|
on Labour Economics |
| By: | Mario Larch; Wolfgang Lechthaler |
| Abstract: | We introduce unemployment and endogenous selection of workers into different skill-classes in a trade model with two sectors and heterogeneous firms. This allows us to study the distributional consequences and the skill-specific unemployment effects of trade liberalization. We show that the gains from trade will be distributed very unequally. While unskilled workers loose in terms of real wages and employment levels in the skilled labor intensive sector, skilled workers loose in terms of real wages and unemployment levels in the unskilled labor intensive sector. However, the inequality of workers between sectors is much larger for skilled labor than for unskilled labor. On average, unemployment among unskilled workers increases when a skill-abundant country opens up to trade |
| Keywords: | Comparative advantage; heterogeneous firms; labor market frictions; unemployment; trade liberalization |
| JEL: | F11 F12 F16 J64 L11 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:kie:kieliw:1538&r=lab |
| By: | Todd Schoellman |
| Abstract: | This paper estimates the multi-dimensional human capital endowments of im¬migrants by characterizing their occupational decisions. This approach allows for estimation of physical skill and cognitive ability endowments, which are difficult to measure directly. Estimation implies that immigrants as a whole are abundant in cognitive ability and scarce in experience/training and communication skills. Counterfactual estimates of the wage impacts of immigration are skewed: the largest gain from preventing immigration is 3.2% higher wages, but the largest loss is 0.3% lower wages. Crowding of immigrants into select occupations plays a minor role in explain¬ing these impacts; occupations’ skill attributes explain the bulk. |
| Keywords: | Human Capital, Migration. |
| JEL: | F22 J24 |
| Date: | 2009–08–19 |
| URL: | http://d.repec.org/n?u=RePEc:eei:rpaper:eeri_rp_2009_19&r=lab |
| By: | Kenn Ariga (Institute of Economic Research, Kyoto University); Masako Kurosawa (National Graduate Institute for Policy Studies); Fumio Ohtake (Institute of Social and Economic Research, Osaka University); Masaru Sasaki (Institute of Social and Economic Research, Osaka University) |
| Abstract: | We use a survey of the Japanese youth within 10 year after high school graduation to investiage the impacts of the academic and social skills on their success in the job market. We find three major factors account for the job market outcome immediately after school: school characteristics and job placement services, academic performance, and social skills, including the negative impacts of problematic behaviors at the school. Second, when we run a Probit regression on whether or not the surveyed individuals hold regular, full time job, we find the persistent but declining (over age) im- pact of the job placement immediately after school. Moreover, we find the impact of variables pertaining to the sociall skills remain significant even after controling for the job placement outcome after school, whereas other variables such as GPA or attributes of highschools are largely irrelevant to the current employment status. |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:kyo:wpaper:678&r=lab |
| By: | Bernardo Lara; Alejandra Mizala; Andrea Repetto |
| Abstract: | In this paper we re-analyze the effect of private voucher education on student academic performance in Chile using new data and a novel identification strategy. Most schools in Chile provide either primary or secondary education. We analyze the effect of private voucher education on students that are forced to enroll at a different school to attend secondary education once graduated from primary schooling. Moreover, contrary to the previous literature on Chile’s universal voucher system, the data set used in this paper contains information on previous academic achievement and thus allows us to control for it. Using a number of propensity score based econometric techniques and changes-in-changes estimation methods we find that private voucher education leads to small, sometimes not statistically significant differences in academic performance. The estimated effect of private voucher education amounts to about 4 to 6 percent of one standard deviation in test scores. The literature on Chile based on cross sectional data had previously found positive effects of about 15 to 20 percent of one standard deviation. JEL Classifications: I200, I210. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:edj:ceauch:263&r=lab |
| By: | Federico Cingano (Bank of Italy); Marco Leonardi (University of Milan); Julián Messina (University of Girona); Giovanni Pica (University of Salerno) |
| Abstract: | This paper analyzes the joint effect of EPL and financial market imperfections on investment, capital-labour substitution, labour productivity and job reallocation in a cross-country framework. In the spirit of Rajan and Zingales (1998) and Ciccone and Papaioannou (2006), we exploit variation in the need for reallocation at the sectoral and aggregate level to assess the average effect of EPL on firms’ policies. Then, exploiting firm-level information we study if the effect of EPL is stronger in firms with lower levels of internal resources. We find that, on average, EPL reduces investment per worker, capital per worker and value added per worker in high reallocation sectors relative to low reallocation sectors. The reduction in the capital-labour ratio is less pronounced in firms with higher internal resources, suggesting that financial constraints exacerbate the negative effects of EPL on capital deepening. |
