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on Labour Economics |
| By: | Hielke Buddelmeyer (Institute of Applied Economic and Social Research, The University of Melbourne); Wang-Sheng Lee (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne); Mark Wooden (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne) |
| Abstract: | This paper uses longitudinal data from the Household, Income and Labour Dynamics in Australia (or HILDA) Survey to examine the extent to which the relatively high rates of transition from low-paid employment into unemployment are the result of disadvantageous personal characteristics or are instead a function of low-paid work itself. Dynamic random effects probit models of the likelihood of unemployment are estimated. After controlling for unobserved heterogeneity and initial conditions, we find that, relative to high-paid employment, low-paid employment is associated with a higher risk of unemployment, but this effect is only significant among women. We also find only weak evidence that low-wage employment is a conduit for repeat unemployment. |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:iae:iaewps:wp2009n06&r=lab |
| By: | Bollinger, Christopher R. (University of Kentucky); Ziliak, James P. (University of Kentucky); Troske, Kenneth (University of Kentucky) |
| Abstract: | Despite evidence that skilled labor is increasingly concentrated in cities, whether regional wage inequality is predominantly due to differences in skill levels or returns is unknown. We compare Appalachia, with its wide mix of urban and rural areas, to other parts of the U.S., and find that gaps in both skill levels and returns account for the lack of high wage male workers. For women, skill shortages are important across the distribution. Because rural wage gaps are insignificant, our results suggest that widening wage inequality between Appalachia and the rest of the U.S. owes to a shortage of skilled cities. |
| Keywords: | wage inequality, region |
| JEL: | J31 J4 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4249&r=lab |
| By: | Nicolas Hérault (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne); Guyonne Kalb (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne) |
| Abstract: | This paper focuses on the correlation of labour market outcomes of parents and children and investigates whether education is an important factor in this correlation, allowing for its potential endogeneity. Based on the Household, Income and Labour Dynamics in Australia (HILDA) data, the multivariate analyses show that men’s labour market outcomes are affected by their fathers’ labour market outcomes. The results show no significant intergenerational correlation of labour market outcomes for women when using the proportion of time in unemployment However, there is a significant relationship between the labour market outcomes of the mother and the proportion of time spent out of work by her daughter. Finally, the results show a significant relationship between parents’ and children’s education levels, indicating that there is an indirect effect of parental education on their children’s labour market outcomes through education. Indeed, it is shown that education significantly reduces the proportion of time in unemployment and not in work. |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iae:iaewps:wp2009n14&r=lab |
| By: | Bosio, Giulio |
| Abstract: | Previous research on wage penalty for temporary workers has focused on the conditional mean model. This paper uses micro data from the 2006 wave of the Survey of Italian Households’ Income and Wealth (SHIW) to examine the wage gap between temporary and permanent workers across the whole wage distribution. I apply a quantile regression models to understand whether there are glass ceiling or sticky floor for fixed-term workers and to test the hypothesis of polarization of wage profile by contract status. I also exploit a counterfactual decomposition analysis to investigate whether the gap is attributed to differences in characteristics or to differences in coefficients effect. A possible source of misspecification may arise, the endogenous selection in temporary status. In order to address the selectivity bias, I adopt an IV specification and a variant of the traditional Heckman (1978) dummy endogenous variable for the quantile framework. The main finding is a sticky floor effect, in the sense that the wage penalty for temporary workers is wider at the bottom of earnings distribution and in particular the decomposition method shows how the coefficients effect is decreasing in the upper half of wage profile. The analysis by educational level and by sector confirms the sticky floor effect. Finally correcting for endogenous self-selection in temporary contract slightly modifies the magnitude of wage gap, without changing the main patterns evidenced in the standard quantile regression. |
| Keywords: | temporary employment; quantile regression; wage gap decomposition; endogenous selection |
| JEL: | J08 J31 J42 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:16055&r=lab |
| By: | Bulent Guler; Faith Guvenen; Giovanni L. Violante |
| Abstract: | Search theory routinely assumes that decisions about the acceptance/rejection of job offers (and, hence, about labor market movements between jobs or across employment states) are made by individuals acting in isolation. In reality, the vast majority of workers are somewhat tied to their partners - in couples and families - and decisions are made jointly. This paper studies, from a theoretical viewpoint, the joint job-search and location problem of a household formed by a couple (e.g., husband and wife) who perfectly pools income. The objective of the exercise, very much in the spirit of standard search theory, is to characterize the reservation wage behavior of the couple and compare it to the single-agent search model in order to understand the ramifications of partnerships for individual labor market outcomes and wage dynamics. We focus on two main cases. First, when couples are risk averse and pool income, joint search yields new opportunities - similar to on-the-job search - relative to the single-agent search. Second, when the two spouses in a couple face job offers from multiple locations and a cost of living apart, joint search features new frictions and can lead to significantly worse outcomes than single-agent search. |
| Keywords: | Search theory ; Unemployment ; Wages |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedmsr:426&r=lab |
| By: | Heinrich Hock (Florida State University); Delia Furtado (University of Connecticut) |
| Abstract: | This paper examines the effects of low-skilled immigration on the work and fertility decisions of high-skilled women born in the United States. The evidence we present indicates that low-skilled immigration to large metropolitan areas between 1980 and 2000 lowered the cost of market-based household services. Using a novel estimation technique to analyze joint decision making, we find that college-educated native females responded, on average, by increasing fertility and reducing short-run labor force participation. These changes were accompanied by a weakening of the negative correlation between work and fertility, as well as an increase in the proportion of women who both bore children and participated in the labor force. Taken in combination, our estimates imply that the continuing influx of low-skilled immigrants substantially reduced the work-fertility tradeoff facing educated urban American women. |
| Keywords: | Child care, fertility, household services, labor supply, immigration |
| JEL: | D10 F22 J13 J22 R23 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:uct:uconnp:2009-20&r=lab |
| By: | David H. Autor; David Dorn |
| Abstract: | After a decade in which wages and employment fell precipitously in low-skill occupations and expanded in high-skill occupations, the shape of U.S. earnings and job growth sharply polarized in the 1990s. Employment shares and relative earnings rose in both low and high-skill jobs, leading to a distinct U-shaped relationship between skill levels and employment and wage growth. This paper analyzes the sources of the changing shape of the lower-tail of the U.S. wage and employment distributions. A first contribution is to document a hitherto unknown fact: the twisting of the lower tail is substantially accounted for by a single proximate cause--rising employment and wages in low-education, in-person service occupations. We study the determinants of this rise at the level of local labor markets over the period of 1950 through 2005. Our approach is rooted in a model of changing task specialization in which `routine' clerical and production tasks are displaced by automation. We find that in labor markets that were initially specialized in routine-intensive occupations, employment and wages polarized after 1980, with growing employment and earnings in both high-skill occupations and low-skill service jobs. |
| JEL: | E24 J24 J31 J62 O33 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15150&r=lab |
| By: | Farré, Lídia (University of Alicante); Gonzalez, Libertad (Universitat Pompeu Fabra); Ortega, Francesc (Universitat Pompeu Fabra) |
| Abstract: | This paper investigates the effects of Spain's large recent immigration wave on the labor supply of highly skilled native women. We hypothesize that female immigration led to an increase in the supply of affordable household services, such as housekeeping and child or elderly care. As a result, i) native females with high earnings potential were able to increase their labor supply, and ii) the effects were larger on skilled women whose labor supply was heavily constrained by family responsibilities. Our evidence indicates that over the last decade immigration led to an important expansion in the size of the household services sector and to an increase in the labor supply of women in high-earning occupations (of about 2 hours per week). We also find that immigration allowed skilled native women to return to work sooner after childbirth, to stay in the workforce longer when having elderly dependents in the household, and to postpone retirement. Methodologically, we show that the availability of even limited Registry data makes it feasible to conduct the analysis using quarterly household survey data, as opposed to having to rely on the decennial Census. |
| Keywords: | immigration, labor supply, fertility, retirement, household services |
| JEL: | J61 J22 J13 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4265&r=lab |
| By: | Bosch, Nicole; van der Klaauw, Bas |
| Abstract: | Among OECD countries, the Netherlands has average female labor force participation, but by far the highest rate of part-time work. This paper investigates the extent to which married women respond to financial incentives. We exploit the exogenous variation caused by a substantial Dutch tax reform in 2001. Our main conclusion is that the positive significant effect of tax reform on labor force participation dominates the negative insignificant effect on working hours. Our preferred explanation is that women respond more to changes in tax allowances than to changes in marginal tax rates. |
| Keywords: | endogeneity; labor force participation; Uncompensated wage elasticity; working hours |
| JEL: | H24 J22 J38 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:7337&r=lab |
| By: | Lídia Farré; Libertad González Luna; Francesc Ortega |
| Abstract: | This paper investigates the effects of Spain’s large recent immigration wave on the labor supply of highly skilled native women. We hypothesize that female immigration led to an increase in the supply of affordable household services, such as housekeeping and child or elderly care. As a result, i) native females with high earnings potential were able to increase their labor supply, and ii) the effects were larger on skilled women whose labor supply was heavily constrained by family responsibilities. Our evidence indicates that over the last decade immigration led to an important expansion in the size of the household services sector and to an increase in the labor supply of women in high-earning occupations (of about 2 hours per week). We also find that immigration allowed skilled native women to return to work sooner after childbirth, to stay in the workforce longer when having elderly dependents in the household, and to postpone retirement. Methodologically, we show that the availability of even limited Registry data makes it feasible to conduct the analysis using quarterly household survey data, as opposed to having to rely on the decennial Census. |
| Keywords: | Immigration, Labor supply, Fertility, Retirement, Household services |
| JEL: | J61 J22 J13 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:upf:upfgen:1161&r=lab |
| By: | Duncan, Denvil (Georgia State University); Sabirianova Peter, Klara (Georgia State University) |
| Abstract: | We exploit the exogenous change in marginal tax rates created by the Russian flat tax reform of 2001 to identify the effect of taxes on labor supply of males and females. We apply the weighted difference-in-difference regression approach and instrumental variables to the labor supply function estimated on individual panel data. The mean regression results indicate that the tax reform led to a statistically significant increase in male hours of work but had no effect on that of females. However, we find a positive response to tax changes at both tails of the female hour distribution. We also find that the reform increased the probability of finding a job among both males and females. Despite significant variation in individual responses, the aggregate labor supply elasticities are trivial and suggest that reform-induced changes in labor supply were an unlikely explanation for the amplified personal income tax revenues that followed the reform. |
