to adjust working hours within their job has reduced the correlation between changes in working hours and job mobility. We do this by implementing a difference-in-differences methodology to the job and hours mobility behaviour of Dutch workers prior and after the introduction of the new law. We find no evidence suggesting that this is indeed the case, regardless of gender. |
| Keywords: | education, training and the labour market; |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:umaror:2009005&r=lab |
| By: | Mendola, Mariapia; Carletto, Gero |
| Abstract: | This paper examines the role of male-dominated international migration in shaping labor market outcomes by gender in migrant-sending households in Albania. Using detailed information on family migration experience from the latest Living Standards Measurement Study survey, the authors find that male and female labor supplies respond differently to the current and past migration episodes of household members. Controlling for the potential endogeneity of migration and for the income (remittances) effect, the estimates show that having a migrant abroad decreases female paid labor supply and increases unpaid work. However, women with past family migration experience are significantly more likely to engage in self-employment and less likely to supply unpaid work. The same relationships do not hold for men. These findings suggest that over time male-dominated Albanian migration may lead to women's empowerment in access to income-earning opportunities at the origin. |
| Keywords: | Labor Markets,Population Policies,Labor Policies,Access to Finance,Gender and Development |
| Date: | 2009–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:4900&r=lab |
| By: | Lindqvist, Erik (Research Institute of Industrial Economics (IFN)); Westman, Roine (New York University) |
| Abstract: | We use data from the military enlistment for a large representative sample of Swedish men to assess the importance of cognitive and noncognitive ability for labor market outcomes. The measure of noncognitive ability is based on a personal interview conducted by a psychologist. Unlike survey-based measures of noncognitive ability, this measure is a substantially stronger predictor of labor market outcomes than cognitive ability. In particular, we find strong evidence that men who fare badly in the labor market in the sense of long-term unemployment or low annual earnings lack noncognitive but not cognitive ability. We point to a technological explanation for this result. Noncognitive ability is an important determinant of productivity irrespective of occupation or ability level, though it seems to be of particular importance for workers in a managerial position. In contrast, cognitive ability is valuable only for men in qualified occupations. As a result, noncognitive ability is more important for men at the verge of being priced out of the labor market. |
| Keywords: | Personality; Noncognitive ability; Cognitive ability; Intelligence; Human capital |
| JEL: | J21 J24 J31 |
| Date: | 2009–03–26 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0794&r=lab |
| By: | Pettersson-Lidbom, Per (Departmet of Economics, Stockholm University); Skogman Thoursie, Peter (IFAU - Institute for Labour Market Policy Evaluation) |
| Abstract: | In this paper, we provide evidence of whether child spacing affects the future success of children. As an exogenous source of variation in child spacing, we make use of the introduction of an administrative rule in the parental leave benefit system in Sweden. This rule made it possible for a woman to retain her previous high level of parental leave benefits, i.e., 90 percent wage replacement, without entering the labor market between births provided that the interval between the births did not exceed 24 months. The rule had a much larger effect on the birth spacing behavior for native-born mothers compared to foreign-born mothers due to their differential attachment to the labor market. We find that the rule caused a reduction in spacing among native-born mothers as compared to the foreign-born mothers. For individuals born by native-born mothers, the reform also caused a decrease in educational attainment. Thus, this suggests that the effect of spacing children closer has a negative impact on children’s future outcomes. We provide additional evidence that this is likely due to the strong effects of early environment on the capacity for human skill development as discussed by Knutsen et al. (2006). |
| Keywords: | Child spacing; parental leave; child school performance |
| JEL: | J13 J18 |
| Date: | 2009–03–31 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2009_007&r=lab |
| By: | Hart, Robert A. |
