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on Labour Economics |
| By: | Schlicht, Ekkehart |
| Abstract: | Applicants for any given job are more or less suited to fill it, and the firm will select the best among them. Increasing the wage offer attracts more applicants and makes it possible to raise the hiring standard and improve the productivity of the staff. Wages that optimize on the trade-off between the wage level and the productivity of the workforce are known as selection wages. As men react more strongly to wage differ¬entials than females, the trade-off is more pronounced for men and a profitmaximizing firm will offer a higher wage for men than for women in equilibrium. |
| Keywords: | Discrimination,selection wages,efficiency wages,hiring standards,monopsony,employment criteria,wage posting,Reder competition |
| JEL: | J31 J7 B54 D13 D42 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwedp:200935&r=lab |
| By: | Sule Celik; Chinhui Juhn; Kristin McCue; Jesse Thompson |
| Abstract: | Using three panel datasets (the matched CPS, the SIPP, and the newly available Longitudinal Employment and Household Dynamics (LEHD) data), we examine trends in male earnings instability in recent decades. In contrast to several papers that find a recent upward trend in earnings instability using the PSID data, we find that earnings instability has been remarkably stable in the 1990s and the 2000s. We find that job changing rates remained relatively constant casting doubt on the importance of labor market “churning.” We find some evidence that earnings instability increased among job stayers which lends credence to the view that greater reliance on incentive pay increased instability of worker pay. We also find an offsetting decrease in earnings instability among job changers due largely to declining unemployment associated with job changes. One caveat to our findings is that we focus on men who have positive earnings in two adjacent years and thus ignore men who exit the labor force or re-enter after an extended period. Preliminary investigation suggests that ignoring these transitions understates the rise in earnings instability over the past two decades. |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:09-20&r=lab |
| By: | Cunningham, Wendy |
| Abstract: | High youth unemployment rates may be a signal of difficult labor market entry for youth or may reflect high churning. The European and United States literature finds the latter conclusion while the Latin American literature suggests the former. This paper uses panel data to examine whether Latin American youth follow OECD patterns or are, indeed, unique. By decomposing transition matrices into propensity to move and rate of separation matrices and estimating duration matrices, the authors find that Latin American youth do follow the OECD trends: their high unemployment reflects high churning while their duration of unemployment is similar to that of non-youth. The paper also finds that young adults (age 19-24) have higher churning rates than youth; most churning occurs between informal wage employment, unemployment, and out-of-the labor force, even for non-poor youth; and unemployment probabilities are similar for men and women when the analysis control for greater churning by young men. The findings suggest that the"first employment"programs that have become popular in the region are not addressing the key constraints to labor market entry for young people and that more attention should be given to job matching, information, and signaling to improve the efficiency of the churning period. |
| Keywords: | Youth and Governance,Labor Markets,Population Policies,Adolescent Health,Labor Policies |
| Date: | 2009–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5022&r=lab |
| By: | Adela Luque; C.J. Krizan |
| Abstract: | As in many other developed countries, the share of skilled workers in Spain’s labor force dramatically increased during the 1990s. This paper decomposes the aggregate skill mix change by a set of key firm characteristics and in the context of Spain’s dual labor market. We find that continuing firms were the major drivers of skill mix growth and that expanding firms in particular increased their ratio of skilled workers. Net entry played a smaller but positive role due to higher-skilled entrants and lower-skilled exiters. Finally, we find that although firms with higher concentrations of temporary workers make bigger employment changes overall, firms’ low-skilled employment is more strongly pro-cyclical than is high skilled employment. |
| Keywords: | Microdata, Skill Mix, Decomposition Methodology, Business Cycle, Dual Labor Markets |
| JEL: | L2 O3 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:09-12&r=lab |
| By: | Marcus Neureiter; Peter Nunnenkamp |
| Abstract: | We use data on motives of international outsourcing and location choices from a recent survey of European companies to assess the labour market repercussions at home. Employing Tobit models we differentiate between job losses as well as job creation for high and low skilled employees at the sector level in ten European home countries. Our findings are in conflict with public concerns about adverse employment effects resulting primarily from cost-oriented sourcing in low wage locations. The quantitative impact on job losses remains modest in the case of cost-saving motives. The simple divide between low and high wage locations hides substantial heterogeneity within both groups. We also find that job losses are typically compensated partly by new job creation, particularly for high skilled workers |
| Keywords: | outsourcing, outward FDI, motives, location choice, job loss, job creation, (un)skilled labour |
| JEL: | F23 J21 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:kie:kieliw:1541&r=lab |
| By: | Yuki, Kazuhiro |
