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on Labour Economics |
| By: | Orley Ashenfelter (Princeton University); Kirk Doran (University of Notre Dame); Bruce Schaller (New York City Department of Transportation) |
| Abstract: | The available estimates of the wage elasticity of male labor supply in the literature have varied between -0.2 and 0.2, implying that permanent wage increases have relatively small, poorly determined effects on labor supplied. The variation in existing estimates calls for a simple, natural experiment in which men can change their hours of work, and in which wages have been exogenously and permanently changed. We introduce a panel data set of taxi drivers who choose their own hours, and who experienced two exogenous permanent fare increases instituted by the New York City Taxi and Limousine Commission. Our preferred estimate suggests that their elasticity of labor supply is about -0.2. |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:pri:indrel:1180&r=lab |
| By: | Gonzalo Fernández-de-Córdoba (Universidad de Salamanca); Javier J. Pérez (Banco de España); José L. Torres (Universidad de Málaga) |
| Abstract: | This paper develops a dynamic general equilibrium model in which the public and the private sector interact in the labor market. Previous studies that analyze the labor market effects of public sector employment and wages have mostly assumed exogenous rules for public wage and public employment. We show that theories that equalize wages with marginal products in the private sector can rationalize the interaction of public and private sector wages when extended to accommodate a non-trivial government sector/public sector union that endogenously determines public employment and wages. Our model suggests a positive correlation between public and private sector wages. Any increase in tax revenues, coupled with the existence of a positive public-private sector wage gap, makes working in the public sector an attractive option. Thus, a positive neutral productivity shock increases public and private sector wages. More interestingly, even a private-sector specific productivity shock spills-over to the public sector, increasing public wages. These facts lend some support to the wage leading role of the private sector. Nevertheless, at the same time, a positive shock to public sector wages would lead to an increase in private sector wages, via the flow of workers from the private to the public sector. |
| Keywords: | Public wages, public employment, labor market, trade unions |
| JEL: | C32 J30 J51 J52 E62 E63 H50 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:bde:wpaper:0927&r=lab |
| By: | Ramos, Raul (University of Barcelona); Duque, Juan C. (Universidad EAFIT); Surinach, Jordi (University of Barcelona) |
| Abstract: | The objective of this paper is to analyse the existence or not of a wage curve in Colombia, paying special attention to the differences between formal and informal workers, an issue that has been systematically ignored in the wage curve literature. The obtained results using microdata from the Colombian Continuous Household Survey (CHS) between 2002 and 2006 show the existence of a wage curve with a negative slope for the Colombian economy. Using information on metropolitan areas, the estimates of the elasticity of individual wages to local unemployment rates was -0.07, a value that is very close to those obtained for other countries. However, the disaggregation of statistical information for formal and informal workers has shown significant differences among both groups of workers. In particular, for the less protected groups of the labour market, informal workers (both men and women), a high negatively sloped wage curve was found. This result is consistent with the conclusions from efficiency wage theoretical models and should be taken into account when analysing the functioning of regional labour markets in developing countries. |
| Keywords: | formal and informal sectors, unemployment, wage curve |
| JEL: | J30 J60 O17 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4461&r=lab |
| By: | Bauer, Philipp C. (economiesuisse); Riphahn, Regina T. (University of Erlangen-Nuremberg) |
| Abstract: | We use Swiss data to test whether intergenerational educational mobility is affected by the age at which children enroll in kindergarten. Taking advantage of heterogeneity across cantons we find that early kindergarten enrollment significantly increases educational mobility. |
| Keywords: | Kindergarten, pre-school enrollment, educational mobility, intergenerational transmission of education |
| JEL: | I2 I21 J24 D30 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4466&r=lab |
| By: | van der Wiel, Karen (CPB Netherlands Bureau for Economic Policy Analysis) |
| Abstract: | This paper empirically establishes the effect of the employer's term of notice on the wage level of employees. The term of notice is defined as the period an employer has to notify workers in advance of their upcoming dismissal. The wages paid during this period are an important element of firing costs and hence employment protection. To find a causal effect, I exploit the exogenous change in the term of notice that resulted from the introduction of a new Dutch law in 1999. Strong evidence is found that a longer 'dormant' term of notice leads to higher wages. In my sample, an additional month of notice increases wages by three percent, ceteris paribus. |
| Keywords: | employment protection, term of notice, wages |
| JEL: | C23 J31 J38 J63 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4465&r=lab |
| By: | Francesco Giavazzi; Fabio Schiantarelli; Michel Serafinelli |
| Abstract: | We study whether cultural attitudes towards gender, the young, and leisure are significant determinants of the evolution over time of the employment rates of women and of the young, and of hours worked in OECD countries. Beyond controlling for a larger menu of policies, institutions and structural characteristics of the economy than has been done so far, our analysis improves upon existing studies of the role of "culture" for labor market outcomes by dealing explicitly with the endogeneity of attitudes, policies and institutions, and by allowing for the persistent nature of labor market outcomes. When we do all this we find that culture still matters for women employment rates and for hours worked. However, policies and other institutional or structural characteristics are also important. Attitudes towards youth independence, however, do not appear to be important in explaining the employment rate of the young. In the case of women employment rates, the policy variable that is significant along with attitudes, is the OECD index of employment protection legislation. For hours worked the policy variables that play a role, along with attitudes, are the tax wedge and unemployment benefits. The quantitative impact of these policy variables is such that changes in policies have at least the potential to undo the effect of variations in cultural traits on labor market outcomes. |
| JEL: | J16 J22 J23 Z1 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15417&r=lab |
| By: | Avraham Ebenstein; Ann Harrison; Margaret McMillan; Shannon Phillips |