| Abstract: | This paper adds to the literature on the relationship between military service and long-term real earnings. Based on a regression discontinuity design it compares the earnings of age cohorts containing British men who were required to undertake post-war National Service with later cohorts who were exempt. It also compares age cohorts containing men who were conscripted into military service during the first half of WWII and those with later spells of conscription. It argues that, in general, we should not expect large long-term real earnings differences between conscript and non-conscript cohorts since important elements of the former received military training and experience of direct value in the civilian jobs market. In the case of call-up during WWII there is even more reason to expect that there was no major disadvantages to those conscripted. This occurred largely because their pre-military job status was preserved due to the employment of substitute women workers who acted as a temporary employment buffer thereby protecting serving men's positions on the jobs hierarchy. |
| Keywords: | regression discontinuity design; long-term real earnings; WWII conscription; National Service |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:stl:stledp:2009-09&r=lab |
| By: | Guido Menzio; Shouyong Shi |
| Abstract: | In this paper, we develop a general stochastic model of directed search on the job. Like in the analogous models of random search on the job, the state of the economy in our model includes the infinite-dimensional distribution of workers across different employment states (unemployment, and employment at different wages). Unlike the analogous models of random search on the job, our model admits an equilibrium in which the agents' value and policy functions do not depend on the distribution of workers. We refer to this type of equilibrium as a Block Recursive Equilibrium. Therefore, while solving the equilibrium of a random search model in a stochastic environment is a difficult task both analytically and computationally, solving the Block Recursive Equilibrium of our model is as easy as solving a representative agent model. |
| JEL: | E32 J64 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:14907&r=lab |
| By: | C. Kirabo Jackson |
| Abstract: | In Trinidad and Tobago students are assigned to secondary schools after fifth grade based on achievement tests, leading to large differences in the school environments to which students of differing initial levels of achievement are exposed. Using both a regression discontinuity design and rule-based instrumental variables to address self-selection bias, I find that being assigned to a school with higher-achieving peers has large positive effects on examination performance. These effects are about twice as large for girls than for boys. This suggests that ability-grouping reinforces achievement differences by assigning the weakest students to schools that provide the least value-added. |
| JEL: | I20 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:14911&r=lab |
| By: | Brenke, Karl; Yuksel, Mutlu; Zimmermann, Klaus F |
| Abstract: | The numbers of migrants from the accessions countries have clearly increased since the enlargement of the EU in 2004. Following enlargement, the net inflow of EU8 immigrants has become 2.5 times larger than the four-year period before enlargement. Poles constitute the largest immigrant group among the EU8 immigrants: since enlargement, 63% of all immigrants and 71% of EU8 immigrants are from Poland. This chapter presents new evidence on the impact of immigrant flow from EU8 countries on the German labor market since EU enlargement. Unlike other EU countries, Germany has not immediately opened up its labor market for immigrants from the new member states. Nevertheless, our analysis documents a substantial inflow and suggests that the composition of EU8 immigrants has changed since EU enlargement. The majority of the new EU8 immigrants are male and young, and they are less educated compared to previous immigrant groups. We also find that recent EU8 immigrants are more likely to be self-employed than employed as a wage earner. Furthermore, these recent EU8 immigrants earn less conditional on being employed or self-employed. Our findings suggest that these recent EU8 immigrants are more likely to compete with immigrants from outside of Europe for low-skilled jobs instead of competing with German natives. While Germany needs high-skilled immigrants, our analysis suggests that the new EU8 immigrants only replace non-EU immigrants in low-skilled jobs. These results underline the importance of more open immigration policies targeting high-skilled immigrants. The current policy not only cannot attract the required high-skilled workforce, but also cannot avoid the attraction of low-skilled immigrants, and is a complete failure. |
| Keywords: | employment; EU enlargement; international migration; wages |
| JEL: | E24 F22 J61 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:7274&r=lab |
| By: | Mendolicchio, Concetta; Paolini, Dimitri; Pietra, Tito |
| Abstract: | The paper studies a two-sector economy with investments in human and physical capital and imperfect labor markets. Workers and firms endogenously select the sector they are active in, and choose the amount of their investments. To enter the high-skill sector, workers must pay a fixed cost that we interpret as direct cost of education. The economy is characterized by two different pecuniary externalities. Given the distribution of the agents across sectors, at equilibrium, in each sector there is underinvestment in both human and physical capital, due to non-contractibility of investments. A second pecuniary externality is induced by the self-selection of the agents in the two sectors. When total factor productivities are sufficiently diverse, subsidies to labor income in the low skill sector and fixed taxes on the direct costs of education increase total surplus, while subsidies to labor income in the high skill sector can actually reduce it. |