| Abstract: | Many empirical works suggest that education has a positive effect on earnings not only because it raises human capital but also because it functions as a signal when employers have incomplete information on employees' skills. The signaling role could have important consequences on the dynamics of education, wages, and wage distribution when there exist intergenerational linkages in educational decisions. This paper examines the dynamic effects in an economy where education has the dual roles and some fraction of individuals is credit constrained from taking education. In particular, it investigates how the number of educated individuals, the importance of the signaling value of education, and the wage inequality between educated and uneducated workers change over time in such economy, and compares the dynamics with those when education does not function as a signal. It also examines whether the signaling role leads to higher aggregate consumption or not in the long run. |
| Keywords: | Human capital; Education; Signaling; Statistical discrimination; Credit constraint |
| JEL: | O11 I20 O15 J24 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:16982&r=lab |
| By: | Denvil Duncan (Andrew Young School of Policy Studies, Georgia State University); Klara Sabirianova Peter (Andrew Young School of Policy Studies, 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. |
| Date: | 2009–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:ays:ispwps:paper0906&r=lab |
| By: | Kai Christoffel (European Central Bank); James Costain (Banco de España); Gregory de Walque (Banque Nationale de Belgique); Keith Kuester (Federal Reserve Bank of Philadelphia); Tobias Linzert (European Central Bank); Stephen Millard (Bank of England); Olivier Pierrard (Banque Centrale du Luxembourg) |
| Abstract: | In a search and matching environment, this paper assesses a range of modeling setups against macro evidence for the monetary transmission mechanism in the euro area. In particular, we assess right-to-manage vs. efficient bargaining, flexible vs. sticky wages, interactions at the firm level between price and wage-setting, alternative forms of hiring frictions, search on-the-job and endogenous job separation. Models with wage stickiness and right-to-manage bargaining or with firm-specific labour imply a sufficient degree of real rigidity, and so can reproduce inflation dynamics well. However, they imply too small a response on the employment margin. The other model variants fit employment dynamics better, but then imply too little real rigidity and, so, too volatile inflation, owing to strong responses of marginal wages and hours per employee. Further sources of real rigidities - possibly from outside of the labour market - seem to be needed to simultaneously explain the responses of wages, inflation and employment. |
| Keywords: | Inflation Dynamics, Labour Market, Business Cycle, Real Rigidities |
| JEL: | E31 E32 E24 J64 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:bde:wpaper:0918&r=lab |
| By: | Büttner, Thomas; Jacobebbinghaus, Peter; Ludsteck, Johannes |
| Abstract: | The occupational skill structure depends on the business cycle if employers respond to shortages of applicants during upturns by lowering their hiring standards. The notion and relevance of hiring standards adjustment was advanced by Reder and investigated formally in a search-theoretic framework by Mortensen. Devereux implements empirical tests for these theories and finds affirmative evidence for the U.S. labour market. We replicate his analysis using German employment register data. Regarding the occupational skill composition we obtain somewhat lower but qualitatively similar responses to the business cycle despite of well known institutional differences between the U.S. and German labour market. The responsiveness of occupational composition wages to the business cycle is considerably lower in Germany. |
| Keywords: | Hiring standards,business cycle adjustment,occupational upgrading,wage structure,wage setting,overqualification |
| JEL: | J62 J31 J41 C24 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwedp:200934&r=lab |
| By: | Hou, Feng; Lu, Yuqian; Morissette, René |
| Abstract: | Using micro data and grouped data that cover the period 1996-2006, we assess the extent to which cohabiting women adjust their labour supply to a lesser extent, if any, than married women in response to changes in male wages. Both micro data regressions and grouping estimators unambiguously indicate that cohabiting women respond less to variation in male wages than married women. However, the magnitude of the difference is not sizeable. Combined with the fact that married men’s and cohabiting men’s own-wage elasticities do not differ much, this explains why the impact of changes in male wages on family earnings ends up being very similar for married couples and cohabiting couples. |
| Keywords: | marriage, cohabitation, women’s labour supply |
| JEL: | J2 |
| Date: | 2009–08–30 |
| URL: | http://d.repec.org/n?u=RePEc:ubc:clssrn:clsrn_admin-2009-45&r=lab |
| By: | Coneus, Katja; Gernandt, Johannes; Saam, Marianne |
| Abstract: | We analyse the determinants of dropout from secondary and vocational education in Germany using data from the Socio-Economic Panel from 2000 to 2007. In addition to the role of classical variables like family background and school achievements, we examine the effect of noncognitive skills. Both, better school grades and higher noncognitive skills reduce the risk to become an educational dropout. The influence of school achievements on the dropout probability tends to decrease and the influence of noncognitive skills tends to increase with age. |
| Keywords: | Noncognitive skills,school grades,secondary education,vocational training |
| JEL: | I21 J13 J24 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:09019&r=lab |
| By: | Katharine Abraham; John Haltiwanger; Kristin Sandusky; James Spletzer |