| Keywords: | labor supply, personal income tax, flat tax, labor supply elasticity, difference-in-difference, regression discontinuity, wage endogeneity, employment participation, Russia, transition |
| JEL: | H3 J2 J3 P2 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4257&r=lab |
| By: | Nikolaus Graf (Institute for Advanced Studies, Vienna, Austria); Helmut Hofer (Institute for Advanced Studies, Vienna, Austria); Rudolf Winter-Ebmer |
| Abstract: | In this paper we evaluate the impact of the old-age part-time scheme (OAPT) on the Austrian labour market which was a policy to allow flexible retirement options for the elderly with an aim to increase labour supply. According to our matching estimates employment probability increases slightly, especially in the first two years after entrance into the programme. Furthermore, the programme seems to reduce the measured unemployment risk. However, the total number of hours worked is significantly reduced by OAPT. While the policy is meant to reduce early exit from the labour force by allowing part-time work, our analysis indicates that most workers substitute part-time work for full-time work and thus the overall effect is rather negative. |
| Keywords: | evaluation of labour market programmes, labour supply of the elderly, nearest neighbour matching |
| JEL: | C31 J14 J26 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:jku:nrnwps:2009_06&r=lab |
| By: | Yolanda Rebollo Sanz (Department of Economics, Universidad Pablo de Olavide) |
| Abstract: | A discrete-time multivariate hazard model is applied to investigate whether an individual’s employment history conditions her chances of eventually obtaining a permanent contract in the Spanish labour market. This study differentiates the incidence of lagged duration dependence from occurrence dependence and individual employment history conditions are not exclusively defined in terms of the number of temporary contracts and job interruptions experienced by the worker, but also by the diversity of her past employers. My analysis focuses on Spanish labour market entrants aged between 18 and 29 for the 1995-2006 period, and performs the estimation by three age cohort groups separately to control for heterogeneity in initial conditions. The results suggest that some workers may become “trapped” in the temporary employment bracket, since their chances of obtaining a permanent contract seem to drop after some months of accumulating several temporary contracts under the same employer between bouts of unemployment. By contrast, moving from one firm to another as a temporary worker might have a positive influence on exit rates to permanent employment. Hence, this paper highlight that it is important to take into account whether or not the worker remains in the same firm when accumulating temporary contracts to test for the stepping stone effect of temporary contracts. |
| Keywords: | Event history model, lagged duration dependence, occurrence dependence, stepping stone effect, firm mobility, Multiple Spells duration models, Job Interruptions |
| JEL: | J41 J63 J68 C41 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:pab:wpaper:09.07&r=lab |
| By: | Liu, Qian (Uppsala University); Nordström Skans, Oskar (IFAU) |
| Abstract: | We study how the duration of paid parental leave affects the accumulation of cognitive skills among children. We use a reform which extended parental leave benefits from 12 to 15 months for Swedish children born after August 1988 to evaluate the effects of prolonged parental leave on children's test scores and grades at age 16. We show that, on average, the reform had no effect on children's scholastic performance. However, we do find positive effects for children of well-educated mothers, a result that is robust to a number of different specifications. We find no corresponding heterogeneity relative to parental earnings or fathers' education, or relative to other predictors of child performance. We find no effects on intermediate outcomes such as mothers' subsequent earnings, child health, parental fertility, divorce rates, or the mothers' mental health. Overall the results suggest positive causal interaction effects between mothers' education and the amount of time mothers spend with their children. Since the institutional context is one in which the alternative is subsidized day care, the results imply that subsidizing longer parental leave spells rather than day care reinforce the relationship between maternal education and school outcomes. |
| Keywords: | maternal employment, education, human capital, cognitive skills |
| JEL: | I21 J13 J24 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4244&r=lab |
| By: | Hou, Feng; Picot, Garnett |
| Abstract: | Immigrant selection rules were altered in the early 1990s, resulting in a dramatic increase in the share of entering immigrants with a university degree and in the skilled economic class. These changes were very successfully implemented following significant deterioration in entry earnings during the 1980s. This paper asks whether these change in immigrant selection contributed positively to immigrant entry earnings during the 1990s. Moving to the 2000s, the paper asks whether, after almost two decades of deterioration, the entry earnings of immigrants improved early in the decade, and if not, why not. We find that through the 1990s, altering immigrant characteristics did little to improve earnings at the bottom of the earnings distribution, and hence poverty rates among entering immigrants. A rapidly increasing share of immigrants with university degrees and in the skilled class found themselves at the bottom of the earnings distribution. They were unable to convert their education and “skilled class†designation to higher earnings. This inability may be related to language, credentialism, education quality, or supply issues, as discussed in the paper. However, the changing charcateristics did increase earnings among immigrants at the middle and top of the earnings distribution. We also find that from 2000 to 2004 the entry earnings of immigrants renewed their slide, but for reasons that differed from the standard explanations of the earlier decline. Following a significant increase in the supply of entering immigrants intending to work in IT and engineering during the late 1990s and early 2000s, these immigrants were faced with the IT downturn. The result was declining entry earnings, concentrated largely among these workers. |
| Keywords: | immigration, earnings, high tech, immigrants |
| JEL: | J61 |
| Date: | 2009–06–26 |
| URL: | http://d.repec.org/n?u=RePEc:ubc:clssrn:clsrn_admin-2009-37&r=lab |
| By: | Chen, Dandan |
| Abstract: | This paper examines the phenomenon of the over-supply of teachers but shortage of qualified teachers in Indonesia. Using a theoretical framework of government-dominated market with government-set wage rate and demand for teachers, the analysis explores how teacher supply, particularly the composition of the teaching force with low or high qualification, would be determined by current and future public policies. Using 2001 to 2008 Indonesian Labor Force Survey data, the paper further estimates the potential effect of the most recent teacher law, which could give college educated teachers a significant pay increase, on the composition of the Indonesian teaching force with differentiated education backgrounds. Using a sample of workers with college education, the author finds that the relative wage rate of teachers and that of alternative occupations significantly influence the decision of college educated workers to become teachers. It is also found that the wage rate set by the most recent teacher law would increase the share of teachers approximately from 16 to 30 percent of the college-educated labor force. This increase that is due to the new government-set wage rate, would result in a pupil-teacher ratio of 24 to 25 pupils per teacher with college education, but will require a more than 31 percent increase in the wage bill for teacher salaries. The empirical approach of this paper is derived from a structural model that takes into account the endogeneity of the wage rate and corrects for sample-selection bias due to occupational choice. |
| Keywords: | Tertiary Education,Primary Education,Education For All,Teaching and Learning,Secondary Education |
| Date: | 2009–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:4975&r=lab |
| By: | Sæther, Erik Magnus (Ragnar Frisch Centre for Economic Research) |
| Abstract: | What is the effect of increased wages on physician’s working hours and sector choice? This study applies an econometric framework that allows for non-convex budget sets, nonlinear labor supply curves and imperfect markets with institutional constraints. The physicians are assumed to make choices from a finite set of job possibilities, characterized by practice form, hours and wage rates. The individuals may combine their main position with an extra job, opening for a variety of combinations of hours in the respective jobs. I take into account the complicated payment schemes for physicians, taxes and household characteristics when estimating labor supply on Norwegian micro data. The results show a modest response in total hours to a wage increase, but a reallocation of hours in favor of the sector with increased wages. |
| Keywords: | Physicians; discrete choice; labor supply |
| JEL: | C25 I10 J22 |
| Date: | 2009–06–22 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:oslohe:2003_019&r=lab |
| By: | Nicole Schneeweis; Martina Zweimüller |
| Abstract: | Gender segregation in the labor market may be explained by women's re- luctance to choose technical occupations, although the foundations for career choices are certainly laid earlier, during education. Educational experts claim that female students are doing better in math and science and are more likely to choose those subjects if they are in single-sex classes. Possible explanations are the lack of self-confidence of girls in male-dominated subjects, the domi- nating behavior of boys in the classroom and unequal treatment by teachers. In this paper, we identify the causal impact of gender composition in coedu- cational classes on the choice of school type for female students. We propose that girls are less likely to choose a female-dominated school type at the age of 14 after spending the previous years in classes with a higher share of female students. We address the problem of endogenous school choice by using nat- ural variation in gender composition of adjacent cohorts within schools. The results are clear-cut and survive powerful falsification and sensitivity checks: Females are less likely to choose a female-dominated school type and more likely to choose the technical school type if they were exposed to a higher share of girls in previous grades. Our paper contributes to the recent debate about coeducation either in certain subjects or at the school level. |
| Keywords: | gender segregation, coeducation, career choice |
| JEL: | I21 I28 J24 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:jku:nrnwps:2009_05&r=lab |
| By: | Skuterud, Mikal; Su, Mingcui |
| Abstract: | We compare predicted relative immigrant wage profiles based on returns to YSM and to foreign and host-country sources of schooling and experience. We find the biases inherent in inferring assimilation from a return to YSM appear more substantial than those emanating from the assumptions necessary to estimate foreign and host-country returns directly using standard data sources. Given the policy relevance of allowing entry effects and subsequent wage growth to depend on the foreign human capital immigrants bring and their post-migration schooling and work decisions, our findings suggest the predominance of YSM models in the literature is not well founded. |
| Keywords: | Immigrant workers; wage differentials; human capital |
| JEL: | J61 J31 J24 |
| Date: | 2009–06–26 |
| URL: | http://d.repec.org/n?u=RePEc:ubc:clssrn:clsrn_admin-2009-38&r=lab |
| By: | Susanna Stén |
