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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 differentials than females, the trade-off is more pronounced for men and a profit-maximizing 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; social roles; social stereotypes; social multiplier; statistical discrimination; taste discrimination |
| JEL: | J31 J7 B54 D13 D42 |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:lmu:muenec:10990&r=lab |
| By: | Galenianos, Manolis; Kircher, Philipp; Virag, Gabor |
| Abstract: | We build a theoretical model to study the welfare effects and resulting policy implications of firms’ market power in a frictional labor market. Our environment has two main characteristics: wages play a role in allocating labor across firms and there is a finite number of agents. We find that the decentralized equilibrium is inefficient and that the firms’ market power results in the misallocation of workers from the high to the low-productivity firms. A minimum wage forces the low-productivity firms to increase their wage, leading them to hire even more often thereby exacerbating the inefficiencies. Moderate unemployment benefits can increase welfare because they limit firms’ market power by improving the workers’ outside option. |
| Keywords: | directed search; heterogeneity; inefficient allocation; market power |
| JEL: | J08 D43 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:17093&r=lab |
| By: | van den Berg, Gerard J. (IFAU - Institute for Labour Market Policy Evaluation); Vikström, Johan (IFAU - Institute for Labour Market Policy Evaluation) |
| Abstract: | Unemployment insurance systems include monitoring of unemployed workers and punitive sanctions if job search requirements are violated. We analyze the effect of sanctions on the ensuing job quality, notably on wage rates and hours worked, and we examine how often a sanction leads to a lower occupational level. The data cover the Swedish population over 1999–2004. We estimate duration models dealing with selection on unobservables. We use weighted exogenous sampling maximum likelihood to deal with the fact that the data register is large whereas observed punishments are rare. We also develop a theoretical job search model with monitoring of job offer rejection versus monitoring of job search effort. The observation window includes a discontinuous policy change in which the punishment severity was reduced. We find that the hourly wage and the number of hours are lower after a sanction, and that individuals move more often to a lower occupational level, incurring human capital losses. Monitoring offer rejections is less effective than monitoring search effort. |
| Keywords: | Unemployment; duration; sanction; wage; hours worked; weighted exogenous sampling maximum likelihood; case worker; job offer; offer rejection; search effort |
| JEL: | C21 C41 J31 J44 J62 J64 J65 |
| Date: | 2009–08–19 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2009_018&r=lab |
| By: | Francesc Ortega (Universitat Pompeu Fabra); Libertad González (Universitat Pompeu Fabra); Lídia Farré Olalla (Universidad de Alicante) |
| Abstract: | This paper investigates the effects of Spain's large recentimmigration wave on the labor supply of highly skilled native women. Wehypothesize that female immigration led to an increase in the supply ofaffordable household services, such as housekeeping and child or elderlycare. As a result, i) native females with high earnings potential were ableto increase their labor supply, and ii) the effects were larger on skilledwomen whose labor supply was heavily constrained by familyresponsibilities. Our evidence indicates that over the last decadeimmigration led to an important expansion in the size of the householdservices sector and to an increase in the labor supply of women in highearningoccupations (of about 2 hours per week). We also find thatimmigration allowed skilled native women to return to work sooner afterchildbirth, to stay in the workforce longer when having elderlydependents in the household, and to postpone retirement.Methodologically, we show that the availability of even limited Registrydata makes it feasible to conduct the analysis using quarterly householdsurvey data, as opposed to having to rely on the decennial Census. |
| Keywords: | Immigration, labor supply, fertility, retirement, household services |
| JEL: | J61 J22 J13 |
| Date: | 2009–01 |
| URL: | http://d.repec.org/n?u=RePEc:ivi:wpasad:2009-19&r=lab |
| By: | KAWAGUCHI Daiji; MORI Yuko |
| Abstract: | This paper considers whether minimum wage is a well-targeted anti-poverty policy by examining the backgrounds of minimum-wage workers, and whether raising the minimum wage reduces employment for unskilled workers. An examination of micro data from a large-scale government household survey, the Employment Structure Survey (Shugyo Kozo Kihon Chosa), reveals that about half of minimum-wage workers belong to households with annual incomes of more than 5 million yen as a non-head of household. A regression analysis indicates that an increase in the minimum wage moderately reduces the employment of male teenagers and middle-aged, married females, while it encourages the employment of high school age youth. |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:09032&r=lab |
| By: | Christian M. Dahl (School of Economics and Management, University of Aarhus); Daniel le Maire (Department of Economics, University of Copenhagen); Jakob R. Munch (Department of Economics, University of Copenhagen) |
