|
on Labour Economics |
| By: | Carneiro, Anabela (University of Porto); Guimaraes, Paulo (University of South Carolina); Portugal, Pedro (Universidade Nova de Lisboa) |
| Abstract: | Using a longitudinal matched employer-employee data set for Portugal over the 1986-2005 period, this study analyzes the heterogeneity in wages responses to aggregate labor market conditions for newly hired workers and existing workers. Accounting for both worker and firm heterogeneity, the data support the hypothesis that entry wages are much more procyclical than current wages. A one-point increase in the unemployment rate decreases wages of newly hired male workers by around 2.8% and by just 1.4% for workers in continuing jobs. Since we estimate the fixed effects, we were able to show that unobserved heterogeneity plays a non-trivial role in the cyclicality of wages. In particular, worker fixed effects of new hires and separating workers behave countercyclically, whereas firm fixed effects exhibit a procyclical pattern. Finally, the results reveal, for all workers, a wage-productivity elasticity of 1.2, slightly above the one-for-one response predicted by the Mortensen-Pissarides model. |
| Keywords: | wage cyclicality, hires, firm-specific effects, compositional effects, labor productivity |
| JEL: | J31 E24 E32 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4174&r=lab |
| By: | Martins, Pedro S. (Queen Mary, University of London); Novo, Álvaro A. (Banco de Portugal); Portugal, Pedro (Universidade Nova de Lisboa) |
| Abstract: | Many pay-as-you-go pension systems have increased or plan to increase their legal retirement age (LRA) to address the financial consequences of ageing. Although the success of these policies is ultimately determined at the labour market, little is known about the effects of higher LRAs at the firm level. Here, we identify this effect by considering a legislative reform introduced in Portugal in 1994: women's LRA was gradually increased from 62 to 65 years while men's LRA stayed unchanged at 65. Using detailed matched employer-employee panel data and difference-in-differences matching methods, we analyse the effects of the reform in terms of a number of worker- and firm-level outcomes. After providing evidence of compliance with the law, we find that the wages and hours worked of older women (those required to work longer) were virtually unchanged. However, firms employing older female workers significantly reduced their hirings, especially of younger female workers. Those firms also lowered their output although not their output per worker. |
| Keywords: | social security reform, older workers, matching estimators |
| JEL: | J14 J26 J63 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4187&r=lab |
| By: | Stephan, Gesine (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]) |
| Abstract: | "In Germany, targeted wage subsidies to employers are an important instrument of active labor market policy. This paper utilizes process generated data of the German Public Employment Service to compare the wages of individuals taking up a subsidized job with those of otherwise similar individuals who found an unsubsidized job. The results indicate that subsidized jobs are not associated with gains or losses regarding daily wages, which might be contributed to wage setting within the German system of industrial relations. Nonetheless, because subsequent employment rates of subsidized persons are higher on average, we find a positive relationship between cumulated wages and subsidization." (author's abstract, IAB-Doku) ((en)) |
| Keywords: | Eingliederungszuschuss - Auswirkungen, Lohnkostenzuschuss - Erfolgskontrolle, arbeitsmarktpolitische Maßnahme, Lohnhöhe, Beschäftigungsdauer |
| JEL: | J31 J38 J58 |
| Date: | 2009–06–02 |
| URL: | http://d.repec.org/n?u=RePEc:iab:iabdpa:200909&r=lab |
| By: | Sæther, Erik Magnus (Ragnar Frisch Centre for Economic Research) |
| Abstract: | This thesis aims to explore the short-term impact of increased wages on the working hours of health personnel and their practice choice. An additional objective is to identify existing compensating differentials in the job market for health personnel. |
| Keywords: | physicians; registered nurses; discrete choice; non-convex budget sets; labor supply; sector-specific wages |
| JEL: | C25 I10 J22 |
| Date: | 2009–06–07 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:oslohe:2005_001&r=lab |
| By: | Christophe Muller; Christophe Nordman |
| Abstract: | We conduct a case study of the linkages of task organization, human capital accumulation and wages in Morocco, using matched worker-firm data for Electrical-mechanical and Textile-clothing industries. In order to integrate task organization into the interacting processes of workers’ training and remunerations, we use a recursive model, which is not rejected by our estimates: task organization influences on-the-job training that affects wages. Beyond sector and gender determinants, assignment of workers to tasks and on-the-job training is found to depend on former education and work experience in a broad sense. Meanwhile, participation in on-the-job training is stimulated by being assigned to a team, especially of textile sector and for well educated workers. Finally, task organization and on-the-job training are found to affect wages. |
| Keywords: | Morocco, Wages, On-the-job training, Human capital, Task organization. |
| URL: | http://d.repec.org/n?u=RePEc:not:notcre:08/12&r=lab |
| By: | Kathrin Leuze; Allessandra Rusconi |
| Abstract: | Occupational sex segregation is a persistent source of social inequalities. The increasing participation of women in tertiary education and rising female employment rates, however, have given hope that gender inequalities will decline as a result of growing female opportunities for high skill employment in the service sector, e.g. the professions. This paper asks whether such optimistic accounts are justified by comparing male and female professional career trajectories in Germany. Our main assumptions hold that, even today, strong gender differences continue to exist between public and private sector professions, which are further aggravated by different forms of family commitment. Overall, our analyses demonstrate that even among highly qualified men and women, important patterns of sex segregation are present. An initial horizontal segregation between public and private sectors brings about “equal, but different” career prospects, which in the phase of family formation turn into vertical segregation, promoting “different and therefore unequal” labor market chances. |