| Abstract: | In this paper, we link industry-level data on offshoring activities of U.S. multinational firms, import penetration, and export shares with individual level worker data from the Current Population Surveys. We examine whether increasing globalization through offshoring or trade has led to reallocation of labor, both within and out of manufacturing, and measure its impact on the wages of domestic workers. We also control for the "routineness" of individual occupations. Our results suggest that (1) offshoring to high wage countries is positively correlated with U.S. manufacturing employment (2) offshoring to low wage countries is associated with U.S. employment declines (3) wages for workers who remain in manufacturing are generally positively affected by offshoring; in particular, we find that wages are positively associated with an increase in U.S. multinational employment in high income locations (4) much of the negative effects of globalization operate through downward pressure on wages of workers who leave manufacturing to take jobs in agriculture or services and (5) the downward pressure on aggregate U.S. wages operating through import competition has been quite important for some occupations. This effect has been overlooked because it operates across, not within, industries. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:tuf:tuftec:0742&r=lab |
| By: | Michiyo Hashiguchi (Research Associate, Osaka School of International Public Policy (OSIPP),Osaka University) |
| Abstract: | Using the Survey of Company Fringe Benefits provided by the Life Insurance Culture Centre in 2002 (Social Science Japan data archive), this study provides corrected estimates for endogeneity attributed to family-friendly policies on wages. The results indicate that the policies related to childcare and care for the elderly have a negative impact on wages when they are actually used. In turn, the effects of the provision of these policies are different by genders on confirming the estimates of two treatment dummies: the satisfaction with regard to training provisions, and the satisfaction over improved employability. While the former has positive effects on wages for both genders, the latter has positive for males, but negative for females. This finding suggests the importance of providing effective incentives related to training in order to facilitate individual job skills and career progress toward a gender equal society. |
| Keywords: | family-friendly, fringe benefits, gender, leave, policy |
| JEL: | C31 J31 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:osp:wpaper:09j003&r=lab |
| By: | Francis Green |
| Abstract: | This paper shows that employability strongly moderates the effects of unemployment and of job insecurity on well-being. I develop a simple framework for employment insecurity and employability with two key features. First, it allows for the risks surrounding unemployment and employment transitions to affect well-being both directly and indirectly through their impact on expected income. Second, the framework allows for the interaction between unemployment and employability, and between job insecurity and employability. Using panel data from Australia, I provide new random effects and fixed effects estimates of the impact of unemployment and of job insecurity on life satisfaction and on mental health, in the context of a model that takes account of the interacting risks. As predicted, unemployed people with little hope of finding a job enjoy the least well-being by a considerable margin, while employed people who are both highly employable and in a secure job enjoy the most. In between there is substantial differentiation according to employability, job insecurity and their interaction. Compared to a secure job the deleterious effects of high job insecurity on well-being are comparable to the effects of unemployment. Both are substantial. The findings are used to compute estimates of the well-being trade-off between increases in job insecurity and increases in employability, relevant to the support of "flexicurity" and similar employment policies. |
| Keywords: | Life satisfaction; mental health; unemployment; employment; job insecurity; employability; flexicurity; employment insecurity; flexibility |
| JEL: | J28 J6 I12 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:ukc:ukcedp:0918&r=lab |
| By: | Montizaan, Raymond (ROA, Maastricht University); Cörvers, Frank (ROA, Maastricht University); de Grip, Andries (ROA, Maastricht University) |
| Abstract: | This paper uses a natural experiment approach to identify the effects of an exogenous change in future pension benefits on workers' training participation. We use unique matched survey and administrative data for male employees in the Dutch public sector who were born in 1949 or 1950. Only the latter were subject to a major pension reform that diminished their pension rights. We find that this exogenous shock to pension rights postpones expected retirement and increases participation in training courses among older employees, although exclusively for those employed in large organizations. |
| Keywords: | natural experiment, retirement, training |
| JEL: | J14 J24 J26 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4462&r=lab |
| By: | Josep Pijoan-Mas (CEMFI, Centro de Estudios Monetarios y Financieros); Virginia Sánchez-Marcos (Universidad de Cantabria) |
| Abstract: | In this article we characterize the evolution of inequality in hourly wages, hours of work, labor earnings, household disposable income and household consumption for Spain between 1985 and 2000. We look at both the Encuesta Continua de Presupuestos Familiares and the European Household Community Panel. Our analysis shows that inequality in individual net labor earnings and household net disposable income has decreased substantially. The decreases in the tertiary education premium and in the unemployment rate have been key ingredients to understand this falling trend. However, the inequality reduction has not been monotonic over the period: while it fell in years of economic expansion, there was an inequality surge in the recession of the early nineties. Public transfers have played a crucial role in smoothing out the inequality arising in the labor market, but instead the Spanish family does not seem to have been an important insurance mechanism. Regarding household consumption, inequality has fallen much less than inequality in household net disposable income, with the decrease mostly concentrated in the second half of the eighties. This suggests that the reduction in income inequality has affected the sources of permanent differences between households only during the second half of the eighties. Our estimates of the earnings process for the period are consistent with this view. |
| Keywords: | Wage inequality, income inequality, consumption inequality. |
| JEL: | D31 D12 E24 J31 |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:cmf:wpaper:wp2009_0910&r=lab |
| By: | Alejandra Cox Edwards (California State University-Long Beach); Estelle James (Hudson Institute) |
| Abstract: | Recent research has argued that incentives stemming from social security systems influence the worker’s decision to retire. The experience of Chile, which radically changed its system in 1981, offers an opportunity to test this hypothesis. The new system tightened access to early pensions, replaced an actuarially unfair defined benefit plan with an actuarially fair defined contribution plan, exempted pensioners from the pension payroll tax and allowed widows to keep their own pension in addition to their survivor’s benefit. Although the old system is being phased out, since 1981 the two systems have co-existed. Using probit analysis of the behavior of a retrospective sample of new and old system affiliates, we estimate the impact of the new social security rules on the probability of dropping out of the labor force, for older workers. We find large effects. Age of pensioning has been postponed. Labor force participation is much higher among affiliates of the new system compared with the old, especially for pensioners and women. This is not simply due to selection: Aggregate participation rates have increased as the new system’s share of total affiliates has risen. |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:mrr:papers:wp202&r=lab |