| Abstract: | This paper studies how decentralization of wage bargaining from sector to firm level influences wage levels and wage dispersion. We use a detailed panel data set covering a period of decentralization in the Danish labor market. The decentralization process provides exogenous variation in the individual worker's wage-setting system that facilitates identification of the effects of decentralization. Consistent with predictions we find that wages are more dispersed under firm-level bargaining compared to more centralized wage-setting systems. However, the differences across wage-setting systems are reduced substantially when controlling for unobserved individual level heterogeneity. |
| Keywords: | Wage bargaining; decentralization; panel data quantile regression |
| JEL: | J31 J51 C23 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:kud:kuiedp:0915&r=lab |
| By: | Peter Berkhout (EIB Amsterdam); Joop Hartog (University of Amsterdam); Hans van Ophem (University of Amsterdam) |
| Abstract: | Firms hiring fresh graduates face uncertainty on the future productivity of workers. Theory suggests that starting wages reflect this, with lower pay for greater uncertainty. We use the dispersion of exam grades within a field of education as an indicator of the unobserved heterogeneity that employers face. We find solid evidence that starting wages are lower if the variance of exam grades is higher and higher if the skew is higher: employers shift the cost of productivity risk to new hires, but pay for the opportunity to catch a really good worker. Estimating the extent of risk cost sharing between firm and worker shows that shifting to workers is larger in the market sector than in the public sector and diminishes with experience. |
| Keywords: | wages; risk compensation; ability; incomplete information |
| JEL: | J31 |
| Date: | 2009–08–06 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:uvatin:20090071&r=lab |
| By: | Hernando Matallana |
| Abstract: | Keynes contents in General Theory that the monetary market logic of the aggregate real wage in the monetary production economy conveys: (i) the determination of the average real wage rate, the level of employment, and the possibility of involuntary unemployment through the interaction of the monetary markets and the goods markets; and (ii) the determination of the money wage rate through the bargains of the firms and the workers as a market-theoretical stability condition of the economic system. Accordingly, (iii) the money wage claims of labour (in conformity with changes of the average labour productivity) do not alter the distribution of income between capital and labour; and (iv) the struggle about the money wages by different groups of workers is actually a zerosum game over the distribution of the aggregate real wage between the different fractions of the working class. The paper discusses Keynes’s contention in the context of the monetary-keynesian theory of the endogenous-money monetary production economy. |
| Date: | 2009–01–08 |
| URL: | http://d.repec.org/n?u=RePEc:col:000089:005271&r=lab |
| By: | Van kerm P (CEPS/INSTEAD) |
| Abstract: | This paper considers new 'distributionally sensitive' summary measures of wage differentials, not solely determined by "the average wage of the average person" but by differences across complete wage distributions. Considerations of risk or inequality aversion in the assessment of wage differentials are explicitly included, transplanting expected utility concepts familiar to income distribution analysts. In an application to the gender pay gap in Luxembourg the disadvantage of women persists with the new generalized measures of wage differentials. This suggests that lower average wages for women are not compensated by less dispersed distributions. The paper also illustrates original estimation of wage distributions in the presence of covariates and under endogenous labour market participation. |
| Date: | 2009–09–02 |
| URL: | http://d.repec.org/n?u=RePEc:ese:iserwp:2009-26&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:dpaper:001&r=lab |
| By: | Clara I. Gonzalez; José Ignacio Conde Ruiz; Michele Boldrin |
| Abstract: | The objective of this paper is to understand the impact of immigration on the Spanish pension system during the next fifty years by building aquantitative-theoretical framework. In order to carry out the exercise of projection of revenues and expenditures in the Spanish pension system, we have developed an Overlapping Generation Model where individuals differ by age, gender, skill and nationality. The Cohort Component Population Projection Method is used for the demographic projections, and for the labor market scenario we have simulated the full labor history of all of our different workers for the period-taking into account the future evolution of the educational levels and five possible situations during their labor history (employed, self-employed, unemployed, disable and inactive). In a first baseline scenario the system will be in deficit around year according to the last official estimations. The arrival of a large number of foreign workers is offering the Social Security System roughly five years of additional time to correct its important underlying unbalances. However after this period, the structural problems will come back and may be even magnified by the presence of an additional number of retired immigrants. Even if immigration reaches its total assimilation in the labor market it will not be sufficient to avoid that the pension system will be in deficit. However, immigration is allowing us to obtain very valuable additional time in order to carry out the necessary reforms. |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:fda:fdaddt:2009-26&r=lab |