| Keywords: | professions, sex segregation, labor market outcomes, family formation, tertiary education, German |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp187&r=lab |
| By: | Nyborg, Karine (Department of Economics); Brekke, Kjell Arne (Department of Economics) |
| Abstract: | Work contributes to people’s self-image in important ways. We propose a model in which individuals have a preference for being important to others. This leads to the following predictions: 1) In fully competitive markets with performance pay, behavior coincides with the standard model (bakers). 2) In jobs where e¤ort is not rewarded according to its social marginal value, behavior is more socially bene…cial than predicted by the standard model (nurses). 3) Even if unemployment bene…ts provide full income compensation, many workers’ utility strictly decreases when losing their job. 4) Similarly, many workers will prefer to work rather than to live o¤ welfare, even with full income compensation. 5) To keep shirkers out of the public sector, nurses’wages must be strictly lower than private sector income. At this wage level, however, the public sector will be too small. 6) It is possible to attract motivated workers to the public sector, without simultaneously attracting shirkers, through capital input improving nurses’opportunity to do a good job. |
| Keywords: | Homo Oeconomicus; Work Motivation; Labour Market |
| JEL: | I00 J00 |
| Date: | 2009–06–02 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:oslohe:2008_001&r=lab |
| By: | Kaas, Leo (University of Konstanz); Lu, Jun (University of Konstanz) |
| Abstract: | We consider a search model of the labor market with two types of equally productive workers and two types of firms, discriminators and non-discriminators. Without policy intervention, there is wage dispersion between and within the two worker groups, but all wage differences become negligible when the taste for discrimination is small. We analyze the effect of an equal-pay policy, both in combination with affirmative action and without. When equal opportunity of hiring cannot be enforced, wage dispersion increases and wages for minority workers fall substantially relative to laissez faire. Sometimes also the wage gap between worker groups widens in response to the policy. |
| Keywords: | search model, wage dispersion, discrimination, equal pay policy |
| JEL: | J41 J71 J78 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4173&r=lab |
| By: | Rupert, Peter (University of California, Santa Barbara); Wasmer, Etienne (Sciences Po, Paris) |
| Abstract: | The Mortensen-Pissarides model with unemployment benefits and taxes has been able to account for the variation in unemployment rates across countries but does not explain why geographical mobility is very low in some countries (on average, three times lower in Europe than in the U.S.). We build a model in which both unemployment and mobility rates are endogenous. Our findings indicate that an increase in unemployment benefits and in taxes does not generate a strong decline in mobility and accounts for only half to two-thirds of the difference in unemployment from the US to Europe. We find that with higher commuting costs the effect of housing frictions plays a large role and can generate a substantial decline in mobility. We show that such frictions can account for the differences in unemployment and mobility between the US and Europe. |
| Keywords: | labor search frictions, unemployment, housing market imperfections, commuting costs |
| JEL: | J30 J60 R20 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4172&r=lab |
| By: | Hudson, John (University of Bath); Sessions, John G. (University of Bath) |
| Abstract: | We examine the impact of parental education on the shape of an individual's experience-earnings profile. A number of factors suggest that parental education will affect the ability of an individual to translate labor market experience into earnings. Our empirical analysis of US data suggests that this is indeed the case. Higher parental education shifts the earnings profile significantly to the left – the profile of individuals with parents who both have 15 years of education peaks at 16 years of experience when their wages are 52% (24%) greater than those whose parents both have only 5 (10) years of education. |
| Keywords: | parental education, human capital, earnings |
| JEL: | J30 J31 J33 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4171&r=lab |
| By: | Dupuy, Arnaud (ROA, Maastricht University); Smits, Wendy (Statistics Netherlands) |
| Abstract: | The aim of this paper is to measure the extent to which lower wages in R&D functions reflect a preference effect. In contrast to the bulk of the literature on compensating wage differentials that compares wage levels of jobs with different attributes, we constructed measures of willingness to accept (WTA) and pay (WTP) for an R&D jobs using contingent valuation technique. Earnings regressions using OLS show an R&D wage penalty of about 3.5%. However, hedonic OLS regressions of WTA and WTP give significant relative preference parameters for R&D jobs that range from 0.19 to 0.22. |
| Keywords: | R&D workers, compensating wage differentials, hedonic prices |
| JEL: | J3 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4194&r=lab |
| By: | Morihiro Yomogida (Faculty of Economics, Sophia University); Laixun Zhao (Research Institute for Economics and Business Administration, Kobe University) |
| Abstract: | This paper develops a general equilibrium model with a vertical production structure to examine the relationship between offshore outsourcing and international migration,especially emphasizing their effects on the wages of skilled and unskilled workers. Two-way outsourcing (simultaneous insourcing and outsourcing) in skilled-labor intensive services arises due to product differentiation and scale economies, and outsourcing in unskilled-labor intensive processing occurs because of factor endowment differences. The tractability of the model allows us to rank outsourcing and migration, according to the wages of both types of workers. Finally, we also analyze under what conditions outsourcing and international migration are complements or substitutes. |
| JEL: | F11 F12 F16 F22 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:kob:dpaper:241&r=lab |