| Keywords: | Human capital; Efficiency; Labour income tax |
| JEL: | J24 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:14772&r=lab |
| By: | Corinne Perraudin (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, CEE - Centre d'Etudes de l'Emploi - Ministère de la recherche - Ministère chargé de l'Emploi, SAMOS - Statistique Appliquée et MOdélisation Stochastique - Université Panthéon-Sorbonne - Paris I); Héloïse Petit (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, CEE - Centre d'Etudes de l'Emploi - Ministère de la recherche - Ministère chargé de l'Emploi); Nadine Thevenot (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I); Bruno Tinel (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I); Julie Valentin (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I) |
| Abstract: | This article highlights the importance of power relations in inter-firm relations and analyses their impact on firms' employment management practices. We show, firstly, that the use of subcontracting creates a chain of inter-firm economic dependency because it leads the principal contractor to plan and control the activities of the subcontractors. We then advance the hypothesis that this chain of dependency influences both the skill structure and wage levels. Empirical tests carried out on French data confirm that firms that subcontract outsource execution tasks and that the hierarchy of firms impacts employees' wage levels. |
| Keywords: | Subcontracting ; skills ; wages ; power relation |
| Date: | 2009–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:halshs-00375550_v1&r=lab |
| By: | Adrian Kalwij; Arie Kapteyn; Klaas de Vos |
| Abstract: | Policy makers have often argued that an additional benefit of facilitating early retirement is that it creates employment for the young. This may happen if older and younger workers are substitutes. Nowadays policy makers' goals are to discourage early retirement to counter the economic consequences of an aging population and, interestingly, the consequences for youth employment appear to play no role in this. This paper studies the nexus between employment of older and younger workers in more depth, if only to put any concerns for adverse effects of later retirement to rest. To empirically investigate this issue the authors estimate a dynamic model of employment of the young, prime age and old people using panel data of 22 OECD countries over the time period 1960-2004. Their empirical analysis does not support the hypothesis that employment of the young and old are substitutes and finds some minor complementarities. This suggests that discouraging early retirement will have no adverse effect on youth employment. |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:ran:wpaper:679&r=lab |
| By: | Helen Slater; Simon Burgess; Neil Davies |
| Abstract: | Using a unique primary dataset for the UK, we estimate the effect of individual teachers on student outcomes, and the variability in teacher quality. This links over 7000 pupils to the individual teachers who taught them, in each of their compulsory subjects in the high-stakes exams at age 16. We use point-in-time fixed effects and prior attainment to control for pupil heterogeneity. We find considerable variability in teacher effectiveness, a little higher than the estimates found in the few US studies. We also corroborate recent findings that observed teachers’ characteristics explain very little of the differences in estimated effectiveness. |
| Keywords: | education, test scores, teacher effectiveness |
| JEL: | I20 |
| Date: | 2009–01 |
| URL: | http://d.repec.org/n?u=RePEc:bri:cmpowp:09/212&r=lab |
| By: | Woock, Christopher |
| Abstract: | Using a unique set of questions in the National Longitudinal Survey of Youth 1979 provides some direct evidence on the mechanism through which union coverage increases WC receipt. Delineating the effects of unions on the decision to apply and the receipt of WC benefits reveals that unions substantially increase the probability of applying conditional on injury, but decrease the probability of receipt conditional on applying. |
| Keywords: | union; workers' compensation; injuries; benefits |
| JEL: | I12 J51 J0 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:14689&r=lab |
| By: | O'Connell, Philip J. (ESRI); Byrne, Delma (ESRI) |