| By: | Morris M. Kleiner (University of Minnesota and NBER); Alan B. Krueger (Princeton University) |
| Abstract: | This study examines the extent and influence of occupational licensing in the U.S. using a specially designed national labor force survey. Specifically, we provide new ways of measuring occupational licensing and consider what types of regulatory requirements and what level of government oversight contribute to wage gains and variability. Estimates from the survey indicated that 35 percent of employees were either licensed or certified by the government, and that 29 percent were fully licensed. Another 3 percent stated that all who worked in their job would eventually be required to be certified or licensed, bringing the total that are or eventually must be licensed or certified by government to 38 percent. We find that licensing is associated with about 18 percent higher wages, but the effect of governmental certification on pay is much smaller. Licensing by larger political jurisdictions is associated with the higher wage gains relative to only local licensing. We find little association between licensing and the variance of wages, in contrast to unions. Overall, our results show that occupational licensing is an important labor market phenomenon that can be measured in labor force surveys. |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:pri:cepsud:1178&r=lab |
| By: | Lehmann, Hartmut (University of Bologna); Wadsworth, Jonathan (Royal Holloway, University of London) |
| Abstract: | Using longitudinal data from the Ukraine we examine the extent of any long-lasting effects of radiation exposure from the Chernobyl disaster on the health and labour market performance of the adult workforce. The variation in the local area level of radiation fallout from the Chernobyl accident is considered as a potential instrument to try to establish the causal impact of poor health on labour force participation, hours worked and wages. There appears to be a significant positive association between local area-level radiation dosage and health perception based on self-reported poor health status, though much weaker associations between local area-level dosage and other specific health conditions or labour market performance. Any effects on negative health perceptions appear to be stronger among women and older individuals. |
| Keywords: | Chernobyl, health, labour market performance |
| JEL: | H00 J00 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4467&r=lab |
| By: | Ann Harrison; Margaret McMillan |
| Abstract: | Critics of globalization claim that US manufacturing firms are being driven to shift employment abroad by the prospects of cheaper labor. Others argue that the availability of low-wage labor has allowed US-based firms to survive and even prosper. Yet evidence for either hypothesis, beyond anecdotes, is slim. Using firm-level data collected by the US Bureau of Economics Analysis (BEA), we estimate the impact on US manufacturing employment of changes in foreign affiliate wages, controlling for changing demand conditions and technological change. We show that the motive for offshoring and consequently the location of offshore activity significantly affects the impact of offshoring on parent employment. However, for firms which do significantly different tasks at home and abroad, foreign and domestic employment are complements. These offsetting effects may be combined to show that offshoring is associated with a quantitatively small decline in manufacturing employment. These results are robust to a variety of estimation techniques and robustness tests. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:tuf:tuftec:0741&r=lab |
| By: | Clémence Berson (Centre d'Economie de la Sorbonne) |
| Abstract: | The assimilation of immigrants and their children is a burning issue in France. Governments build a large part of their policies on the labor market. The public sector is reputed to integrate minorities better because of its entrance exams and pay-scales. In this paper, a comparison of the public and private sectors shows that second-generation immigrants are not treated equally. Those of African descent are discriminated against in both sectors even though selection issues are controlled for, whereas the wages of those of South European origin are similar to those of the French. |
| Keywords: | Discrimination, wage gap, public and private sectors, France. |
| JEL: | C35 J31 J45 J71 |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:mse:cesdoc:09059&r=lab |
| By: | Stéphane Bonhomme (CEMFI, Centro de Estudios Monetarios y Financieros); Ulrich Sauder (University of Warwick) |
| Abstract: | We compare the effects of selective and non selective secondary education on children’s test scores, using British data from the National Child Development Study (NCDS). Test scores are modelled as the output of an additive production function. Inputs include family and school characteristics, as well as the child’s unobserved initial endowment, which may be correlated with the education system attended. In the model, the average effect of selective education can be estimated using semiparametric Difference-in-Difference (DID) methods. We generalize the DID approach and provide conditions under which the entire counterfactual distribution of potential outcomes is identified, and can be consistently estimated using a deconvolution-related approach. Descriptive statistics on the NCDS data show that children perform better in selective schools. Our results suggest that this is essentially due to differences in pupils’ composition between selective and non selective schools. When correcting for these differences, we find that the effects of selective education are small and mostly insignificant. |
| Keywords: | Selective education, ability bias, tratment effects, quantiles. |
| JEL: | C33 I21 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:cmf:wpaper:wp2009_0906&r=lab |
| By: | Mühlemann, Samuel (University of Bern); Wolter, Stefan (University of Bern); Wüest, Adrian (affiliation not available) |
| Abstract: | Dual apprenticeship training is a market-driven form of education at the upper secondary level, taking place in firms as well as in vocational schools. So far, little is known about the impact of the business cycle on the number of apprenticeship programs offered by firms. Using panel-data of Swiss cantons from 1988-2004, we find that the influence of the business cycle is statistically significant, but small in size. Instead, supply of apprenticeship programs is driven to a much greater extent by demographic change. Conversely, the number of first-year high school students is not affected by the business cycle. We find, however, that enrollment increases if the population at age 16 grows, but access to high schools does not become more restricted in times of negative growth. |
| Keywords: | apprenticeship training, business cycle, high school enrollment |
| JEL: | E24 I21 J18 J44 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4460&r=lab |
| By: | Marjit, Sugata; Chaudhuri, Sarbajit; Kar, Saibal |
| Abstract: | Global recession is likely to hit the skilled sector or the so-called white goods, white collared sector in a typical developing economy. In this paper we try to analyze the impact of such an event on informal wage as the vast majority of the workforce in the developing world is employed in the unorganized or informal sector. In particular, we demonstrate the analytical possibility that a recession in the skilled sector will actually increase real informal wage. |