| Abstract: | Using a large data set that links individual Current Population Survey (CPS) records to employer-reported administrative data, we document substantial discrepancies in basic measures of employment status that persist even after controlling for known definitional differences between the two data sources. We hypothesize that reporting discrepancies should be most prevalent for marginal workers and marginal jobs, and find systematic associations between the incidence of reporting discrepancies and observable person and job characteristics that are consistent with this hypothesis. The paper discusses the implications of the reported findings for both micro and macro labor market analysis |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:09-09&r=lab |
| By: | Jeremy T. Fox |
| Abstract: | I estimate the relative magnitudes of worker switching costs and how much the employer switching of experienced engineers responds to outside wage offers. Institutional features imply that voluntary turnover dominates switching in the market for Swedish engineers from 1970--1990. I use data on the allocation of engineers across a large fraction of Swedish private sector firms to estimate the relative importance of employer wage policies and switching costs in a dynamic programming, discrete choice model of voluntary employer choice. The differentiated firms are modeled in employer characteristic space and each firm has its own age-wage profile. I find that a majority of engineers have moderately high switching costs and that a minority of experienced workers are responsive to outside wage offers. Younger workers are more sensitive to outside wage offers than older workers. |
| JEL: | J21 J23 J29 J31 J33 J42 J44 J61 J62 J63 L0 |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15322&r=lab |
| By: | Georgellis, Yannis; Lange, Thomas |
| Abstract: | Based on data from the European Values Study (EVS), we compare the determinants of job satisfaction and the impact of union membership in Eastern and Western European labor markets. Correcting our regressions for union endogeneity and controlling for individual characteristics, values and beliefs, and important aspects of a job, we find a positive association between unionization and job satisfaction. This is contrary to the dominant view of the impact of unionization on job satisfaction suggesting that there is a strong, negative relationship between the two variables. We also uncover distinct attitudinal differences between Eastern and Western European employees, highlighting persistent influences of former communist labor relations. |
| Keywords: | Unions; job satisfaction; EVS |
| JEL: | M54 J5 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:17020&r=lab |
| By: | Christoffel, Kai (European Central Bank); Costain, James (Banco de Espana); de Walque, Gregory (National Bank of Belgium); Kuester, Keith (Federal Reserve Bank of Philadelphia); Linzert, Tobias (European Central Bank); Millard, Stephen (Bank of England); Pierrard, Olivier (Banque Centrale du Luxembourg) |
| Abstract: | This paper reviews recent approaches to modelling the labour market, and assesses their implications for inflation dynamics through both their effect on marginal cost and on price-setting behaviour. In a search and matching environment, we consider the following modelling set-ups: right-to-manage bargaining versus efficient bargaining, wage stickiness in new and existing matches, interactions at the firm level between price and wage-setting, alternative forms of hiring frictions, search on-the-job and endogenous job separation. We find that most specifications imply too little real rigidity relative to the data and, so, too volatile inflation. Models with wage stickiness and right-to-manage bargaining, or with firm-specific labour emerge as the most promising candidates. |
| Keywords: | Inflation dynamics; labour market; business cycle; real rigidities |
| JEL: | E24 E31 E32 J64 |
| Date: | 2009–08–24 |
| URL: | http://d.repec.org/n?u=RePEc:boe:boeewp:0375&r=lab |
| By: | Sabrina Wulff Pabilonia (U.S. Bureau of Labor Statistics); Charlene Marie Kalenkoski (U.S. Bureau of Labor Statistics) |
| Abstract: | Recent research suggests that working while in high school reduces the amount of time students spend doing homework. However, an additional hour of work leads to a reduction in homework by much less than one hour, suggesting a reduction in other activities. This paper uses data from the 2003-2007 American Time Use Surveys (ATUS) to investigate the effects of market work on the time students spend on homework, sleeping, household work, and screen time. Results show that an increase in paid work reduces time spent in all of these activities by 84%, with the largest effect found for screen time. |
| Keywords: | teenagers, time allocation, homework, screen time, sleep |
| JEL: | J13 J22 J24 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:bls:wpaper:ec090010&r=lab |
| By: | Glenda Quintini; Thomas Manfredi |
| Abstract: | This paper derives school-to-work transition pathways in the United States and Europe between the late 1990s and the early 2000s. To do so, it uses Optimal Matching, a technique developed to sequence DNA. The key advantage of using this technique is that, rather than focusing on a specific point in time or a single destination, such as employment, inactivity or unemployment, they convey information on all activities undertaken by youth over the transition period, their sequence and their persistence. Strong similarities are found between the United States and Europe. However, pathways in the United States are characterised by significantly more dynamism than in Europe: youth in employment tend to change jobs more frequently while inactive or unemployed youth are more likely to experience several short spells rather than a single long one. School-to-work transition pathways in the United States also involve less time spent in unemployment than in Europe. The share of school-leavers involved in pathways dominated by employment is larger in the United States than in Europe and non-employment traps are less frequent in the United States. The most successful European countries in terms of school-to-work transitions are those where apprenticeships are widespread. On the other hand, European countries with a high incidence of temporary work among youth have a significantly smaller share of youth belonging to pathways dominated by employment and a larger share of youth in pathways characterised by frequent job changes separated by long unemployment spells. At the individual level, qualifications, gender, ethnicity and motherhood are found to influence the probability of disconnecting from the labour market and education for a prolonged period of time. Overall, the analysis shows the potential of Optimal Matching as a descriptive tool for the study of school-to-work transitions. It also tentatively explores how pathways obtained through Optimal Matching could be used for further analysis to draw policy-relevant conclusions. At present, data availability appears to be the main barrier to fully exploiting this novel technique.