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on Labour Economics |
| By: | Rupert, Peter (University of California, Santa Barbara); Stancanelli, Elena (CNRS, Nice); Wasmer, Etienne (Sciences Po, Paris) |
| Abstract: | A search model of the labor market is augmented to include commuting time to work. The theory posits that wages are positively related to commute distance, by a factor itself depending negatively on the bargaining power of workers. Since not all combinations of distance and wages are accepted, there is non-random selection of accepted job offers. We build on these ingredients to explore in the data the relationship between wages and commute time. We find that neglecting to account for this selection will bias downward the wage impact of commuting, and marginally affect the coefficients on education, age and gender. The correlation between the residuals of the selectivity equation and the distance equation is -0.70, showing the large impact of commute time on job acceptance decisions. We also use the theory to calculate the bargaining power of workers which largely varies depending on demographic groups: it appears to be much larger for men than that for women and that the bargaining power of women with young children is essentially zero. |
| Keywords: | simultaneous equations, search model, commuting |
| JEL: | J3 J6 R2 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4510&r=lab |
| By: | Lofstrom, Magnus (Public Policy Institute of California) |
| Abstract: | Low-skilled workers do not fare well in today's skill intensive economy and their opportunities continue to diminish. Given that individuals in this challenging skill segment of the workforce are more likely to have poor experiences in the labor market, and hence incur greater public expenses, it is particularly important to seek and evaluate their labor market options. Utilizing data from the Survey of Income and Program Participation, this paper provides a comprehensive analysis of the economic returns to business ownership among low-skilled workers and addresses the essential question of whether self-employment is a good option for low-skilled individuals that policymakers might consider encouraging. The analysis reveal substantial differences in the role of self-employment among low-skilled workers across gender and nativity – women and immigrants are shown to be of particular importance both from the perspectives of trends and policy relevance. We find that although the returns to low-skilled self-employment among men are relatively high we find that wage/salary employment is a substantially more financially rewarding option for most women. These findings raise the question of why low-skilled women enter self-employment. Our business start-up results are consistent, but not conclusive, with lack of affordable child care options and limited labor market opportunities in the wage/salary sector as motivating native born women to enter self-employment. We do not find empirical evidence of similar constraints among immigrant women. |
| Keywords: | self-employment, entrepreneurship, low-skill, women, immigrants |
| JEL: | J15 J16 J31 L26 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4539&r=lab |
| By: | Juan Pablo Atal; Hugo Nopo; Natalia Winder |
| Abstract: | This paper surveys gender and ethnic wage gaps in 18 Latin American countries, decomposing differences using matching comparisons as a non-parametric alternative to the Blinder-Oaxaca (BO) decomposition. It is found that men earn 9-27 percent more than women, with high cross-country heterogeneity. The unexplained pay gap is higher among older, informal and self-employed workers and those in small firms. Ethnic wage differences are greater than gender differences, and educational attainment differentials play an important role in explaining the gap. Higher ethnic wage gaps are found among males, singleincome generators of households and full-time workers, and in rural areas. An important share of the ethnic wage gap is due to the scarcity of minorities in highpaid positions. |
| Keywords: | gender, ethnicity, wage gaps, Latin America, matching |
| JEL: | C14 D31 J16 O54 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:idb:wpaper:4640&r=lab |
| By: | Koskela, Erkki (University of Helsinki) |
| Abstract: | What are the impacts of labor tax reform on wage setting and employment to keep the relative tax burden per low-skilled and high-skilled workers constant in the case of heterogenous domestic labor markets, i.e. imperfect competition in low-skilled labor and perfect competition in high-skilled labor in the presence of outsourcing? A higher degree of tax progression by raising the wage tax and the tax exemption for the low-skilled workers will decrease the wage rate and increase labour demand of low-skilled workers, whereas it will decrease (increase) employment of high-skilled workers in CES utility function when the elasticity of substitution between consumption and leisure is higher (lower) than one. A higher degree of wage tax progression for the high-skilled worker will have no effect on the high-skilled wage in the presence of CES and C-D utility function so this will have no total employment effects. |
| Keywords: | flexible outsourcing, dual labor market, impacts of labour taxation |