| Abstract: | ABSTRACT : The 1990’s was a turbulent period for Finnish postgraduate education. The education system was reformed and the number of postgraduate students who graduated every year increased at a fast pace. In this thesis doctorate and licentiate degree holders as a group, as well as how their labour market situation has changed in the period of 1990-2004, is studied. The aim of the thesis is to describe the changes in the period rather than to try to explain them, since this is very complicated. The thesis uses the Finnish Longitudinal Employer-Employee Data (FLEED) that is maintained by Statistics Finland. The data cover a randomly chosen third of the Finnish population aged 16-69 in the years 1990-2004. The descriptive analysis shows that the composition of the group changed. Women’s share of the postgraduate degree holders increased, as did the mean age among recently graduated, mostly because the share aged over 50 increased. The labour market situation of the postgraduate degree holders weakened during the period but was still good, all in all. There were remarkable differences between the different fields of study. Those with education in social and health care and in engineering enjoyed the most favourable conditions, while those with education in humanistic fields faced the least favourable labour market situation. The number of private sector employers with employees with postgraduate degrees doubled during the period. There were some differences between the firms employing postgraduate degree holders and the average firm in Finland. Moreover, the return to postgraduate education was estimated using regression analysis. Throughout the period, it seems that the return to postgraduate education remained unchanged. The marginal return to postgraduate education somewhat decreased during 1990-1996, but thereafter the direction of the development is less clear. In 2004 a person with a postgraduate degree earned 101 percent more than a person with upper secondary education only and 16 percent more than a holder of a Master’s degree. There were also obvious differences in earnings between postgraduate degree holders in different fields of study. Persons with a degree in social and health care earned 52 percent more than those with a humanistic degree in 2004. In the same year female postgraduate degree holders earned about 20 percent less than their male colleagues, but the wage differential across gender decreased during the period. |
| Keywords: | PhD, higher education, Finland, employment, wages, returns to education |
| JEL: | J24 J44 |
| Date: | 2009–06–08 |
| URL: | http://d.repec.org/n?u=RePEc:rif:dpaper:1187&r=lab |
| By: | Katsuya Takii (Osaka School of International Public Policy (OSIPP),Osaka University); Ryuichi Tanaka (Tokyo Institute of Technology) |
| Abstract: | This paper reexamines how differences in systems for financing education influence GDP by highlighting a neglected function of education policy: it affects the magnitude of gains from job assignment. When more productive jobs demand more skill, privately financed education can increase productivity gains from matching between jobs and skill by increasing the availability of highly educated people. This differs from the standard argument that publicly financed education increases the total amount of human capital by equalizing educational opportunities. It is shown that if job opportunities have large variations in productivity, education policy may face a serious efficiency--equity trade-off. |
| Keywords: | Job assignment, Human capital, Education system |
| JEL: | D31 D72 H42 I22 O11 O15 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:osp:wpaper:09e005&r=lab |
| By: | Ryo Kambayashi; Daiji Kawaguchi; Ken Yamada |
| Abstract: | The median wage in Japan has fallen nominally since 1999 due to a severe recession, while the statutory minimum wage has steadily increased over the same period. We used large micro-data sets from two government surveys to investigate how the minimum wage has affected wage distribution under the unusual circumstances of deflation. The compression of the lower tail of female wage distribution was almost completely explained by the increased real value of the minimum wage. The steady increases in the effective minimum wage reduced employment among low-skilled, young and middle-aged female workers, but the mechanical effect associated with disemployment on wage compression was minimal. |
| Keywords: | Minimum Wage, Wage Distribution, Employment, Deflation, Japan |
| JEL: | J23 J31 J38 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:hst:ghsdps:gd09-074&r=lab |
| By: | Ransom, Michael R. (Brigham Young University); Sims, David P. (Brigham Young University) |
| Abstract: | In the context of certain dynamic models, it is possible to infer the elasticity of labor supply to the firm from the elasticity of the quit rate with respect to the wage. Using this property, we estimate the average labor supply elasticity to public school districts in Missouri. We take advantage of the plausibly exogenous variation in pre-negotiated district salary schedules to instrument for actual salary. Instrumental variables estimates lead to a labor supply elasticity estimate of about 3.7, suggesting the presence of significant market power for school districts, especially over more experienced teachers. The presence of monopsony power in this labor market may be partially explained by institutional features of the teacher labor market. |
| Keywords: | labor monopsony, teachers |
| JEL: | J42 J63 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4271&r=lab |
| By: | Gagnon, Jason; Xenogiani, Theodora; Xing, Chunbing |
| Abstract: | The rapid and massive increase in rural-to-urban worker flows to the coast of China has drawn recent attention to the welfare of migrants working in urban regions, particularly to their working conditions and pay; serious concern is raised regarding pay discrimination against rural migrants. This paper uses data from a random draw of the 2005 Chinese national census survey to shed more light on the discrimination issue, by making comparisons of earnings and the sector of work between rural migrants on one hand, and urban residents and urban migrants on the other. Contrary to popular belief, we find no earnings discrimination against rural migrants compared to urban residents. However, rural migrants are found to be discriminated in terms of the sector in which they work, with a vast majority working in the informal sector lacking adequate social protection. |
| Keywords: | Migration; China; Discrimination; Informal Employment |
| JEL: | O15 J71 J24 R23 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:16109&r=lab |
| By: | Smith, James P. (RAND) |
| Abstract: | This paper examines impacts of childhood health on SES outcomes observed during adulthood-levels and trajectories of education, family income, household wealth, individual earnings and labor supply. The analysis is conducted using data that collects these SES measures in a panel who were originally children and who are now well into their adult years. Since all siblings are in the panel, one can control for unmeasured family and neighborhood background effects. With the exception of education, poor childhood health has a quantitatively large effect on all these outcomes. Moreover, these estimated effects are larger when unobserved family effects are controlled. |
| Keywords: | childhood health, labor market outcomes |
| JEL: | I10 J00 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4274&r=lab |
| By: | Kazianga, Harounan; de Walque, Damien; Alderman, Harold |
| Abstract: | This paper uses a prospective randomized trial to assess the impact of two school feeding schemes on health and education outcomes for children from low-income households in northern rural Burkina Faso. The two school feeding programs under consideration are, on the one hand, school meals where students are provided with lunch each school day, and, on the other hand, take-home rations that provide girls with 10 kg of cereal flour each month, conditional on 90 percent attendance rate. After running for one academic year, both programs increased girls’ enrollment by 5 to 6 percentage points. While there was no observable significant impact on raw scores in mathematics, the time-adjusted scores in mathematics improved slightly for girls. The interventions caused absenteeism to increase in households that were low in child labor supply while absenteeism decreased for households that had a relatively large child labor supply, consistent with the labor constraints. Finally, for younger siblings of beneficiaries, aged between 12 and 60 months, take-home rations have increased weight-for-age by .38 standard deviations and weight-for-height by .33 standard deviations. In contrast, school meals did not have any significant impact on the nutrition of younger children. |
| Keywords: | Youth and Governance,Primary Education,Education For All,Street Children,Adolescent Health |
| Date: | 2009–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:4976&r=lab |
| By: | Hägglund, Pathric (Swedish Institute for Social Research, Stockholm University) |
| Abstract: | This paper uses experimental data to study the effects of participation in intensified placement efforts on subsequent job chances and earnings. Five small-scale experiments were performed in four different regions of Sweden in 2004 and the control groups were offered the PES regular services. Due to small samples, many of the impact estimates were imprecise and insignificant. However, the services generally reduced unemployment among the treated. I find significantly enhanced exits to either jobs or other activities (or both) in four of the experiments. Three of the experiments also report positive effects on employment probability and earnings in the years following the programme. Finally, combining job-search assistance and monitoring of job search generated significantly better results than monitoring alone in one of the experiment locations. |
| Keywords: | Active labour market policy evaluation; randomised social experiment; placement efforts |
| JEL: | C93 J64 |
| Date: | 2009–06–15 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2009_016&r=lab |
| By: | Marianne Simonsen (School of Economics and Management, University of Aarhus, Denmark); Lars Skipper (Institute for Local Government Studies) |
| Abstract: | We shed new light on the effects of having children on hourly wages by exploiting access to data on the entire population of employed twins in Denmark. In addition we use administrative data on absenteeism; the amount of hours off due to holidays and sickness. Our results suggest that childbearing reduces female hourly wages but the principal explanation is in fact mothers’ higher levels of absence. We find a positive wage premium for fathers both when applying OLS on the entire population of Danes and when imposing twin fixed effects in the twin sample. |
| Keywords: | Fertility, wages, twins |
| JEL: | J13 J24 J31 J71 |
| Date: | 2009–07–08 |
| URL: | http://d.repec.org/n?u=RePEc:aah:aarhec:2009-09&r=lab |
| By: | van Ours, Jan C. (Tilburg University) |
| Abstract: | For various reasons the relationship between age and productivity is a matter of policy concern. I present new empirical research showing how productivity is affected by age. I study age effects at the individual level by analyzing data on running and publishing in economic journals. Furthermore I present empirical evidence at the firm level on the relationship between age, wage and productivity. In particular I address the potential wage-productivity gap that might occur at higher ages. I conclude that the productivity of older workers indeed decreases with their age. Nevertheless, the decline is limited. Furthermore, I find no evidence of a pay-productivity at higher ages. |
| Keywords: | age, productivity, matched worker-firm data |
| JEL: | J14 J24 J31 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4264&r=lab |
| By: | Bassetti, Thomas; Favaro, Donata |
| Abstract: | In this article we propose a model of growth with human capital accumulation, in which individuals allocate their time among work, education and socio-political participation. Socio-political participation, while subtracting time to education, positively affects individual’s utility; the utility function depends on both consumption and time allocated to socio-political participation. The model is expanded to include two social groups, specifically women and men, whose values and targets are different; every individual engages in socio-political activities to socially establish the values of the group she/he belongs to and his utility will be greater the more the society has values similar to those of the belonging group. The model predicts that economies with a more egualitarian presence of females and males in employment and higher population growth rates converge to a stationary state where time allocated to working activities is lower and time for education is higher. We simulate the model on some European countries with different female/male employment rates, population growth rates and capital shares. Simulations confirm the empirical evidence: European countries with a more equal presence of women and men in the labour market experience higher education attainment rates, allocate a higher proportion of time to social participation, and work, on average, a lower number of hours than countries with a lower relative proportion of females in employment. |
| Keywords: | human capital; growth; socio-political participation; social groups; gender |
| JEL: | O1 J22 J24 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:15969&r=lab |
| By: | Andrew Leigh (Economics Program, Research School of Social Sciences, The Australian National University); Roger Wilkins (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne) |