| By: | Susan B. Carter (Department of Economics, University of California Riverside); Richard C. Sutch (Department of Economics, University of California Riverside) |
| Abstract: | Elementary economic models are often used to suggest that immigration depresses the wages of native-born workers. These models assume that when immigrants enter a labour market, all other features of that market remain unchanged. Such an assumption is almost never valid. Here we explore the economic impacts of immigrants during America’s Age of Mass Migration a century ago. This was a period of dynamic structural change that witnessed the appearance of new industries, adoption of new technologies, discovery of new mineral resources, the rise of big business, and the geographic concentration of industries. We show that immigrants – and residents – selected destinations where labour demand and wages were rising. Thus, native workers experienced wage increases in the presence of heavy immigration. Models that abstract from the special characteristics of labour markets that attract immigrants misrepresent their economic impact. |
| Keywords: | Immigration, Internal migration, Economic history of immigration, Counterfactual analysis |
| Date: | 2006–08 |
| URL: | http://d.repec.org/n?u=RePEc:ucr:wpaper:200808&r=lab |
| By: | Fertig, Michael (ISG, Cologne); Schmidt, Christoph M. (RWI Essen); Sinning, Mathias (Australian National University) |
| Abstract: | This paper investigates whether and to what extent demographic change has an impact on human capital accumulation. The effect of the relative cohort size on educational attainment of young adults in Germany is analyzed utilizing data from the German Socio-Economic Panel for West-German individuals of the birth cohorts 1966 to 1986. These are the cohorts which entered the labor market since the 1980's. Particular attention is paid to the effect of changes in labor market conditions, which constitute an important channel through which demographic change may affect human capital accumulation. Our findings suggest that the variables measuring demographic change exert a considerable though heterogeneous impact on the human capital accumulation of young Germans. Changing labor market conditions during the 1980's and 1990's exhibit a sizeable impact on both the highest schooling and the highest professional degree obtained by younger cohorts. |
| Keywords: | demographic change, schooling, vocational training |
| JEL: | J11 J24 C25 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4180&r=lab |
| By: | Aronsson, Thomas (Umeå University); Koskela, Erkki (University of Helsinki) |
| Abstract: | This paper concerns optimal redistributive income taxation and provision of a public input good in a two-type model with a minimum wage policy implemented for the low-ability type, where firms may outsource part of the production process abroad, and where outsourcing is substitutable for domestic low-ability labor. Our results show that the incentives for the government to relax the self-selection constraint and to increase the employment among the low-skilled reinforce each other in terms of marginal income taxation; both of them contribute to increase the marginal income tax rate implemented for the low-ability type and decrease the marginal income tax rate implemented for the high-ability type. The appearance of equilibrium unemployment also constitutes an incentive to implement a tax on outsourcing. Without a direct instrument for taxing outsourcing, the government may reduce the amount of resources spent on outsourcing by increased provision of the public input good, which leads to less wage inequality and increased employment. |
| Keywords: | outsourcing, optimal nonlinear taxation, public goods, unemployment |
| JEL: | H21 H25 J31 J62 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4196&r=lab |
| By: | Donata Bessey (Institute for Strategy and Business Economics, University of Zurich); Uschi Backes-Gellner (Institute for Strategy and Business Economics, University of Zurich) |
| Abstract: | In this paper, we analyze the impact of onset of marijuana consumption during different periods in youth on educational outcomes and labor market success using a Swiss data set. In order to deal with endogeneity, we estimate a multivariate probit model with an instrumental variables strategy. Our results seem to suggest that onset of marijuana consumption under age 14 leads to a signicantly lower probability of having at least a secondary education, and onset of consumption between age 15 and 16 as well as between age 17 and 18 leads to a signicantly lower probability of having a tertiary education. While we do not find any impact of marijuana consumption on the probability of being unemployed, onset of marijuana consumption under age 14 and between age 15 and 16 leads to a significantly higher probability of working less than 80%. |
| Keywords: | Risky behavior, production of human capital, multivariate probit |
| JEL: | I19 I21 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:iso:educat:0043&r=lab |
| By: | Robert Bifulco (Syracuse University); Jason M. Fletcher (Yale University); Stephen L. Ross (University of Connecticut) |
| Abstract: | We use data from the National Longitudinal Study of Adolescent Health (Add Health) to examine the effects of classmate characteristics on economic and social outcomes of students. The unique structure of the Add Health allows us to estimate these effects using comparisons across cohorts within schools, and to examine a wider range of outcomes than other studies that have used this identification strategy. This strategy yields variation in cohort composition that is uncorrelated with student observables suggesting that our estimates are not biased by the selection of students into schools or grades based on classmate characteristics. We find that increases in the percent of classmates whose mother is college educated has significant, desirable effects on educational attainment and substance use. We find no evidence that in-school achievement, student attitudes, or behaviors serve as mechanisms for this effect. The percent of students from disadvantaged minority groups does not show any negative effects on the post-secondary outcomes we examine, but is associated with students reporting less caring student-teacher relationships and increased prevalence of some undesirable student behaviors during high school. |