| Keywords: | capital-labor substitution, labor market imperfections, financial market imperfections |
| JEL: | J21 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:bde:wpaper:0914&r=lab |
| By: | Sandewall, Örjan (London School of Economics); Cesarini, David (Department of Economics); Johannesson, Magnus (Department of Economics) |
| Abstract: | Twins-based estimates of the return to schooling feature prominently in the labor economics literature. The validity of such estimates hinges critically on the assumption that within-pair variation in schooling is explained by factors which are unrelated to wage earning ability. This paper develops a framework for testing this assumption, and finds, using a unique dataset of monozygotic twins, strong evidence against it. Di¤erences in adolescent IQ test scores predict within-pair variation in educational attainment, and including IQ in the wage equation causes within-pair point estimates for the returns to schooling to decline significantly. Our results thus cast doubt on the validity of estimates derived from the co-twin literature. |
| Keywords: | Returns to Schooling; Twins; Equal Ability Assumption |
| JEL: | I21 J24 |
| Date: | 2009–08–24 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0806&r=lab |
| By: | Gabriel Felbermayr; Mario Larch; Wolfgang Lechthaler |
| Abstract: | We introduce search and matching unemployment into a model of trade with differentiated goods and heterogeneous firms. Countries may differ with respect to size, geographical location, and labor market institutions. Contrary to the literature, our single-sector perspective pays special attention to the role of income effects and shows that bad institutions in one country worsen labor market outcomes not only in that country but also in its trading partners. This spill-over effect is conditioned by trade costs and country size: smaller and/or more centrally located nations suffer less from inefficient policies at home and are more heavily affected from spill-overs abroad than larger and/or peripheral ones. We offer empirical evidence for a panel of 20 rich OECD countries. Carefully controlling for institutional features and for business cycle comovements between countries, we confirm our qualitative theoretical predictions. However, the magnitude of spill-over effects is larger in the data than in the theoretical model. We show that introducing real wage rigidity can remedy this problem |
| Keywords: | Spill-over effects of labor market institutions; unemployment; international trade; search frictions; heterogeneous firms |
| JEL: | F11 F12 F16 J64 L11 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:kie:kieliw:1540&r=lab |
| By: | Ha, Wei; Yi, Junjian; Zhang, Junsen |
| Abstract: | Existing studies on the impact of migration on income inequality at sending communities suffer from severe methodology defects and data limitations. This paper analyzes the impact of rural-to-urban migration on inequality using a newly constructed panel dataset for around 100 villages over a ten-year period from 1997 to 2006 in China. To our best knowledge, this is the first paper that examines the dynamic aspects of migration and income inequality employing a dynamic panel data analysis. Unlike earlier studies focusing exclusively on remittances, our data include the total labor earnings of migrants in destination areas. Furthermore, we look at the gender dimension of the impact of migration on wage inequality within the sending communities. Since income inequality is time-persisting, we use a system GMM framework to control for the lagged income inequality in estimating the effect of emigration on income inequality in the sending villages. At the same time, contemporary emigration is validly instrumented in the GMM framework because of the unobserved time-varying community shock that correlates with emigration and income inequality, as well as with the potential reverse causality from income inequality to emigration. We found a Kuznets (inverse U-shaped) pattern between migration and income inequality in the sending communities. Specifically, contemporary emigration increases income inequality, while lagged emigration has strong income inequality-reducing effect in the sending villages. A 50-percent increase in the lagged emigration rate translates into one-sixth to one-seventh standard deviation reduction in inequality. Contemporary emigration has slightly smaller effects in raising the income inequality within villages. These effects are robust to the different specifications and different measures of inequality. More interestingly, the estimated relationship between emigration and the gender wage gap also has an inverse U-shaped pattern. Emigration tends to increase the gender wage gap initially, and then tends to decrease it in the sending villages. |
| Keywords: | Internal Migration; Inequality; System GMM. |
| JEL: | D31 O15 J61 C33 |
| Date: | 2009–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:16896&r=lab |
| By: | Ester Faia; Wolfgang Lechthaler; Christian Merkl |