| Keywords: | Recession; skill; capital-labor ratio; informal wage; general equilibrium |
| JEL: | E31 J31 J21 |
| Date: | 2009–04–30 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:18003&r=lab |
| By: | Böckerman, Petri; Johansson, Edvard; Kauhanen, Antti |
| Abstract: | The paper examines the effect of innovative work practices on the prevalence of sickness absence and accidents at work. We focus on several different aspects of workplace innovations (self-managed teams, information sharing, employer-provided training and incentive pay) along with the “bundles” of those practices. We use nationally representative individual-level data from the Finnish Quality of Work Life Survey from 2008. Using single equation models, we find that innovative work practices increase short-term sickness absence for blue-collar and lower white-collar employees. In two-equation models that treat innovative workplace practices as endogenous variables we do not find relationship between innovative work practices and sickness absence or accidents at work. |
| Keywords: | innovative work practices; workplace innovation; sickness absence; accidents |
| JEL: | I12 J28 |
| Date: | 2009–10–14 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:17872&r=lab |
| By: | Saint-Paul, Gilles (University of Toulouse I) |
| Abstract: | Much of the political economy analysis of reform focuses on the conflict of interest between groups that stand to gain or lose from the competing policy proposals. In reality, there is also a lot of disagreement about the working of the policy: in addition to conflicting interests, conflicting views play an important role. Those views are shaped in part by an educational bureaucracy. It is documented that the beliefs of that bureaucracy differ substantially from those of the broader constituency. I analyse a model where this effect originates in the self-selection of workers in the educational occupation, and is partly reinforced by the insulation of the educational profession from the real economy (an effect which had been discussed by Hayek). The bias makes it harder for the population to learn the true parameters of the economy if these are favourable to the market economy. Two parameters that govern this capacity to learn are social entropy and heritability. Social entropy defines how predictable one's occupation is as a function of one's beliefs. Heritability is the weight of the family's beliefs in the determination of the priors of a new generation. Both heritability and social entropy reduce the bias and makes it easier to learn that the market economy is "good", under the assumption that it is. Finally I argue that the capacity to learn from experience is itself affected by economic institutions. A society which does not trust markets is more likely to favour labour market rigidities that in turn reduces the exposure of individuals to the market economy, and thus their ability to learn from experience. This in turn reinforces the weight of the educational system in the formation of beliefs, thus validating the initial presumption against the market economy. This sustains an equilibrium where beliefs and institutions reinforce each other in slowing or preventing people from learning the correct underlying parameters. |
| Keywords: | ideology, beliefs, political economy, labor market reform, occupational choice, education, employment protection, civil service, market economy, unemployment |
| JEL: | E24 I21 I28 J22 J23 J24 J45 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4468&r=lab |
| By: | Amélie Lafrance (Statistics Canada, Economic Analysis); Casey Warman (Department of Economics, Queen's University); Frances Woolley (Department of Economics, Carleton University) |
| Abstract: | We use the Canadian Community Health Survey (CCHS) to explore the effects of marriage and cohabitation on gay, lesbian, bisexual and heterosexual individuals’ hours worked and full-time earnings. The CCHS is one of the largest national-level data sets containing both income and sexual orientation information (Carpenter, 2008). Partnered gay and bisexual men spend more hours in paid employment than their unattached counterparts. However, for those working more than 30 hours per week, the earnings advantage of partnered gay and bisexual men relative to the unattached is insignificant. The hours worked of partnered and unattached lesbians are indistinguishable, however partnered lesbians earn about ten percent more than the unattached. Bisexual men and women experience some of the worst labor market outcomes of any group. These findings suggest that caution should be employed when generalizing results based on studies of cohabiting gay and lesbian couples to the entire non-heterosexual population. |
| Date: | 2009–10–14 |
| URL: | http://d.repec.org/n?u=RePEc:car:carecp:09-08&r=lab |
| By: | Richard Rogerson (Arizona State University); Johanna Wallenius (Arizona State University) |
| Abstract: | We analyze the forces that can generate retirement in different versions of standard life cycle models of labor supply. While nonconvexities in production can generate retirement, we show that the size of nonconvexities needed increases sharply as the intertemporal elasticity of substitution for labor decreases. In a model with home production, we show that these models imply a large increase in time devoted to home production at retirement. This is contrary to what is found in the ATUS data. We suggest that nonconvexities in the enjoyment of leisure time may be a promising alternative feature to generate retirement. |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:mrr:papers:wp205&r=lab |
| By: | Jingjing Chai (Goethe University); Wolfram Horneff (Goethe University); Raimond Maurer (Goethe University); Olivia S. Mitchell (The Wharton School) |
| Abstract: | This paper derives optimal life cycle portfolio asset allocations as well as annuity purchases trajectories for a consumer who can select her hours of work and also her retirement age. Using a realistically-calibrated model with stochastic mortality and uncertain labor income, we extend the investment universe to include not only stocks and bonds, but also survival-contingent payout annuities. We show that making labor supply endogenous raises older peoples’ equity share; substantially increases work effort by the young; and markedly enhances lifetime welfare. Also, introducing annuities leads to earlier retirement and higher participation by the elderly in financial markets. Finally, when we allow for an age-dependent leisure preference parameter, this fits well with observed evidence in that it generates lower work hours and smaller equity holdings at older ages as well as sensible retirement age patterns. |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:mrr:papers:wp204&r=lab |
| By: | Roland G. Fryer, Jr; Steven D. Levitt |
| Abstract: | We document and analyze the emergence of a substantial gender gap in mathematics in the early years of schooling using a large, recent, and nationally representative panel of children in the United States. There are no mean differences between boys and girls upon entry to school, but girls lose more than two-tenths of a standard deviation relative to boys over the first six years of school. The ground lost by girls relative to boys is roughly half as large as the black-white test score gap that appears over these same ages. We document the presence of this gender math gap across every strata of society. We explore a wide range of possible explanations in the U.S. data, including less investment by girls in math, low parental expectations, and biased tests, but find little support for any of these theories. Moving to cross-country comparisons, we find that earlier results linking the gender gap in math to measures of gender equality are sensitive to the inclusion of Muslim countries, where in spite of women’s low status, there is little or no gender gap in math. |