| Abstract: | This paper brings together two research fields: on work-related training and high performance work practices (HPWP), respectively. We estimate models of both the determinants and the impact of training using the NCPP/ESRI Changing Workplace Survey. Our models of the determinants of training confirm previous research: age, education, contract, tenure, and firm size all influence training. Several components of HPWP are associated with a higher probability of training, specifically, general (non-firm-specific) training. Participation in general training is associated with higher earnings, as is involvement in highly participative and consultative working arrangements, and performance reward systems. These patterns of training, and returns to training, are broadly consistent with HPWP approaches and represent a challenge to human capital theory. |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:wp289&r=lab |
| By: | Yu Sheng (The Australian National University); Xinpeng Xu (The Hong Kong Polytechnic University) |
| Abstract: | We extend the classic Balassa-Samuelson model to an environment with search unemployment. We show that the classic Balassa-Samuelson model with the assumption of full employment emerges as a special case of our more generalized model. In our generalized model, the degree of labor market rigidities affects the strength of the structural relationship between real exchange rate and sectoral productivity and in some circumstances, the standard Balassa-Samuelson effect may not hold. Empirical evidence supports our theory: controlling for the difference in labor market rigidities across countries provides a better fit in estimating the Balassa-Samuelson effect. |
| Keywords: | The Balassa-Samuelson Model, Search Unemployment, Labor Market Rigidities |
| JEL: | F16 F31 J64 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:hkm:wpaper:092009&r=lab |
| By: | Marcus Tamm |
| Abstract: | This paper examines the impact of a change in the German child benefit system in 1996, which led to a large increase in lump sum transfers to families with children.We analyze the impact on the labor force participation of family members. Comparing behavioral changes of adults with children with behavioral changes of adults without children,we find that single mothers and mothers with a working partner considerably reduced the number of working hours (conditional on participation). Participation rates however did not decrease. For single fathers neither participation rates nor working hours display any significant changes. |
| Keywords: | Child support, labor supply, program evaluation |
| JEL: | H31 I38 J22 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:rwi:repape:0097&r=lab |
| By: | Jan Brenner |
| Abstract: | In many economic models a central variable of interest is lifetime or permanent income which is not observed in survey data sets and typically proxied by annual income information. To assess the quality of such approximations, we use a unique source of lifetime earnings – the German pension system – and focus on two important issues that have been largely ignored in the existing literature. The first is how to deal with zero income observations in the analysis of women.The second is whether these approximations differ between natives and guest workers. For female earners, we find that estimates of the associations between current and lifetime income are highly sensitive to the treatment of zero earnings. The reason turns out to be the highly cyclical nature of the labor supply behavior of mothers. Furthermore, immigrants’ income proxies are prone to significantly larger attenuation biases over the entire life-cycle. This result is explained by the larger share of annual income variance attributable to the transitory income component for immigrants.Averaging income over up to 15 years alleviates the attenuation bias as well as the difference in biases between natives and guest workers. |
| Keywords: | Generalized errors-in-variables model, life-cycle bias, lifetime income, guest workers |
| JEL: | C10 C50 J61 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:rwi:repape:0095&r=lab |
| By: | David Howell and Ana Okatenko (New School for Social Research, New York, NY) |
| Keywords: | labor markets; Europe |
| Date: | 2008–09 |
| URL: | http://d.repec.org/n?u=RePEc:epa:cepawp:2008-2&r=lab |
| By: | Eva Mörk (IFAU and Uppsala University); Anna Sjögren (IFAU); Helena Svaleryd (IFN) |
| Abstract: | We study the effect of child care costs on the fertility behavior of Swedish women and find that reductions in child care charges influence fertility decisions, even when costs are initially highly subsidized. Exploiting the exogenous variation in child care costs caused by a Swedish child care reform, we are able to identify the causal effect of child care costs on fertility in a context in which child care enrolment is almost universal and the labor force participation of mothers is very high. A typical household planning another child experienced a reduction in expected future child care costs of SEK 106,000 (USD 17,800). This reduction resulted in 3–5 more child births per 1,000 women during an 18 month period, which corresponds to a 4–6 per cent increase in the birth rate. |
| Keywords: | Child Care, Cost of children, Fertility, Quasi-experiment, Difference-in-differences. |
| JEL: | H31 J13 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:ieb:wpaper:2009/4/doc2009-2&r=lab |
| By: | Simon Burgess; Carol Propper; Marisa Ratto; Stephanie von Hinke Kessler Scholder; Emma Tominey |