| Abstract: | We study the design of optimal monetary policy in a New Keynesian model with labor turnover costs in which wages are set according to a right to manage bargaining where the firms’ counterpart is given by currently employed workers. Our model captures well the salient features of European labor market, as it leads to sclerotic dynamics of worker flows. The coexistence of those types of labor market frictions alongside with sticky prices gives rise to a non-trivial trade-off for the monetary authority. In this framework, firms and current employees extract rents and the policy maker finds it optimal to use state contingent inflation taxes/subsidies to smooth those rents. Hence, in the optimal Ramsey plan, inflation deviates from zero and the optimal volatility of inflation is an increasing function of firing costs. The optimal rule should react to employment alongside inflation |
| Keywords: | optimal monetary policy, hiring and firing costs, labor market frictions, policy trade-off |
| JEL: | E52 E24 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:kie:kieliw:1534&r=lab |
| By: | Douhan, Robin (Research Institute of Industrial Economics (IFN)); van Praag, Mirjam (University of Amsterdam) |
| Abstract: | We combine two empirical observations in a general equilibrium occupational choice model. The first is that entrepreneurs have more control than employees over the employment of and accruals from assets, such as human capital. The second observation is that entrepreneurs enjoy higher returns to human capital than employees. We present an intuitive model showing that more control (observation 1) may be an explanation for higher returns (observation 2); its main outcome is that returns to ability are higher in higher control environments. This provides a theoretical underpinning for the control-based explanation for higher returns to human capital for entrepreneurs. |
| Keywords: | Entrepreneurship; Ability; Occupational Choice; Human Capital; Wage Structure |
| JEL: | I20 J24 J31 L26 |
| Date: | 2009–08–20 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0805&r=lab |
| By: | Juha Kilponen (Bank of Finland, Monetary Policy and Research Department, P.O. Box 160, FI-00101 Helsinki, Finland); Juuso Vanhala (Bank of Finland, Monetary Policy and Research Department, P.O. Box 160, FI-00101 Helsinki, Finland) |
| Abstract: | This paper focuses on tenure driven productivity dynamics of a firm-worker match as a potential explanation of "unemployment volatility puzzle". We let new matches and continuing jobs differ by their productivity levels and by their 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. Our contribution is to produce model driven stickiness of old jobs’ wages which does not rely on ad hoc assumptions on wage rigidity. 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 behaving Beveridge curve, despite endogenous job destruction, and more volatile vacancies and unemployment, without a need to rely on differing wage setting mechanisms of new and continuing jobs. Price rigidities do not alter the basic mechanism and the transmission of monetary policy shock is very similar to the standard New Keynesian model with search frictions. JEL Classification: E24, E32, J64. |
| Keywords: | Matching, productivity shocks, job flows, Beveridge curve, vintage structure, nominal rigidities, monetary policy shock, tenure. |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20091080&r=lab |
| By: | García Suaza, Andrés Felipe; Guataqui, Juan Carlos; Guerra, José Alberto; Maldonado, Darío |
| Abstract: | In order to present an estimation of the Internal Rate of Return (IRR) to higher education in Colombia we take advantage of the methodological approach provided by Heckman, Lochner and Todd (2005). Trying to overcome the criticism that surrounds interpretations of the education coefficient of Mincer equations as being the rate of return to investments in education we develop a more structured approach of estimation, which controls for selection bias, includes more accurate measures of labor income and the role of education costs and income taxes. Our results implied a lower rate of return than the ones found in the Colombian literature and show that the Internal Rate of Return for higher education in Colombia lies somewhere between 0.074 and 0.128. The results vary according to the year analyzed and individual’s gender. This last result reinforces considerations regarding gender discrimination in the Colombian labor market. |
| Date: | 2009–08–13 |
| URL: | http://d.repec.org/n?u=RePEc:col:000092:005745&r=lab |
| By: | Daniele Tavani |
| Abstract: | In a simple one-sector, two-class, fixed-proportions economy, wages are set through axiomatic bargaining a`la Nash (1950). As for choice of technology, firms choose the direction of factor augmentations to maximize the rate of unit cost reduction (Kennedy 1964, and more recently Funk 2002). The ag-gregate environment resulting by self-interested decisions made by economic agents is described by a two-dimensional dynamical system in the employ¬ment rate and output/capital ratio. The economy converges cyclically to a long-run equilibrium involving a Harrod-neutral profile of technical change, a constant rate of employment of labor, and constant input shares. The type of oscillations predicted by the model matches the available data on the United States (1963-2003). Finally, institutional change, as captured by variations in workers’ bargaining power, has a positive effect on the rate of output growth but a negative effect on employment. |
