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on Labour Economics |
| By: | Sandra Schaffner |
| Abstract: | Although the cyclical aspects of worker reallocation are investigated in numerous studies, only scarce empirical evidence exists for Germany. Kluve, Schaffner, and Schmidt (2009) emphasize the heterogeneity of cyclical influences for different subgroups of workers, defined by age, gender and skills. This paper contributes to this literature by extending this analysis to job-to-job flows. In fact, job-to-job transitions are found to be the largest flows in the German labor market. The findings suggest that job-finding rates and job-to-job transitions are procyclical while separation rates are acyclical or even countercyclical. The empirical framework employed here allows demographic groups to vary in their cyclical sensitivity. In Germany, young workers have the highest transition rates into and out of employment and between different jobs. Additionally, these transitions are more volatile than those of medium- aged or old workers. By contrast, old workers experience low transition rates and less pronounced swings than the core group of medium-aged, medium- skilled men. |
| Keywords: | Labor force, employment dynamics, worker flows, business cycle, worker heterogeneity, job-to-job |
| JEL: | E32 J63 J64 E24 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:rwi:repape:0118&r=lab |
| By: | Riddell, W. Craig |
| Abstract: | Change is an enduring feature of the economy and the labour market, even in normal times. The importance of adjusting to change, and of policies that promote adjustment, has been a recurring theme throughout David Dodge’s distinguished career. This paper deals with “displaced workers,†those who permanently lose their jobs because of changing economic circumstances. I examine what we know about displacement and its consequences, and assess policies designed to assist workers adversely affected by economic change. A central finding of research on displacement is that long tenure displaced workers -- those who have held their jobs for an extended period of time -- suffer much more from losing their jobs than do others. Canada’s Employment Insurance does not take into account this salient feature of the consequences of job loss. The paper discusses ways of addressing this deficiency in our primary social insurance program for job losers. |
| Keywords: | labour market adjustment, job displacement, unemployment, unemployment insurance, adjustment assistance policies, wage insurance |
| JEL: | J60 J63 J64 J65 J68 |
| Date: | 2009–07–22 |
| URL: | http://d.repec.org/n?u=RePEc:ubc:clssrn:clsrn_admin-2009-41&r=lab |
| By: | Heywood, John S.; Parent, Daniel |
| Abstract: | We show that the reported tendency for performance pay to be associated with greater wage inequality at the top of the earnings distribution applies only to white workers. This results in the white-black wage differential among those in performance pay jobs growing over the earnings distribution even as the same differential shrinks over the distribution for those not in performance pay jobs. We show this remains true even when examining suitable counterfactuals that hold observables constant between whites and blacks. We explore reasons behind our finding that performance pay is associated with greater racial earnings gaps at the top of the wage distribution focusing on the interactions between discrimination, unmeasured ability and selection. |
| Keywords: | Racial Wage Differentials, Compensation Practices |
| JEL: | J15 J31 J33 |
| Date: | 2009–07–22 |
| URL: | http://d.repec.org/n?u=RePEc:ubc:clssrn:clsrn_admin-2009-42&r=lab |
| By: | Feng, Shuaizhang (Princeton University); Zheng, Bingyong (Shanghai University of Finance and Economics) |
| Abstract: | We study a competitive labor market with imperfect information. In our basic model, the labor market consists of heterogeneous workers and ex ante identical firms who have only imperfect private information about workers' productivities. Firms compete by posting wages in order to cherry-pick more productive workers from the applicant pool. The model predicts many important empirical regularities, including non-degenerated firm size distribution, persistent wage dispersion, and employer size-wage premium. We also consider extensions of the model where firms differ in either productivity or information about worker types, both generating assortative matching with a positive but imperfect correlation of worker and firm types. The main insight of this paper is that identical workers can get different wages depending on productivities of their coworkers in a competitive market with informational frictions. Our model also sheds light on inter-industry wage differential and sorting between industry and worker characteristics. |
| Keywords: | imperfect information, cherry-picking, wage dispersion, size-wage premium, inter-industry wage differential |
| JEL: | D83 J31 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4309&r=lab |
| By: | Maciej, Szelewicki; Tyrowicz, Joanna |