| JEL: | E24 H22 J21 J31 J51 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4544&r=lab |
| By: | Arni, Patrick (University of Lausanne); Lalive, Rafael (University of Lausanne); van Ours, Jan C. (Tilburg University) |
| Abstract: | This paper provides a comprehensive evaluation of benefit sanctions, i.e. temporary reductions in unemployment benefits as punishment for noncompliance with eligibility requirements. In addition to the effects on unemployment durations, we evaluate the effects on post-unemployment employment stability, on exits from the labor market and on earnings. In our analysis we use a rich set of Swiss register data which allow us to distinguish between ex ante effects, the effects of warnings and the effects of enforcement of benefit sanctions. Adopting a multivariate mixed proportional hazard approach to address selectivity, we find that both warnings and enforcement increase the job finding rate and the exit rate out of the labor force. Warnings do not affect subsequent employment stability but do reduce post-unemployment earnings. Actual benefit reductions lower the quality of post-unemployment jobs both in terms of job duration as well as in terms of earnings. The net effect of a benefit sanction on post-unemployment income is negative. Over a period of two years after leaving unemployment workers who got a benefit sanction imposed face a net income loss equivalent to 30 days of full pay due to the ex post effect. In addition to that, stricter monitoring may reduce net earnings by up to 4 days of pay for every unemployed worker due to the ex ante effect. |
| Keywords: | benefit sanctions, earnings effects, unemployment duration, competing-risk duration models |
| JEL: | J64 J65 J68 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4509&r=lab |
| By: | Arni, Patrick (University of Lausanne); Lalive, Rafael (University of Lausanne); van Ours, Jan C. (University of Tilburg) |
| Abstract: | This paper provides a comprehensive evaluation of benefit sanctions ,i.e. temporary reductions in unemployment benefits as punishment for noncompliance with eligibility requirements. In addition to the effects on unemployment durations, we evaluate the effects on post-unemployment employment stability, on exits from the labor market and on earnings. In our analysis we use a rich set of Swiss register data which allow us to distinguish between ex ante effects, the effects of warnings and the effects of enforcement of benefit sanctions. Adopting a multivariate mixed proportional hazard approach to address selectivity, we find that both warnings and enforcement increase the job finding rate and the exit rate out of the labor force. Warnings do not affect subsequent employment stability but do reduce post-unemployment earnings. Actual benefit reductions lower the quality of post-unemployment jobs both in terms of job duration as well as in terms of earnings. The net effect of a benefit sanction on post-unemployment income is negative. Over a period of two years after leaving unemployment workers who got a benefit sanction imposed face a net income loss equivalent to 30 days of full pay due to the ex post effect. In addition to that, stricter monitoring may reduce net earnings by up to 4 days of pay for every unemployed worker due to the ex ante effect. |
| Keywords: | Benefit sanctions; earnings effects; unemployment duration; competing-risk duration models |
| JEL: | J64 J65 J68 |
| Date: | 2009–11–16 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2009_022&r=lab |
| By: | Marianna Kudlyak |
| Abstract: | The user cost of labor captures the hiring wage and the expected effect of the economic conditions at the time of hiring on future wages. In search and matching models, I show that it is the user cost and not the wage that is weighted against the worker's marginal product at the time of hiring; so, the user cost is the allocational variable. I construct its measure in the data and estimate that it is more procyclical than average wages or wages of newly hired workers. I show that the textbook search and matching model cannot simultaneously generate the empirical elasticities of the vacancy-unemployment ratio and of the user cost of labor, irrespectively of the surplus division rule. |
| Keywords: | Business cycles ; Labor market |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedrwp:09-12&r=lab |
| By: | Frenette, Marc |
| Abstract: | Do students know the education required to achieve their career objectives? Is this information related to their education pathways? To address these questions, the Youth in Transition Survey (YITS), Cohort A is used to compare high school students' perceptions of the level of education they will require for the job they intend to hold at age 30, with the level required according to professional job analysts at Human Resources and Skills Development Canada (HRSDC). The focus is on students intending to work in a job which requires a university degree, and examine the correlation between the knowledge of educational requirements and subsequent university enrolment. The results suggest that about three out of four students intending to work in a job requiring a university degree are aware of the education they will require. Evidence suggests that knowledge of educational requirements is related to academic performance and socio-economic background. Differences by intended occupation are quite small. Moreover, students who know that a university degree is required are more likely to attend university, even after accounting for differences in academic performance, sex, and socioeconomic background. In fact, the knowledge of educational requirements is as strongly related to university attendance as other well-documented correlates such as sex, academic performance and parental education. Finally, higher university attendance rates are observed when students learn earlier (rather than later), that a university degree is required for their intended job. |