| JEL: | I20 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15430&r=lab |
| By: | Jung, Sven; Schnabel, Claus |
| Abstract: | Using a representative establishment data set for Germany, we show that more than 40 percent of plants covered by collective agreements pay wages above the level stipulated in the agreement, which gives rise to a wage cushion between the levels of actual and contractual wages. Cross-sectional and fixed-effects estimations for the period 2001-2006 indicate that the wage cushion mainly varies with the profit situation of the plant and with indicators of labour shortage and the business cycle. While plants bound by multi-employer sectoral agreements seem to pay wage premiums in order to overcome the restrictions imposed by the rather centralized system of collective bargaining in Germany, plants which make use of single-employer agreements are significantly less likely to have wage cushions. ; Anhand von repräsentativen Daten des IAB-Betriebs-panels zeigen wir, dass über 40 Prozent der tarifgebundenen Betriebe in Deutschland höhere Löhne als im Tarifvertrag festgelegt zahlen, was zu einer Lohnspanne (bzw. einem Lohnpuffer) zwischen Effektiv- und Tariflöhnen führt. Querschnitts- und Fixe-Effekte-Schätzungen für den Zeitraum 2001-2006 deuten darauf hin, dass die übertarifliche Entlohnung hauptsächlich mit der Ertragslage des Betriebes und mit Indikatoren der Arbeitskräfteknappheit und des Konjunkturzyklus variiert. Während an Flächentarifverträge gebundene Betriebe über Tarif entlohnen dürften, um Beschränkungen zu überwinden, die ihnen durch das relativ zentrali-sierte Tarifverhandlungssystem in Deutschland auferlegt werden, weisen Betriebe mit Firmentarifverträgen wesentlich seltener eine übertarifliche Entlohnung auf. |
| Keywords: | wages,wage cushion,wage determination,bargaining,Germany |
| JEL: | J30 J31 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:faulre:63&r=lab |
| By: | Juergen Jung (Department of Economics, Towson University); Chung Tran (Department of Economics, University of New South Wales) |
| Abstract: | In this paper we argue that the strategic interaction between the labor supply decision of the elderly and private transfers from their children lowers the opportunity cost of leisure of the elderly. This in turn magnifies the crowding-out effect of public pensions on the labor supply of the elderly. We show that this mechanism has implications for evaluating the crowding-out effect of public pensions in developing countries. That is, a misspecified econometric model that does not control for the endogeneity of private transfers leads to a biased estimate of the crowding-out effect of public pensions. Using data from a household survey in Vietnam we find that the effect of public pensions on the probability of retirement is 2.5 times larger when explicitly accounting for the interaction between private transfers and the labor supply decision of elderly individuals. |
| Keywords: | Altruism, crowding-out, social security, retirement, transfers. |
| JEL: | H31 H55 I38 J14 J22 J28 |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:tow:wpaper:2009-01&r=lab |
| By: | Nebiyou Tilahun; David Levinson (Nexus (Networks, Economics, and Urban Systems) Research Group, Department of Civil Engineering, University of Minnesota) |
| Abstract: | This paper empirically explores the relationship between (i) job finding and commuting outcomes and (ii) the relationship between job search and the commute and location outcomes of relocation decisions after finding employment. The relationship between commute outcomes when finding a new job and the job search method that one employs are explored first. That is followed by an analysis of how long one stays at their residence after finding work, and where they eventually relocate relative to their new employment site as well as their previous residence. Along with the usual socio-demographic variables, the analysis takes on the job search method as well as the local contacts that one has in their residential area as important variables informing these choices. The findings indicate that jobs found through the use of internet and newspapers were on average farther away from the searchersÕ residence as compared to those found through contacts and formal means. On relocation after employment, we find that being a renter and moving to a rental unit were important in how quickly one relocated. In addition those that used the internet to find their jobs also relocated faster after controlling for demographic variables such as age. The distribution of ones social contacts were also found to be important in how far away from the previous location a person relocated. |
| Keywords: | Job search, travel behavior, transport geography, commuting, relocation |
| JEL: | J61 J64 R41 R31 D83 L14 D85 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:nex:wpaper:jobsearchmethods&r=lab |
| By: | Vincenzo Cuciniello (Chair of International Finance, Ecole Polytechnique Federale de Lausanne (EPFL), Switzerland); Luisa Lambertini (Chair of International Finance, Ecole Polytechnique Federale de Lausanne (EPFL), Switzerland) |
| Abstract: | We study whether monetary policy should target the exchange rate in a two-country model with non-atomistic wage setters, non-traded goods and different degrees of exchange-rate pass through. Commitment to an exchange rate target reduces the labor market distortion. Large labor unions anticipate that higher wages depreciate the exchange rate, which triggers an increase in the interest rate and restrain wage demands. However, reduced exchange rate flexibility worsens the distortion stemming from preset pricing. Targeting the nominal exchange rate will be optimal when the labor market distortion is larger than the preset-pricing one. This result arises with cooperation both under producer and local currency pricing, even though the optimal degree of exchange-rate targeting is higher under local currency pricing. In the Nash equilibrium, the terms-of-trade effect raises optimal wage mark-ups thereby reducing the optimal weight on the exchange rate target. The terms-of-trade effect is stronger as openness and substitutability among Home and Foreign goods increase. |
| Keywords: | Monetary policy, International Finance, Open-Economy Macroeconomics |
| JEL: | F3 F41 E52 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:cif:wpaper:200901&r=lab |
| By: | Christian Merkl; Dennis Wesselbaum |
| Abstract: | This papers analyzes the role of the extensive vis-à-vis the intensive margin of labor adjustment in Germany and the United States. The contribution is twofold. First, we provide an update of older U.S. studies and confirm the view that the extensive margin (i.e., the adjustment in the number of workers) explains the largest part in the overall variability in aggregate hours (namely, about three quarters). Second, although the German labor market is very different from its U.S. counterpart, the quantitative importance of the extensive margin is of similar magnitude |
| Keywords: | Business Cycle, Extensive and Intensive Margin, Variance Decomposition |
| JEL: | C10 E32 J21 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:kie:kieliw:1563&r=lab |
| By: | Melendez-Plumed, Vicenc |