<BR>Cet article analyse les trajectoires de transition de l’école à l’emploi aux États-Unis et en Europe entre la fin des années 1990 et le début des années 2000. Pour ce faire, il utilise « l’Optimal Matching », une technique développée pour l’analyse des séquences d’ADN. Le principal atout de cette technique est qu’au lieu de se concentrer sur un moment spécifique ou sur une seule activité, telle que l’emploi, l’inactivité ou le chômage, elles véhiculent de l’information sur toute les activités entreprises par les jeunes pendant la période de transition, leur chronologie et leur persévérance. On constante de nombreuses similarités entre les États-Unis et l’Europe. Toutefois, les trajectoires aux États-Unis sont caractérisées par beaucoup plus de dynamisme qu’en Europe : les jeunes occupés ont tendance à changer d’emploi plus fréquemment et les épisodes de chômage sont plus souvent cours et répétés que de longue durée. Les trajectoires de transition de l’école à l’emploi aux États-Unis sont aussi caractérisées par moins de temps passé au chômage qu’en Europe. La proportion de jeunes quittant l’école qui entame des trajectoires dominées par l’emploi est plus importante aux États-Unis qu’en Europe et les pièges du non-emploi sont moins fréquents aux États-Unis. Les pays européens les plus performants en termes de transitions de l’école à l’emploi sont ceux où l’apprentissage est le plus répandu. D’autre part, les pays européens à forte incidence de l’emploi temporaire parmi les jeunes, présentent une part plus faible de jeunes dans les trajectoires dominées par l’emploi et une part plus importante de jeunes dans les trajectoires marquées par plusieurs changements d’emploi séparés par de longs épisodes de chômage. Au niveau individuel, le niveau de qualification, le sexe, l’origine ethnique et la maternité influencent la probabilité de se déconnecter du marché du travail et du système éducatif pour une période prolongée. Globalement, l’analyse montre le potentiel de l’Optimal Matching comme outil descriptif dans l’étude des transitions de l’école à l’emploi. Cet article tente également d’utiliser les trajectoires obtenues avec l’application de l’Optimal Matching pour en tirer des conclusions politiques. La disponibilité de données est actuellement la principale barrière à l’exploitation à part entière de cette nouvelle technique. |
| JEL: | J21 J22 J64 |
| Date: | 2009–08–20 |
| URL: | http://d.repec.org/n?u=RePEc:oec:elsaab:90-en&r=lab |
| By: | Judith Hellerstein; Melissa McInerney; David Neumark |
| Abstract: | We specify and implement a test for the importance of network effects in determining the establishments at which people work, using recently-constructed matched employer-employee data at the establishment level. We explicitly measure the importance of network effects for groups broken out by race, ethnicity, and various measures of skill, for networks generated by residential proximity. The evidence indicates that labor market networks play an important role in hiring, more so for minorities and the less-skilled, especially among Hispanics, and that labor market networks appear to be race-based. |
| Date: | 2009–01 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:09-01&r=lab |
| By: | Carlos Carrillo-Tudela (Department of Economics, University of Leicester and IZA); Guido Menzio (Department of Economics, University of Pennsylvania and NBER); Eric Smith (Department of Economics, University of Essex and FRB Atlanta) |
| Abstract: | This paper revisits the no-recall assumption in job search models with take-it-or-leave-it offers. Workers who can recall previously encountered potential employers, in order to engage them in Bertrand bidding, have a distinct advantage over workers without such attachments. Firms account for this difference when hiring a worker. When a worker first meets a firm, the firm offers the worker a sufficient share of the match rents to avoid a bidding war in the future. The pair share the gains to trade. In this case, the Diamond paradox no longer holds. |
| Keywords: | Job search, recall, wage determination, Diamond paradox |
| JEL: | J24 J42 J64 |
| Date: | 2009–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:pen:papers:09-027&r=lab |
| By: | Delia Furtado; Nikolaos Theodoropoulos |
| Abstract: | Social networks are commonly understood to play a large role in the labor market success of immigrants. Using 2000 U.S. Census data, this paper examines whether access to native networks, as measured by marriage to a native, increases the probability of immigrant employment. We start by confirming in both least squares and instrumental variables frameworks that marriage to a native indeed increases immigrant employment rates. Next, we show that the returns to marrying a native are not likely to arise solely from citizenship rights acquired through marriage or characteristics of native spouses. We then present several pieces of evidence suggesting that networks obtained through marriage play an important part in explaining the relationship between marriage decisions and employment. |
| Keywords: | Immigration, Marriage, Employment, Networks |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:ucy:cypeua:3-2009&r=lab |