| By: | Regula Geel (Institute for Strategy and Business Economics, University of Zurich); Uschi Backes-Gellner (Institute for Strategy and Business Economics, University of Zurich) |
| Abstract: | Mobility and flexibility is increasingly demanded as structural change challenges estab-lished educational systems and traditional occupational demarcations. We use Lazear’s skill-weights approach (2003) first to operationalize the degree of specificity of skill com-binations in an innovative manner and second to derive hypotheses about the effects of occupation-specific skill combinations. In our empirical section, we find that the more specific an occupation, the smaller is the probability of an occupational change, as ex-pected. Furthermore, we are able to identify different clusters of occupations that are char-acterized by similar skill combinations within a given cluster and different skill combina-tions between clusters. We find that employees in very specific occupations have a com-paratively higher probability of changing their occupation within than between skill clus-ters. Moreover, occupational mobility within a skill cluster is accompanied by wage gains, while mobility between skill clusters results in wage losses. Not surprisingly, the more specific the former occupation is, either the higher is the resulting wage loss or the smaller is the resulting wage gain depending on whether the move is between or within skill clus-ters, respectively. Therefore, the acquired skill combination rather than the occupation per se crucially determines the mobility of an employee. |
| Keywords: | Skill-weights approach, mobility, skill clusters, apprenticeship training |
| JEL: | J62 M53 |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:iso:educat:0047&r=lab |
| By: | Kai Christoffel; James Costain; Gregory de Walque; Keith Kuester; Tobias Linzert; Stephen Millard; Olivier Pierrard |
| Abstract: | This paper reviews recent approaches to modeling the labour market and assesses their implications for inflation dynamics through both their effect on marginal cost and on price-setting behavior. In a search and matching environment, we consider the following modeling setups: right-to-manage bargaining vs. 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 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. |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:bcl:bclwop:cahier_etudes_38&r=lab |
| By: | John T. Addison (University of South Carolina (U.S.A.), GEMF (Portugal), and IZA); Ralph W. Bailey (University of Birmingham (U.K.)); W. Stanley Siebert (University of Birmingham (U.K.) and IZA) |
| Abstract: | Wage Dispersion in a Partially Unionized Labor Force This paper critiques Card’s (2001) method for analyzing wage dispersion in a partially unionized labor market based on a disaggregation of the population into skill categories. We argue that disaggregation is a good idea, the use of skill categories less so. We offer a modified model in which each worker is assigned a union-membership probability, a predicted union wage, and a predicted nonunion wage. Our model provides a natural three-way decomposition of variance, and is also suited to counterfactual analysis. By way of an application, we examine the effect of de-unionization on wage dispersion in the United Kingdom between 1983 and 1995, reporting that the decline in membership accounts for only about one-fifth of the observed increase in wage dispersion. |
| Keywords: | wage dispersion, three-way variance decomposition, bivariate kernel density smoothing, union membership, deunionization. |
| JEL: | D3 J31 J51 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:gmf:wpaper:2009-09&r=lab |
| By: | Colombino, Ugo (Department of Economics Cognetti De Martiis,); Hernæs, Erik (The Ragnar Frisch Centre for Economic Research,); Locatelli, Marilena (Department of Economics Cognetti De Martiis); Strøm, Steinar (Dept. of Economics, University of Oslo) |
| Abstract: | In order to estimate labour supply responses among older people we have employed a very simple model of retirement decisions that can be estimated on a single cross-section sample, and still be given a structural interpretation in terms of inter-temporal decisions. The model is estimated on Norwegian register data from 1996, which covers all Norwegians aged 55-68 in 1996. The empirical model is employed to assess the impact on retirement of moving the Norwegian pension system towards actuarial fairness. Future annual pension benefits are increased if retirement is postponed say, for one year. In one of the simulations future annual benefits are increased by NOK 8,000 (as of April 2009 1 Euro~ NOK 8.7), which is around 5 per cent of the average pension benefit in 1996 and corresponds approximately to the adjustment in the new pension system which comes into effect 1. January 2011. The number of men and women choosing retirement is reduced by around 5 per cent, given that there is no consumption smoothing. When perfect consumption smoothing is assumed the reduction is much larger; 18 per cent in the case of men and 14 per cent in the case of women. These reductions are really sizeable and indicate that pension reforms, combined with removing constraints in the credit market, may be of great importance in giving the individuals incentive to prolong their working life. |
| Keywords: | Retirement; inter-temporal interpretation; estimates and policy simulations; Norway |
| JEL: | D10 H55 J26 |
| Date: | 2009–04–19 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:osloec:2009_009&r=lab |
| By: | Sergi Jiménez Martín; Judit Vall Castello |