| Abstract: | Discrimination is a significant issue in labour market economics across developed as well as developing countries. In this paper we inquire the actual size of wage discrimination in the Republic of Soutn Africa, accounting for large differences in individual endowments. We apply the Oaxaca-Blinder decomposition as well as propensity score matching to adequately determine the role of discrimination in the wage gaps observed. Although the size of the absolute racial wage gap is enormous, amounting for more than 500%, the actual estimated effect non-attributable to other factors ranges between 45%-55%. This estimator, however, assumes homogenous discrimination across the wage distribution, while data suggest that there are significant educational, sectoral and occupational differentials. To account for these effects, we implement propensity score matching by finding “statistical twins” of the White population among the Black population, thus we demonstrate how wages differ between these groups in comparable labour market situations. Here too we find that wages for the White are on average approximately 30%, while the effects vary at quartiles of the wage distribution. |
| Keywords: | discrimination; Oaxaca-Blinder decomposition; propensity score matching; Republic of South Africa; racial wage gap |
| JEL: | J08 J71 O12 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:16440&r=lab |
| By: | Catia Nicodemo (Departament d'Economia Aplicada, Universitat Autonoma de Barcelona) |
| Abstract: | This paper utilizes a panel data sample selection model to correct the selection in the analysis of longitudinal labor market data for married women in European countries. We estimate the female wage equation in a framework of unbalanced panel data models with sample selection. The wage equations of females have several potential sources of |
| Keywords: | Female participation, labor supply, family benefits, unbalanced panel data |
| JEL: | J2 J3 C2 C3 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:uab:wprdea:wpdea0906&r=lab |
| By: | Ronald Bachmann; Peggy David |
| Abstract: | Using two data sets derived from German administrative data, including a linked employer-employee data set, we investigate the cyclicality of worker and job flows.The analysis stresses the importance of two-sided labour market heterogeneity in this context, taking into account both observed and unobserved characteristics.We find that small firms hire mainly unemployed workers, and that they do so at the beginning of an economic expansion. Later on in the expansion, hirings more frequently result from direct job-to-job transitions, with employed workers moving to larger firms. Contrary to our expectations, workers moving to larger firms do not experience significantly larger wage gains than workers moving to smaller establishments. Furthermore, our econometric analysis shows that the interaction of unobserved heterogeneities on the two sides of the labour market plays a more important role for employed job seekers than for the unemployed. |
| Keywords: | Worker flows, accessions, separations, business cycle, job-to-job, employer-to-employer, linked employer-employee |
| JEL: | J63 J64 J21 E24 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:rwi:repape:0124&r=lab |
| By: | Philippe Askenazy; Eve Caroli; Jérôme Gautié |
| Abstract: | Ce travail présente un panorama de la qualité de l'emploi peu qualifié en France aujourd'hui. Nous nous intéressons en particulier aux conditions de travail, d'emploi et de rémunérations des salariés les moins qualifiés et les moins rémunérés. Nous mettons tout d'abord en évidence l'incidence relativement faible du travail à bas salaires dans notre pays, comparée aux Etats-Unis mais aussi à d'autres pays européens. Nous montrons que, bien que globalement décroissante depuis 15 ans, cette incidence se concentre sur des groupes de salariés bien particuliers. Les raisons de cette relative compression des salaires sont à rechercher du côté du SMIC mais également du côté de dispositifs de politique de l'emploi. En revanche, les conditions de travail se sont dégradées au cours des années récentes, en particulier dans les emplois peu qualifiés et à bas salaires. Les différentes formes de pénibilité et de charge mentale ont sensiblement augmenté, reflétant une nette intensification du travail. Cette tendance est commune à de nombreux pays développés mais la France se distingue par l'ampleur et la persistance du phénomène. Cette intensification porte avec elle une insatisfaction croissante des salariés qui tend à se cristalliser sur les salaires jugés insuffisants au regard des efforts demandés. La qualité de l'emploi en France est également affectée par l'importance de la précarité professionnelle qui se concentre elle aussi sur les travailleurs situés au bas de l'échelle des qualifications et des salaires. Notre recherche souligne le caractère multiforme de cette précarité. Elle touche l'emploi par l'intermédiaire des contrats de travail temporaires de plus en plus nombreux et moins bien protégés que ne le suggèrent les indices agrégés de protection de l'emploi. Elle s'étend, au-delà, à l'ensemble des conditions d'emploi et de rémunération. Au total, l'importance de la précarité professionnelle telle que ressentie par les salariés tend à renforcer la demande de protection de l'emploi et donc l'attachement à la loi dans un pays où la représentation syndicale reste faible et fractionnée. ###[english abstract: This research provides a picture of job quality in low-skilled jobs in France today. We focus on working, employment and pay conditions of lower-skilled workers in the least paid jobs. We first show that the incidence of low-wage work is reduced in France as compared to the USA, but also to other EU countries. This incidence has been decreasing in the past 15 years, but it remains concentrated on specific groups of workers. The reasons for this relative compression of wages at the bottom of the distribution have to do with the existence of a national minimum wage (the so-called SMIC) and with the existence of specific labour market policies. In