| Abstract: | Over recent years, several developed countries have implemented earned income tax credits in order to encourage welfare recipients to move into work. Here, we investigate the impact of ‘Working Credits’, which increased the incentives for welfare recipients to work, but only for a temporary period. Using differences-in-differences and regression-adjusted differences-in-differences, we find evidence that the introduction of the Working Credit increased employment rates, earnings and exits for those on income support. Results from matched differences-in-differences are less precise, but generally consistent with the other two empirical strategies. Back-of-the-envelope estimates suggest that on a cost-per-job basis, the Working Credit compares favourably with existing labour market programs. |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:iae:iaewps:wp2009n07&r=lab |
| By: | Mark L. Hoekstra; Scott Carrell |
| Abstract: | Recent empirical work on peer effects in education has primarily focused on identification. However, little is known about the extent to which social and education policy can mitigate the negative spillovers caused by disruptive children. This paper addresses this question by examining the causal effects from two different policy responses: judicial intervention following the reporting of domestic violence by a parent and additional counseling resources in the school. We find that children from homes with as-yet unreported domestic violence cause large negative classroom externalities. However, these negative peer effects disappear completely once the parent reports the violence to the court. Our results also show that one additional school counselor increases student math and reading achievement by 1.1 percentile points. Collectively, our results offer encouraging evidence that policymakers have the ability to counteract the negative peer effects caused by children from troubled families. |
| JEL: | J12 D62 I21 |
| Date: | 2009–01 |
| URL: | http://d.repec.org/n?u=RePEc:pit:wpaper:375&r=lab |
| By: | Viviane Azevedo; Cesar Bouillon; Patricia Yanez-Pagans |
| Abstract: | Although Mexico’s Conditional Cash Transfer Program Oportunidades has increased overall school enrollment, many adolescents do not attend school, especially in urban areas. This paper simulates the effects of changes in program design using a simple parametric method based on a simultaneous probability model of school attendance and child labor. The paper also provides alternative non parametric simulation results by extending Todd and Wolpin’s (2006) method to incorporate changes in working hours when attending school. The results indicate that eliminating or reducing school subsidies for primary education and increasing transfer for older students is a cost-effective way to raise overall school enrollment in urban areas. Increasing school attendance of 16-year-olds to 80 percent or more, however, would require a quadrupling of scholarships. This suggests that complementary interventions are needed. |
| Keywords: | School attendance and work, Conditional cash transfers, Simulation, Oportunidades |
| JEL: | I20 J22 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:idb:wpaper:4631&r=lab |
| By: | Manoj K. Pandey |
| Abstract: | The paper analyzes the effect of health status on labour force participation for aged Indians. The potential endogeneity in health and labour force participation has been taken care of by using full information maximum likelihood (FIML) and estimation results are compared with alternative two-stage methods. Results show that health has a significant and positive effect on labour force participation of the aged. In order to keep enough supply of elderly in the labour market, sufficient health care is necessary and hence more investment in this sector is imperative. |
| Keywords: | self-reported health status, labour force participation, elderly, endogeneity, exogeneity, simultaneous equation model |
| JEL: | J21 J14 I18 C35 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:pas:asarcc:2009-11&r=lab |
| By: | Abeler, Johannes (University of Nottingham); Altmann, Steffen (IZA); Kube, Sebastian (Max Planck Institute for Research on Collective Goods); Wibral, Matthias (University of Bonn) |
| Abstract: | We study how different payment modes influence the effectiveness of gift exchange as a contract enforcement device. In particular, we analyze how horizontal fairness concerns affect performance and efficiency in an environment characterized by contractual incompleteness. In our experiment, one principal is matched with two agents. The principal pays equal wages in one treatment and can set individual wages in the other. We find that the use of equal wages elicits substantially lower efforts. This is not caused by monetary incentives per se since under both wage schemes it is profit-maximizing for agents to exert high efforts. The treatment difference instead seems to be driven by the fact that the norm of equity is violated far more frequently in the equal wage treatment. After having suffered from violations of the equity principle, agents withdraw effort. These findings hold even after controlling for the role of intentions, as we show in a third treatment. Our results suggest that adherence to the norm of equity is a necessary prerequisite for successful establishment of gift-exchange relations. |
| Keywords: | reciprocity, gift exchange, equity, wage equality, wage setting, incomplete contracts |
| JEL: | J33 D63 M52 C92 J41 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4262&r=lab |
| By: | Berglann, Helge (Norwegian Agricultural Economics Research Institute (NILF)); Moen, Espen R. (Norwegian School of Management (BI)); Roed, Knut (Ragnar Frisch Centre for Economic Research); Skogstrøm, Jens Fredrik (Ragnar Frisch Centre for Economic Research) |
| Abstract: | We examine the origins and outcome of entrepreneurship on the basis of exceptionally comprehensive Norwegian matched worker-firm-owner data. In contrast to most existing studies, our notion of entrepreneurship not only comprises self-employment, but also employment in partly self-owned limited liability firms. Based on this extended entrepreneurship concept, we find that entrepreneurship tends to be profitable. It also raises income uncertainty, but the most successful quartile gains much more than the least successful quartile loses. Key determinants of the decision to become an entrepreneur are occupational qualifications, family resources, gender, and work environments. Individual unemployment encourages, while aggregate unemployment discourages entrepreneurship. |
| Keywords: | entrepreneurship, self-employment, spin-offs |
| JEL: | L26 M13 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4250&r=lab |
| By: | Aslund, Olof (IFAU); Böhlmark, Anders (SOFI, Stockholm University); Nordström Skans, Oskar (IFAU) |
| Abstract: | The paper studies childhood migrants and examines how age at migration affects their ensuing integration at the residential market, the labor market, and the marriage market. We use population-wide Swedish data and compare outcomes as adults among siblings arriving at different ages in order to ensure that the results can be given a causal interpretation. The results show that the children who arrived at a higher age had substantially lower shares of natives among their neighbors, coworkers and spouses as adults. The effects are mostly driven by higher exposure to immigrants of similar ethnic origin, in particular at the marriage market. We also find some effects on educational attainment, employment rates and wages, although these effects are much more limited in magnitude. We also analyze children of migrants and show that parents' time in the host country before child birth matters, which implies that the outcomes of the social integration process are inherited. Inherited integration has a particularly strong impact on the marriage patterns of females. |
| Keywords: | immigration, integration, segregation, age at migration, siblings |
| JEL: | J12 J15 J13 J01 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4263&r=lab |
| By: | Kilponen , Juha (Bank of Finland Research); Vanhala, Juuso (Bank of Finland Research) |
| Abstract: | This paper focuses on productivity dynamics of a firm-worker match as a potential explanation for the ‘unemployment volatility puzzle’. We let new matches and continuing jobs differ in terms of productivity level and sensitivity to aggregate productivity shocks. As a result, new matches have a higher destruction rate and lower, but more volatile, wages than old matches, as new hires receive technology associated with the latest vintage. In our model, an aggregate productivity shock generates a persistent productivity difference between the two types of matches, creating an incentive to open new productive vacancies and to destroy old matches that are temporarily less productive. The model produces a well behaved Beveridge curve, despite endogenous job destruction and more volatile vacancies and unemployment, without needing to rely on differing wage setting mechanisms for new and continuing jobs. |
| Keywords: | matching; productivity shocks; new hires; continuing jobs; job flows; Beveridge curve; vintage structure |
| JEL: | E24 E32 J64 |
| Date: | 2009–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:bofrdp:2009_015&r=lab |
| By: | Hiroaki Miyamoto; Yuya Takahashi |
| Abstract: | This paper studies the impact of long-run productivity growth on job finding and separation rates, and thus the unemployment rate, using a search and matching model. We incorporate disembodied technological progress and on-the-job search into the endogenous job separation model of Mortensen and Pissarides (1994). The incorporation of on-the-job search allows faster growth to reduce unemployment by decreasing the separation rate and inducing job creation. We demonstrate that introducing on-the-job search substantially improves the ability of the Mortensen and Pissarides model to explain the impact of growth on unemployment. Our quantitative analysis shows that our model increases the magnitude of the negative impact of growth on unemployment compared to the standard matching model with disembodied technological progress. |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:dpr:wpaper:0734&r=lab |
| By: | Parent, Daniel |
| Abstract: | Using U.S. and Canadian census data I exploit the massive out migration of approximately 1 million French-Canadians who moved mainly to New England between 1865 and 1930 to look at how the educational attainment and enrollment patterns of their descendants compare with those of same aged French-speaking Quebeckers. Data from the 1971 (1970) Canadian (U.S.) censuses reveal that New England born residents who had French as their mother tongue enjoyed a considerable advantage in terms of educational attainment. I attribute this large discrepancy to their exposure to the U.S. public school system which had no equivalent in Quebec until the late sixties. This result is even more remarkable given the alleged negative selection out of Quebec and the fact that Franco-Americans were fairly successful in replicating the same educational institutions as the ones existing in Quebec. Turning to the 2001 (2000) Canadian (U.S.) censuses, I find strong signs that the gap has subsided for the younger aged individuals. In fact, contrary to 30 years earlier, young Quebeckers in 2001 had roughly the same number of years of schooling and were at least as likely to have some post-secondary education. However, they still trail when it comes to having at least a B.A. degree. This partial reversal reects the impact of the "reverse treatment" by which Quebec made profound changes to its educational institutions, particularly in the post-secondary system, in the mid-to-late 60's. Given the speed at which this partial catch-up occurred, it would appear that the magnitude of the intergenerational externalities that can be associated with education is at best fairly modest. |
| Keywords: | Educational Attainment, Institutions |
| JEL: | N10 I20 |
| Date: | 2009–06–26 |
| URL: | http://d.repec.org/n?u=RePEc:ubc:clssrn:clsrn_admin-2009-36&r=lab |
| By: | de Grip, Andries (ROA, Maastricht University); Fouarge, Didier (ROA, Maastricht University); Sauermann, Jan (ROA, Maastricht University) |
| Abstract: | Using a dataset of science and engineering graduates from 12 European countries, we analyse the determinants of labour migration after graduation. We find that not only wage gains are driving the migration decision, but also differences in labour market opportunities, past migration experience, and international student exchange are strong predictors of future migration. Contrary to our expectations, job characteristics such as the utilisation of skills in the job and involvement in innovation hardly affect the migration decision. When analysing country choice, countries such as the USA, Canada and Australia appear to attract migrants due their larger R&D intensity. Moreover, graduates with higher grades are more likely to migrate to these countries. |
| Keywords: | migration, university graduates, scientists & engineers |
| JEL: | F22 J61 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4268&r=lab |
| By: | Herbert S. Buscher; Eva Dettmann; Marco Sunder; Dirk Trocka |
| Abstract: | We analyze the supply and demand of skilled labor in an East German federal state, Thuringia. This state has been facing high unemployment in the course of economic transformation and experiences population ageing and shrinking more rapidly than most West European regions. In a first step, we use extrapolation techniques to forecast labor supply and demand for the period 2009-2015, disaggregated by type of qualification. The analysis does not corroborate the notion of an imminent skilled-labor shortage but provides hints for a tightening labor market for skilled workers. In the second step, we ask firms about their appraisal of future recruitment conditions, and both current and planned strategies in the context of personnel management. The majority of firms plan to expand further education efforts and hire older workers. The study closes with policy recommendations to prevent occupational mismatch. |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iwh:dispap:13-09&r=lab |