| Abstract: | This paper analyses the determinants of observed exits from employment for people aged 45-59 years old in the context of the Spanish labour market in 1981-2006. The main aim of the paper is to identify the effect of the business cycle (BC) on the timing and the type of exit route out of the labour force. We proceed in two stages. In the first stage, we study the determinants of exits from employment to non-employment. In the second, we take into account the fact that there are several competing exit routes (unemployment, disability or inactivity) and estimate a competing risk model to evaluate how important BC conditions are in determining the respective exit probabilities. We make use of the recently released Muestra Continua de Vidas Laborales to estimate discrete time hazard regression models. We match this information with a number of variables constructed with macroeconomic data derived from the Instituto Nacional de Estadistica to measure growth and employability performance of different economic sectors and regions in Spain in order to capture the variation in the business cycle between times, sectors and regions. Time-varying covariates are also included in the analysis to model the monetary incentives provided by the system. We find that both BC conditions and a number of special schemes included in the unemployment and disability legislation affect the exit timing and also the choice of the route out of the labour market. |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:fda:fdaddt:2009-25&r=lab |
| By: | Atanas Hristov |
| Abstract: | We outline the case for credit frictions and a demand side aspect to labor market fluctuations. To illustrate the above proposition, we present a simple framework to analyze the joint dependence between a labor search problem in the labor market and a costly state verification problem in the credit market in the presence of price rigidities. Credit market imperfections amplify volatility of labor market variables to both supply and demand shocks, but to a much higher extent to demand shocks under rigid prices. The reason is that demand disturbances provide for a strong incentive to demand-constrained firms to adjust production and thereby labor factor. |
| Keywords: | Credit and search frictions, unemployment, monetary policy |
| JEL: | J64 G24 E51 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwfin:diwfin07030&r=lab |
| By: | Richard G. Frank; Ellen Meara |
| Abstract: | Recent models of human capital formation represent a synthesis of the human capital approach and a life cycle view of human development that is grounded in neuroscience (Heckman 2007). This model of human development, the stability of the home and parental mental health can have notable impacts on skill development in children that may affect the stock of human capital in adults (Knudsen, Heckman et al. 2006; Heckman 2007). We study effects of maternal depression and substance abuse on children born to mothers in the initial cohort of the 1979 National Longitudinal Survey of Youth (NLSY), a national household survey of high school students aged 14-22 in 1979. We follow 1587 children aged 1-5 in 1987, observing them throughout childhood and into high school. We employ a variety of methods to identify the effect of maternal depression and substance abuse on child behavioral, cognitive, and educational related outcomes. We find no evidence that maternal symptoms of depression affect contemporaneous cognitive scores in children. However, maternal depression symptoms have a moderately large effect on child behavioral problems. These findings suggest that the social benefits of effective behavioral health interventions may be understated. Based on evidence linking early life outcomes to later well-being, efforts to prevent and/or treat mental and addictive disorders in mothers and other women of childbearing age have the potential to improve outcomes of their children not only early in life, but throughout the life cycle. |
| JEL: | I1 |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15314&r=lab |
| By: | Hermann Gartner; Christian Merkl; Thomas Rothe |
| Abstract: | This paper shows that the German labor market is more volatile than the US labor market. Specifically, the volatility of the cyclical component of several labor market variables (e.g., the job-finding rate, labor market tightness, and job vacancies) divided by the volatility of labor productivity is roughly twice as large as in the United States. We derive and simulate a simple dynamic labor market model with heterogeneous worker productivity. This model is able to explain the higher German labor market volatilities by a longer expected job duration |
| Keywords: | multinational enterprises, firm heterogeneity, industry characteristics, sector-specific FDI, vertical and horizontal FDI |
| JEL: | J6 E24 E32 |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:kie:kieliw:1545&r=lab |
| By: | Jonathan Heathcote; Kjetil Storesletten; Giovanni L. Violante |
| Abstract: | This paper studies consumption and labor supply in a model where agents have partial insurance and face risk and initial heterogeneity in wages and preferences. Equilibrium allocations and variances and covariances of wages, hours and consumption are solved for analytically. We prove that all parameters of the structural model are identified given panel data on wages and hours, and cross-sectional data on consumption. The model is estimated on US data. Second moments involving hours and consumption show that the rise in wage dispersion in the 1970s was effectively insured by households, while the rise in the 1980s was not. |