| Abstract: | We use an experiment to study the impact of team-based incentives, exploiting rich data from personnel records and management information systems. Using a triple difference design, we show that the incentive scheme had an impact on team performance, even with quite large teams. We examine whether this effect was due to increased effort from workers or strategic task reallocation. We find that the provision of financial incentives did raise individual performance but that managers also disproportionately reallocated efficient workers to the incentivised tasks. We show that this reallocation was the more important contributor to the overall outcome. |
| Keywords: | Incentives, Public Sector, Teams, Performance |
| JEL: | J33 J38 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:bri:cmpowp:09/215&r=lab |
| By: | Aleksander Berentsen; Guido Menzio; Randall Wright |
| Abstract: | We study the long-run relation between money, measured by inflation or interest rates, and unemployment. We first discuss data, documenting a strong positive relation between the variables at low frequencies. We then develop a framework where both money and unemployment are modeled using explicit microfoundations, integrating and extending recent work in macro and monetary economics, and providing a unified theory to analyze labor and goods markets. We calibrate the model, to ask how monetary factors account quantitatively for low-frequency labor market behavior. The answer depends on two key parameters: the elasticity of money demand, which translates monetary policy to real balances and profits; and the value of leisure, which affects the transmission from profits to entry and employment. For conservative parameterizations, money accounts for some but not that much of trend unemployment -- by one measure, about 1/5 of the increase during the stagflation episode of the 70s can be explained by monetary policy alone. For less conservative but still reasonable parameters, money accounts for almost all low-frequency movement in unemployment over the last half century |
| JEL: | E24 E52 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:kie:kieliw:1501&r=lab |
| By: | Yen-Chien Chen (Department of Economics, National Taiwan University); Stacey H. Chen (Department of Economics, Royal Holloway, University of London); Jin-Tan Liu (Department of Economics, National Taiwan University) |
| Abstract: | Son-preferring parents tend to continue to have babies until a son's birth. After deciding the set of children, the parents with resource constraints may divert family sources from daughters to a son. Thus, the presence of a son, relative to a daughter, have 2 distinct effects on his sister's educational out- comes; the direct effect while holding constant family size and the indirect effect through decreasing family size. Previous estimates of the direct effect take family size as an exogenous and predetermined covariate, and assume the size is endogenous and dependent on the sex composition of early-born siblings. We show that even if child gender and family size are both exogenous, use of an instrument for family size is required to isolate the direct effect from the main effects of family size. Using a large and unique administrative data from Taiwan, we demonstrate how Instrumental-Variable Methods resolve both prob- lems of endogeneity and causal dependence of an important covariate (family size) on treatment status (sibling sex). Furthermore, we minimize the incident of sex-selective abortion by restricting our birth data on cohorts prior to abor- tion legalization and prior to prevalent practice of prenatal sex determination. Using the occurrence of twining to instrument for family size conditional on birthweights, our IV estimates show a strong direct effect of a male sibling, relative to a female, on women's college attainment, if the women were born in the earliest year of our data, 1978. After 1978, both effects of sibling gender and family size are almost zero. |
| Keywords: | Sibling sex composition, family size, intrafamily allocation of resources; quantity-quality trade-off; education |
| JEL: | I20 J13 J16 J24 O10 R20 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:hol:holodi:0903&r=lab |
| By: | Kai Christoffel (European Central Bank, Kaiserstrasse 29, D-60311 Frankfurt am Main, Germany.); Keith Kuester (European Central Bank, Kaiserstrasse 29, D-60311 Frankfurt am Main, Germany.); Tobias Linzert (European Central Bank, Kaiserstrasse 29, D-60311 Frankfurt am Main, Germany.) |