| Keywords: | Education, Peer Effects, Cohort Study, Substance Abuse |
| JEL: | I21 I19 J13 J15 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:uct:uconnp:2009-15&r=lab |
| By: | Jung Hur (College of Economics, Sogan University, Seoul, Korea); Laixun Zhao (Research Institute for Economics and Business Administration, Kobe University) |
| Abstract: | Using the labor union's bargaining power as an indication of government policy on labor standards issues, we analyze the competition between a domestic (North) firm and a foreign (South) firm, and their relationship with optimal labor standards (LS). First, we show that the optimal level of LS is higher when labor unions are employment-oriented than when they are not. Second, it is higher under free trade than under the optimal tariff system if labor unions are employment-oriented. Third, 'a race to the bottom' of LS occurs in the case of wage-oriented unions. Fourth, the North's imposing a tariff to force the Southern government to raise its LS is effective only if the Southern union is wage-oriented. In order to raise Southern LS, both countries may need some deeper form of economic integration, if the North does not want to abandon its free trade system. |
| Keywords: | Labor Standards, Race to the Bottom, Tariff, Economic Integration, Labor Union |
| JEL: | F10 F16 J50 J80 L13 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:kob:dpaper:240&r=lab |
| By: | L'Haridon, Olivier; Malherbe, Franck |
| Abstract: | The design of employment protection legislation (EPL) is of particular importance in the European debate on the contours of labor market reform. In this article we appeal to an equilibrium unemployment model to investigate the virtues of EPL reform which reduces the red tape and legal costs associated with layos and introduces a U.S.-style experiencerating system, which we model as a combination of a layo tax and a payroll subsidy. The reform considered shows that it is possible to improve the eciency of employment protection policies without aecting the extent of worker protection on the labor market. These results are consistent with the conventional wisdom that experience rating is desirable, not only as an integral component of unemployment-compensation nance, as most studies acknowledge, but also as part and parcel of a virtuous EPL system. |
| Keywords: | Search and Matching Models; Employment Protection; State-Contingent Layo Tax; Experience-Rating |
| JEL: | J41 J48 J60 |
| Date: | 2008–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:ebg:heccah:0910&r=lab |
| By: | Bandiera, Oriana (London School of Economics); Barankay, Iwan (University of Pennsylvania); Rasul, Imran (University College London) |
| Abstract: | We present evidence on social incentives in the workplace, namely on whether workers’ behavior is affected by the presence of those they are socially tied to, even in settings where there are no externalities among workers due to either the production technology or the compensation scheme in place. To do so we combine data on individual worker productivity from a firm’s personnel records with information on each worker’s social network of friends in the firm. We find that compared to when she has no social ties with her co-workers, a given worker’s productivity is significantly higher when she works alongside friends who are more able than her, and significantly lower when she works with friends who are less able than her. As workers are paid piece rates based on individual productivity, social incentives can be quantified in monetary terms and are such that (i) workers who are more able than their friends are willing to exert less effort and forgo 10% of their earnings; (ii) workers who have at least one friend who is more able than themselves are willing to increase their effort and hence productivity by 10%. The distribution of worker ability is such that the net effect of social incentives on the firm’s aggregate performance is positive. The results suggest that firms can exploit social incentives as an alternative to monetary incentives to motivate workers. |
| Keywords: | conformism, social incentives, social networks |
| JEL: | L2 M5 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4190&r=lab |
| By: | Aycan, Çelikaksoy (Stockholm University Linnaeus Center for Integration Studies - SULCIS); Lena, Nekby (Stockholm University Linnaeus Center for Integration Studies - SULCIS); Saman, Rashid (Stockholm University Linnaeus Center for Integration Studies - SULCIS) |
| Abstract: | Assortative mating patterns in two dimensions namely, ethnic background and education are analysed in this paper for individuals with an immigrant background living in Sweden. We focus on the role of individual and spousal characteristics as well as the role of parental composition on partnership formation. Results indicate that assorative mating by ethnic background is significantly lower for second generation immigrants in comparison to first generation immigrants. In the case of assortative mating by education, although the descriptive statistics show that the proportion of educational homogamy is higher for second generation immigrants, after controlling for own and partners’ characteristics, educational homogamy is found to be significantly lower for those in the second generation. Gender differences in these patterns suggest that second generation females are significantly less likely than second generation men to be in educational homogamous partnerships relative to their first generation counterparts. In terms of parental composition, having a Swedish background (mother or father) is associated with lower ethnic endogamy, especially for first generation women. Having a Swedish background is also associated with significantly higher probabilities of educational homogamy but primarily only for first generation male immigrants. |
| Keywords: | Positive Assortative Mating; Immigrant Status; Ethnic Endogamy; Education Homogamy |
| JEL: | F22 J12 J15 J16 |
| Date: | 2009–05–29 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sulcis:2009_007&r=lab |
| By: | Cohen-Goldner, Sarit (Bar-Ilan University); Gotlibovski, Chemi (Academic College of Tel-Aviv Yaffo); Kahana, Nava (Bar-Ilan University) |