| Keywords: | Wages ; Consumption (Economics) |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedmsr:432&r=lab |
| By: | Eytan Sheshinski |
| Abstract: | It has been argued that increased life expectancy raises the rate of return on education, causing a rise in the investment in education followed by an increase in lifetime labor supply. Empirical evidence of these relations is rather weak. Building on a lifecycle model with uncertain longevity, this paper shows that increased life expectancy does not suffice to warrant the above hypotheses. We provide assumptions about the change in survival probabilities, specifically about the age dependence of hazard rates, which determine individuals' behavioral response w.r.t. education, work and age of retirement. Comparison is made between the case when individuals have access to a competitive annuity market and the case of no insurance. |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:huj:dispap:dp520&r=lab |
| By: | Jeffrey Lin |
| Abstract: | Where does adaptation to innovation take place? The author presents evidence on the role of agglomeration economies in the application of new knowledge to production. All else equal, workers are more likely to be observed in new work in locations that are initially dense in both college graduates and industry variety. This pattern is consistent with economies of density from the geographic concentration of factors and markets related to technological adaptation. A main contribution is to use a new measure, based on revisions to occupation classifications, to closely characterize cross-sectional differences across U.S. cities in adaptation to technological change. Worker-level results also provide new evidence on the skill bias of recent innovations. |
| Keywords: | Cities and towns ; Urban economics ; Labor market ; Job creation ; Technological innovations |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedpwp:09-17&r=lab |
| By: | Carlos Medina; Cristhian Manuel Posso |
| Abstract: | This document provides evidence to show that Colombia is a net exporter of 5% of its population with a university or post-graduate degree, while Argentina, Brazil and Chile are net importers of people with a similar level of education. We find that those Colombians who returned home to Colombia from the United States between the years 1990 and 2005 were, on average, less well educated than those who decided to stay in the States, a fact which has contributed to emphasising the positive selection made by Colombians when choosing the US as their destination, and as a result has increased the net flight of human capital (the so-called “brain drain”). The same exercise carried out on the South American countries as a whole leads to an analogous result. Although data does not allow us to include the quality of jobs immigrants are performing in the US as a determinant of the decision to return, it allow us to show that immigrants to the US from Argentina, Bolivia, Chile, Uruguay and Venezuela are generally employed in activities that require better qualifications than those in which Colombian migrants are working, although the Colombians are usually engaged in work which requires better qualifications than the jobs where migrants from Ecuador and Peru are employed. In the case of Colombians, and for the rest of South Americans taken as a whole, their level of education is closely linked to the level of qualification required for the work they do in the United States. |
| Date: | 2009–08–31 |
| URL: | http://d.repec.org/n?u=RePEc:col:000094:005758&r=lab |
| By: | Iñigo Iturbe-Ormaetxe Kortajarene (Universidad de Alicante); Marisa Hidalgo (Universidad de Alicante) |
| Abstract: | This paper analyzes public intervention in education, taking into account the existence of two educational levels: basic education and college education. The government decides per capita expenditure at each level and the subsidy for college education. We explore the effects of transferring resources from one level to the other on equity and efficiency, where efficiency refers to average productivity of college graduates. Except in the special case in which the economy is at the Equity-Efficiency Frontier (EEF), there is always a policy reform that increases the productivity of college graduates without excluding the talented poor from college. For developed countries, this policy consists of transferring resources from college to basic education. |
| Keywords: | Basic education, college education, public expenditure in education |
| JEL: | H52 I28 J24 |
| Date: | 2009–01 |
| URL: | http://d.repec.org/n?u=RePEc:ivi:wpasad:2009-18&r=lab |
| By: | Leandro Prados de la Escosura; Joan R. Roses |
| Abstract: | We investigate human capital accumulation in Spain using alternative approaches based on the concept of ‘labor quality’ and on the idea of education. We, then, assess the effect of human capital accumulation on labor productivity growth and discuss the implications of the different measures for TFP growth. While long-run trends in human capital are similar with either measure, the skill premium approach fits better Spanish historical experience. Human capital provided a positive albeit small contribution to labor productivity growth facilitating technological innovation. Broad capital accumulation and efficiency gains appear complementary in Spain’s long-term growth. |
| Keywords: | Human Capital, Growth, Labor Productivity, Total Factor |
| JEL: | E24 J24 O47 N33 N34 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:cte:whrepe:wp09-06&r=lab |
| By: | Pablo Brañas-Garza (Universidad de Granada); Juan C. Cárdenas (Universidad de los Andes); Máximo Rossi (Universidad de la República, Uruguay) |