| Keywords: | Bargaining, Induced Technical Change, Factor Shares, Employment. |
| JEL: | E24 E25 J52 O31 |
| Date: | 2009–08–15 |
| URL: | http://d.repec.org/n?u=RePEc:eei:rpaper:eeri_rp_2009_15&r=lab |
| By: | Böckerman, Petri; Riihimäki, Elisa |
| Abstract: | We examine the employment effects of international outsourcing by using firm-level data from the Finnish manufacturing sector. A major advantage of our data is that outsourcing is defined based on firms’ actual use of intermediate inputs from foreign trade statistics. The estimates show that intensive outsourcing (more than two times the 2-digit industry median) does not reduce employment nor have an effect on the share of low-skilled workers. |
| Keywords: | International outsourcing; offshoring; labour demand; propensity score matching |
| JEL: | F16 F23 |
| Date: | 2009–08–21 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:16903&r=lab |
| By: | Jeffrey Zabel |
| Abstract: | The United States is known for the ability of its residents to move to where the jobs are, and this has helped the nation maintain its position as the world’s top economy. Households’ decisions to move depend not only on job prospects but also on the relative cost of housing. I investigate how the housing market affects the flow of workers across cities. This occurs through at least two channels: the relative mobility of homeowners versus renters, and the relative cost of housing across markets. I use homeownership rates to measure the former, and use an index that measures house prices across metropolitan statistical areas (MSAs); the price elasticity of housing supply; and the growth rate of house prices to capture the latter. ; To show how variation in these factors affects cross-city migration, I estimate a VAR model of migration, employment, wages, house prices, and new housing supply using data from 277 U.S. MSAs for 1990–2006. The impulse response functions based on employment supply and demand shocks show substantial variation when evaluated at different values of the homeownership rate, the price elasticity of housing supply, relative housing prices, and their growth rates. I also allow for spillover effects in the model that reflect the impact of a labor demand shock in the nearest city. |
| Keywords: | Migration, Internal - United States ; Housing - Prices ; Labor mobility |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbcw:09-2&r=lab |
| By: | Scott Imberman; Adriana D. Kugler; Bruce Sacerdote |
| Abstract: | In 2005, hurricanes Katrina and Rita forced many children to relocate across the Southeast. While schools quickly enrolled evacuees, receiving families worried about the impact of evacuees on non-evacuee students. Data from Houston and Louisiana show that, on average, the influx of evacuees moderately reduced elementary math test scores in Houston. We reject linear-in-means models of peer effects and find evidence of a highly non-linear but monotonic model - student achievement improves with high ability and worsens with low ability peers. Moreover, exposure to undisciplined evacuees increased native absenteeism and disciplinary problems, supporting a "bad apple" model in behavior. |
| JEL: | H23 I21 J24 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15291&r=lab |
| By: | Tomokazu Nomura (Assistant Professor, Graduate School of Economics, Kobe University) |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:koe:wpaper:0914&r=lab |
| By: | Andersson, Christian (Swedish National Audit Office); Johansson, Per (IFAU - Institute for Labour Market Policy Evaluation) |
| Abstract: | To study effects of out-of-school learning we use data on boarding home pupils who attended elementary public schools in the 1940’s. The out-of-school environment at the boarding homes could be considered being more learner friendly than the home environment on average: the pupils at the boarding homes had daily scheduled time for doing their homework under assistance of a junior school teacher and, in addition, they had access to a small library. The placement at boarding homes was based on the distance to the nearest school and had, thus, no direct connection to pupils’ skills which simplifies the empirical analysis based on register data. We find that the more learning friendly environment equalize skills at school leaving age. The effect is larger for kids with low initial ability. |
| Keywords: | Pedagogic personal; homework; early interventions |
| JEL: | I20 N34 |
| Date: | 2009–08–10 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2009_017&r=lab |
| By: | Heather Brome |
| Abstract: | Each of the New England states is wrestling with how to retain a skilled workforce and sustain economic competitiveness while facing an aging population. In particular, each state fears that it is losing young, educated workers to other states and regions. This paper builds on earlier research about trends in the region’s young professionals: it looks at the supply of young professionals in each state to better understand trends in that population. The analysis reveals that, while there are some differences between the New England states, all are facing slow growth or no growth in its population of young professionals. |