| Abstract: | A rate of profit, expressed in labour magnitudes, that allows matching total plus value with total profits is determined. The relative prices, expressed in wage units, associated with this rate ensure that total profits are equal to the difference between the sum of relative prices and the sum of labour values as well. |
| Keywords: | Labour values; relative prices; rate of profit; plus value |
| JEL: | B51 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:18017&r=lab |
| By: | Hirsch, Boris; Schank, Thorsten; Schnabel, Claus |
| Abstract: | Using a large linked employer-employee data set for Germany, we find that the existence of a works council is associated with a lower separation rate to employment, in particular for men and workers with low tenure. While works council monopoly effects show up in all specifications, clear voice effects are only visible for low tenured workers. Works councils also reduce separations to non-employment, and this impact is more pronounced for men. Insurance effects only show up for workers with tenure of more than one year. Our results indicate that works councils primarily represent the interests of a specific clientele. ; Unter Verwendung eines großen kombinierten Firmen-Beschäftigten-Datensatzes für Deutschland finden wir, dass die Existenz eines Betriebsrates mit einer geringeren Abgangsrate in (anderweitige) Beschäftigung einhergeht, dies insbesondere bei männlichen Arbeitnehmern und solchen mit geringen Betriebszugehörigkeitsdauern. Während es anzeichen für Monopoleeffekte eines Betriebsrates in allen empirischen Spezifikationen gibt, sind eindeutige Voiceeffekte lediglich für Beschäftige mit geringen Betriebszugehörigkeitsdauern erkennbar. Ein weiteres Ergebnis ist, dass bei Vorhandensein eines Betriebsrates auch die Abgangsrate in Nichtbeschäftigung abnimmt, wobei dieser Effekt abermals bei männlichen Beschäftigten ausgeprägter ist. Diese Versicherungseffekte eines Betriebsrates treten jedoch nur für Arbeitnehmer mit Betriebszugehörigkeitsdauern von über einem Jahr auf. Unsere Ergebnisse deuten darauf hin, dass Betriebsräte in erster Linie die Interessen einer spezifischen Klientel vertreten. |
| Keywords: | works council,separations,collective voice,duration models,Germany |
| JEL: | J53 J63 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:faulre:62&r=lab |
| By: | Romina Boarini |
| Abstract: | Compulsory school education in Italy produces poor results in terms of 15-year olds’ performance on PISA tests, compared with other OECD countries, despite a relatively high level of expenditure. While the influence of social background is smaller than in many OECD countries, it is largely transmitted through a kind of self-segregation resulting from family choices among the different types of upper secondary school. Large differences in pupils’ performance between regions cannot be explained by the quantity of resources available; separating the influence of socio-economic conditions from school efficiency is difficult and must be treated carefully in plans for extending fiscal federalism. The Italian government is rightly concerned to get better value for money and this chapter argues that policies to improve the information available to schools and teachers on the results they are achieving, while giving them appropriate incentives, responsibility and power to respond to such information, are necessary accompaniments to expenditure-saving policies. An improved focus on good quality training, both for new recruits and experienced teachers, and recruitment procedures themselves, should also pay dividends on efficiency.<P>Améliorer l’école et l’égalité d’accès à l’éducation en Italie<BR>Par rapport aux autres pays de l'OCDE, les résultats des tests PISA des élèves italiens de 15 ans sont médiocres, et ce, malgré des dépenses d’éducation relativement élevées. Si l’incidence du milieu social est moindre que dans de nombreux autres pays membres, elle passe essentiellement par une sorte d’autodiscrimination résultant du choix des familles entre les différents types d’établissements secondaires du deuxième cycle. L’importance des écarts de résultats scolaires entre les régions ne peut s’expliquer par le volume des ressources disponibles. Il est difficile de faire la distinction entre l’impact des conditions socioéconomiques et l’efficience des établissements, et cela doit être étudié avec soin dans le cadre des projets d’extension du fédéralisme fiscal. Le gouvernement italien souhaite, à juste titre, optimiser les dépenses publiques et le présent chapitre défend l’idée selon laquelle des mesures visant à améliorer les informations à disposition des établissements scolaires et des enseignants concernant leurs résultats – tout en leur apportant les incitations, les responsabilités et les pouvoirs nécessaires pour agir en fonction de ces résultats – doivent accompagner les mesures d’économies budgétaires. Une attention plus grande accordée à une formation de qualité pour les enseignants, qu’il s’agisse des nouvelles recrues comme des enseignants chevronnés, ainsi qu’aux procédures de recrutement elles-mêmes, devrait également favoriser l’efficience. |
| Keywords: | education, Italy, Italie, éducation, fiscal federalism, fédéralisme fiscal, PISA data, données PISA, school outcomes, résultats scolaires |
| JEL: | I21 I28 |
| Date: | 2009–10–12 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:727-en&r=lab |
| By: | Arie Kapteyn (RAND); James P. Smith (RAND); Arthur van Soest (Tilburg University, Netspar & RAND) |
| Abstract: | To analyze the effect of health on work, many studies use a simple self-assessed health measure based upon a question such as “do you have an impairment or health problem limiting the kind or amount of work you can do?” A possible drawback of such a measure is the possibility that different groups of respondents may use different response scales. This is commonly referred to as “differential item functioning” (DIF). A specific form of DIF is justification bias: to justify the fact that they don’t work, non-working respondents may classify a given health problem as a more serious work limitation than working respondents. In this paper we use anchoring vignettes to identify justification bias and other forms of DIF across countries and socio-economic groups among older workers in the U.S. and Europe. Generally, we find differences in response scales across countries, partly related to social insurance generosity and employment protection. Furthermore, we find significant evidence of justification bias in the U.S. but not in Europe, suggesting differences in social norms concerning work. |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:mrr:papers:wp207&r=lab |
| By: | Richard T. Carson; Phoebe Koundouri; NAUGES Céline |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:ler:wpaper:09.25.301&r=lab |
| By: | Charlene M. Kalenkoski (Department of Economics, Ohio University); David C. Ribar (Department of Economics, University of North Carolina at Greensboro); Leslie S. Stratton (Department of Economics, VCU School of Business) |
| Abstract: | We investigate how household disadvantage affects the time use of 15-18 year-olds using 2003- 2006 data from the American Time Use Survey. Applying competing-risk hazard models, we distinguish between the incidence and duration of activities and incorporate the daily time constraint. We find that teens living in disadvantaged households spend less time in nonclassroom schooling activities than other teens. Girls spend some of this time in work activities, suggesting they are taking on adult roles. However we find more evidence of substitution into unsupervised activities, suggesting that it may be less structured environments that reduce educational investment. |
| Keywords: | Time use, adolescence, event history models |