contrast, working conditions have worsened in recent times, in particular in low-skilled, low-paid jobs. Mental strain has increased a lot, together with painful working conditions, due to work intensification. This trend is common to many developed countries, but it is particularly pervasive and persistent in France. This intensification generates increasing job dissatisfaction which particularly focuses on wages, the level of which is seen as insufficient with respect to the efforts that are required. Job quality in France is also affected by "professional precariousness" which concentrates on lower-skilled workers. Our research provides evidence of various forms of precariousness. It encompasses job security, of course, for temporary workers who are often much less protected than one would think when looking at aggregate EPL indicators. Beyond this, it extends to employment and pay conditions. Overall, the feeling of precariousness experienced by workers tends to raise the demand for employment protection and hence the attachment to the law in a country where trade-unions are weak and often divided.]### |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:pse:psecon:2009-25&r=lab |
| By: | Janine Leschke (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, ETUI - European Trade Union Institute); Maria Jepsen (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, ETUI - European Trade Union Institute) |
| Abstract: | Much of the gender inequality in the labour market is brought about by women's dual role as worker and (potential) carer. In this regard transitional arrangements can contribute to mitigate the risks associated with parenthood and to distribute risks more equally. This paper looks at these issues in light of the transitional labour market (TLM) concept. The first section discusses various gender-equality models which imply different ways of organising, for example, childcare, parental leave and flexible working time. Sections two and three look at gender inequalities in labour market outcomes and discuss transitional arrangements that can contribute to the achievement of more gender equality in six countries taken as examples. The last section discusses the results of the labour market and institutional analysis in light of the TLM concept. |
| Keywords: | Gender, labour market, transitional labour markets, childcare, parental leave, flexible working time. |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-00384510_v1&r=lab |
| By: | Booth, Alison L. (Australian National University) |
| Abstract: | In almost all European Union countries, the gender wage gap is increasing across the wages distribution. In this lecture I briefly survey some recent studies aiming to explain why apparently identical women and men receive such different returns and focus especially on those incorporating pyschological factors as an explanation of the gender gap. Research areas with high potential returns to further analysis are identified. Several examples from my own recent experimental work with Patrick Nolen are also presented. These try to distinguish between the role of nature and nurture in affecting behavioural differences between men and women that might lead to gender wage gaps. |
| Keywords: | glass ceiling, experimental economics, personality differences |
| JEL: | C9 J16 J71 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4300&r=lab |
| By: | Hartmut Egger; Peter Egger; James R. Markusen |
| Abstract: | We formulate a two-country model with monopolistic competition and heterogeneous firms to reconsider labor market linkages in open economies. Labor-market imperfections arise by virtue of country-specific real minimum wages. Two principal experiments are considered. First, we show that trade liberalization under minimum wages differs significantly from trade liberalization under standard assumptions. In the former case, there is effectively a perfectly elastic supply of labor to production whereas in the conventional case it is assumed that aggregate labor supply is perfectly inelastic. Standard effects on marginal and average firm productivity are reversed in our model, yet there are significant gains from trade arising from employment expansion, an effect quite different from the source of gains from trade in the conventional approach. Second, we show that with firm heterogeneity an increase in one country's minimum wage triggers firm exit in both countries and thus harms workers at home and abroad. In an extension to our baseline model, we illustrate that offshoring production from the high-wage to the low-wage country within multinational firms lowers the scope for exporting the costs of a higher minimum wage to the trading partner. |
| JEL: | F12 F15 F16 F23 J30 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15196&r=lab |
| By: | Dufourt, Frédéric (BETA-CNRS); Lloyd-Braga, Teresa (Universidade Catolica Portuguesa, Lisbon); Modesto, Leonor (Universidade Catolica Portuguesa, Lisbon) |
| Abstract: | We propose and estimate a model where unemployment fluctuations result from self-fulfilling changes in expected inflation (sunspot shocks) affecting nominal wage bargaining. Since the estimated parameters fall near the locus of Hopf bifurcations, country-specific expected inflation shocks can replicate the strong persistence and heterogeneity observed in European unemployment rates. They also generate positive comovements in macroeconomic variables and a large relative volatility of consumption. All these features, hardly accounted for by standard sunspot-driven models, are explained here by the fact that liquidity constrained workers, facing earnings uncertainty in the context of imperfect unemployment insurance, choose to consume their current income. |