| Keywords: | College graduates - New England ; Migration, Internal ; Labor mobility |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbce:09-1&r=lab |
| By: | Andrén, Daniela (Department of Business, Economics, Statistics and Informatics); Svensson, Mikael (Department of Business, Economics, Statistics and Informatics) |
| Abstract: | There is increasing evidence that staying active is an important part of a recovery process for individuals on sick leave due to musculoskeletal disorders (MSDs). It has been suggested that using part-time sick-leave rather than full-time sick leave will enhance the possibility of full recovery to the workforce, and several countries actively favor this policy. However, to date only few studies have estimated the effect of using part-time sick leave in contrast to full-time sick leave. In this paper the effects of being on part-time sick leave compared to full-time sick leave is estimated for the probability of returning to work with full recovery of lost work capacity and uses a sample of 1,170 employees from the RFV-LS database of the Social Insurance Agency of Sweden. A twostage recursive bivariate probit model is used to deal with the endogeneity problem. The first step estimates the probability of being assigned to part-time sick leave, and the second step estimates the likelihood of recovery with part-time sick-leave as an explanatory variable together with a set of other individual characteristics. The results indicate that employees assigned to part-time sick leave do recover to full work capacity with a higher probability than those assigned to full-time sick leave. The average treatment effect of part-time sick leave is 25 percentage points. Considering that it may also be less expensive than assigning individuals to full-time sick leave, this would clearly imply efficiency improvements from assigning individuals, when possible, to part-time sick leave |
| Keywords: | Sick-leave; Part-time; Musculoskeletal; Endogenous regressors. |
| JEL: | I12 J21 J28 |
| Date: | 2009–08–18 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:oruesi:2009_011&r=lab |
| By: | Martine Druant (National Bank of Belgium, boulevard de Berlaimont 14, B-1000 Brussels, Belgium.); Silvia Fabiani (Bank of Italy, Via Nazionale 91, I-00184 Rome, Italy.); Gabor Kezdi (Central European University and Magyar Nemzeti Bank, Szabadság tér 8-9, H-1850 Budapest, V., Hungary.); Ana Lamo (European Central Bank, Kaiserstrasse 29, D-60311 Frankfurt am Main, Germany.); Fernando Martins (Universidade Lusíada of Lisbon and Bank of Portugal, 1150 Lisbon, Portugal.); Roberto Sabbatini (Bank of Italy, Via Nazionale 91, I-00184 Rome, Italy.) |
| Abstract: | This paper presents new evidence on the patterns of price and wage adjustment in European firms and on the extent of nominal rigidities. It uses a unique dataset collected through a firm-level survey conducted in a broad range of countries and covering various sectors. Several conclusions are drawn from this evidence. Firms adjust wages less frequently than prices: the former tend to remain unchanged for about 15 months on average, the latter for around 10 months. The degree of price rigidity varies substantially across sectors and depends strongly on economic features, such as the intensity of competition, the exposure to foreign markets and the share of labour costs in total cost. Instead, country specificities, mostly related to the labour market institutional setting, are more relevant in characterising the pattern of wage adjustment. The latter exhibits also a substantial degree of time-dependence, as firms tend to concentrate wage changes in a specific month, mostly January in the majority of countries. Wage and price changes feed into each other at the micro level and there is a relationship between wage and price rigidity. JEL Classification: D21, E30, J31. |
| Keywords: | survey, wage rigidity, price rigidity, indexation, institutions, time dependent. |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20091084&r=lab |
| By: | Andreas Kuhn; Rafael Lalive; Josef Zweimüller |
| Abstract: | We study the short-run effect of involuntary job loss on comprehensive measures of public health costs. We focus on job loss induced by plant closure, thereby addressing the reverse causality problem of deteriorating health leading to job loss as job displacements due to plant closure are unlikely caused by workers' health status, but potentially have important effects on individual workers' health and associated public health costs. Our empirical analysis is based on a rich data set from Austria providing comprehensive information on various types of health care costs and day-by-day work history at the individual level. Our central findings are: (i) overall expenditures on medical treatments (hospitalizations, drug prescriptions, doctor visits) are not strongly aected by job displacement; (ii) job loss increases expenditures for antidepressants and related drugs, as well as for hospitalizations due to mental health problems for men (but not for women); and (iii) sickness benefits strongly increase due to job loss. |
| Keywords: | Social cost of unemployment, health, job loss, plant closure |
| JEL: | I12 I19 J28 J65 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:zur:iewwpx:424&r=lab |
| By: | Viviane Azevedo; Cesar Bouillon |