| JEL: | J22 J13 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:vcu:wpaper:0904&r=lab |
| By: | Wesselbaum, Dennis |
| Abstract: | The efficiency wage theory developed by Akerlof (1982) assumes observability of effort and the ability of firm and worker to commit on their effort/wage decisions. We show that, from a game theoretical point of view, we have to understand the firm/worker relationship as a repeated Prisoner's dilemma. Therefore, cooperation is per se not a (subgame perfect) Nash equilibrium and hence the Akerlof (1982) theory is based upon an implicit assumption of cooperation, which can not be implemented w.l.o.g.. In addition, we find that this approach is a special case of the Shapiro and Stiglitz (1984) approach and hence unify the two approaches. |
| Keywords: | Efficiency Wage; Prisoner's Dilemma; Repeated Game; Subgame Perfect Nash Equilibrium. |
| JEL: | J41 C73 C72 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:18026&r=lab |
| By: | Martinoia, Michela |
| Abstract: | TThis paper has a double goal. On one side we want to evaluate the effect of economic integration on migration flows moving from the enlargement countries towards the EU-15; on the other, we want to analyse whether the migration flows had any impact over employment, real wages and labour force in the receiving countries of the European labour market. Due to the fact that economic integration can be observed in different real, monetary and financial phenomena, we refer to three of these to measure integration: trade openness, trade integration and financial market integration. These indicators have been inserted in a theoretical model that tries to explain labour market dynamics. The theoretical context that seemed the most suitable one to summarise European labour market characteristics is a modified version of the insider/outsider model proposed by Layard, Nickell and Jackman (LNJ, 1991). Another innovative contribution is the introduction of an equation modelling migration flows, whose creation is inspired to the neo-classic approach to the migration theory (Harris-Todaro, 1970). The model based on rational expectations is solved to find the equilibrium solution and the impact multipliers. Subsequently we estimated a structural VAR with the aim of both evaluating the impact that different shocks on integration measures have on migration flows, and measuring the type of effects that an increase in migration flows causes on the labour market. The estimates show that economic integration generate relevant effects on migration flows from the enlargement countries towards the EU-15 countries. Moreover, from the results emerge that migration flows generate an effect on the labour market. |
| Keywords: | European economic integration, labour market effects, migration |
| JEL: | E24 F15 F22 J61 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:uca:ucapdv:136&r=lab |
| By: | Ogilvie, S. |
| Abstract: | This paper uses evidence from German-speaking central Europe to address open questions about the Consumer and Industrious Revolutions. Did they happen outside the early-developing, North Atlantic economies? Were they shaped by the “social capital” of traditional institutions? How were they affected by social constraints on women? It finds that people in central Europe did desire to increase market work and consumption. But elites used the “social capital” of traditional institutions to oppose new work and consumption practices, especially by women, migrants, and the poor. Although they seldom blocked new practices wholly, they delayed them, limited them socially, and increased their costs. |
| Keywords: | economic history; consumption; social capital; institutions; guilds; communities; labour; discrimination; gender; Germany |
| JEL: | N0 N33 N43 N63 N73 N93 J13 J22 J31 J4 J7 O15 O17 |
| Date: | 2009–10–15 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:0943&r=lab |
| By: | Andrea Riedel (Schumpeter School of Business and Economics, University of Wuppertal); Kerstin Schneider (Schumpeter School of Business and Economics, University of Wuppertal and CESifo); Claudia Schuchart (ZBL, University of Wuppertal); Horst Weishaupt (DIPF, Frankfurt) |
| Abstract: | In this paper we look at school choice in primary schools in Germany. The data used is from Wuppertal, a major city in North-Rhine Westphalia (NRW), where school districts were abolished in 2008 to allow for free school choice. Here we look at the situation before 2008 to learn more about choice in the presence of school districts. Our analysis shows that it is not uncommon to visit a primary school that is not the assigned public school. Moreover, parents choose schools taking into account the distance to school, the quality and the socioeconomic composition of the school. Families from disadvantaged neighborhoods tend to send their children to the assigned school. A high percentage of migrants and/or economically disadvantaged families in the school district, however, induces parents to choose another school. Advantaged families make segregating choices, whereas the results for disadvantaged are not clear cut. The negative external effect of choice on the composition of the not chosen school is significant and the level of segregation in the primary schools is high and exceeds the level of residential segregation. |
| Keywords: | education system, segregation, school choice, denominational school, migration, socioeconomic status |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:bwu:schdps:sdp09011&r=lab |
| By: | Robert Baumann (Department of Economics, College of the Holy Cross); Victor Matheson (Department of Economics, College of the Holy Cross); Cara Howe (Department of Economics, College of the Holy Cross) |
| Abstract: | Tournament design is of crucial importance in competitive sports. The primary goal of effective tournament design is to provide incentives for the participants to maximize their performance both during the tournament and in the time period leading up to the tournament. In spectator sports, a secondary goal of tournament design is to also promote interesting match ups that generate fan interest. Seeded tournaments, in general, promote both goals. Teams or individuals with strong performances leading up to a tournament receive higher seeds which increase their chances of progressing further in the tournament. Furthermore, seeding ensures that the strongest teams or players are most likely to meet in the final rounds of the tournament when fan interest is at its peak. Under some distributions of team or player skill, however, a seeding system can introduce anomalies that could affect incentives. Our analysis of the NCAA men’s basketball tournament uncovers such an anomaly. The seeding system in this tournament gives teams with better success in the regular season more favorable first round match ups, but the tournament is not reseeded as the games progress. Therefore, while higher seeds progress to the 2nd round of the tournament at uniformly higher rates than lower seeds, this relationship breaks down in later rounds. We find that 10th and 11th seeds average more wins and typically progress farther in the tournament than 8th and 9th seeds. This finding violates the intended incentive structure of seeded tournaments. |
| Keywords: | basketball, tournament design, sports, NCAA |
| JEL: | L83 D02 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:spe:wpaper:0910&r=lab |
| By: | Jacob A. Bikker; Dirk W.G.A. Broeders; Eduard Ponds; David Hollanders |