| By: | Attanasio, Orazio (University College London); Kugler, Adriana (University of Houston); Meghir, Costas (University College London) |
| Abstract: | This paper evaluates the impact of a randomized training program for disadvantaged youth introduced in Colombia in 2005. This randomized trial offers a unique opportunity to examine the impact of training in developing countries. We use originally collected data on individuals randomly offered and not offered training. The program raises earnings and employment, especially for women. Women offered training earn 18% more and have a 0.05 higher probability of employment than those not offered training, mainly in formal sector jobs. Cost-benefit analysis of these results suggests that the program generates much larger net gains than those found in developed countries. |
| Keywords: | vocational training, randomized trials |
| JEL: | C21 I38 J24 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4251&r=lab |
| By: | Lundborg, Petter (VU University Amsterdam); Nystedt, Paul (Linköping University); Rooth, Dan-Olof (Kalmar University) |
| Abstract: | The association between stature and favorable labor market outcomes has been extensively documented. Recent studies have attributed this height premium to cognitive and social skills. We offer an alternative explanation, where the premium mainly arises from the positive association between height and physical capacity. Accounting for the latter reduces the height premium by about 80 percent. By also accounting for cognitive and non-cognitive skills, we are able to explain the entire height premium. Our estimates are based on data from the military enlistment register that has been linked to earnings for the entire population of Swedish males aged 28-38 in 2003. |
| Keywords: | earnings, height premium, cognitive and non-cognitive skills, physical capacity |
| JEL: | J10 J70 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4266&r=lab |
| By: | Barrett, Alan (ESRI, Dublin) |
| Abstract: | Ireland, along with Sweden and the UK, allowed full access to its labour market to the citizens of the accession countries when the EU enlarged in May 2004. Given the limited number of countries that opened up and the rapid pace of economic growth in Ireland around 2004, a significant inflow was expected. However, the rate of inflow exceeded all expectations. Based on census information, the number of EU10 nationals living in Ireland grew from around 10,000 in 2002 to 120,000 in 2006. Data on inflows suggests that this number could have reached 200,000 by 2008 or 4.5 percent of the population. The EU10 immigrants have very high employment rates and also have levels of education that are comparable to the native labour force in Ireland. However, they appear to earn considerably less than the native labour force and also to be in lower grade occupations. They have impacted positively on the Irish economy in terms of GNP growth. This is because wages grew more slowing in Ireland than would otherwise have been the case as a result of the labour supply increase brought about by this immigration flow. |
| Keywords: | EU enlargement, EU new member states, Ireland, immigration |
| JEL: | J61 F22 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4260&r=lab |
| By: | Byrne, Delma (ESRI) |
| Abstract: | In this paper I investigate the extent to which the Irish higher education system promotes inclusion or diversion in relation to social selectivity. In doing so, stratification processes are examined for two educational outcomes: inequality in the type of higher education institution attended (institutional differentiation) and the level of qualification pursued at higher education (qualification differentiation). The paper considers the individual and school level influences on these two educational outcomes and concludes that the Irish system is inclusive, but class disparities remain in terms of both institutional differentiation and qualification differentiation. Class disparities are largely mediated through educational attainment at the individual level and diversion is particularly evident in relation to the non-manual and skilled manual groups. Furthermore, school effects have a particular influence on those who do not obtain their preference of higher education course. |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:wp304&r=lab |
| By: | Heywood, John S. (University of Wisconsin, Milwaukee); Siebert, W. Stanley (University of Birmingham, UK); Wei, Xiangdong (Lingnan University) |
| Abstract: | The determinants of worker job satisfaction are estimated using a representative survey of three major cities in China. Legally segregated migrants, floaters, earn significantly less than otherwise equivalent non-migrants but routinely report greater job satisfaction, a finding not previously reported. We confirm a positive role for membership in the communist party but find that it exists only for non-migrants suggesting a club good aspect to membership. In contrast to earlier studies, many controls mirror those found in western democracies including the "paradox of the contented female worker." |
| Keywords: | job satisfaction, internal migrants, party membership, China |
| JEL: | J28 J61 O17 D73 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4254&r=lab |
| By: | Timothy J. Bartik (W.E. Upjohn Institute for Employment Research); Randall W. Eberts (W.E. Upjohn Institute for Employment Research); Wei-Jang Huang (W.E. Upjohn Institute for Employment Research) |
| Abstract: | The U.S. Department of Labor’s Employment and Training Administration issued Training and Employment Guidance Letter (TEGL) 09-08 Change 1 on June 5, 2009. This guidance letter revises the Government Performance and Results Act (GPRA) performance measures for federal workforce development programs to take into account the effect of the recession on participants’ labor market and educational outcomes. As described in the TEGL, the performance targets of the various workforce development programs have been developed for use for the years PY2008 through PY2010. They are intended to be used for PY2009 performance target negotiations and will appear in the President’s Budget Request for FY2010. The performance targets for future program years, adjusted for unemployment rates, are driven by the economic assumptions of the President’s Budget Request for FY2010. The revised performance targets are based on analysis carried out as part of a study conducted for the U.S. Department of Labor by the W. E. Upjohn Institute for Employment Research. This working paper has two purposes. The first is to describe the methodology used to estimate the relationship between unemployment rates and workforce program performance targets. The second is to describe the procedures used to adjust the GPRA performance targets for changes in unemployment rates during the current recession and over the business cycle. The study described in this working paper is the initial phase of an ongoing analysis of the effect of economic conditions on workforce development program outcomes. |
| Keywords: | performance standards, workforce programs, GPRA |
| JEL: | J24 J68 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:upj:weupjo:09-154&r=lab |
| By: | Susanne Prantl; Alexandra Spitz-Oener |
| Abstract: | We analyze how an entry regulation that imposes a mandatory educational standard affects entry into self-employment and occupational mobility. We exploit the German reunification as a natural experiment and identify regulatory effects by comparing differences between regulated occupations and unregulated occupations in East Germany to the corresponding differences in West Germany after reunification. Consistent with our expectations, we find that entry regulation reduces entry into selfemployment and occupational mobility after reunification more in regulated occupations in East Germany than in West Germany. Our findings are relevant for transition or emerging economies as well as for mature market economies requiring large structural changes after unforeseen economic shocks. |
| Keywords: | Entry Regulation, Self-Employment, Occupational Mobility |
| JEL: | J24 J62 K20 L11 L51 M13 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:hum:wpaper:sfb649dp2009-034&r=lab |
| By: | Hedberg, Charlotta (Stockholm University Linnaeus Center for Integration Studies - SULCIS) |
| Abstract: | Labour markets in welfare states are structured along the lines of gender and immigrant & minority statuses. This paper brings novel insights into the issue of ethnic entrepreneurship as a means of sustainable inclusion of immigrants into the labour market by adding a gender dimension. Based on unique longitudinal data, the paper analyses the division of labour and the work incomes of female immigrant entrepreneurs in contrast with male immigrants and native-born Swedes. The results indicate that the division of labour is structured along the lines of both gender and immigrant status. At first glance, a gender perspective on ethnic entrepreneurship acknowledges persistent inequalities in the labour market. Analysis of entrepreneurship within niches such as the health care sector, however, indicates greater complexity in the entrepreneurial landscape. The paper identifies implications of a nuanced analysis of entrepreneurial research, which recognises diversity along the axes of both immigrant status and gender. Entrepreneurial processes can lead to both exclusion and inclusion of minority groups in the labour market, depending on the sector concerned. |
| Keywords: | Entrepreneurship; gender; immigrant status; segmentation; division of labour |
| JEL: | J15 J16 L26 |
| Date: | 2009–06–29 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sulcis:2009_008&r=lab |
| By: | Steinbacher, Matej; Steinbacher, Matjaz; Steinbacher, Mitja |
| Abstract: | In the paper we test a homogenous agent version of the Montgomery's (1991) non-cooperative wage posting model. The inclusion of intrinsic costs, related to the uncertainty when changing the alternative agents are already using, alters the outcome of the model in two respects: firstly, it significantly prolongs the convergence-time to the equilibrium, and, more importantly, it may lead to the wage dispersion, irrespective of equally-productive-agent proposition, something not present in the model of Montgomery. |
| Keywords: | Job-search model; wage posting; wage dispersion; numerical optimization |
| JEL: | J31 D83 C15 C73 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:16114&r=lab |
| By: | Geng Li |
| Abstract: | We study variations in housework time and leisure consumption when workers are subject to labor market work hours constraints that prevent them from working the optimal number of hours. Using data from two large nationwide longitudinal surveys, we first document that such constraints are widespread--about 50 percent of all households in our sample had been bound by such constraints in at least one year, highlighting the significance of studying household behaviors in labor markets under binding constraints. Our analysis reveals strong heterogeneity and asymmetry in workers' reactions to this type of market constraint that are difficult to reconcile with standard preferences and home production technology. In particular, we find that the ceilings on market work hours induce workers to increase time spent on housework, including cooking, and to reduce vacation time. In contrast, floors on market work hours do not significantly affect time spent on housework, but may boost vacation time. On net, workers constrained by hours ceilings (floors) appear to have more (less) leisure time. Meanwhile, the response to hours ceilings are more pronounced among unmarried households. We also find some evidence that the magnitude of the effects of market hours constraints increases with the persistence of these constraints. Our results are robust to a number of variations in measurement metrics, econometric specifications, sample selection criteria, and data sources. We argue that the empirical results documented in this paper can be taken as additional moments conditions against which equilibrium models with home production are calibrated. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2009-21&r=lab |
| By: | Berglann, Helge; Moen, Espen R; Roed, Knut; Skogstrøm, Jens Fredrik |
| Abstract: | We examine the origins and outcome of entrepreneurship on the basis of exceptionally comprehensive Norwegian matched worker-firm-owner data. In contrast to most existing studies, our notion of entrepreneurship not only comprises self-employment, but also em-ployment in partly self-owned limited liability firms. Based on this extended entrepre-neurship concept, we find that entrepreneurship tends to be profitable. It also raises in-come uncertainty, but the most successful quartile gains much more than the least suc-cessful quartile loses. Key determinants of the decision to become an entrepreneur are occupational qualifications, family resources, gender, and work environments. Individual unemployment encourages, while aggregate unemployment discourages entrepreneurship. |