| Abstract: | This paper reviews evidence on social mobility in Latin America. Several studies have used data sets that collect intergenerational socio economic information. The data, though limited, suggest that social mobility is low in the region, even when compared with low social mobility developed countries like the United States and United Kingdom, with high levels of immobility at the lower and upper tails of the income distribution. While Latin America has improved education mobility in recent decades, which may have translated into higher mobility for younger cohorts, the region still presents, except for Chile, lower education mobility than in developed countries. The paper also reviews studies on the main determinants of the region’s low levels of social mobility, including social exclusion, low access to higher education, and labor market discrimination. |
| Keywords: | Social mobility, Latin America, Inequality, Social Exclusion, Education |
| JEL: | D30 D60 I30 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:idb:wpaper:4634&r=lab |
| By: | Martine Druant (National Bank of Belgium, Research Department); Silvia Fabiani (Bank of Italy); Gabor Kezdi (Central European University; Magyar Nemzeti Bank); Ana Lamo (European Central Bank); Fernando Martins (Bank of Portugal; Universidade Lusíada of Lisbon); Roberto Sabbatini (Bank of Italy) |
| Abstract: | This paper presents new evidence on the patterns of price and wage adjustment in European firms and on the extent of nominal rigidities. It uses a unique dataset collected through a firm-level survey conducted in a broad range of countries and covering various sectors. Several conclusions are drawn from this evidence. Firms adjust wages less frequently than prices: the former tend to remain unchanged for about 15 months on average, the latter for around 10 months. The degree of price rigidity varies substantially across sectors and depends strongly on economic features, such as the intensity of competition, the exposure to foreign markets and the share of labour costs in total cost. Instead, country specificities, mostly related to the labour market institutional setting, are more relevant in characterising the pattern of wage adjustment. The latter exhibits also a substantial degree of time-dependence, as firms tend to concentrate wage changes in a specific month, mostly January in the majority of countries. Wage and price changes feed into each other at the micro level and there is a relationship between wage and price rigidity |
| Keywords: | survey, wage rigidity, price rigidity, indexation, institutions, time dependent |
| JEL: | D21 E30 J31 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbb:reswpp:200908-27&r=lab |
| By: | Baltzopoulos, Apostolos (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology) |
| Abstract: | The present study carries out a mutli-level analysis of entrepeneurship by considering the choice of the individual to leave his job position to become self-employed. A comprehensive data-set matching the individual to his place of work allows controlling for the characteristics of both the firm and the region he worked in before starting his own firm. The results suggest that small firms spawn entrepreneurs more frequently and individuals working in larger regions that are characterized by larger local markets, higher accumulation of knowledge resources and higher population density are more likely to transcend into entrepreneurship. I also find evidence that people are more likely to select the path of self-employment in the face of weak local competition. |
| Keywords: | Entrepreneurship; self-employment; externalities |
| JEL: | D01 O12 O18 R10 |
| Date: | 2009–08–26 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:cesisp:0189&r=lab |
| By: | De Paola, Maria; Scoppa, Vincenzo |
| Abstract: | In this paper we investigate the effects of class size on the achievements of a sample of college students enrolled at a middle-sized Italian public university. To estimate the effects of class size we exploit the exogenous variations in class size determined by a maximum class size rule introduced by the 2001 Italian university reform. From our analysis it emerges that large teaching classes produce negative effects on student performance measured both in terms of the grades obtained in exams and the probability of passing exams. These results are robust to the use of a matching estimator. |
| Keywords: | Class size; student achievement; educational production function |
| JEL: | C23 I21 J24 |
| Date: | 2009–08–25 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:16945&r=lab |
| By: | Okamoto, Ikuko |
| Abstract: | This paper presents issues affecting the movement of rural labour in Myanmar, by examining the background, purpose and earned income of labourers migrating to fishing villages in southern Rakhine. A broad range of socioeconomic classes, from poor to rich, farmers to fishermen, is migrating from broader areas to specific labour-intensive fishing subsectors, such as anchovy fishing. These labourers are a mixed group of people whose motives lie either in supplementing their household income or accumulating capital for further expansion of their economic activities. The concentration of migrating labourers with different objectives in this particular unstable, unskilled employment opportunity suggests an insufficiently developed domestic labour market in rural Myanmar. There is a pressing need to create stable labour-intensive industries to meet this demand. |