| Abstract: | There is not general consensus about if women are more or less generous than men. Although the number of papers supporting more generous females is a bit larger than the opposed it is not possible to establish any definitive and systematic gender bias. This paper provides new evidence on this topic using a unique experimental dataset. We used data from a field experiment conducted under identical conditions (and monetary payoffs) in 6 Latin American cities, Bogotá, Buenos Aires, Caracas, Lima, Montevideo and San José. Our dataset amounted to 3,107 experimental subjects who played the Trust Game. We will analyze the determinants of behavior of second movers, that is, what determines reciprocal generosity. In sharp contrast to previous papers we found that males are more generous than females. In the light of this result, we carried out a systematic analysis of individual features (income, education, age, etc.) for females and males separately. We found differential motivations for women and men. Third, we see that (individual) education enhances pro-social behavior. Lastly, we see that subjects’ expectations are crucial. |
| Keywords: | Reciprocal altruism, gender, education |
| JEL: | C93 D64 J16 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:inq:inqwps:ecineq2009-128&r=lab |
| By: | Melissa P. McInerney (Department of Economics, College of William and Mary) |
| Abstract: | During the 1990s, the state of Ohio contracted out Workers’ Compensation (WC) case management, incorporating a large bonus payment intended to reward reduced claim duration. The bonus is essentially a decreasing function of average days away from work, excluding claims longer than 15 months. In response, duration is predicted to decrease for minor claims and increase for some severe claims so that claimants miss more than 15 months of work and are excluded from the calculation. Contractor responses are consistent with these expected heterogeneous responses but inconsistent with state intentions, suggesting public entities should anticipate strategic behavior when crafting performance-based incentives. |
| Keywords: | Workers' Compensation, Contracting Out, Privatization |
| JEL: | H72 J28 L33 |
| Date: | 2009–08–27 |
| URL: | http://d.repec.org/n?u=RePEc:cwm:wpaper:88&r=lab |
| By: | Popovic, Milenko |
| Abstract: | In this paper two dynamic models of artist behavior and arts labor supply are developed. Both are based on household production function approach and on the assumption that artists are multiple-job-holders. In the first model proposed here artist is depicted as someone who is hired on the arts labor market and paid for her arts time. In the second model artist is described as someone who sell her products, like paintings for instance, on the market for arts products. In order to make these models dynamic, artist productivity is here supposed to be a function of accumulated human capital of artist. Following the results of existing empirical research, previous experience and previous artistic practice are supposed to be the most important form of human capital accumulation. Once analysis is expended to capture this kind of artist human capital accumulation, the supply of the labor in the arts market appears as a resulting from an inter-temporal process of resources allocation. Both models end with same result: shadow price of producing unit of art commodity in certain year should be equal to the sum of current monetary benefits, current nonmonetary benefits, stream of future monetary benefits, and stream of future nonmonetary benefits generated by production of respected art unit. This result appears to be pretty suitable for formalization of several existing hypotheses aimed at explaining arts labor market peculiarities. Especially, by referring to the stream of expected nonmonetary benefits, models developed here are able to formalize most promising among these hypothesis according to which artist need for self-actualization is driving force in explaining oversupply of arts labor. |
| Keywords: | arts; household production function; allocation of time; expected benefits |
| JEL: | J31 J22 J24 Z11 |
| Date: | 2009–09–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:17108&r=lab |
| By: | Davia, Maria A. (Universidad de Castilla, La Mancha); McGuinness, Seamus (ESRI); O'Connell, Philip J. (ESRI) |
| Abstract: | This paper uses EU-SILC data from 2005 and 2006 to explore the hypothesis that international differences in rates of return to education reflect variations in the level of risk associated with educational investments. While there was some evidence to support this hypothesis with regards to returns to ISCED level 5 qualifications among males, the majority of the variation in international returns was related to distributional impacts. The results suggest that higher rates of return to more advanced qualifications relate to more dispersed distributions among poorly qualified workers which, in turn, raise the returns to credentials further up the educational spectrum. |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:wp311&r=lab |
| By: | Karthik Muralidharan; Venkatesh Sundararaman |