| Keywords: | Entrepreneurship; Self-employment; Spin-offs |
| JEL: | L26 M13 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:7360&r=lab |
| By: | Kristian Koerselman (Department of Economics and Statistics, Abo Akademi University) |
| Abstract: | Curriculum tracking, the separation of secondary school students into academic and vocational tracks, correlates positively with pretracking achievement in both British and international data. I argue that this correlation is caused by the incentives emanating from the track placement decision. Using test score data collected in TIMSS 1995 and 2003, and in PIRLS 2001 and 2006, I investigate the effect of tracking on the early achievement distribution empirically, amongst others by means of quantile regression. The evidence presented in this paper implicates that previous valueadded estimates of the net impact of tracking may be biased. |
| Keywords: | curriculum tracking, ability streaming, anticipatory effects, high-stakes testing |
| JEL: | I21 I28 J08 J24 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:tkk:dpaper:dp47&r=lab |
| By: | Yu, Li; Orazem, Peter; Jolly, Robert W. |
| Abstract: | This study analyzes whether economic conditions at the time of labor market entry affect entrepreneurship, using difference in business start-ups between cohorts of college students graduating in boom or bust economic conditions. Those graduating during an economic bust tend to delay their business start-ups relative to boom period graduates by about two years. Our results are consistent with additional findings that higher unemployment rates at time of graduation significantly delay the first business start-up across all college graduation cohorts over the 1982-2004 period. The adverse effect of a bust is temporary, delaying but not preventing self-employment over the life-cycle. |
| Keywords: | boom, bust, entrepreneurship, occupatiopnal choice, survivor analysis, business cycle, cohort |
| JEL: | J2 |
| Date: | 2009–07–03 |
| URL: | http://d.repec.org/n?u=RePEc:isu:genres:13086&r=lab |
| By: | Arne Feddersen (Chair for Economic Policy, University of Hamburg); Wolfgang Maennig (Chair for Economic Policy, University of Hamburg) |
| Abstract: | We estimate the economic effects of the 1996 Atlanta Olympic Games. Our difference in difference model checks for serial correlation and allows for a simultaneous test of level and trend effects, but otherwise follows HOTCHKISS, MOORE, & ZOBAY (2003) in this journal. We were not able to reconfirm their finding that the Games had significant positive employment effects. We do, however, reaffirm their result of no significant wage effects. |
| Keywords: | Olympic Games, Sports Economics, Mega Events |
| JEL: | H54 R12 L83 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:hce:wpaper:025&r=lab |
| By: | Demiralp, Berna |
| Abstract: | This paper presents a model of migration in which migration decisions are made with incomplete information on the labor market conditions at destination. It provides an explanation for how differences in the level of information about the destination can bring about differences in economic outcomes related to migration, such as the migration propensity and the return to migration. The implications of the model show the conditions under which information positively and negatively affects these outcomes. Thus, the model can be used to explain a wide set of empirical findings regarding the relationship between information and migration outcomes. 2005 CPS data are used to estimate the econometric model. The estimation results suggest that increased access to information regarding destination labor markets increases one's likelihood to migrate to another state. Furthermore, the findings suggest that people who have more information regarding the destination at the time of their migration decision on average experience higher returns to migration. |
| Keywords: | migration; incomplete information; return to migration |
| JEL: | J61 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:16121&r=lab |
| By: | Angle, John; Nielsen, Francois; Scalas, Enrico |
| Abstract: | Four economists, Mauro Gallegati, Steven Keen, Thomas Lux, and Paul Ormerod, published a paper after the 2005 Econophysics Colloquium criticizing conservative particle systems as models of income and wealth distribution. Their critique made science news: coverage in a feature article in Nature. A particle system model of income distribution is a hypothesized universal statistical law of income distribution. Gallegati et al. (2006) claim that the Kuznets Curve shows that a universal statistical law of income distribution is unlikely and that a conservative particle system is inadequate to account for income distribution dynamics. The Kuznets Curve is the graph of income inequality (ordinate variable) against the movement of workers from rural subsistence agriculture into more modern sectors of the economy (abscissa). The Gini concentration ratio is the preferred measure of income inequality in economics. The Kuznets Curve has an initial uptick from the Gini concentration ratio of the earned income of a poorly educated agrarian labor force. Then the curve falls in near linear fashion toward the Gini concentration ratio of the earned incomes of a modern, educated labor force as the modern labor force grows. The Kuznets Curve is concave down and skewed to the right. This paper shows that the iconic Kuznets Curve can be derived from the Inequality Process (IP), a conservative particle system, presenting a counter-example to Gallegati et al.’s claim. The IP reproduces the Kuznets Curve as the Gini ratio of a mixture of two IP stationary distributions, one characteristic of the wage income distribution of poorly educated workers in rural areas, the other of workers with an education adequate for industrial work, as the mixing weight of the latter increases and that of the former decreases. The greater purchasing power of money in rural areas is taken into account. |
| Keywords: | conservative particle system; gamma probability density function; Gini concentration ratio; income distribution; Inequality Process; Kuznets Curve; purchasing power |
| JEL: | D31 O15 |
| Date: | 2009–03–12 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:16058&r=lab |
| By: | Mussa, Richard |
| Abstract: | The paper investigates two issues regarding household expenditure on primary education of own children using the Second Malawi Integrated Household Survey(IHS2) data. Firstly, we look at factors which infuence a household's decision to spend or not (the participation decision), and by how much (the expenditure decision). This is done for urban and rural households. We find that there are differences in the factors which influence both decision levels for the two groups of households. Secondly, to get a deeper understanding of these rural-urban spending differences, the study develops the Blinder-Oaxaca decomposition technique for the independent Double Hurdle model. The proposed decomposition is done at the aggregate and disaggregated levels. The aggregated decomposition allows us to isolate the expenditure differences into a part attributable to differences in characteristics and a part which is due to differences in coefficients. The detailed (disaggregated) decomposition enables us to pinpoint the major factors behind the spending gap. At the aggregate decomposition level, our results show that at least 66% of the expenditure differential is explained by differences in characteristics between rural and urban households, implying that an equalization of household characteristics would lead to about 66% of the spending gap disappearing. At the disaggregated decomposition level, the rural-urban difference in household income is found to be the largest contributor to the spending gap, followed by quality of access of primary schools. Besides, rural-urban di¤erences in mothers education and employment are found to contribute more to the spending differential relative to the same for fathers. |
| Keywords: | Education expenditure; double hurdle; Blinder-Oaxaca decomposition; Malawi tion |
| JEL: | D13 |
| Date: | 2009–01–27 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:16090&r=lab |
| By: | Guajardo, Guillermo |
| Abstract: | This paper analyzes the human capital training strategies adopted between the 1850s and 1930s by railroad companies in Mexico and Chile. These two countries enable one to contrast the different routes taken by the same type of firm, technology and labor force. A propos of this, we suggest that because of its complexity, capital intensity and new work methods, railway technology had a positive impact on human capital training in the cases studied. During the period when railways were the main form of land transport studied -covered by this study- they combined the labor force with foreign workers and modern technology and it was not until well into the 20th century that a formal system of technical schools was established. Instead, informal and formal learning cycles and routes tended to be followed. That is why this paper considers three aspects: I) the institutional and social factors that helped or hindered industrial operations, maintenance and production training; II) the way learning, training and talent retention cycles were shaped and talent migrated towards other activities or was dispersed or lost; and lastly, III) how training was institutionalized through what were known as “firm schools” responsible for training human capital as an internalization response to coping with shortages in the labor market. |
| Keywords: | human capital; technology; railways; México; Chile |
| JEL: | L32 L92 N76 |
| Date: | 2009–06–26 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:16038&r=lab |
| By: | Faith Guvenen; Burhanettin Kuruscu |
| Abstract: | In this paper, we construct a parsimonious overlapping-generations model of human capital accumulation and study its quantitative implications for the evolution of the U.S. wage distribution from 1970 to 2000. A key feature of the model is that individuals differ in their ability to accumulate human capital, which is the main source of wage inequality in this model. We examine the response of this model to skill-biased technical change (SBTC), which is modeled as an increase in the trend growth rate of the price of human capital starting in the early 1970s. The model displays behavior that is consistent with several important trends observed in the US data, including the rise in overall wage inequality; the fall and subsequent rise in the college premium, as well as the fact that this behavior was most pronounced for younger workers; the rise in within-group inequality; the stagnation in median wage growth; and the small rise in consumption inequality despite the large rise in wage inequality. We consider different scenarios regarding how individuals? expectations evolve during SBTC. Specifically, we study the case where individuals immediately realize the advent of SBTC (perfect foresight), and the case where they initially underestimate the future growth of the price of human capital (pessimistic priors), but learn the truth in a Bayesian fashion over time. Lack of perfect foresight appears to have little effect on the main results of the paper. Overall, the model shows promise for explaining a diverse set of wage distribution trends observed since the 1970s in a unifying human capital framework. |
| Keywords: | Wages ; Human capital ; Productivity ; Consumption (Economics) |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedmsr:427&r=lab |
| By: | Albrecht, James (Georgetown University); Björklund, Anders (SOFI, Stockholm University); Vroman, Susan (Georgetown University) |
| Abstract: | We examine the evolution of the Swedish wage distribution over the periods 1968-1981 and 1981-2000. The first period was the heyday of the Swedish solidarity wage policy with strongly equalization clauses in the central wage agreements. During the second period, there was more scope for firm-specific factors to affect wages. We find a remarkable compression of wages across the distribution in the first period, but in the second period, wage growth was quite uniform across the distribution. We decompose these changes across the distribution into two components – those due to changes in the distribution of characteristics such as education and experience and those due to changes in the distribution of returns to those characteristics. The wage compression between 1968 and 1981 was driven by changes in the distribution of returns, but between 1981 and 2000, the change in the distribution of returns was neutral with respect to inequality. |
| Keywords: | wage compression, unionization, quantile regression |
| JEL: | J31 J51 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4246&r=lab |
| By: | Hiroko Okudaira |
| Abstract: | The goal of this paper is to detect the degree to which court decisions control the stringency of employment protection and to investigate how such judicial discretion affects labor market performance. However, identification difficulty arises because court decisions are volatile against economic and social conditions. This paper overcomes the endogeneity problem by exploiting the triennial judge transfer system in Japan, or the exogenous allocation of judges to prefectures. A key finding is that the prefecture employment rate is reduced by approximately 1.4% if a prefecture receives more pro-worker judgments than pro-employer ones in a given year. |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:dpr:wpaper:0733&r=lab |