| Keywords: | Migration, Labour, Fishery, Migrant labor, Labor market |
| JEL: | J61 R23 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:jet:dpaper:dpaper206&r=lab |
| By: | Shawn Kantor; Alexander Whalley |
| Abstract: | In this paper we quantify the extent and magnitude of agglomeration spillovers from a formal institution whose sole mission is the creation and dissemination of knowledge -- the research university. We use the fact that universities follow a fixed endowment spending policy based on the market value of their endowments to identify the causal effect of the density of university activity on labor income in the non-education sector in large urban counties. Our instrument for university expenditures is based on the interaction between each university's initial endowment level at the start of the study period and the variation in stock market shocks over the course of the study period. We find modest but statistically significant spillover effects of university activity. The estimates indicate that a 10% increase in higher education spending increases local non-education sector labor income by about 0.5%. As the implied elasticity is no larger than what previous work finds for agglomeration spillovers arising from local economic activity in general, university activity does not appear to make a place any more productive than other forms of economic activity. We do find, however, that the magnitude of the spillover is significantly larger for firms that are technologically closer to universities in terms of citing patents generated by universities in their own patents and sharing a labor market with higher education. |
| JEL: | I2 O3 R1 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15299&r=lab |
| By: | Vincenzo Cuciniello (Chair of International Finance, Ecole Polytechnique Federale de Lausanne (EPFL), Switzerland); Luisa Lambertini (Chair of International Finance, Ecole Polytechnique Federale de Lausanne (EPFL), Switzerland) |
| Abstract: | We study whether monetary policy should target the exchange rate in a two-country model with non-atomistic wage setters, non-traded goods and different degrees of exchange-rate pass through. Commitment to an exchange rate target reduces the labor market distortion. Large labor unions anticipate that higher wages depreciate the exchange rate, which triggers an increase in the interest rate and restrain wage demands. However, reduced exchange rate flexibility worsens the distortion stemming from preset pricing. Targeting the nominal exchange rate will be optimal when the labor market distortion is larger than the preset-pricing one. This result arises with cooperation both under producer and local currency pricing, even though the optimal degree of exchange-rate targeting is higher under local currency pricing. In the Nash equilibrium, the terms-of-trade effect raises optimal wage mark-ups thereby reducing the optimal weight on the exchange rate target. The terms-of-trade effect is stronger as openness and substitutability among Home and Foreign goods increase. |
| Keywords: | Monetary policy, International Finance, Open-Economy Macroeconomics |
| JEL: | F3 F41 E52 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:cif:wpaper:005&r=lab |
| By: | Andrén, Daniela (Department of Business, Economics, Statistics and Informatics); Thomas, Andrén (Konjunkturinstitutet) |
| Abstract: | This paper analyzes the effects of starting the sick leave on part-time compared to fulltime on the probability to recover (i.e., return to work with full recovery of lost work capacity). Using a discrete choice one-factor model, we estimate mean treatment parameters and distributional treatment parameters from a common set of structural parameters. Our results indicate that part-time sick leave is not an intensive treatment and should not to be used for all from the very beginning of a case. However, when the output is analyzed for time spans longer than three months, the average probability to recover is higher for those who started on part time sick leave. Besides, the share of individuals who are positive indifferent between the two states is large (above 50%), which suggests that there is potential for increasing the share |
| Keywords: | part-time sick leave; selection; unobserved heterogeneity; treatment effects |
| JEL: | I12 J21 J28 |
| Date: | 2009–08–17 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:oruesi:2009_010&r=lab |
| By: | Lori Dorfman |
| Abstract: | The book offers advocates arguments to make, and value statements to support those arguments, for a variety of early care and education policy goals. It is believed that young children, their families, and the community at large will benefit if all early childhood education advocates get better at making their case. This book is filled with substantive things to say about various early childhood education policies, expressed in ways designed to evoke the values that illustrate interconnections in our society. This |
| Keywords: | book, child, childhood, community, education, society, young children, children, young, early care, education plolicy, teachers, parents |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2190&r=lab |