| Abstract: | This paper examines the impact of participants. age distribution on the asset allocation of Dutch pension funds, using a unique data set of pension fund investment plans for 2007. Theory predicts a negative effect of age on (strategic) equity exposures. We observe that pension funds do indeed take the average age of their participants into account. However, the average age of active participants has been incorporated much more strongly in investment behaviour than the average ages of retired or dormant participants. This suggests that both employers and employees, who dominate pension fund boards, tend to show more interest in active participants. A one-year higher average age in active participants leads to a significant and robust reduction in the strategic equity exposure by around 0.5 percentage point. Larger pension funds show a stronger age-equity exposure effect than smaller pension funds. This age-dependent asset allocation of pension funds aligns with the original life-cycle model by which young workers should invest more in equity than older workers because of their larger human capital. Other factors, viz. fund size, funding ratio, and average pension wealth of participants, influence equity exposure positively and significantly, in line with theory. Pension plan type and pension fund type have no significant impact. |
| Keywords: | Pension funds, strategic equity allocation, lifecycle saving and investing |
| JEL: | D91 G11 G23 H55 J14 |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:use:tkiwps:0925&r=lab |
| By: | Annamaria Lusardi (Dartmouth College); Olivia S. Mitchell (The Wharton School); Vilsa Curto (Harvard University) |
| Abstract: | We examined financial literacy among the young using data from the 1997 National Longitudinal Survey of Youth. We showed that financial literacy is low among the young; fewer than one-third of young adults possess basic knowledge of interest rates, inflation, and risk diversification. Financial literacy is strongly related to sociodemographic characteristics and family financial sophistication. Specifically, a college-educated male whose parents had stocks and retirement savings is about 50 percentage points more likely to know about risk diversification than a female with less than a high school education whose parents were not wealthy. These findings have implications for consumer policy. |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:mrr:papers:wp191&r=lab |
| By: | David Vincent |
| Abstract: | The paper explores the significance of counting communication skills in one of the earliest societies to achieve mass literacy. The Millennium Development Goals in education reflect structures of practice and thinking rooted in the 19th century. The notion of a goal itself, the measurable output of official endeavour, belongs to the founding of the modern state. Literacy as an early performance indicator of public expenditure embodied a construction of an opposition between ignorance and knowledge, a disaggregation of social structures and a dismissal of informal education. It sustained the rise of the performance orientation of schooling, which subordinated the role of users. Despite their cultural limitations, the literacy and postal statistics permitted long-run quantitative analysis. There remains a question, to which historians do not have a privileged answer, as to whether education in its fullest sense is a goal that can ever be consistently measured over time and across space. The contemporary shifts in the meaning of literacy threaten to disconnect the term from history and disable our capacity fully to understand the dynamics of change. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:bwp:bwppap:6709&r=lab |
| By: | Gian Luca Clementi; Thomas F. Cooley |
| Abstract: | In this paper we describe the important features of executive compensation in the US from 1993 to 2006. Some confirm what has been found for earlier periods and some are novel. Important facts about compensation are that: the compensation distribution is highly skewed; each year, a sizeable fraction of chief executives lose money; the use of equity grants has increased; the income accruing to CEOs from the sale of stock has increased; regardless of the measure we adopt, compensation responds strongly to innovations in shareholder wealth; measured as dollar changes in compensation, incentives have strengthened over time, measured as percentage changes in wealth, they have not changed in any appreciable way. |
| JEL: | G30 J33 M52 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15426&r=lab |
| By: | Mark Koyama (Wadham College and Department of Economics, University of Oxford, UK.) |
| Abstract: | In pre-industrial economies labour supply curves often bend backwards at very low levels of income. This changed prior to the industrial revolution: total working hours increased (De Vries (1993, Voth (1998,2000). This paper examines this industrious revolution using a model of labour supply where consumption takes time. This analytical framework enables us to draw a distinction between a pessimistic account of the industrious revolution as suggested by Van Zanden (2006) and an optimistic account advanced by de Vries (2008) of an industrious revolution driven by changing patterns of demand. This formulation clarifies the importance of new consumption opportunities in driving hours worked. |
| Keywords: | labour supply, industrious revolution, consumption, time allocation |
| JEL: | N23 J22 |
| Date: | 2009–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:nuf:esohwp:_078&r=lab |
| By: | Ning Tang (The Wharton School, University of Pennsylvania); Olivia S. Mitchell (The Wharton School, University of Pennsylvania); Gary R. Mottola (Vanguard Center for Retirement Research); Stephen P. Utkus (Vanguard Center for Retirement Research) |
| Abstract: | Though millions of US workers have 401(k) plans, few studies evaluate participant investment performance. Using data on over 1,000 401(k) plans and their participants, we identify key portfolio investment inefficiencies and attribute them to offered investment menus versus individual portfolio choices. We show that the vast majority of 401(k) plans offers reasonable investment menus. Nevertheless, participants “undo” the efficient menu and make substantial mistakes: in a 20-year career it will reduce retirement wealth by one-fifth, in fact, more than what a naive allocation strategy would yield. We outline implications for plan sponsors and participants seeking to enhance portfolio efficiency: don’t just offer or choose more funds, but help people invest smarter. |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:mrr:papers:wp203&r=lab |
| By: | Marcia J. Carlson (University of Wisconsin-Madison); Natasha V. Pilkauskas (Columbia University); Sara S. McLanahan (Princeton University); Jeanne Brooks-Gunn (Columbia University) |
| Abstract: | We use data from the Fragile Families and Child Wellbeing Study to examine couple how couple relationship quality and parental engagement are linked over children’s early years. Our sample includes 1,630 couples that are co-resident over years 1 to 3 and 1,376 over years 3 to 5 (1,196 over both periods). Overall, we find that better relationship quality predicts greater parental engagement for both mothers and fathers—especially from children’s infant to toddler years; we find little evidence that parenting predicts future relationship quality. Married and cohabiting couples are generally similar in how relationship quality and parenting are linked. When couples are having their first birth, relationship quality is more strongly tied to parental engagement for fathers (but not mothers). |
| Keywords: | Couple relationship quality, parenting, fragile families |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:pri:crcwel:1182&r=lab |