| By: | Raquel Vegas (FEDEA); Isabel Argimón (Banco de España); Marta Botella (Banco de España); Clara I. González (FEDEA) |
| Abstract: | In this paper we analyse the role that Social Security wealth and incentives play in the transition to retirement in Spain. We use the labour records and other relevant information contained in a newly released database [Muestra Continua de Vidas Laborales (2006)] to construct incentive measures stemming from the Social Security provisions in relation to retiring at old age and investigate the role played by such incentives and by other socio-economic variables on the retirement hazard. We compute the effects of the reform that took place in 2002, which made the requirements to access a pension stricter in general. We carry out a dynamic reduced-form analysis of the retirement decision using a duration model. Our results show that both the pension wealth and substitution effects have a significant role on retirement decisions, but that the latter has less relevance since the reform introduced in 2002. |
| Keywords: | older workers employment, retirement, public pensions |
| JEL: | J14 J26 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:bde:wpaper:0913&r=lab |
| By: | Jay Stewart (U.S. Bureau of Labor Statistics) |
| Abstract: | I use data from the American Time Use Survey to examine how maternal employment affects when during the day that mothers of pre-school-age children spend doing enriching childcare and whether they adjust their schedules to spend time with their children at more desirable times of day. I find that employed mothers shift enriching childcare time from workdays to nonwork days. On workdays, full-time employed parents shift enriching childcare time toward evenings, but there is little shifting among part-time employed mothers. I find no evidence that full-time employed mothers adjust their schedules to spent time with their children at more-preferred times of day, whereas part-time employed mothers shift employment to later in the day. |
| Keywords: | Timing of activities, Time use, Childcare |
| JEL: | J22 J13 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:bls:wpaper:ec090030&r=lab |
| By: | Jennifer Feenstra Schultz; David Doorn |
| Abstract: | The link between rising employer costs for health insurance benefits and demand for part-time workers is investigated using non-public data from the Medical Expenditure Panel Survey- Insurance Component (MEPS-IC). The MEPS-IC is a nationally representative, annual establishment survey from the Agency for Healthcare Research and Quality (AHRQ). Pooling the establishment level data from the MEPS-IC from 1996-2004 and matching with the Longitudinal Business Database and supplemental economic data from the Bureau of Labor Statistics, a reduced form model of the percent of total FTE employees working part-time is estimated. This is modeled as a function of the employer health insurance contribution, establishment characteristics, and state-level economic indicators. To account for potential endogeneity, health insurance expenditures are estimated using instrumental variables (IVs). The unit of analysis is establishments that offer health insurance to full-time employees but not part time employees. Conditional on establishments offering health insurance to full-time employees, a 1 percent increase in employer health insurance contributions results in a 3.7 percent increase in part-time employees working at establishments in the U.S. |
| Keywords: | employer health insurance costs; labor demand; part-time employment |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:09-08&r=lab |
| By: | Goeggel, Kathrin; Zwick, Thomas |
| Abstract: | Small average wage effects of employer and/or occupation changes mask large differences between occupation groups and apprentices with different schooling back-grounds. Apprentices in commerce and trading occupations strongly profit from an employer change. Employer and occupation changers in industrial occupations face large wage disadvantages however. We are the first to analyse these differences. Quality differences of apprenticeship quality between training firms that have been mainly discussed so far are small, however. This paper also explains differences between previous findings by comparing their estimation strategies. It demonstrates that selectivity into occupations and changers, unobserved heterogeneity between occupations, and the sample selection matter and proposes several improvements in the estimation technique to measure apprenticeship quality. |
| Keywords: | Wage mark-up,apprenticeship training,occupations |
| JEL: | J24 J31 M53 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:09024&r=lab |
| By: | Robalino, David A.; Zylberstajn, Helio |
| Abstract: | This paper solves and estimates a stochastic model of optimal inter-temporal behavior to assess how changes in the design of the unemployment benefits and pension systems in Brazil could affect savings rates, the share of time that individuals spend outside of the formal sector, and retirement decisions. Dynamics depend on five main parameters: preferences regarding consumption and leisure, preferences regarding formal Vs. informal work, attitudes towards risks, the rate of time preference, and the distribution of an exogenous shock that affects movements in and out of the social security system (given individual decisions). The yearly household survey is used to create a pseudo panel by age-cohorts and estimate the joint distribution of model parameters based on a generalized version of the Gibbs sampler. The model does a good job in replicating the distribution of the members of a given cohort across states (in or out of the social security / active or retired). Because the parameters are related to individual preferences or exogenous shocks, the joint distribution is unlikely to change when the social insurance system changes. Thus, the model is used to explore how alternative policy interventions could affect behaviors and through this channel benefit levels and fiscal costs. The results from various simulations provide three main insights: (i) the Brazilian SI system today might generate distortions (lower savings rates and less formal employment) that increase the costs of the system and might generate regressive redistribution; (ii) there are important interactions between the unemployment benefits and pension systems, which calls for joint policy analysis when considering reforms; and (iii) current distortions could be reduced by creating an actuarial link between contributions and benefits and then combining matching contributions and anti-poverty targeted transfers to cover individuals with limited or no savings capacity. |