| By: | Hart, Robert A. (University of Stirling) |
| Abstract: | The strikes' literature is dominated by the causes and effects of strike action as they relate directly to strikers themselves. This paper considers another important group of affected workers – those individuals incidentally made idle as a result of the strike action of others. Using a unique data set of the British Engineering Employers' Federation (EEF), it examines the years 1960 to 1970, a critical period in Britain's postwar strikes’ history. The mid-point of this decade marked the start of the era of the 'British Disease', a universally adopted title given to Britain's perceived international leadership in strikes incidence and industrial unrest. Workers made idle were an important symptom of the disease. In the study here, they accounted for 72% of days lost in disputes in which they were involved and 44% of total days lost in all disputes. Consideration is given to the likely causes of these incidental layoffs within 7130 strikes of EEF federated firms covering engineering, automotive and metal industries. Particular attention is given to the British car industry, accounting for 22% of total EEF strikes during the period of study. The regression analysis examines the causes of workers being made idle with explanatory variables covering labour market conditions, strikes durations, pay issues, non-pay issues. The regressions also control for company, union, geographical districts, annual and seasonal fixed effects. |
| Keywords: | strikes, workers made idle, pay disputes, non-pay disputes |
| JEL: | J52 L61 L62 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4248&r=lab |
| By: | Nielsen, Helena Skyt (University of Aarhus) |
| Abstract: | Many OECD countries have implemented policies to induce couples to share parental leave. This paper investigates how responsive intra-household leave-sharing is to changes in economic incentives. To investigate this fundamental question, we are forced to look at one of the Nordic countries which are the most progressive when it comes to family-friendly policies. An extensive reform of child leave schemes in Denmark affected couples differently depending on whether the parents where employed in the same or in different parts of the public sector. Based on a difference-in-differences strategy, I find that economic incentives are very important for intra-household leave-sharing. Increasing the couples' after tax income by $9 per day of leave which is transferred from the mother to the father is found to lead to a one day transfer. This corresponds to a supply elasticity close to unity. |
| Keywords: | fathers, parental leave, child leave |
| JEL: | J13 J22 J45 J48 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4267&r=lab |
| By: | Sonia Oreffice; Climent Quintana |
| Abstract: | We empirically analyze the marriage market aspects of body size, weight and height in the US using data from the Panel Study of Income Dynamics on anthropometric characteristics of both spouses. Gender-asymmetric trade-offs arise within couples between physical and socio-economic traits, but also between anthropometric traits, with significant penalties for fatter women and shorter men. Wives’ obesity (body size or weight) measures are negatively correlated with their husbands’ income, education and height, controlling for his weight (or body size) and her height, along with spouses’ demographic and socioeconomic characteristics. Conversely, heavier husbands are not penalized by matching with poorer or shorter wives, but only with less educated women. Men’s and women’s height are both valued in the market, with shorter men matched to heavier and less educated wives, and shorter women to poorer and less educated husbands (the latter effect only shows up in 2005). |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:fda:fdaddt:2009-22&r=lab |
| By: | Hart, Robert A. |
| Abstract: | The strikes' literature is dominated by the causes and effects of strike action as they relate directly to strikers themselves. This paper considers another important group of affected workers - those individuals incidentally made idle as a result of the strike action of others. Using a unique data set of the British Engineering Employers' Federation (EEF), it examines the years 1960 to 1970, a critical period in Britain's postwar strikes' history. The mid-point of this decade marked the start of the era of the ‘British Disease', a universally adopted title given to Britain's perceived international leadership in strikes incidence and industrial unrest. Workers made idle were an important symptom of the disease. In the study here, they accounted for 72% of days lost in disputes in which they were involved and 44% of total days lost in all disputes. Consideration is given to the likely causes of these incidental layoffs within 7130 strikes of EEF federated firms covering engineering, automotive and metal industries. Particular attention is given to the British car industry, accounting for 22% of total EEF strikes during the period of study. The regression analysis examines the causes of workers being made idle with explanatory variables covering labour market conditions, strikes durations, pay issues, non-pay issues. The regressions also control for company, union, geographical districts, annual and seasonal fixed effects. |
| Keywords: | non-pay disputes; pay disputes; workers made idle; Strikes |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:stl:stledp:2009-14&r=lab |
| By: | Partha Deb; William T. Gallo; Padmaja Ayyagari; Jason M. Fletcher; Jody L. Sindelar |
| Abstract: | This paper examines the impact of job loss from business closings on body mass index (BMI) and alcohol consumption. We improve upon extant literature by using: exogenously determined business closings, a sophisticated estimation approach (finite mixture models) to deal with complex heterogeneity, and national, longitudinal data (Health and Retirement Study). For both alcohol consumption and BMI, we find evidence that individuals who are more likely to respond to job loss by increasing unhealthy behaviors are already in the problematic range for these behaviors before losing their jobs. Thus health effects of job loss could be concentrated among “at risk†individuals. |
| JEL: | C13 I1 J69 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15122&r=lab |
| By: | Ivan Vidangos |
| Abstract: | This paper assesses the quantitative importance of a number of sources of income risk for household welfare and precautionary saving. To that end I construct a lifecycle consumption model in which household income is subject to shocks associated with disability, health, unemployment, job changes, wages, work hours, and a residual component of household income. I use PSID data to estimate the key processes that drive and affect household income, and then use the consumption model to: (i) quantify the welfare value to consumers of providing full, actuarially fair insurance against each source of risk and (ii) measure the contribution of each type of shock to the accumulation of precautionary savings. I find that the value of fully insuring disability, health, and unemployment shocks is extremely small (well below 1/10 of 1 percent of lifetime consumption in the baseline model). The gains from insuring shocks to the wage and to the residual component of household income are significantly larger (above 1% and 2% of lifetime consumption, respectively). These two shocks account for more than 60% of precautionary wealth. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2009-14&r=lab |
| By: | Herbst, Chris M. (Arizona State University); Tekin, Erdal (Georgia State University) |
| Abstract: | Child care subsidies play a critical role in facilitating the transition of disadvantaged mothers from welfare to work. However, little is known about the influence of these policies on children's health and well-being. In this paper, we study the impact of subsidy receipt on low-income children's weight outcomes in the fall and spring of kindergarten. The goals of our empirical analysis are twofold. We first utilize standard OLS and fixed effects methods to explore body mass index as well as measures of overweight and obesity. We then turn to quantile regression to address the possibility that subsidy receipt has heterogeneous effects on children's weight at different points in the BMI distribution. Results suggest that subsidy receipt is associated with increases in BMI and a greater likelihood of being overweight and obese. We also find substantial variation in subsidy effects across the BMI distribution. In particular, child care subsidies have no effect on BMI at the lower end of the distribution, inconsistent effects in the middle of the distribution, and large effects at the top of the distribution. Our results point to the use of non-parental child care, particularly center-based services, as the key mechanism through which subsidies influence children's weight outcomes. |
| Keywords: | child care, subsidy, obesity |
| JEL: | I12 I18 J13 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4255&r=lab |
| By: | Alvarez-Cuadrado, Francisco (McGill University); Poschke, Markus (McGill University) |
| Abstract: | The process of economic development is characterized by substantial rural-urban migrations and a decreasing share of agriculture in output and employment. The literature highlights two main engines behind this process of structural change: (i) improvements in agricultural technology combined with the effect of Engel's law of demand push resources out of the agricultural sector (the "labor push" hypothesis), and (ii) improvements in industrial technology attract labor into this sector (the "labor pull" hypothesis). We present a simple model that features both channels and use it to explore their relative importance. We evaluate the U.S. time series since 1800 and a sample of 13 industrialized countries starting in the 19th century. Our results suggest that, on average, the "labor pull" channel dominates. This contrasts with popular modeling choices in the recent literature. |
| Keywords: | growth, structural change |
| JEL: | O11 O41 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4247&r=lab |
| By: | Helena Skyt Nielsen (School of Economics and Management, University of Aarhus, Denmark) |
| Abstract: | Many OECD countries have implemented policies to induce couples to share parental leave. This paper investigates how responsive intra-household leave-sharing is to changes in economic incentives. To investigate this fundamental question, we are forced to look at one of the Nordic countries which are the most progressive when it comes to family-friendly policies. An extensive reform of child leave schemes in Denmark affected couples differently depending on whether the parents where employed in the same or in different parts of the public sector. Based on a difference-in-differences strategy, I find that economic incentives are very important for intra-household leave-sharing. Increasing the couples’ after tax income by $9 per day of leave which is transferred from the mother to the father is found to lead to a one day transfer. This corresponds to a supply elasticity close to unity. |
| Keywords: | fathers, parental leave, child leave |
| JEL: | J13 J22 J45 J48 |
| Date: | 2009–06–29 |
| URL: | http://d.repec.org/n?u=RePEc:aah:aarhec:2009-08&r=lab |
| By: | Robert Drago (Pennsylvania State University, USA); Katina Sawyer (Pennsylvania State University, USA); Karina Sheffler (Oklahoma State University, USA); Diana Warren (Institute of Applied Economic and Social Research, The University of Melbourne); Mark Wooden (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne) |
| Abstract: | In May 2004, the Australian government announced a "Baby Bonus" policy, paying women an initial A$3,000 per new child. We use household panel data from the Household, Income and Labour Dynamics in Australia Survey (N = 14,932) and a simultaneous equations approach to analyze the effects of this bonus on fertility intentions and ultimately births. The results indicate that opportunity costs influence intentions and births in predictable ways. Fertility intentions rose after the announcement of the Baby Bonus, and the birth rate is estimated to have risen modestly as a result. The marginal cost to the government for an additional birth is estimated to be at least A$124,000. |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:iae:iaewps:wp2009n01&r=lab |
| By: | Jason M. Fletcher; Steven F. Lehrer |
| Abstract: | While there is a well-established, large positive correlation between mental and physical health and education outcomes, establishing a causal link remains a substantial challenge. Building on findings from the biomedical literature, we exploit specific differences in the genetic code between siblings within the same family to estimate the causal impact of several poor health conditions on academic outcomes. We present evidence of large impacts of poor mental health on academic achievement. Further, our estimates suggest that family fixed effects estimators by themselves cannot fully account for the endogeneity of poor health. Finally, our sensitivity analysis suggests that these differences in specific portions of the genetic code have good statistical properties and that our results are robust to reasonable violations of the exclusion restriction assumption. |