| Keywords: | Education, training and learning, Children and youth, Educational attainment, Education |
| Date: | 2009–10–29 |
| URL: | http://d.repec.org/n?u=RePEc:stc:stcp3e:2009320e&r=lab |
| By: | Roberto Bonilla |
| Abstract: | I analyse an economy where a search labour market with an endogenous wage distribution and a matching marriage market interact. The economy is populated by homogeneous workers, firms and marriage partners (MPs). Workers simultaneously search for firms in order to work and for MPs in order to marry. Firms post wages to attract workers. MPs look for workers in order to marry. Married workers receive a pre-determined flow utility, and married MPs derive flow utility equal to the worker’s earnings. This provides the link between the markets. By interpreting workers and MPs as men and women respectively, I show that the so called married wage premium can arise purely from frictions in both markets. Also, the paper may explain the simultaneous occurrence of three stylised facts: In the model, an increase in the value of women’s option outside marriage leads to a decrease in marriage rates and an increase in the spread of the male wage distribution. |
| Keywords: | Search, Married wage premium, matching markets. |
| JEL: | J01 |
| Date: | 2009–03–11 |
| URL: | http://d.repec.org/n?u=RePEc:eei:rpaper:eeri_rp_2009_31&r=lab |
| By: | Boone, Jan (Tilburg University); van Ours, Jan C. (Tilburg University) |
| Abstract: | Putting a limit on the duration of unemployment benefits tends to introduce a "spike" in the job finding rate shortly before benefits are exhausted. Current theories explain this spike from workers’ behavior. We present a theoretical model in which also the nature of the job matters. End-of-benefit spikes in job finding rates are related to optimizing behavior of unemployed workers who rationally assume that employers will accept delays in the starting date of a new job, especially if these jobs are permanent. We use a dataset on Slovenian unemployment spells to test this prediction and find supporting evidence. We conclude that the spike in the job finding rate suggests that workers exploit unemployment insurance benefits for subsidized leisure. |
| Keywords: | unemployment benefits, spikes |
| JEL: | J22 I31 J16 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4523&r=lab |
| By: | Tindara Addabbo; Donata Favaro |
| Abstract: | In this paper we evaluate wage differentials in Italy combining gender and education perspectives. The main goal of the article is to verify whether the extent of the gender pay gap varies between highly- and low-educated workers, and whether or not the role played by gender differences in characteristics and in market rewards is similar in the two groups. We apply quantile regression analysis and an adaptation of the procedure suggested by Machado and Mata (2005) to evaluate the predicted wage gap at different levels of education, at different points of the female wage distribution scale. The analysis is carried out on the Italian sample of the last available year of the European Community Household Panel (2001). We show that the extent and the trend of the gap predicted across the female distribution is sharply different between groups with diverse educational levels. In the case of low-educated workers, although the predicted gap is largely explained by differences in rewards, lower levels of education or experience are however responsible for the gap, especially on the right-hand side of the distribution. On the contrary, highly-educated females have better characteristics than highly-educated men that partially compensate the rather high difference in returns, in particular at the extremes of the distribution. It thus follows that the unexplained part of the predicted gap reveals a glass ceiling effect only for more highly-educated females. |
| Keywords: | human capital; gender wage differentials; quantile regressions |
| JEL: | J31 J71 C31 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:mod:recent:036&r=lab |
| By: | Ann Huff Stevens; Jessamyn Schaller |
| Abstract: | We study the relationship between parental job loss and children’s academic achievement using data on job loss and grade retention from the 1996, 2001, and 2004 panels of the Survey of Income and Program Participation. We find that a parental job loss increases the probability of children’s grade retention by 0.8 percentage points, or around 15 percent. After conditioning on child fixed effects, there is no evidence of significantly increased grade retention prior to the job loss, suggesting a causal link between the parental employment shock and children’s academic difficulties. These effects are concentrated among children whose parents have a high school education or less. |