| Keywords: | ,Labor Markets,Labor Policies,Pensions&Retirement Systems,Emerging Markets |
| Date: | 2009–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5027&r=lab |
| By: | Jason Gagnon; Theodora Xenogiani; Chunbing Xing |
| 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.<BR>L’augmentation rapide et massive des mouvements ruraux-à-urbains d’ouvriers vers la côte de la Chine a appelé à l’attention récente le bien-être des migrants travaillant dans des régions urbaines, en particulier vis-à-vis de leurs conditions de travail et de salaire ; la préoccupation a d’autant plus augmenté concernant la discrimination de salaire contre les migrants ruraux. Ce document emploie des données d’un tirage aléatoire du recensement national chinois de 2005 pour éclaircir la question de la discrimination en faisant des comparaisons de revenus et de secteur de travail entre les migrants ruraux d’une part, et les résidents et migrants urbains de l’autre. Contrairement à la croyance populaire, nous ne trouvons aucune discrimination de revenus entre migrants ruraux et résidents urbains. Cependant, les migrants ruraux s’avèrent être distingués en termes de secteur dans lequel ils travaillent, une grande majorité d’entre eux travaillant dans le secteur informel, caractérisé par un manque d’accès à une protection sociale adéquate. |
| Keywords: | migration, China, Chine, informal employment, migration, emploi informel, discrimination, discrimination |
| JEL: | J24 J71 O15 R23 |
| Date: | 2009–06–30 |
| URL: | http://d.repec.org/n?u=RePEc:oec:devaaa:278-en&r=lab |
| By: | Steven E. Haugen (U.S. Bureau of Labor Statistics) |
| Abstract: | The Current Population Survey (CPS) has been the source of official labor force statistics for the U.S. since its inception in March 1940. The best-known statistic calculated from CPS data is the unemployment rate. To be classified as unemployed, a person must have had no employment during the survey reference week, been available for work, and made specific efforts to find employment during the 4-week period ending with the reference week. The unemployment rate represents the number unemployed as a percent of the labor force. The unemployment rate has proven to be a reliable indicator of overall labor market conditions and has performed quite well as a business cycle indicator. That does not mean, however, that everyone has been completely satisfied with the official figures. As a result, in the 1970s, a range of unemployment indicators known as U-1 through U-7 was introduced. In 1994, a redesigned CPS was fielded, and some of the survey changes affected series used as inputs in several of the U-1—U-7 measures. Consequently, BLS introduced a new set of “U’s” in 1995. The new U-1—U-6 range of alternative measures of labor underutilization offered an updated set of indicators that took advantage of newly collected information in the redesigned survey. This paper summarizes the rationale for the original and current ranges of alternative indicators. The paper also concludes that while the five alternatives to the official unemployment rate in the current U-1—U-6 range may represent varying views of labor resource underutilization, they show very similar patterns of change across the course of the business cycle. |
| Keywords: | Employment, unemployment, unemployment rate, underemployment |
| JEL: | E24 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:bls:wpaper:ec090020&r=lab |
| By: | Peter A. Groothuis; James Richard Hill |
| Abstract: | Cross sectional employment data is not random. Individuals who survive to a longer level of tenure tend to have a higher level of productivity than those who exit earlier. This result suggests that in cross sectional data high productivity workers are over-sampled at high levels of tenure. In wage equations using cross sectional data, results could be biased from the over sampling of high productive workers at long levels of tenure. This survival effect in cross sectional data could possibly bias the coefficient on tenure upwards. We explore techniques to correct for survival bias using a panel study of National Basketball Association players. In particular we focus on a modified Heckman selectivity bias procedure using duration models to correct for survival bias. Key Words: |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:apl:wpaper:09-19&r=lab |
| By: | Jonathan Wadsworth |
| Abstract: | One potential channel through which the effects of the minimum wage could be directed isthat firms who employ minimum wage workers could have passed on any higher labour costsresulting from the minimum wage in the form of higher prices. This study looks at the effectsof the minimum wage on the prices of UK goods and services by comparing prices of goodsproduced by industries in which UK minimum wage workers make up a substantial share oftotal costs with prices of goods and services that make less use of minimum wage labour.Using sectoral-level price data matched to LFS survey data on the share of minimum wageworkers in each sector, it is hard to find much evidence of significant price changes in themonths that correspond immediately to the uprating of the NMW. However over the longerterm, prices in several minimum wage sectors - notably take-away foods, canteen meals,hotel services and domestic services - do appear to have risen significantly faster than pricesof non-minimum wage sectors. These effects were particularly significant in the four yearsimmediately after the introduction of the minimum wage. |