| Abstract: | Previous papers tested the validity of the Family Investment Hypothesis (FIH) among immigrants by comparing the labor market outcomes of immigrant couples and native or mixed couples. Here we propose an alternative test for the FIH which is based on a comparison between married and single immigrants. The logic underlying this alternative method states that if credit constraints are binding, then only married immigrants can cross-finance their investment within the family. In order to overcome potential selection bias that would arise if unobserved characteristics that affect the marital status of the individual also affect his/her labor market outcomes, we construct a difference-in-differences estimator that exploits variation in the labor market outcomes of married and single natives. Implementation of this method using US and Israeli data leads to a rejection of the FIH in both countries. |
| Keywords: | family investment model, labor supply |
| JEL: | J22 J61 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4185&r=lab |
| By: | García-Mainar, Inmaculada (University of Zaragoza); Molina, José Alberto (University of Zaragoza); Montuenga, Víctor M. (University of Zaragoza) |
| Abstract: | This paper analyses the intra-household allocation of time to show gender differences in childcare. In the framework of a general efficiency approach, hours spent on childcare by each parent are regressed against individual and household characteristics, for five samples (Denmark, France, Germany, Italy and Spain), with data being drawn from the European Community Household Panel-ECHP (1994-2001). Empirical results show a clear inequality in childcare between fathers and mothers, with this being more evident in Mediterranean countries. Panel data estimates reveal that, in general, caring tasks are mainly influenced by the presence of young children in the household, by the total non-labor income, and by the ratio of mothers' non-labor income to family's non-labor income, with this latter variable exhibiting a different behavior across genders and across countries. |
| Keywords: | childcare, gender differences, intra-household allocation, time use |
| JEL: | D13 J22 C33 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4188&r=lab |
| By: | Felbermayr, Gabriel (University of Hohenheim); Prat, Julien (University of Vienna); Schmerer, Hans-Jörg (University of Tuebingen) |
| Abstract: | This paper documents a robust empirical regularity: in the long-run, higher trade openness is causally associated to a lower structural rate of unemployment. We establish this fact using: (i) panel data from 20 OECD countries, (ii) cross-sectional data on a larger set of countries. The time structure of the panel data allows us to deal with endogeneity concerns, whereas cross-sectional data make it possible to instrument openness by its geographical component. In both setups, we carefully purge the data from business cycle effects, include a host of institutional and geographical variables, and control for within-country trade. Our main finding is robust to various definitions of unemployment rates and openness measures. The preferred specification suggests that a 10 percent increase in total trade openness reduces unemployment by about one percentage point. Moreover, we show that openness affects unemployment mainly through its effect on TFP and that labor market institutions do not appear to condition the effect of openness. |
| Keywords: | international trade, real openness, unemployment, GMM models, IV estimation |
| JEL: | F16 E24 J6 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4184&r=lab |
| By: | Kathrin Goeggel (Federal Ministry of Labour and Social Affairs, Berlin); Thomas Zwick (LMU München) |
| Abstract: | Small average wage effects of employer and/or occupation changes after apprenticeship training mask large differences between occupation groups and apprentices with different schooling back-grounds. Apprentices in commerce and trading occupations strongly profit from an employer change. Employer and occupation changers in industrial occupations face large wage disadvantages, however. We are the first to analyse these differences while those quality differences between training firms that have been widely studied before are small. This paper also explains differences between previous findings by comparing their empirical estimation strategies. It demonstrates that selectivity into occupations and changers, unobserved heterogeneity between occupations, and sample selection matter. Finally, it proposes several improvements in the estimation technique to measure apprenticeship quality. |
| Keywords: | Wage mark-up, apprenticeship training, occupations |
| JEL: | J24 J31 M53 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iso:educat:0045&r=lab |
| By: | Fevang, Elisabeth (Ragnar Frisch Centre for Economic Research); Kvrendokk, Snorre (Ragnar Frisch Centre for Economic Research); Røed, Knut (Ragnar Frisch Centre for Economic Research) |
| Abstract: | Based on Norwegian register data we show that having a lone parent in the terminal phase of life significantly affects the offspring’s labor market activity. The employment propen-sity declines by around 1 percentage point among sons and 2 percentage points among daughters during the years just prior to the parent’s death, ceteris paribus. Long-term sickness absence increases sharply. The probability of being a long-term social security claimant (defined as being a claimant for at least three months during a year) rises with as much as 4 percentage points for sons and 2 percentage points for daughters. After the par-ent’s demise, earnings tend to rise for those still in employment while the employment propensity continues to decline. The higher rate of social security dependency persists for several years. |
| Keywords: | Elderly care; labor supply; ageing; inheritance |
| JEL: | J14 J22 |
| Date: | 2009–06–02 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:oslohe:2008_008&r=lab |
| By: | Derek Yu (Department of Economics, University of Stellenbosch) |