| Abstract: | In this paper, we explore the role of labor markets for monetary policy in the euro area in a New Keynesian model in which labor markets are characterized by search and matching frictions. We first investigate to which extent a more flexible labor market would alter the business cycle behaviour and the transmission of monetary policy. We find that while a lower degree of wage rigidity makes monetary policy more effective, i.e. a monetary policy shock transmits faster onto inflation, the importance of other labor market rigidities for the transmission of shocks is rather limited. Second, having estimated the model by Bayesian techniques we analyze to which extent labor market shocks, such as disturbances in the vacancy posting process, shocks to the separation rate and variations in bargaining power are important determinants of business cycle fluctuations. Our results point primarily towards disturbances in the bargaining process as a significant contributor to inflation and output fluctuations. In sum, the paper supports current central bank practice which appears to put considerable effort into monitoring euro area wage dynamics and which appears to treat some of the other labor market information as less important for monetary policy. JEL Classification: E32, E52, J64, C11. |
| Keywords: | Labor Market, wage rigidity, bargaining, Bayesian estimation. |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:200901035&r=lab |
| By: | Gagliarducci, Stefano; Paserman, M. Daniele |
| Abstract: | This paper studies gender interactions within hierarchical organizations using a large data set on the duration of Italian municipal governments elected between 1993 and 2003. A municipal government can be viewed as a hierarchy, whose stability over time depends on the degree of cooperation between and within ranks. We find that in municipalities headed by female mayors, the probability of early termination of the legislature is higher. This result persists and becomes stronger when we control for municipality fixed effects as well as non-random sorting of women into municipalities using regression discontinuity in gender-mixed electoral races decided by a narrow margin. The likelihood that a female mayor survives until the end of her term is lowest when the council is entirely male, and in regions with less favorable attitudes towards working women. The evidence is suggestive that female mayors are less able at fostering cooperation among men, or alternatively, that men are more reluctant to be headed by women. Other interpretations receive less support in the data. Our results may provide an alternative explanation for the underrepresentation of women in leadership positions. |
| Keywords: | Discrimination; Gender; Government stability; Hierarchies |
| JEL: | H72 M54 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:7272&r=lab |
| By: | Kotsadam, Andreas (Department of Economics, School of Business, Economics and Law, Göteborg University) |
| Abstract: | Using advanced panel data methods on ECHP (European Community Household Panel) data, female labor force participation at both the intensive and extensive margin is found to be negatively associated with informal caregiving to elderly. The effects of informal caregiving seem to be more negative in the Southern European countries, less negative in the Nordic countries, and in between these extremes in the Central European countries included in the study. That is, not only do women in some countries provide more care, the care they provide also has a stronger negative correlation with the probability of being employed and the number of hours worked. It is argued in this paper that a candidate explanation for the phenomenon of lower marginal effects in countries with more formal care and less pronounced gendered care norms has to do with the degree of coercion in the caring decision.<p> |
| Keywords: | Informal care; Female labor supply; European welfare states |
| JEL: | I11 I12 J22 |
| Date: | 2009–04–06 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunwpe:0353&r=lab |
| By: | Nicolas R. Ziebarth |
| Abstract: | Sick leave payments represent a significant portion of public health expenditures and labor costs. Reductions in replacement levels are a commonly used instrument to tackle moral hazard and to increase the efficiency of the health insurance market. In Germany’s Statutory Health Insurance (SHI) system, the replacement level for periods of sickness of up to six weeks was reduced from 100 percent to 80 percent of an employee’s gross wage at the end of 1996. At the same time, the replacement level for individuals absent for a long-term period, i.e., from the seventh week onwards, was reduced from 80 to 70 percent. We show theoretically that the net reform effects on long-term absenteeism can be disentangled into a direct and an indirect effect. Using SOEP data, a natural control group, and two different treatment groups, we estimate the net and the direct effect on the incidence and duration of long-term absenteeism by difference-in-differences. Our findings suggest that, on population average, the reforms have not affected long-term absenteeism significantly, which is in accordance with our theoretical predictions, assuming that employees on long-term sick leave are seriously sick. However, we find some heterogeneity in the effects and a small but significant decrease in the duration of long-term absenteeism for the poor and middle-aged full-time employed persons. All in all, moral hazard and presenteeism seem to be less of an issue in the right tail of the sickness spell distribution. Finally, our calculations suggest that from 1997 to 2006, around five billion euros were redistributed from persons on long-term sick leave to the SHI insurance pool. |