| Keywords: | Minimum wage, prices |
| JEL: | J6 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp0947&r=lab |
| By: | Coneus, Katja; Sprietsma, Maresa |
| Abstract: | It is a well-known fact that the level of parents' education is strongly correlated with the educational achievement of their children. In this paper,we shed light on the potential channels through which human capital is transmitted from mothers to their children in early childhood. The main channels through which maternal human capital benefits the child's verbal and social skills are birth weight and father's support. Moreover,reading stories to the child is most relevant for the transmision of verbal skills whereas for social skills, a crucial channel for maternal human capital is the attendance of institutional childcare. |
| Keywords: | early childhood,skills,intergenerational transmission |
| JEL: | I20 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:09038&r=lab |
| By: | Till von Wachter; Elizabeth Handwerker; Andrew Hildreth |
| Abstract: | Estimates of the cost of job displacement from survey and administrative data differ markedly. This paper uses a unique match of data between the Displaced Worker Survey (DWS) and administrative wage records from California to examine the sources of this discrepancy. When we use similar estimation methods and account for measurement error in survey wages correlated with worker demographics, estimates of earnings losses at displacement are similar from both datasets and significantly larger than those based on the DWS alone. Also correcting for measurement errors in reported displacements suggests both sources of such estimates may yield lower bounds for the true cost of displacement. |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:09-14&r=lab |
| By: | Xing, Chunbing |
| Abstract: | As massive rural residents leave their home countryside for better employment, migration has profound effects on income distributions such as rural-urban income gap and inequalities within rural or urban areas. The nature of the effects depend crucially on who are migrating and their migrating patterns. In this paper, we emphasize two facts. First, rural residents are not homogeneous, they self-select to migrate or not. Second, there are significant differences between migrants who successfully transformed their hukou status (permanent migrants) and those did not (temporary migrants). Using three coordinated CHIP data sets in 2002, we find that permanent migrants are positively selected from rural population especially in terms of education. As permanent migration takes more mass from the upper half of rural income density, both rural income level and inequalities decrease, the urban-rural income ratio increases at the same time. On the contrary, the selection effect of temporary migrants is almost negligible. It does not have obvious effect on rural income level and inequalities. |
| Keywords: | migration; self-selection; China |
| JEL: | O15 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:17036&r=lab |
| By: | Marcelo Soto |
| Abstract: | Empirical studies assume that the macro Mincer return on schooling is con- stant across countries. Using a large sample of countries this paper shows that countries with a better quality of education have on average relatively higher macro Mincer coeficients. As rich countries have on average better educational quality, differences in human capital between countries are larger than has been typically assumed in the development accounting literature. Consequently, factor accumulation explains a considerably larger share of income differences across countries than what is usually found. |
| Keywords: | Human capital; income growth; GMM estimation; development accounting. |
| JEL: | O11 O47 C33 |
| Date: | 2009–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:aub:autbar:779.09&r=lab |
| By: | Aldashev, Alisher |
| Abstract: | The paper analyzes effects of occupational and regional mobility on the matching rate using the monthly panel disaggregated on regional and occupational level. The main contribution of the paper is measuring the effect of substitutability between vacancies for different occupations and vacancies in different regions on matchings. The estimates indicate higher regional mobility in West Germany but higher occupational mobility in East Germany. The results show that if occupations were perfect substitutes, the number of matches could increase by 5-9%. Perfect regional mobility could increase matchings by 5-15%. It is also shown that partial aggregation causes a downward bias in substitutability estimates. |
| Keywords: | Matching function,constant elasticity of substitution,spatial correlation,occupational and regional mobility,nonlinear least squares,GMM |
| JEL: | J62 J63 R23 J61 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:09014&r=lab |
| By: | David Marsden |
| Abstract: | This paper considers one of the paradoxes of incentive pay used in Britain's public services,namely that despite much evidence that it does not motivate employees, it continues to bewidely used. It is argued that behind this evidence, there are significant examples in which itsuse has been associated with improved performance. A good part of this is to be explained bythe way performance pay links pay and appraisal, and the pressure this puts on line managersto set clearer goals for their staff. There is also some evidence that the goal setting is theoutcome of a form of integrative, or positive sum, negotiation between individual employeesand their managers, and that it is not just 'top down'. |
| Keywords: | pay for performance, public sector pay |
| JEL: | J33 M52 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp0946&r=lab |
| By: | Alessandro Innocenti; Antonio Nicita |