| Abstract: | Statistics South Africa (Stats SA) has been collecting labour market data since 1993 with the October Household Survey (OHS), which was conducted annually between 1993 and 1999, as well as the Labour Force Survey (LFS), which was a biannual survey introduced in 2000 to replace the OHS. In March 2005, consultants from the International Monetary Fund (IMF) were appointed to revise all aspects of the LFS. All documents, processes and procedures relating to the LFS were reviewed, before a report on the findings was presented to Stats SA in June 2005. At the end, it was decided to re-engineer the LFS, and this took place in October 2005. Moreover, consultants were appointed in 2006 to help improve the survey questionnaire, sampling and weighting, data capture and processing systems. Eventually, Stats SA came up with a decision that the LFS would take place on a quarterly basis from 2008, i.e., the Quarterly Labour Force Survey (QLFS) was introduced to replace the LFS. The comparability issues between the OHSs and LFSs have been discussed thoroughly by Burger and Yu (2006), Casale, Muller and Posel (2005), Wittenberg (2004) and Yu (2007), focusing on changes in the sampling frame, inconsistencies in the questionnaire design, changes in the methodology to derive labour market status, trends in numerous variables (e.g., demographics, educational attainment, labour force participation rates, unemployment rates, earnings, etc.), oversampling of informal sector workers in 2000, overestimation of the earnings of self-employed in the OHSs, and the continuous improvement of the questionnaire by Stats SA. Therefore, this paper rather focuses on the comparability between LFS and QLFS, so as to assist researchers and policy makers when they try to analyze or compare both the LFS and QLFS data. As only four QLFSs have taken place at the time of writing, trends in variables will not be the focus of this paper. Instead, this paper will mainly look at the changes in questionnaire design, sampling method, derivation of new variables (i.e., underemployment status and unemployment status), a new methodology to capture the formal/informal status of the employed, as well as the drastic changes in methodology to capture labour market status. With regard to the latter, it is found that there is no longer a clear distinction between strict and broad labour market status in the QLFS, and this makes it difficult to derive long-term trends in the labour force participation rates (LFPRs) and unemployment rates under both strict and broad definitions. |
| Keywords: | South Africa, Household survey |
| JEL: | J00 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:sza:wpaper:wpapers80&r=lab |
| By: | Hartmut Egger; Gabriel Felbermayr |
| Abstract: | In this paper we set up a simple theoretical framework to study the possible source country effects of skilled labor emigration. We show that for given technologies, labor market integration necessarily lowers GDP per capita in a poor source country of emigration, because it distorts the education decision of individuals. As pointed out by our analysis, a negative source country effect also materializes if all agents face identical emigration probabilities, irrespective of their education levels. This is in sharp contrast to the case of exogenous skill supply. Allowing for human capital spillovers, we further show that with social returns to schooling there may be a counteracting positive source country effect if the prospect of emigration stimulates the incentives to acquire education. Since, in general, the source country effects are not clear, we calibrate our model for four major source countries - Mexico, Turkey, Morocco, and the Philippines - and show that an increase in emigration rates beyond those observed in the year 2000 is very likely to lower GDP per capita in poor economies. |
| Keywords: | Emigration; endogenous skill formation; source country effects |
| JEL: | F22 J24 |
| URL: | http://d.repec.org/n?u=RePEc:hoh:hohdip:308&r=lab |
| By: | Jennifer Roberts; Nigel Rice; Andrew M. Jones |
| Abstract: | Both health and income inequalities have been shown to be much greater in Britain than in Germany. One of the main reasons seems to be the difference in the relative position of the retired, who, in Britain, are much more concentrated in the lower income groups. Inequality analysis reveals that while the distribution of health shocks is more concentrated among those on low incomes in Britain, early retirement is more concentrated among those on high incomes. In contrast, in Germany, both health shocks and early retirement are more concentrated among those with low incomes. We use comparable longitudinal data sets from Britain and Germany to estimate hazard models of the effect of health on early retirement. The hazard models show that health is a key determinant of the retirement hazard for both men and women in Britain and Germany. The size of the health effect appears large compared to the other variables. Designing financial incentives to encourage people to work for longer may not be sufficient as a policy tool if people are leaving the labour market involuntarily due to health problems. |
| Keywords: | health, early retirement, hazard models |
| JEL: | J26 I10 C23 C41 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp188&r=lab |
| By: | Gabriel Felbermayr; Julien Prat; Hans-Jörg Schmerer |
| Abstract: | This paper documents a robust empirical regularity: in the long-run, higher trade openness is causally associated to a lower structural rate of unemployment. We es- tablish this fact using: (i) panel data from 20 OECD countries, (ii) cross-sectional data on a larger set of countries. The time structure of the panel data allows to deal with endogeneity concerns, whereas cross-sectional data make it possible to instru- ment openness by its geographical component. In both setups, we carefully purge the data from business cycle effects, include a host of institutional and geographical variables, and control for within-country trade. Our main finding is robust to various definitions of unemployment rates and openness measures. The preferred specification suggests that a 10 percent increase in total trade openness reduces unemployment by about one percentage point. Moreover, we show that openness affects unemployment mainly through its effect on TFP and that labor market institutions do not appear to condition the effect of openness. |
| Keywords: | international trade, real openness, unemployment, GMM models, IV esti- mation. |
| JEL: | F16 E24 J6 |
| URL: | http://d.repec.org/n?u=RePEc:hoh:hohdip:310&r=lab |
| By: | Liang, Che-Yuan (Department of Economics) |
| Abstract: | This paper extends the nonparametric method to estimate labor supply developed by Blomquist and Newey (2002) to handle cases in which there are individuals who do not work. The method is then applied to married women in Sweden from 1973 to 1999. For 1999, I find an aggregate uncompensated wage elasticity around 1 and an aggregate income elasticity around -0.05. Furthermore, marginal tax rates are beyondthe net government revenue maximizing rates. Despite large labor supply effects, the dramatic evolution of the tax system can only explain a small share of the 58 percent rise in female labor supply during this period. |