| JEL: | J62 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15480&r=lab |
| By: | Bauer, Thomas (RWI Essen); Bender, Stefan (IAB, Nürnberg); Paloyo, Alfredo R. (Ruhr Graduate School in Economics); Schmidt, Christoph M. (RWI Essen) |
| Abstract: | We identify the causal effect of compulsory military service on conscripts’ subsequent labor-market outcomes by exploiting the regression-discontinuity design of the military draft in Germany during the 1950s. Unbiased estimates of the effect of military service on lifetime earnings, wages, and employment are obtained by comparing men born before July 1, 1937 (the "White Cohort") who were exempted from compulsory military service to men who were born on or shortly after this threshold date and hence faced a positive probability of being drafted. We find that the putative earnings advantage and wage premium of those who served in the armed forces vanish when selection effects are taken into account. |
| Keywords: | causal effect, quasi-experimental estimators, conscription |
| JEL: | J31 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4535&r=lab |
| By: | Domenico Tabasso |
| Abstract: | This paper addresses the issue of the presence and the extent of equalizing differences between temporary and permanent workers. The assumption of perfect competition in the labour market is directly questioned and a simple duopsonistic model is developed with the aim of capturing the main sources of differentiation among workers. The empirical analysis, based on several waves of the UK Labour Force Data, tends to confirm several of the hypotheses suggested by the model and emphasizes how in the short run workers who have experienced a change in their job status can expect a career trajectory in line with the theory on compensating differentials. In particular, shifts from temporary to permanent contracts tend to relate to a reduction in wage and a simultaneous increase in travel-to-work distance, while the wage dynamic related to the workers shifting from a temporary contract to another temporary position appears to be directly linked to individual characteristics. |
| Date: | 2009–10–29 |
| URL: | http://d.repec.org/n?u=RePEc:esx:essedp:675&r=lab |
| By: | Philip Du Caju (National Bank of Belgium (NBB), Boulevard de Berlaimont 14, B-1000 Brussels, Belgium.); François Rycx (Free University of Brussels, avenue F.D. Roosevelt 50, B-1050 Brussels, Belgium.); Ilan Tojerow (Free University of Brussels, avenue F.D. Roosevelt 50, B-1050 Brussels, Belgium.) |
| Abstract: | This paper investigates inter-industry wage differentials in Belgium, taking advantage of access to a unique matched employer-employee data set covering all the years from 1999 to 2005. Findings show the existence of large wage differentials among workers with the same observed characteristics and working conditions, employed in different sectors. These differentials are persistent and no particular downward or upward trend is observed. Further results indicate that ceteris paribus, workers earn significantly higher wages when employed in more profitable firms. The time dimension of our matched employer-employee data allows us to instrument firms' profitability by its lagged value. The instrumented elasticity between wages and profits is found to be quite stable over time and varies between 0.034 and 0.043. It follows that Lester’s range of pay due to rent sharing fluctuates between about 24 and 37 percent of the mean wage. This rent-sharing phenomenon accounts for a large fraction of the industry wage differentials. We find indeed that the magnitude, dispersion and significance of industry wage differentials decreases sharply when controlling for profits. JEL Classification: D31, J31, J41. |
| Keywords: | Industry wage differentials, Rent-sharing, Matched employer-employee data. |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20091103&r=lab |
| By: | Kluve, Jochen (RWI Essen); Tamm, Marcus (RWI Essen) |
| Abstract: | Over the last decades many OECD countries introduced parental leave regulations in order to counteract low and decreasing birth rates. In general, these regulations aim at making parenthood more attractive and more compatible with a working career, especially for women. The recent German Elterngeld reform is one example: By replacing 67 per cent of prepartum parental labor earnings for up to 14 months after birth of the child – if both father and mother take up the transfer – it intends to i) smooth or prevent households' earnings decline postpartum, ii) make childbearing attractive for working women while iii) keeping them close to the labor market, and iv) incentivize fathers to participate in childcare. We evaluate the reform by using a natural experiment created by the quick legislative process of the Elterngeld reform: Comparing outcomes of parents with children born shortly after and before the coming into effect of the law on 1 January 2007 yields unbiased estimates of the reform effects, because at the time when these children were conceived none of the parents knew that the regulation would be in force by the time their child is born. Our results are based on unique data from the official evaluation of the reform, which we conducted for the German government, and they show that the reform has been generally successful in attaining its objectives. In particular, we find a significant decrease in mothers' employment probability during the 12 months after giving birth, and a significant increase in mothers' employment probability after the Elterngeld transfer expires. |