| Abstract: | In this paper we compare - in the laboratory - stoppage and virtual strike. Our experiment confirms that higher wages offered by an employer lead to considerably more costly effort provision. The number of strikes, the level of efforts and average total payoffs are higher under virtual strike than under standard strike. However, when standard strike is associated with reciprocal externalities, it induces higher effort levels, higher payoffs and an extremely reduced number of strikes than virtual strike. It is unclear whether this behavior re?ects reciprocity or other forms of social preferences. However our results might explain why standard strikes rather than virtual ones are generally adopted by workers. |
| Keywords: | virtual strike, cooperation, reciprocity, fairness, experiments |
| JEL: | C91 D74 D78 J52 K31 M55 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:usi:labsit:026&r=lab |
| By: | Fabrizio Castellucci (Bocconi University); Mario Padula (Department of Economics, University Of Venice Cà Foscari); Giovanni Pica (Department of Economics, University of Salerno) |
| Abstract: | Estimating the effect of aging on productivity is a daunting task. First, it requires clean measures of productivity. Second, unobserved heterogeneity at workers, firms and workers/firms level challenges the identification of the age-productivity gradient in cross-sectional data. Finally, the study of the age-productivity link requires to partial out the role of experience and to account for the selection bias that arises if less able people drop out faster than more able ones. We tackle these issues by focussing on a panel of Gran Prix Formula One drivers and show that the age-productivity link has an inverted U-shape profile, with a peak at around the age of 30-32. |
| Keywords: | Aging, individual effects, firm effects, match effects, Formula One |
| JEL: | J24 C23 L83 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:ven:wpaper:2009_16&r=lab |
| By: | Christopher P. Reicher |
| Abstract: | This paper estimates a series of shocks to hit the US economy during the Great Depression, using a New Keynesian model with unemployment and bargaining frictions. Shocks to long-run inflation expectations appear to account for much of the cyclical behavior of employment, while an increase in labor’s bargaining power also played an important role in deepening and lengthening the Depression. Government spending played very little role during the Hoover Administration and New Deal, until the rise in military spending effectively brought an end to the Depression in 1941. With the economy at or near the zero interest rate bound, interest rates and monetary aggregates provided a misleading indicator as to the true stance of inflation expectations; in fact, conditions were deflationary all throughout the 1930s in spite of high money growth and low interest rates. The experience of the 1930s offers lessons to modern policymakers who find themselves in a similar situation |
| Keywords: | Great Depression, expectations, deflation, zero bound, liquidity trap |
| JEL: | E24 E31 E52 E65 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:kie:kieliw:1543&r=lab |
| By: | Pamina Koenig |
| Abstract: | This paper analyzes the effect of immigrants' networks on the decision of individual firms to starting exporting to the immigrants' home country. Existing evidence on the trade-creating effect of immigrants show a robust effect, however at the national or regional level. Using French exports at the firm-level to 61 countries, I find that increasing the number of foreign immigrants in the region by 10 % increases the probability that a firm starts exporting to the immigrants' home country by 1.2%. More, the effect of immigrants is enhanced when immigrants are older or more educated. The effect of immigrants also varies among origin countries. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:pse:psecon:2009-31&r=lab |
| By: | Wiji Arulampalam (University of Warwick and Oxford University Centre for Business Taxation); Michael P Devereux (Oxford University Centre for Business Taxation); Giorgia Maffini (University of Warwick and Oxford University Centre for Business Taxation) |
| Abstract: | We examine how far taxes on corporate income are directly shifted onto the workforce. We use data on 55,082 companies located in nine European countries over the period 1996–2003. We identify this direct shifting through cross-company variation in tax liabilities, conditional on value added per employee. Our central estimate is that the long run elasticity of the wage bill with respect to taxation is -0.093. Evaluated at the median, this implies that an exogenous rise of $1 in tax would reduce the wage bill by 75 cents. We find only weak evidence of a difference for multinational companies. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:btx:wpaper:0917&r=lab |
| By: | Czarnitzki , Dirk; Toole, Andrew A. |
| Abstract: | Is there a trade-off of scholarly research productivity when faculty members found or join for-profit firms? This paper offers an empirical examination of this question for a subpopulation of biomedical academic scientists who received research funding from the U.S. National Institutes of Health (NIH). In this study, we are able to distinguish between permanent versus temporary employment transitions by entrepreneurial faculty members and examine how their journal article publication rates change using individual-level panel data. We find that the biomedical scientists who eventually choose to found or join a for-profit firm were more productive during their careers in academe than a randomly selected control group of their NIH peers. When they pursue entrepreneurship in the private sector, however, their scholarly productivity falls. Those entrepreneurial faculty members who return to academe are not as productive as they were before their entrepreneurial experience in terms of journal publications. |
| Keywords: | academic entrepreneurship,SBIR,NIH,biomedical research,life scientist productivity |
| JEL: | O38 O31 L53 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:09022&r=lab |