| Keywords: | female labor supply; nonparametric estimation; nonlinear budget sets; tax revenues |
| JEL: | C14 D31 H31 J22 |
| Date: | 2009–05–18 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:uunewp:2009_008&r=lab |
| By: | Clark, Ken (University of Manchester); Kanellopoulos, Nikolaos C. (affiliation not available) |
| Abstract: | Using panel data for twelve European countries over the period 1994-2001 we estimate the extent of state dependence in low pay. Controlling for observable and unobservable heterogeneity as well as the endogeneity of initial conditions we find positive, statistically significant state dependence in every single country. The magnitude of this effect varies by country, however this variation is not systematically related to labour market institutions. |
| Keywords: | initial conditions, state dependence, low pay persistence, low pay, dynamic random effects probit models |
| JEL: | C23 C25 J31 J69 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4183&r=lab |
| By: | Nicolas L. Dromel (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris); Elie Kolakez (ERMES - TEPP - Université Paris II Panthéon-Assas); Etienne Lehmann (CREST - Centre de Recherche en Économie et Statistique - INSEE - École Nationale de la Statistique et de l'Administration Économique, IZA - Institute for the Study of Labor) |
| Abstract: | In this paper, we argue that credit market imperfections impact not only the level of unemployment, but also its persistence. For this purpose, we first develop a theoretical model based on the equilibrium matching framework of Mortensen and Pissarides (1999) and Pissarides (2000) where we introduce credit constraints. We show these credit constraints not only increase steady-state unemployment, but also slow down the transitional dynamics. We then provide an empirical illustration based on a country panel dataset of 19 OECD countries. Our results suggest that credit market imperfections would significantly increase the persistence of unemployment. |
| Keywords: | Credit markets, labor markets, unemployment, credit constraints, search frictions. |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:halshs-00389762_v1&r=lab |
| By: | Fevang, Elisabeth (Ragnar Frisch Centre for Economic Research); Kverndokk, Snorre (Ragnar Frisch Centre for Economic Research); Røed, Knut (Ragnar Frisch Centre for Economic Research) |
| Abstract: | This paper presents a model of informal care to parents. We assume that the child participates in the labour market and gains in utility from consumption and leisure. In addition it has altruistic motivation to give informal care to its elderly parent. We show how the labour income, labour supply and informal caregiving are affected by exogenous factors such as the education level, wage rate, other supply of care, travel distance and inheritance. |
| Keywords: | informal care for elderly; labour market; elderly parent |
| JEL: | J22 |
| Date: | 2009–06–02 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:oslohe:2008_012&r=lab |
| By: | Erik Jonasson (Lund University, Sweden); Steven M Helfand (Department of Economics, University of California Riverside) |
| Abstract: | By paying particular attention to the local economic context, this paper analyzes the determinants of non-agricultural employment and earnings in non-agricultural jobs. The empirical analysis is based on the Brazilian Demographic Census, allowing for disaggregated controls for the local economy. Education stands out as one of the key determinants of employment outcome and earnings potential. Failure to control for locational effects, however, can lead to biased estimation of the importance of individual and household-specific characteristics. The empirical results show that local market size and distance to population centers have a significant impact on non-agricultural employment prospects and earnings. |
| Keywords: | Rural non-agricultural employment, economic geography, Latin America, Brazil |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:ucr:wpaper:200802&r=lab |
| By: | Ashley Dunstan; Troy Matheson; Hamish Pepper (Reserve Bank of New Zealand) |
| Abstract: | This paper examines the relationship between wages and consumer prices in New Zealand over the last 15 years. Reflecting the open nature of the New Zealand economy, the headline CPI is disaggregated into non-tradable and tradable prices. We find that there is a joint causality between wages and disaggregate inflation. An increase in wage inflation forecasts an increase in non-tradable inflation. However, it is tradable inflation that drives wage inflation. While exogenous shocks to wages do not help to forecast inflation, the leading relationship from wages to non-tradable inflation implies that monitoring wages may prove useful for projecting the impact of other shocks on future inflation. |
| JEL: | C32 E24 E31 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:nzb:nzbdps:2009/06&r=lab |
| By: | Stevenson, Betsey (Wharton School, University of Pennsylvania); Wolfers, Justin (Wharton School, University of Pennsylvania) |
| Abstract: | By many objective measures the lives of women in the United States have improved over the past 35 years, yet we show that measures of subjective well-being indicate that women’s happiness has declined both absolutely and relative to men. The paradox of women’s declining relative well-being is found across various datasets, measures of subjective well-being, and is pervasive across demographic groups and industrialized countries. Relative declines in female happiness have eroded a gender gap in happiness in which women in the 1970s typically reported higher subjective well-being than did men. These declines have continued and a new gender gap is emerging − one with higher subjective well-being for men. |
| Keywords: | subjective well-being, life satisfaction, happiness, gender, job satisfaction, women's movement |
| JEL: | D6 I32 J1 J7 K1 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4200&r=lab |
| By: | Santi Budria; Luis Diaz-Serrano; Ada Ferrer-i-Carbonell; Joop Hartog |