| Keywords: | long-term absenteeism, sick pay, moral hazard, natural experiment, SOEP |
| JEL: | I18 J22 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp172&r=lab |
| By: | Kata Mihaly |
| Abstract: | Peer interactions have been argued to play a major role in student academic achievement. Recent work has focused on measuring the structure of peer interactions with the location of the student in their social network and has found a positive relationship between student popularity and academic achievement. Here the author ascertains the robustness of previous findings to controls for endogenous friendship formation. The results indicate that popularity influences academic achievement positively in the baseline model, a finding which is consistent with the literature. However, controlling for endogenous friendship formation results in a large drop in the effect of popularity, with a significantly negative coefficient in all of the specifications. These results point to a negative short term effect of social capital accumulation, lending support to the theory that social interactions crowd out activities that improve academic performance. |
| JEL: | I21 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:ran:wpaper:678&r=lab |
| By: | Monte, Ferdinando |
| Abstract: | Skill-biased technical change and trade integration have both been indicated to be the cause of the wide increase in wage inequality in U.S. in the last 50 years. This paper shows in a simple uni ed framework why both mechanisms can reproduce the observed pattern of wage dispersion. Intra-fi rm rent distribution can be used to disentangle these causes. |
| Keywords: | International Trade; Skill Biased Techical Change; Inequality |
| JEL: | F16 D33 O33 |
| Date: | 2009–04–16 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:14719&r=lab |
| By: | Acemoglu, Daron |
| Abstract: | This paper studies the conditions under which the scarcity of a factor (in particular, labor) encourages technological progress and technology adoption. In standard endogenous growth models, which feature a strong scale effect, an increase in the supply of labor encourages technological progress. In contrast, the famous Habakkuk hypothesis in economic history claims that technological progress was more rapid in 19th-century United States than in Britain because of labor scarcity in the former country. Similar ideas are often suggested as possible reasons for why high wages might have encouraged rapid adoption of certain technologies in continental Europe over the past several decades, and as a potential reason for why environmental regulations can spur more rapid innovation. I present a general framework for the analysis of these questions. I define technology as strongly labor saving if the aggregate production function of the economy exhibits decreasing differences in the appropriate index of technology,<font face="Symbol">q</font>, and labor. Conversely, technology is strongly labor complementary if the production function exhibits increasing differences in <font face="Symbol">q</font> and labor. The main result of the paper shows that labor scarcity will encourage technological advances if technology is strongly labor saving. In contrast, labor scarcity will discourage technological advances if technology is strongly labor complementary. I provide examples of environments in which technology can be strongly labor saving and also show that such a result is not possible in certain canonical macroeconomic models. These results clarify the conditions under which labor scarcity and high wages encourage technological advances and the reason why such results were obtained or conjectured in certain settings, but do not always apply in many models used in the growth literature. |
| Keywords: | Habakkuk hypothesis; high wages; innovation; labor scarcity; technological change |
| JEL: | C65 O30 O31 O33 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:7247&r=lab |
| By: | Robin S. Lee; Michael Schwarz |
| Abstract: | We introduce the interview assignment problem, which generalizes the one-to-one matching model of Gale and Shapley (1962) by introducing a stage of costly information acquisition. Agents may learn preferences over partners via costly interviews. Although there exist multiple equilibria where all agents receive the same number of interviews, efficiency depends on overlap – the number of common interview partners among agents. We prove the equilibria with the highest degree of overlap yields the highest probability of being matched. The analysis suggests that institutions which ration interviews or create labor market segmentation may lead to greater efficiency in information acquisition activities. |
| JEL: | C78 D85 J01 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:14922&r=lab |
| By: | Haroon Bhorat; Carlene van der Westhuizen (Development Policy Research Unit; Director and Professor) |