| Keywords: | parental leave, natural experiment, female labor market participation |
| JEL: | H31 J13 J18 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4500&r=lab |
| By: | Rita Asplund |
| Abstract: | ABSTRACT : This paper explores the sources underlying the marked increase in the dispersion of private-sector wages in Finland since the mid-90s by use of a recently proposed method to decompose changes along the whole wage distribution over a period of time into several factors contributing to those changes. The results suggest that changes in the way individual and workplace attributes are valued in the labour market have been the driving force behind both real wage growth and increasing wage dispersion. This finding holds true most strongly for white-collar manufacturing workers, who dominate the higher-paid segment of the Finnish private sector. This phenomenon is less pronounced for services sector workers and, eventually, disappears when moving towards the lower end of the sector’s wage distribution. Taken together, these findings are well in line with international evidence stating that changes in the way attributes are rewarded in the labour market tend to drive the growth in wage dispersion in the upper tail of the distribution while changes in the workforce composition are likely to be a notably stronger force behind widening wage differentials in the lower tail of the distribution. |
| Keywords: | decomposition, composition effect, price effect, wage dispersion |
| JEL: | J31 |
| Date: | 2009–11–05 |
| URL: | http://d.repec.org/n?u=RePEc:rif:dpaper:1206&r=lab |
| By: | Amuedo-Dorantes, Catalina (San Diego State University, California); de la Rica, Sara (University of the Basque Country) |
| Abstract: | Spain, as other south-Mediterranean countries, is characterized for the predominance of split work schedules. Split work schedules typically consist of 5 hours of work in the morning (typically from 9 am to 2 pm), followed by a 2 hour break and another 3 hours of work in the afternoon/evening (typically from 4 pm to 7 pm). Because of the evening work hours, split work schedules are contributing to work-family conflicts in the midst of significantly higher female labor force participation. Our purpose is to examine who has a split work schedule and why. We focus on full-time working women with full-time working partners, for whom the need to reconcile work and family responsibilities is likely to be more pressing. We first find that women with partners with a split work schedule or without children (less than 20 percent our sample) are more likely to have a split work schedule. Yet, despite the revealed preference for a continuous work schedule of the remaining women in our sample, we fail to find evidence of a compensating wage differential for having a split work schedule. We thus examine why and find that younger and less educated women more likely to be constrained in their job choices are more likely to work in the private sector, where split work schedules are primarily found. |
| Keywords: | work-family conflicts, timing of work, split/continuous time schedule, compensating wage differentials, job constraints |
| JEL: | J16 J31 J81 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4542&r=lab |
| By: | Paul J Devereux (University College Dublin); Robert A Hart (University of Stirling) |
| Abstract: | Do students benefit from compulsory schooling? In an important article, Oreopoulos (2006) studied the 1947 British compulsory schooling law change and found large returns to schooling of about 15% using the General Household Survey (GHS). Reanalysing this dataset, we find much smaller returns of about 3% on average with no evidence of any positive return for women and a return for men of 4-7%. Additionally, we utilize the New Earnings Survey Panel Data-set (NESPD) that has earnings information superior to that in the GHS and find similar estimates: zero returns for women and returns of 3 to 4% for men. |
| Keywords: | Compulsory Schooling, Returns to Education |
| Date: | 2009–11–01 |
| URL: | http://d.repec.org/n?u=RePEc:ucn:wpaper:200924&r=lab |
| By: | Macunovich, Diane (University of Redlands) |
| Abstract: | Despite strong increases in women's labor force participation – especially among married women with children – in the 1980s, and somewhat less strong increases in the 1990s, the first decade of the twenty-first century has seen declines across the board. These have been especially marked among single women, women with no children, and women with more than 16 years of education. Single women with no children have experienced declines of 7.2, 6.2 and 3.6 percentage points since the late 1980s, among women with less than 16, 16, and more than 16 years of education, respectively. Own-wage elasticities have increased since 2000, after decreasing in the previous 20 years, and the absolute value of cross-wage elasticities has also increased, after declining for at least 20 years. Despite this, the absolute value of elasticities with respect to the presence of children has for the most part continued to decline. Measured factors cannot explain the marked declines in hours worked that have been observed, suggesting that while the labor supply function was hypothesized to have shifted to the right in the 1980s and 1990s, it has shifted back to the left since the late 1990s. And the characteristics of single and childless women dropping out of the labor force after 1999 have changed: they on average had worked more hours, earned more per hour, enjoyed less other income, and had fewer children, than those who had dropped out prior to 1999. |