| Abstract: | We replicate Shaw (1996) who found that individual wage growth is higher for individuals with greater preference for risk taking. Expanding her dataset with more American observations and data for Germany, Spain and Italy, we find mixed support for the earlier results. We present and estimate a new model and find that in particular the wage level is sensitive to attitudes towards risk taking. |
| Keywords: | wage growth, risk, post-school investment |
| JEL: | J24 J30 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp192&r=lab |
| By: | Jörn Block; Philipp Sandner |
| Abstract: | Using data from the German Socio-Economic Panel Study (GSOEP), we analyze whether necessity entrepreneurs differ from opportunity entrepreneurs in terms of self-employment duration. Using univariate statistics, we find that opportunity entrepreneurs remain in self-employment longer than necessity entrepreneurs. However, after controlling for the entrepreneurs¿ education in the professional area where they start their venture, this effect is no longer significant. We therefore conclude that the difference observed is not an original effect but rather is due to selection. We then go on to discuss the implications of our findings for entrepreneurship-policy making, and give suggestions to improve governmental start-up programs. |
| Keywords: | Self-employment; Firm survival; Necessity entrepreneurs; Opportunity entrepreneurs; Hazard rates, GSOEP |
| JEL: | J23 J24 M13 C41 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp191&r=lab |
| By: | Ham, Roger (University of Western Sydney); Junankar, Pramod N. (Raja) (University of Western Sydney); Wells, Robert (University of Western Sydney) |
| Abstract: | This paper is an econometric investigation of the choice of individuals between a number of occupation groupings utilising an extensive array of conditioning variables measuring a variety of aspects of individual heterogeneity. Whilst the model contains the main theory of occupational choice, human capital theory, it also tests dynasty hysteresis through parental status variables. The focus is an examination of the relationship between choice and personality with the inclusion of psychometrically derived personality variables. Occupational choice is modelled using multinomial logit estimation using the Household Income and Labour Dynamics in Australia (HILDA) survey data. Human capital variables are found to exhibit strong credentialism effects. Parental status has a small and limited effect on occupation outcomes indicative of only some small dynasty hysteresis. On the other hand, personality effects are found to be significant, relatively large and persistent across all occupations. Further, the strength of these personality effects are such that they can in many instances rival that of various education credentials. These personality effects include but are not limited to: managers being less agreeable and more antagonistic; labourers being less conscientiousness; and sales people being more extraverted. |
| Keywords: | occupational choice, personality traits, credentialism, dynasty hysteresis |
| JEL: | J24 J62 C25 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4193&r=lab |
| By: | Aas, Eline (Institute of Health Management and Health Economics) |
| Abstract: | Typically, the participation rate is below 100 per cent. In this paper pecuniary compensation is used to increase the participation rate. In a postal questionnaire to 5,000 people invited to screening for colorectal cancer, those not participating were asked "would you participate if you were given NOK X in compensation?" <p> The results show that compensation increases participation and that the participation probability systematically varies with travel expenses, income, age, county, native country, marital status, use of health care services, genetic predisposition, expected benefit from the screening, subjective health status, and education. The estimated costs per additional screening are increasing |
| Keywords: | participation; willingness-to pay; compensation; costs; binary probit |
| JEL: | C25 H42 H43 I10 |
| Date: | 2009–06–07 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:oslohe:2005_007&r=lab |
| By: | O'Donoghue, Cathal (Teagasc Rural Economy Research Centre); Meredith, David (Teagasc Rural Economy Research Centre); O'Shea, Eamon (National University of Ireland, Galway) |
| Abstract: | As in many other developed countries, Ireland in recent decades has experienced a postponement of maternity. In this paper we consider the main trends in this phenomenon, considering changes in first and later births separately. We adapt the theoretical model due to Walker (1995) to incorporate a declining marginal return to experience to provide a human capital/career planning explanation for this postponement. We estimate a hazard model based upon the 1994 Living in Ireland Survey to empirically test this model. The career-planning hypothesis was found to hold. However an assumption about perfect capital markets failed indicating the impact of an income effect on the timing of maternity. The model also identified the importance of cohort differences in the timing of marriage in explaining much of the inter-cohort specific differences in the timing of maternity. |
| Keywords: | labour markets, fertility |
| JEL: | J13 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4192&r=lab |
| By: | Alexandre, Fernando (University of Minho); Bação, Pedro (University of Coimbra); Cerejeira, João (University of Minho); Portela, Miguel (University of Minho) |
| Abstract: | Real exchange rate movements are important drivers of the reallocation of resources between sectors of the economy. Economic theory suggests that the impact of exchange rates should vary with the degree of exposure to international competition and with the technology level. This paper contributes by bringing together these two views, both theoretically and empirically. We show that both the degree of openness and the technology level mediate the impact of exchange rate movements on labour market developments. According to our estimations, whereas employment in high-technology sectors seems to be relatively immune to changes in real exchange rates, these appear to have sizable and significant effects on highly open low-technology sectors. The analysis of job flows suggests that the impact of exchange rates on these sectors occurs through employment destruction. |
| Keywords: | exchange rates, international trade, job flows |
| JEL: | J23 F16 F41 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4191&r=lab |