| Abstract: | During 2006 and 2007, a selection of research papers, in the main written by labour law experts, have provided critical input and guidance on the nature of the debate around the efficiency of the labour regulatory environment in South Africa. In November 2007, key stakeholders from government, labour and business attended a workshop on the Labour Regulatory Environment in South Africa at the Mount Grace Hotel, Magaliesberg, where the results of the aforementioned studies were presented and debated. Labour law experts generally agree that the current challenges in the regulatory environment have arisen disproportionately from the improper realisation of the labour market reforms introduced in the mid-1990s. |
| Keywords: | South Africa: labour regulation, Labour Regulatory Environment |
| JEL: | A1 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:ctw:wpaper:96112&r=lab |
| By: | Carlsson, Fredrik (Department of Economics, School of Business, Economics and Law, Göteborg University); Martinsson, Peter (Department of Economics, School of Business, Economics and Law, Göteborg University); Qin, Ping (Department of Economics, School of Business, Economics and Law, Göteborg University); Sutter, Matthias (Department of Public Finance, University of Innsbruck) |
| Abstract: | We study household decision making in a high-stakes experiment with a random sample of households in rural China. Spouses have to choose between risky lotteries, first separately and then jointly. We find that spouses’ individual risk preferences are more similar the richer the household and the higher the wife’s relative income contribution. A couple’s joint decision is typically determined by the husband, but women who contribute relatively more to the household income, women in high-income households, women with more education than their husbands, and women with communist party membership have a stronger influence on the joint decision.<p> |
| Keywords: | Household decision making; Risk; Field experiment; China |
| JEL: | C91 C92 C93 D10 |
| Date: | 2009–04–20 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunwpe:0356&r=lab |
| By: | Barthel, Jens |
| Abstract: | The connection between age and productivity is a widely discussed topic in the empirical literature. The present paper's aim is to contribute to the explanation of an apparant lower productivity of older individuals. If we introduce uncertainty about the future working conditions depending on present success, a decrease of productivity over the working life can be observed despite a constant a priori productivity. |
| Keywords: | age discrimination; productivity |
| JEL: | J14 J71 |
| Date: | 2008–12–12 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:14682&r=lab |
| By: | Rebeca Echávarri (The University of the Basque Country) |
| Abstract: | This paper investigates the extent to which a biased transmission of educational endowments affects fertility. To this end, we devise a version of Becker’s family decision model that takes preference change into account. Specifically, we model education as an instrument that increases the autonomy (to prefer), and autonomy as an instrument of preference-change for household-structures. The empirical validity of the proposed model is examined for the European setting using the European Community Household Panel. In the context of the model, empirical findings imply the following. On the one hand, both preference for quantity and preference for bequest for each offspring (quality) increases with education, while preference for current consumption decreases. On the other hand, education is found to be negatively correlated with fertility, at a decreasing rate. Therefore, the paper provides a useful additional toolkit for public policy evaluation. It explains how public policies oriented toward the guarantee of personal freedoms, such as the expansion of education and autonomy, are likely to guarantee the same freedoms for subsequent generations. |
| Keywords: | Intergenerational Transmission; Household Behavior; Education; Autonomy. |
| JEL: | D1 J1 |
| Date: | 2009–04–22 |
| URL: | http://d.repec.org/n?u=RePEc:ehu:dfaeii:200901&r=lab |
| By: | Aloysius Siow |
| Abstract: | In a static frictionless transferable utilities bilateral matching market with systematic and idiosyncratic payoffs, supermodularity of the match output function implies a strong form of positive assortative matching: The equilibrium matching distribution has all positive local log odd ratios or totally positive of order 2 (TP2). A strong form of a preference for own type implies supermodularity of the match output function. It has additional restrictions on local odds ratios. Local odds ratios are not informative on whether a bilateral matching market equilibrates with or without transfers. Using white married couples in their thirties from the US 2000 census, spousal educational matching obeyed TP2 except for less than 0.2% of marriages with extreme spousal educational disparities. Using the TP2 order, there were more positive assortative matching by couples living in SMSA's than those who do not; but not more positive assortative matching in 2000 than in 1970. There were increases in specific local log odds over that period. |
| Keywords: | matching, marriage, education, local log odds, TP2, United States |
| JEL: | J1 C51 |
| Date: | 2009–04–15 |
| URL: | http://d.repec.org/n?u=RePEc:tor:tecipa:tecipa-356&r=lab |