| Keywords: | women's labor force participation, women's labor supply, opt-out revolution, women's own-wage elasticities, effect of children on women's labor force participation |
| JEL: | J21 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4512&r=lab |
| By: | Stéphane Auray (Université Lille 3 (GREMARS), Université de Sherbrooke (GREDI) and CIRPÉE); Samuel Danthine (Universite du Quebec a Montreal, Universidad de Malaga and CIRPEE) |
| Abstract: | This paper is an attempt to explain differences in economic performance between a subset of OECD countries. We classify countries in terms of their degree of rigidity in the labor market, and use a matching model with labor/leisure choice, bargaining frictions, and labor income taxation to capture these rigidity differences. Added flexibility improves economic performance in different ways depending on whether income taxation is high or low. Feeding income taxation rates estimated from the countries at hand, we find that the model is able to replicate the observed rigidity levels. The model is also shown to reproduce well cross-country differences in non-employment population ratios and the share of part-time jobs. |
| Keywords: | models of search and matching, bargaining frictions, economic performance, labor market institutions, part-time jobs, labor market rigidities |
| JEL: | E24 J22 J30 J41 J50 J64 |
| Date: | 2009–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:shr:wpaper:09-20&r=lab |
| By: | René Böheim; Nicole Schneeweis; Florian Wakolbinger |
| Abstract: | We use data on Austrian firms and employees to estimate the effects of employer-provided training on productivity, wages, and the inequality of wages within firms. While the average amount spent on employer-provided training is low in general, we find a robust positive elasticity of training on productivity of about 0.04. In-house training is more effective than external courses, and language, administrative and personal skills courses are more effective than sales training and IT-courses. We find a significant relationship between training and wages, the coefficient is about 0.05. We find no significant effect of training on the inequality of wages within firms. |
| Keywords: | employer-provided training, productivity, wages |
| JEL: | D21 J24 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:jku:nrnwps:2009_27&r=lab |
| By: | Peri, Giovanni (University of California, Davis and CESifo, Munich) |
| Abstract: | A series of recent influential papers has emphasized that in order to identify the wage effects of immigration one needs to consider national effects by skill level. The criticism to the so called "area approach" is based on the fact that native workers are mobile and would eliminate, in the long-run, local wage effects in a national market. A second criticism is that the small sizes of many local labor markets induces large measurement errors in the share of immigrants and attenuation bias in the estimates of their effects. In this paper we show that a production-function-based approach with skill differentiation and integrated national markets has predictions on the employment effect of immigrants at the local (state) level. Hence if we look at the employment (rather than wage) response to immigration by state, we can still estimate the substitutability-complemetariety between natives and immigrants and infer whether, other things constant, immigrants stimulate or depress the demand for native labor. Moreover, to avoid measurement error issues, we only consider California, as it is the largest state and the largest recipient of immigrants. To address further endogeneity issues we use demographic characteristics of Mexican migrants to the US to predict immigration by skill level in California. Looking at immigration between 1960 and 2005 we find that: i) the assumption of a national integrated labor market by skill holds and ii) immigration did not have any negative employment effect on natives in any education-experience group in California. The estimated effects support the hypothesis that natives and immigrants in the same education-experience group are not perfectly substitutable. Specializing in different tasks and stimulating efficiency are the other likely mechanisms through which immigrants stimulate (rather than hurt) employment of natives. |
| JEL: | F22 J31 J61 R13 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:ucdeco:09-13&r=lab |
| By: | René Böheim; Nicole Schneeweis; Florian Wakolbinger |