| JEL: | C33 I12 I21 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15148&r=lab |
| By: | Emmanuel Dhyne (National Bank of Belgium, Research Department; Warocqué Research Center, Université de Mons); Benoit Mahy (Warocqué Research Center, Université de Mons; Département d’Economie Appliquée, Université Libre de Bruxelles) |
| Abstract: | This paper aims to document and analyse the use of fixed-term contracts (FTC) and to analyse the dynamics of labour adjustment by type of labour contract at the firm level, drawing on the detailed breakdown of both the labour force and labour entries and exits that are available in the "Belgian Firms' Social Balance Sheets" dataset. It also aims to investigate the structure of labour adjustment costs by type of labour contract, using the methodology proposed by Goux, Maurin and Pauchet (2001). Results first indicate that flexible labour contracts are not only used to facilitate short-term labour adjustment but also as a screening device. The findings also suggest that when a firm decides to introduce flexible labour into its production process, it does also this to meet long-run objectives such as implementing minimising costs innovations. It is further estimated that the introduction of FTCs does not seem to affect the speed of indefinite-term contracts (ITC) adjustment. Our results also tend to indicate that the FTC is a key adjustment variable in response to cost shocks and to unexpected demand fluctuations while, in response to expected fluctuations in output, firms then prefer to adjust their level of permanent employment. Finally, and as far as the structure of labour adjustment costs in Belgium is concerned, the marginal recruitment cost under an ITC represents 12.4% of the marginal termination cost of ITC, while the marginal cost associated with the recruitment under an FTC only accounts for 0.8% of its ITC counterpart |
| Keywords: | labour dynamics, fixed-term contract, indefinite-term contract, agency workers |
| JEL: | J23 J32 J63 J82 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbb:reswpp:200907-02&r=lab |
| By: | Kamal, Yasir; Hanif, Fawad |
| Abstract: | This paper endeavors to study the various factors of job satisfaction among different commercial bankers in Pakistan and highlight the findings by performing statistical techniques like regression and correlation to gauge level of significance for the factor. Pay has been considered as the major factor for job satisfaction however other related factors like promotion, recognition, job involvement and commitment are also taken into account. Job satisfaction is an attitude of an employee over a period of his job so the factors of satisfaction and dissatisfaction changes over the period. It is a relative term and is nowadays used as a key factor to gauge the performance of a particular employee and organization. Satisfied employees are more likely to be friendly and responsive which attracts customers. Dissatisfied employees can lead to customer dissatisfaction. |
| Keywords: | Job Satisfaction; Pay; Banker |
| JEL: | M0 M12 |
| Date: | 2009–06–25 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:16059&r=lab |
| By: | Cecilia Albert Verdú (Departamento de Fundamentos de Economía e H.E., Universidad de Alcalá.); María A. Davia Rodríguez (Departamento de Economía Española e Internacional, Econometría e Historia e Instituciones económicas, Universidad de Castilla La Mancha.) |
| Abstract: | This piece of work analyses the profile of poverty amongst youth in Spain from a multidimensional perspective. This approach entails the estimation of poverty risks, material deprivation indicators and an education exclusion indicator. Material deprivation indicators refer to deficiencies in dwelling’s conditions, to arrears with payments and non-affordability of basic goods. The analysis is developed on a sample of young adults from the Spanish section of EU-SILC (European Union Survey on Living Conditions). The methodology consists on a set discrete dependent variable models and count data models. The risk of poverty, material deprivation and education exclusion are strongly influenced by household composition, education attainment and labour market status as well as disability and nationality. |
| Keywords: | Youth, Poverty, Material Deprivation, Education Exclusion. |
| JEL: | I31 I32 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:alc:alcamo:0903&r=lab |
| By: | Kazuya Wada |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:hst:ghsdps:gd09-073&r=lab |
| By: | Fried, Harold O.; Tauer, Loren W. |
| Abstract: | This paper is about aging and the ability to perform under pressure on the PGA tour. Performance increases with golfing skill, but may first increase and then decrease with age as experience interacts with changes in physical condition. Similarly, mental fortitude or the ability of a golfer to perform under pressure may first increase and then decrease with age as experience interacts with changes in the ability to concentrate. Net performance on the tour is the result of both physical golfing skill and the ability to perform under pressure. We control for changes in physical skill and focus on the mental side of the game. The role of experience suggests an inverted U shaped relationship between age and mental performance that could vary significantly across golfers. We use Order-m FDH to calculate a measure of performance under pressure, and we confirm an inverted U-shaped curve with age. Along the way, we examine the ability to perform under pressure at the level of the individual golfer. |
| Keywords: | age, efficiency, order-m FDH, golf, performance under pressure, Productivity Analysis, |
| Date: | 2009–06–11 |
| URL: | http://d.repec.org/n?u=RePEc:ags:cudawp:51103&r=lab |
| By: | Justina A. V. Fischer; Alfonso Sousa-Poza |
| Abstract: | Using pseudo-panel microdata we show that pension generosity affects early retirement decisions. The changes in the average replacement rate and decreases in wealth accrual between 1967 and 2004 have caused an increase in early retirement probabilities from 16% to 63%. |
| Keywords: | Early Retirement; Pension Systems; Pension Neutrality; Pension Generosity; SHARE |
| JEL: | J26 J21 H55 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:hoh:hohdip:311&r=lab |
| By: | Dostie, Benoit (HEC Montreal); Jayaraman, Rajshri (European School of Management and Technology (ESMT)) |
| Abstract: | This paper asks whether adversity spurs the introduction of process innovations and increases the use of managerial incentives by firms. Using a large panel data set of workplaces in Canada, our identification strategy relies on exogenous variation in adversity arising from increased border security along the 49th parallel following 9/11. Our longitudinal difference-in-differences estimates indicate that firms responded to adversity by introducing new or improved processes, but did not change their use of managerial incentives. These results suggest that the threat of bankruptcy may provide impetus for improving efficiency. |
| Keywords: | process innovation, managerial incentives, efficiency, natural experiment |
| JEL: | L20 O31 M52 J33 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4261&r=lab |
| By: | Michael Schwarz; Sergei Severinov |
| Abstract: | In this paper we study "investment tournaments," a class of decision problems that involve gradual allocation of investment among several alternatives whose values are subject to exogenous shocks. The decision-maker's payoff is determined by the final values of the alternatives. An important example of career tournaments motivating our research is the career choice problem, since a person choosing a career often starts by investing in learning several professions. We show that in a broad range of cases it is optimal for the decision-maker in each time period to allocate all resources to the most promising alternative. We also show that in tournaments for a promotion the agents would rationally put forth a higher effort in an early stage of the tournament in a bid to capture a larger share of employer's investment, such as mentoring. |
| JEL: | J24 J41 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15136&r=lab |
| By: | Mengel Friederike (METEOR) |
| Abstract: | We identify a strong and significant negative effect of substitutions in (irrelevant) early games in worldcup and olympic football tournaments on performance in later rounds. We argue that this effect is due to the psychological consequences of such a decision and evaluate alternative possible explanations. |
| Keywords: | Economics (Jel: A) |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:umamet:2009029&r=lab |
| By: | Balleer, Almut (University of Bonn); van Rens, Thijs (CREI and Universitat Pompeu Fabra) |
| Abstract: | Over the past two decades, technological progress has been biased towards making skilled labor more productive. What does skill-biased technological change imply for business cycles? To answer this question, we construct a quarterly series for the skill premium from the CPS and use it to identify skill-biased technology shocks in a VAR with long run restrictions. We find that hours worked fall in response to skill-biased, but not in response to skill-neutral improvements in technology. Skill-biased technology shocks are associated with increases in the relative price of investment, indicating that capital and skill are substitutes in aggregate production. |
| Keywords: | skill-biased technology, skill premium, VAR, long-run restrictions, capital-skill complementarity, business cycle |
| JEL: | E24 E32 J24 J31 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4258&r=lab |
| By: | Clarissa Gondim Teixeira (International Policy Centre for Inclusive Growth) |
| Abstract: | Since the 1990s, Latin American governments have implemented various conditional cash transfer programmes (CCTs). The objective of CCTs is to alleviate poverty in the short run and create conditions for upward social mobility in the long run through human capital investments. CCTs target families living below the poverty lines, focusing on children and school-age adolescents. (?) |
| Keywords: | What Is the Impact of Cash Transfers on Labour Supply? |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:ipc:opager:85&r=lab |
| By: | Grepperud, Sverre (Institute of Health Management and Health Economics); Pedersen, Pål Andreas (Bodø Graduate School of Business) |
| Abstract: | This paper analyses optimal contracts in a principal-agent model where the agent is intrinsically motivated at the outset and there is an endogenous relationship between the structure of incentive payments and intrinsic motivation (crowding effects). The analysis shows that crowding effects have implications for the optimal contract and that under some conditions the principal can do better without implementing any economic incentives. Furthermore, it is shown that when high-powered incentives diminish intrinsic motivation (crowding-out) the first-best solution in a principal-agent framework is unattainable. |
| Keywords: | Agency theory; intrinsic motivation; crowding effects |
| JEL: | J01 |
| Date: | 2009–06–30 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:oslohe:2001_004&r=lab |
| By: | Nordberg, Morten (The Ragnar Frisch Centre for Economic); Kverndokk, Snorre (The Ragnar Frisch Centre for Economic) |
| Abstract: | We use a dependent competing risks hazard rate model to investigate individual sickness absence behaviour in Norway, on the basis of register data covering more than 2 million absence spells. Our findings are: i) that business cycle improvements yield lower work-resumption rates for persons who are absent, and higher relapse rates for persons who have already resumed work; ii) that absence sometimes represents a health investment, in the sense that longer absence ‘now’ reduces the subsequent relapse propensity; and iii) that the work-resumption rate increases when sickness benefits are exhausted, but that work-resumptions at this point tend to be short-lived. |
| Keywords: | Absenteeism; Dependent risks |
| JEL: | C41 J22 |
| Date: | 2009–06–22 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:oslohe:2003_017&r=lab |
| By: | Bali Swain, Ranjula (Department of Economics) |
| Abstract: | We evaluate the effect of training, in both skill development and human capital, provided by facilitators of self help groups (SHGs). Indian SHGs are unique in that they are mainly NGOformed microfinance groups but later funded by commercial banks. The results suggest that, in general, training does not impact assets but training can reverse the potentially negative effect of credit on income. Moreover, training is more effective for asset accumulation in villages with better infrastructure. In terms of training delivery, results show that the most effective linkage is when NGOs form groups and banks finance SHGs. |
| Keywords: | Asia; India; microfinance; impact studies; training; Self Help Groups |
| JEL: | G21 I32 O12 |
| Date: | 2009–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:uunewp:2009_011&r=lab |