| Keywords: | unemployment fluctuations, sunspots equilibria, expected inflation, wage bargaining |
| JEL: | J60 E32 E37 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4302&r=lab |
| By: | John P. Haisken-DeNew; Matthias Vorell |
| Abstract: | Of the many labour market Hartz IV reforms that have been implemented in Germany since 2005, the role of short-term unemployment insurance has not received much attention. In this paper we examine distributional effects of labour earnings and unemployment benefits using simulated increases in unemployment insurance replacement rates or equivalently, increases in the net present value of benefit duration. Starting around an 18%-point increase in the replacement rate, there are significant negative labour supply effects, drawing those employed into unemployment shifting the mass of the earnings distribution to the left. At around a 25%-point increase in the replacement rate, the mass of the distribution shifts right again, as those receiving unemployment benefits simply enjoy an increased transfer. Thus, due to the substantial negative labour supply effects, German economic policy should avoid potentially increasing the UI benefit replacement rate (or equivalently, increasing the benefit duration) in the near future as a response to the worldwide economic crisis. |
| Keywords: | Unemployment, income distribution, labour supply |
| JEL: | J65 D31 J22 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:rwi:repape:0121&r=lab |
| By: | Filmer, Deon; Schady, Norbert |
| Abstract: | There is a strong association between schooling attained and test scores in many settings. If this association is causal, one might expect that programs that increase school enrollment and attainment would also improve test scores. However, if there is self-selection into school based on expected gains, marginal children brought into school by such programs may be drawn disproportionately from the left-hand side of the ability distribution, which could limit the extent to which additional schooling translates into more learning. To test this proposition, this paper uses data from Cambodia. The results show that a program that provides scholarships to poor students had a large effect on school enrollment and attendance, which increased by approximately 25 percentage points. However, there is no evidence that, 18 months after the scholarships were awarded, recipient children did any better on mathematics and vocabulary tests than they would have in the absence of the program. The paper discusses results that suggest that the self-selection of lower-ability students into school in response to the program is an important part of the explanation. The analysis also shows minimal program effects on other outcomes, including knowledge of health practices, expectations about the future, and adolescent mental health. |
| Keywords: | Tertiary Education,Education For All,Primary Education,Teaching and Learning,Secondary Education |
| Date: | 2009–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:4998&r=lab |
| By: | Mohammad Irfan (International Islamic University, Islamabad) |
| Abstract: | This paper attempts to document changes in the wage levels of different categories of workers employed in various segments of the labour market during the period 1990-91–2006-07, according to the information given in the labour force surveys. Wage structure can be analysed from different angles. Here we look at the levels and trends in the broad categories of industry. Further subdivided along the demarcation of formal/informal, and by worker characteristics such as age, sex, education, and occupational categories. Largescale Manufacturing Industries, Banking Sector, and Civil Servants’ salary structure are subjected to investigation for disuring wage trends in the formal sector. The impact of unionism and of the labour and wage policies of various regimes and upon wage outcome is also assessed. There appears to be a consonance between money wage growth at the aggregate level of the economy and GDP growth. The former registered a positive growth, with the exception of the 1999-2002 period, when the latter had low growth. Time trend of average wage works out to 7.6 percent, which, adjusted for inflation, yields a 0.7 percent trend growth rate in real wages for the 1990-07 period. Real wage growth rate at the aggregative level is characterised by substantial diversity. One finds an inverse relationship between the level of wage rate and real wage growth. Thus workers in the informal sector and commodity producing sectors like Agriculture and Manufacturing suffered a real wage decline during the period under study. That the real wage gains were denied to the majority of the workers (60 percent or so) lying at the lower rung of the wage distribution rendered the wage structure iniquitous wherein duality further accentuated. The character of the regime tends to have its mark. During the 1990s, the political leadership notwithstanding, low GDP growth and Pressler Amendment appeared to have sympathetic attitude towards labour, which was visible in the virulence of trade unions as well as announcement of the Minimum Wage Policy during early 1990s. However, in the context of labour supply pressure and subdued economic performance, stagnation and decline in real wage could not be avoided. In contrast, there hardly has been any sizeable positive impact on the real wages of the informal sector workers since the turnaround of the economy in 2003. The governmental attitude was reflective of the follow-up of the imperatives of globalisation, weakening of trade unions, and introduction of the changes in the procedures governing the tripartite mechanism and formulation of labour and wage policy. The need to have a fresh look at the labour and wage policy to ensure sustenance and to address inequality issues can hardly be overemphasised. |