| Abstract: | Performance pay for teachers is frequently suggested as a way of improving education outcomes in schools, but the theoretical predictions regarding its effectiveness are ambiguous and the empirical evidence to date is limited and mixed. We present results from a randomized evaluation of a teacher incentive program implemented across a large representative sample of government-run rural primary schools in the Indian state of Andhra Pradesh. The program provided bonus payments to teachers based on the average improvement of their students' test scores in independently administered learning assessments (with a mean bonus of 30% of monthly pay). At the end of two years of the program, students in incentive schools performed significantly better than those in control schools by 0.28 and 0.16 standard deviations in math and language tests respectively. They scored significantly higher on "conceptual" as well as "mechanical" components of the tests, suggesting that the gains in test scores represented an actual increase in learning outcomes. Incentive schools also performed better on subjects for which there were no incentives, suggesting positive spillovers. Group and individual incentive schools performed equally well in the first year of the program, but the individual incentive schools outperformed in the second year. Incentive schools performed significantly better than other randomly-chosen schools that received additional schooling inputs of a similar value. |
| JEL: | C93 I21 M52 O15 |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15323&r=lab |
| By: | Albert Bollard (Stanford University); David McKenzie (Development Research Group, World Bank); Melanie Morten (Yale University) |
| Abstract: | Recorded remittances to Africa have grown dramatically over the past decade. Yet data limitations still mean relatively little is known about which migrants remit, how much they remit, and how their remitting behavior varies with gender, education, income levels, and duration abroad. We construct the most comprehensive remittance database on immigrants in the OECD currently available, containing microdata on over 12,000 African immigrants. Using this microdata we establish several basic facts about remitting patterns of Africans, and then explore how key characteristics of policy interest relate to remittance behavior. Africans are found to remit twice as much on average as migrants from other developing countries, while those from poorer African countries are more likely to remit than those from richer African countries. We find male migrants remit more than female migrants, particularly among those with a spouse remaining in the home country; that more educated migrants remit more than less educated migrants; and that while the amount remitted increases with income earned, the gradient is quite flat over a large range of income. Finally, we find little evidence that the amount remitted decays with time spent abroad, with reductions in the likelihood in remitting offset by increases in the amount remitted conditional on remitting. |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:200921&r=lab |
| By: | Tim Braunholtz Speight |
| Abstract: | The focus is on the social discrimination trap, which highlights the ways in which men and women’s, girls and boys’ experiences of poverty differ in important ways. It is also discussed how understanding the gender dimensions of chronic poverty is important not only for tackling the greater levels of deprivation and vulnerability that girls and women routinely face in many country contexts, but also for tackling poverty more broadly. [Policy Brief No. 12]. |
| Keywords: | chronic poverty, poverty, women, deprivation, vulnerability, country, social discriminatin, discriminatin, women, girls, boys, fender, gender dimension, |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2197&r=lab |
| By: | Hjalmarsson, Randi (Univerisity of Maryland); Lindquist, Matthew (Dept. of Economics, Stockholm University) |
| Abstract: | This paper studies intergenerational correlations in drunk driving between fathers and their children using the Stockholm Birth Cohort. We find strong evidence of an intergenerational drunk driving relationship. Cohort members who have fathers with a drunk driving record have 2.59 times higher odds of having a drunk driving conviction themselves than cohort members with non-drunk driving fathers. We then go on to investigate the underlying mechanisms that give rise to these correlations. The results provide compelling evidence that at least some of this relationship represents a behavior-specific transference from fathers to their children. Specifically, much of the raw father-child drunk driving relationship persists over and above controls for a number of potential explanations, including that the relationship is: (i) a by-product of parental alcoholism, (ii) symptomatic of a general pattern of non-law abiding behavior, (iii) attributable to inherited ability and physical characteristics, and (iv) accounted for by common background variables or social factors. We then go on to show how this mechanism may change over time. As cohort members age into adulthood, the father-child drunk driving relationship appears to be driven by a more general behavioral transference mechanism and can be accounted for by parental alcoholism and non-law abiding behavior. |
| Keywords: | alcohol; crime; drunk driving; illegal behavior; intergenerational crime; intergenerational mobility; risky behavior |
| JEL: | J62 K42 |
| Date: | 2009–09–07 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sunrpe:2009_0016&r=lab |
| By: | Thomas Y. Mathä; Allison Shwachman |