| Abstract: | We use data on Austrian firms and employees to estimate the effects of employer-provided training on productivity, wages, and the inequality of wages within firms. While the average amount spent on employer-provided training is low in general, we find a robust positive elasticity of training on productivity of about 0.04. In-house training is more effective than external courses, and language, administrative and personal skills courses are more effective than sales training and IT-courses. We find a significant relationship between training and wages, the coefficient is about 0.05. We find no significant effect of training on the inequality of wages within firms. |
| Keywords: | employer-provided training, productivity, wages |
| JEL: | D21 J24 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:jku:econwp:2009_15&r=lab |
| By: | Eckstein, Zvi (Tel Aviv University); Lifshitz, Osnat (Academic College of Tel-Aviv Yaffo) |
| Abstract: | The increase in female employment and participation rates is one of the most dramatic economic changes to have taken place during the last century. However, while the employment rate of married women more than doubled during the last fifty years, that of unmarried women remained almost constant. In order to empirically analyze these trends we divide the paper into two parts: In the first, we empirically estimate a traditional female dynamic labor supply model using an extended version of Eckstein and Wolpin (1989) in order to compare the various explanations in the literature for the observed trends. The main finding is that the rise in education levels accounts for about one-third of the increase in female employment while about 40 percent remains unexplained by observed household characteristics. We show that this unexplained portion can be empirically attributed to changes in preferences or the costs of childrearing and household maintenance. In the second part, we formulate and estimate a new framework for the couple intra-family game that is then used to analyze the household dynamic labor supply. We find that female labor supply may have increased significantly due to a change in the form of the household game. |
| Keywords: | dynamic discrete choice, female employment, accounting, household game |
| JEL: | E24 J2 J3 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4550&r=lab |
| By: | Bijwaard, Govert (NIDI - Netherlands Interdisciplinary Demographic Institute) |
| Abstract: | In this empirical paper we assess how labour market transitions and out- and repeated migration of immigrants are interrelated. We estimate a multi-state multiple spell competing risks model with four states: employed, unemployed receiving benefits, out-of-the-labour market (no benefits) and abroad. For the analysis we use data on recent labour immigrants to The Netherlands, which implies that all migrants are (self)-employed at the time of arrival. We find that many migrants leave the country after a period of no-income. Employment characteristics and the country of origin play an important role in explaining the dynamics. Microsimulations of synthetic cohorts reveal that many migrants experience unemployment spells, but ten years after arrival only a few are unemployed. Scenarios based on microsimulation indicate that the Credit Crunch will not only increase the unemployment among migrants but also departure from the country. Scenarios also indicate that an increase in the number of migrants from the EU accession countries will lead to higher labour market and migration dynamics. Finally, based on microsimulation we do not expect that the recent simplification of the entry of high income migrants will have a lasting effect, as many of those migrants leave fast. |
| Keywords: | migration dynamics, labour market transitions, competing risks, immigrant assimilation |
| JEL: | F22 J61 C41 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4530&r=lab |
| By: | Rémi Bazillier (LEO - Laboratoire d'économie d'Orleans - CNRS : UMR6221 - Université d'Orléans); Yasser Moullan (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I) |
| Abstract: | We study in this paper the interactions between migration rates and the level of labour standards. We use an augmentee version of the Grogger and Hanson (2008) model, adding the level of working conditions into the specification. Our hypothesis is that the differential of working conditions may be a complementary determinant of migration. In a first time, we test the influence of labour standards in countries of origin using a database on emigration rates built by Defoort (2006) for the period 1975-1995. For labour standards, we built an original index with a temporal dimension. We find that labour standards in the source countries does not have a significant impact on the probability of moving abroad. In a second time, we use a bilateral migration database built by Marfouk and Docquier (2004) in order to test the influence of labour standards in destination countries. If labour standards in the source countries do not have a significant impact on migration flows, level of labour conditions in destination countries have multiple effects on bilateral migration flows. Social protection or protection of collective relations have a positive impact on migration, while job and employment protection laws have the opposite effect. We also find that high-skilled workers are much more sensitive to social security benefits while low skilled workers are more attracted by a protective job and employment legislation. |