| Keywords: | Wages; Wage Structure; Pakistan |
| JEL: | J3 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:pid:wpaper:2009:54&r=lab |
| By: | C. Kirabo Jackson; Elias Bruegmann |
| Abstract: | Using longitudinal elementary school teacher and student data, we document that students have larger test score gains when their teachers experience improvements in the observable characteristics of their colleagues. Using within-school and within-teacher variation, we further show that a teacher’s students have larger achievement gains in math and reading when she has more effective colleagues (based on estimated value-added from an out-of-sample pre-period). Spillovers are strongest for less-experienced teachers and persist over time, and historical peer quality explains away about twenty percent of the own-teacher effect, results that suggest peer learning. |
| JEL: | I2 J24 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15202&r=lab |
| By: | Spyros Arvanitis (KOF Swiss Economic Institute, ETH Zurich, Switzerland); Euripidis N. Loukis (University of the Aegean, Department of Information and Communication Systems Engineering, Karlovassi/Samos, Greeece) |
| Abstract: | This paper aims at investigating empirically at the firm level the effect of the use of modern information and communication technologies (ICT), and also of two other factors, the adoption of new forms of workplace organization and trade (export) activities, on the demand for employees with different levels of (vocational) education. The study is based on firm-level data collected through a common questionnaire from firms’ samples of similar composition (concerning firm sizes and industries) in Greece and Switzerland; from these data econometric models of similar specification have been constructed for both countries. The results of multivariate analysis show that the intensive use of ICT correlates positively with the employment shares of high-educated personnel and negatively with the ones of the loweducated personnel. These findings are consistent with the hypothesis of ‘skill-biased technical change’. Further, the intensive use of “employee voice”-oriented organizational practices correlates positively with the employment shares of high-educated employees in both countries, and also negatively with the employment share of low-educated ones only for the Swiss firms. The results for the “work design” organizational practices are more ambiguous. Thus, there is only partial confirmation of the hypothesis of skilled-biased organizational change. Finally, we found some evidence in favour of the trade effect (export activities) only for the Swiss firms. Our results show both similarities and differences in the above aspects between Greece and Switzerland and indicate that national context characteristics affect the relationship of the demand for employees with different levels of (vocational) education with ICT use, adoption of new forms of workplace organization and trade. |
| Keywords: | labour demand, labour skills, information technology, workplace organization |
| JEL: | J23 J24 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:kof:wpskof:09-234&r=lab |
| By: | Sologon, Denisa Maria (Maastricht University); O'Donoghue, Cathal (Teagasc Rural Economy Research Centre) |
| Abstract: | Do EU citizens have an increased opportunity to improve their position in the distribution of earnings over time? This question is answered by exploring short and long-term wage mobility for males across 14 EU countries between 1994 and 2001 using ECHP. Mobility is evaluated using rank measures which capture positional movements in the distribution of earnings. All countries recording an increase in cross-sectional inequality recorded also a decrease in short-term mobility. Among countries where inequality decreased, short-term mobility increased in Denmark, Spain, Ireland and UK, and decreased in Belgium, France and Ireland. Long-term mobility is higher than short-term mobility, but long-term persistency is still high in all countries. The lowest long-term mobility is found in Luxembourg followed by four clusters: first, Spain, France and Germany; second, Netherlands, and Portugal; third, UK, Italy and Austria; forth, Greece, Finland, Belgium and Ireland. The highest long-term mobility is recorded in Denmark. |
| Keywords: | panel data, wage distribution, inequality, mobility |
| JEL: | C23 D31 J31 J60 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4311&r=lab |
| By: | Carola Frydman; Raven S. Molloy |
| Abstract: | Evidence since the 1980s suggests that the level and structure of executive compensation in U.S. public corporations are largely unresponsive to tax incentives. However, the relative tax advantage of different forms of pay has been relatively small during this period. Using a sample of top executives in large firms from 1946 to 2005, we find little response of salaries, qualified stock options, long-term incentive pay, or bonuses paid after retirement to changes in tax rates on labor income--even though tax rates were significantly higher and more heterogeneous across individuals in the first several decades following WWII. To explain this lack of response, we find suggestive evidence that concerns about within-firm equality may have limited firms' ability to differentiate top executives' compensation packages based on their marginal income tax rates. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2009-30&r=lab |