| Abstract: | This paper empirically analyses the link between market potential and regional wages in the enlarged EU. We extend previous studies of EU regions in several ways. 1) we analyze the link between market potential and wages for the EU27, 2) correct for spatial autocorrelation present in the data, showing that by neglecting spatial autocorrelation the strength of the relationship between market potential and wages may be underestimated, 3) decompose total market potential into several geographical components and analyze their respective contributions to explaining the geographical wage structure, and 4) explore which regions have gained the most from European integration by calculating counterfactual market potential if they could only trade with other regions within the same country. Length: 48 pages |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:bcl:bclwop:cahier_etudes_37&r=lab |
| By: | Soline de Villard |
| Abstract: | Environs trois quarts des pauvres à travers le monde vivent dans les zones rurales. Parmi eux, les femmes constituent un groupe particulièrement vulnérable et pourtant stratégique pour le développement économique et social. Investir au profit des femmes rurales ne répond alors plus seulement à un impératif moral; cela contribue aussi à définir une stratégie prometteuse en matière de lutte contre la pauvreté et contre la faim. |
| Keywords: | rural development, gender, equality, women, employment |
| JEL: | J16 J43 R11 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fao:pbrief:05fr&r=lab |
| By: | Carlos Gradín (Universidade de Vigo); Olga Cantó (Instituto de Estudios Fiscales and Universidade de Vigo) |
| Abstract: | Poverty rates among households with children in Spain have been shown to be persistently higher than those among households without children. These higher rates prevail for chronic, transitory and, most remarkably, for recurrent poverty. In order to study the dynamics of poverty transitions in Spain we estimate a dynamic random effects probit model that controls for unobserved heterogeneity and initial conditions using the European Community Household Panel. Our results show differential effects of several individual and household characteristics on the probability of being poor for households with and without children. Of special interest is how labour instability factors can help to explain the outstandingly higher recurrence in poverty among households with children in Spain, compared with other countries. |
| Keywords: | children, poverty dynamics, random-effects, Spain. |
| JEL: | D1 D31 I32 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:inq:inqwps:ecineq2009-123&r=lab |
| By: | Berthoud R (Institute for Social and Economic Research) |
| Abstract: | This short paper aims to contribute to the live debate about the current recession in the United Kingdom by analysing the impact of the recessions of the early 1980s and 1990s on non-employment patterns among people in the main range of working ages. The implication is that the effects observed in earlier business cycles are likely to be repeated now. The paper shows the impact of cyclical factors on overall patterns of non-employment and which social groups are most affected. A key question is whether types of people who are already disadvantaged are especially sensitive to a down-turn. |
| Date: | 2009–08–13 |
| URL: | http://d.repec.org/n?u=RePEc:ese:iserwp:2009-23&r=lab |
| By: | Josse Delfgaauw (Erasmus University Rotterdam); Robert Dur (Erasmus Universiteit Rotterdam); Joeri Sol (Erasmus University Rotterdam); Willem Verbeke (Erasmus University Rotterdam) |
| Abstract: | We ran a field experiment in a Dutch retail chain consisting of 128 stores. In a random sample of these stores, we introduced short-term sales competitions among subsets of stores. We find that sales competitions have a large effect on sales growth, but only in stores where the store's manager and a large fraction of the employees have the same gender. Remarkably, results are alike for sales competitions with and without monetary rewards, suggesting a high symbolic value of winning a tournament. Lastly, despite the substantial variation in team size, we find no evidence for free-riding. |
| Keywords: | field experiment; gender differences; competition; sales contests; awards |
| JEL: | C93 J16 M52 |
| Date: | 2009–08–04 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:uvatin:20090069&r=lab |
| By: | Soline de Villard |
| Abstract: | About three quarters of the world’s poor live in rural areas. Among those, women constitute a particularly vulnerable, yet crucially important group for social and economic development. Investing in rural women is thus not only a moral imperative; it can also be a promising strategy to effectively fight poverty and hunger. |
| Keywords: | rural development, gender, equality, women, employment |
| JEL: | J16 J43 R11 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fao:pbrief:05en&r=lab |
| By: | Ingolf Dittmann (Erasmus University Rotterdam); Ko-Chia Yu (Erasmus University Rotterdam) |
| Abstract: | This paper investigates whether observed executive compensation contracts are designed to provide risk-taking incentives in addition to effort incentives. We develop a stylized principal-agent model that captures the interdependence between firm risk and managerial incentives. We calibrate the model to individual CEO data and show that it can explain observed compensation practice surprisingly well. In particular, it justifies large option holdings and high base salaries. Our analysis suggests that options should be issued in the money. If tax effects are taken into account, the model is consistent with the almost uniform use of at-the-money stock options. We conclude that the provision of risk-taking incentives is a major objective in executive compensation practice. |
| Keywords: | Stock Options; Executive Compensation; Effort Aversion; Risk-Taking Incentives; Optimal Strike Price |
| JEL: | G30 M52 |
| Date: | 2009–08–25 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:uvatin:20090076&r=lab |