| By: | Corinne Perraudin (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, CEE - Centre d'Etudes de l'Emploi - Ministère de la recherche - Ministère chargé de l'Emploi, SAMOS - Statistique Appliquée et MOdélisation Stochastique - Université Panthéon-Sorbonne - Paris I); Héloïse Petit (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, CEE - Centre d'Etudes de l'Emploi - Ministère de la recherche - Ministère chargé de l'Emploi); Nadine Thevenot (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I); Bruno Tinel (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I); Julie Valentin (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I) |
| Abstract: | This article highlights the importance of power relations in inter-firm relations and analyses their impact on firms' employment management practices. We show, firstly, that the use of subcontracting creates a chain of inter-firm economic dependency because it leads the principal contractor to plan and control the activities of the subcontractors. We then advance the hypothesis that this chain of dependency influences both the skill structure and wage levels. Empirical tests carried out on French data confirm that firms that subcontract outsource execution tasks and that the hierarchy of firms impacts employees' wage levels. |
| Keywords: | Subcontracting ; skills ; wages ; power relation |
| Date: | 2009–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-00375550_v1&r=lab |
| By: | Nicolas L. Dromel (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris); Elie Kolakez (ERMES - TEPP - Université Paris II Panthéon-Assas); Etienne Lehmann (CREST - Centre de Recherche en Économie et Statistique - INSEE - École Nationale de la Statistique et de l'Administration Économique, IZA - Institute for the Study of Labor) |
| Abstract: | In this paper, we argue that credit market imperfections impact not only the level of unemployment, but also its persistence. For this purpose, we first develop a theoretical model based on the equilibrium matching framework of Mortensen and Pissarides (1999) and Pissarides (2000) where we introduce credit constraints. We show these credit constraints not only increase steady-state unemployment, but also slow down the transitional dynamics. We then provide an empirical illustration based on a country panel dataset of 19 OECD countries. Our results suggest that credit market imperfections would significantly increase the persistence of unemployment. |
| Keywords: | Credit markets, labor markets, unemployment, credit constraints, search frictions. |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-00389762_v1&r=lab |
| By: | Marie-Pierre Dargnies (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris) |
| Abstract: | This paper studies the impact of the possibility to enter a tournament as a team on the gender gap in tournament entry. While a large and significant gender gap in entry in the individual tournament is found in line with the literature, no gender gap is found in entry in the team tournament. While women do not choose to enter the tournament significantly more often when it is team-based, men enter significantly less as part of a team than alone. Changes in overconfidence as well as in risk, ambiguity and feedback aversion, the difference in men and women's taste for the uncertainty on their teammate's ability all account for a part of the disappearance of the gender gap in tournament entry. A remaining explanation is that being part of a team changes men and women's taste for performing in a competitive environment. |
| Keywords: | Gender gap, tournament, teams. |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-00367702_v1&r=lab |
| By: | Bargain, Olivier (University College Dublin); Doorley, Karina (University College Dublin) |
| Abstract: | While financial incentives usually have a significant effect on the labor supply of married women and single mothers, the evidence about the participation elasticity of childless singles, and single males especially, is more scant. This is, however, important in countries like France and Germany, where single individuals constitute the core of social assistance recipients. As yet, there is no conclusive evidence about whether, and to what extent, this group is affected by the financial disincentives embedded in the generous redistributive programs in place in these countries. In this paper, we exploit a particular feature of the main welfare scheme in France (Revenu Minimum d'Insertion, RMI), namely that childless adults under age 25 are not eligible for it. Using a regression discontinuity approach and the French micro-census data, we find that the RMI reduces the employment of uneducated single men by 7%-10%. Important policy implications are drawn. |
| Keywords: | regression discontinuity, welfare, social assistance, labor supply |
| JEL: | H52 J21 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4291&r=lab |
| By: | Luc Behaghel; Eve Caroli; Emmanuelle Walkowiak |
| Abstract: | Following the adoption of information and communication technologies (ICT), firms may react to increasing skill requirements either by training or hiring the new skills, or a combination of the two. Using matched datasets with about 1,000 French plants, we assess the relative importance of these external and internal labour market strategies. We show that skill upgrading following technological and organisational changes takes place mostly through internal labour markets adjustments. Consistently with the results in the literature, we find that the intensive use of ICT is associated with an upward shift in the occupational structure within firms. We show that about one third of the upgrading of the occupational structure is due to hiring and firing workers from and to the external labour market, whereas two-thirds are due to promotions. Moreover, we find no compelling evidence of external labour market strategies based on "excess turnover". In contrast, French firms heavily rely on training in order to upgrade the skill level of their workforce. When looking at potential heterogeneity across firms in skill upgrading strategies, we find that all firms rely much more on promotions than on external movements in order to shift their occupational structure upward. In contrast, different training patterns are found across sectors: the use of ICT is strongly correlated with training for all occupational groups in manufacturing sectors, whereas this is not the case in services. This difference is robust to controlling for other sources of heterogeneity and may be explained by the fact that labour turnover is much higher in services than in manufacturing. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:pse:psecon:2009-24&r=lab |
| By: | Thomas Schober; Rudolf Winter-Ebmer |
| Abstract: | Seguino (2000) shows that gender wage discrimination in export-oriented semi-industrialized countries might be fostering investment and growth in general. While the original analysis does not have internationally comparable wage discrimination data, we replicate the analysis using data from a meta-study on gender wage discrimination and do not find any evidence that more discrimination might further economic growth – on the contrary: if anything the impact of gender inequality is negative for growth. Standing up for more gender equality – also in terms of wages – is good for equity considerations and at least not negative for growth. |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:jku:nrnwps:2009_08&r=lab |
| By: | Peter Blair Henry; Diego Sasson |
| Abstract: | For three years after the typical developing country opens its stock market to inflows of foreign capital, the average annual growth rate of the real wage in the manufacturing sector increases by a factor of seven. No such increase occurs in a control group of developing countries. The temporary increase in the growth rate of the real wage drives up the level of average annual compensation for each worker in the sample by 609 US dollars—an increase equal to 25 percent of their annual pre-liberalization salary. The increase in the growth rate of labor productivity in the aftermath of liberalization exceeds the increase in the growth rate of the real wage so that the increase in workers’ incomes actually coincides with a rise in manufacturing sector profitability. Overall, the results suggest that trade in capital may have a larger impact on wages than trade in goods. |
| JEL: | E2 F15 F3 F41 F43 O4 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15204&r=lab |
| By: | Francisco Gallego (Instituto de Economía. Pontificia Universidad Católica de Chile.); Andrés Hernando |
| Abstract: | How do parents choose among schools when they are allowed to do so? In this paper, we analyze detailed information of 70,000 fourth-graders attending about 1,200 publicly subsidized schools in the context of the Chilean voucher system. We model the school choice of a household as a discrete choice of a single school, based on the random utility model developed by McFadden (1974) and the specification of Berry, Levinsohn, and Pakes (1995), which includes choice-specific unobservable characteristics and deals with potential endogeneity. Our results imply that households value some attributes of schools, with the two most important dimensions being test scores and distance to school. Interestingly, at the same time, our results suggest there is a lot of heterogeneity in preferences because the valuation of most school attributes depend on household characteristics. In particular, we find that while proximity to school is an inferior attribute, test scores is a normal attribute. We present evidence that our results are mainly driven by self-selection and not by school-side selection. As a nal check, we compute the average enrollment elasticity with respect to all school attributes and find that higher elasticities are correlated with higher supply of the attribute, especially in the case of test scores-enrollment elasticities for private schools. |
| Keywords: | School choice, Chile, Vouchers, Structural Estimates, Parental Preferences. |
| JEL: | I20 I21 I22 I28 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:ioe:doctra:356&r=lab |
| By: | Grund, Christian (University of Würzburg); Harbring, Christine (University of Cologne) |
| Abstract: | Based on two representative samples of employees, the German Socio Economic Panel and the European Social Survey, we explore the relation between certain measures of control in employment relationships (i.e. working time regulations, use of performance appraisal systems, monitoring by supervisors, autonomy to organize the work) and individuals’ inclination to trust others. Trust is measured by the general trust question like in most other economic studies based on surveys. We find that strict working time regulations, monitoring and lack of autonomy – all indicators for control at the workplace – are negatively related to trust. Moreover, we contribute to the literature on trust by gathering hints to other potential determinants of trust. |
| Keywords: | autonomy, control, monitoring, performance appraisal, regulation of working time, trust |
| JEL: | J81 M12 M5 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4297&r=lab |
| By: | Backiny-Yetna, Prospere; Wodon, Quentin |
| Abstract: | This paper provides a comparative assessment of the market share, reach to the poor, and performance of faith-based and public schools in the Democratic Republic of Congo using data from the 2004-2005 "123" survey. More than two thirds of primary school students attend faith-based government-assisted schools. Both types of school cater to a similar population that is overwhelmingly poor. Faith-based schools perform slightly better at least in some dimensions than government schools, but the differences between the two types of schools are small and not statistically significant. |
| Keywords: | Primary education; faith-based; performance; poverty; Democratic Republic of Congo |
| JEL: | Z12 H11 I21 L33 H44 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:16463&r=lab |
| By: | Gebhard Kirchgässner |
| Abstract: | In this paper it is asked whether it is meaningful to state a ‘right to work’ as a basic human right to be written down in the constitution, for example, whether working time should generally be reduced, and whether those who do not have (or find) a job should get a guaranteed minimal income. All three demands have to be rejected, at least in the radical form in which they are often stated. They cannot be realised at all or at least not without impairing other basic human rights. Finally, it is asked what can be retained from these (usually well-intended) demands. |
| Keywords: | Unemployment, Right to Work, Working Time, Negative Income Tax, Basic Income |
| JEL: | J |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:usg:dp2009:2009-17&r=lab |
| By: | Basit Zafar |
| Abstract: | Because students rely on their subjective expectations when choosing a college major, understanding this process of expectations formation is crucial for education policy recommendations. This paper focuses on how college students form expectations about various major-specific outcomes. I collect a unique panel data set of Northwestern University undergraduates that contains their subjective expectations about major-specific outcomes. Although students tend to be overconfident about their future academic performance, I find that they revise their expectations about various major-specific outcomes in systematic ways. For example, students who receive extremely positive information about their ability revise upward their prediction for short-term grade-point average (GPA). Similarly, those who receive very negative information revise downward their beliefs about GPA. Furthermore, students seem to update their probabilistic beliefs in a manner consistent with Bayesian analysis: Prior beliefs about outcomesto be realized in college tend to be fairly precise, while new information influences prior beliefs about outcomes in the workplace. Moreover, students who are more uncertain about major-specific outcomes in the initial survey make greater absolute revisions in their beliefs in the follow-up survey. Finally, I present evidence that learning plays a role in the decision to switch majors. Negative revisions to beliefs about graduating in four years, enjoying coursework, and earning an expected salary are associated with dropping a major. |
| Keywords: | Education ; Forecasting ; Human behavior ; Prediction (Psychology) |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fednsr:378&r=lab |
| By: | Jed Kolko; David Neumark |
| Abstract: | We study how the employment effects of enterprise zones vary with their location, implementation, and administration, based on evidence from California. We use new establishment-level data and geographic mapping methods, coupled with a survey of enterprise zone administrators. Overall, the evidence indicates that enterprise zones do not increase employment. However, the evidence also suggests that the enterprise zone program has a more favorable effect on employment in zones that have a lower share of manufacturing and in zones where managers report doing more marketing and outreach activities. On the other hand, devoting more effort to helping firms get hiring tax credits reduces or eliminates any positive employment effects, which may be attributable to idiosyncrasies of California’s enterprise zone program during the period we study. |
| JEL: | H25 J23 J78 R12 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15206&r=lab |
| By: | Kakwani, Nanak; Neri, Marcelo; Son, Hyun H. |
| Abstract: | This paper analyses the relationship between growth patterns, poverty, and inequality in Brazil during its globalization process, focusing on the role played by the labour market and social programmes. Methodologically, the paper makes two contributions to the literature. One is the proposal of a new measure of pro-poor growth, which links growth rates in mean income and in income inequality. The other contribution is a decomposition methodology that explores linkages between three dimensions: growth patterns, labour market performances, and social policies. The proposed methodologies are then applied to the Brazilian National Household Survey covering the period 1995.2004. |
| Keywords: | inequality, poverty, growth, pro-poor growth, labour market, social policy |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:rp2009-26&r=lab |