| Keywords: | Migration, labour standards, brain-drain, labour markets. |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:halshs-00429730_v1&r=lab |
| By: | Grip Andries de; Lindeboom Maarten; Montizaan Raymond (METEOR) |
| Abstract: | This paper assesses the impact of a dramatic reform of the Dutch pension system on mental health, savings behavior and retirement expectations of workers nearing retirement age. The reform means that public sector workers born on January 1, 1950 or later face a substantial reduction in their pension rights while workers born before this threshold date may still retire under the old, more generous rules. We employ a unique matched survey and administrative data set comprising male public sector workers born in 1949 and 1950 and find strong ex ante effects on mental health for workers who are affected by the reform. This effect increases as birth dates approach the threshold date. Furthermore, the effects differ in accordance with worker characteristics. Finally, we find that the response of those affected by the reform is to work longer and to save more. |
| Keywords: | labour economics ; |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:umamet:2009043&r=lab |
| By: | David Powell; Hui Shan |
| Abstract: | The link between taxes and occupational choices is central for understanding the welfare impacts of income taxes. Just as taxes distort the labor-leisure decision, they also distort the wage-amenity decision. Yet, there are no estimates of the full response on this margin. When tax rates increase, workers favor jobs with lower wages and more non-taxable amenities. The authors introduce a two-step methodology which uses compensating differentials to characterize the tax elasticity of occupational choice. They estimate a significant compensated elasticity of 0.05, implying that a 10% increase in the net-of-tax rate causes workers to change to a 0.5% higher wage job. |
| Keywords: | income taxes, occupational choice, compensating differentials |
| JEL: | H24 H31 J24 |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:ran:wpaper:705&r=lab |
| By: | Havnes, Tarjei (University of Oslo); Mogstad, Magne (Statistics Norway) |
| Abstract: | The strong correlation between child care and maternal employment rates has led previous research to conclude that affordable and readily available child care is a driving force both of cross-country differences in maternal employment and of its rapid growth over the last decades. We analyze the introduction of subsidized, universally accessible child care in Norway. Our precise and robust difference-in-differences estimates reveal that there is little, if any, causal effect of child care on maternal employment, despite a strong correlation. Instead of increasing mothers’ labor supply, the new subsidized child care mostly crowds out informal child care arrangements, suggesting a significant net cost of the child care subsidies. |
| Keywords: | universal child care, female labor force participation |
| JEL: | J13 H40 J21 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4504&r=lab |
| By: | Thomas Liebig; Sarah Widmaier |
| Abstract: | This document provides a first comparative overview of the presence and outcomes of the children of immigrants in the labour markets of OECD countries, based on a collection of data from 16 OECD countries with large immigrant populations. Its key findings are the following: • In about half of all OECD countries, children of immigrants - both native-born offspring of immigrants and foreign-born who immigrated before adulthood with their parents - account for ten or more percent of young adults (aged 20-29) in the labour market. • Most children of immigrants have parents from low- and middle-income countries, and the share with parents from such countries is larger among foreign-born children than among the nativeborn offspring of immigrants. This is a result of the diversification of migration flows over the past 20 years. • Among the native-born children of immigrants in European OECD countries, Turkey is the single most important country of parental origin, followed by Morocco. When comparing the countries of parental origin for the native- and the foreign-born children of immigrants, one observes in the European OECD countries a strong decline in the importance of the origin countries of the post-World War II wave of labour migration, in particular Turkey but also Morocco, Italy, Portugal and Pakistan. • In all countries except Germany and Switzerland, a large majority of the native-born children of immigrants have obtained the nationality of their countries of residence. • The OECD’s Programme for International Student Assessment (PISA) has demonstrated lower assessment results for the children of immigrants in most European OECD countries. There are close links between PISA outcomes and educational attainment levels. In the countries in which children of migrants have large gaps in PISA-scores vis-à-vis children of natives, children of immigrants are also strongly overrepresented among those who are low-educated. • One observes a clear difference between the non-European OECD countries (Australia, Canada, New Zealand and the United States) on the one hand and European OECD countries on the other hand. In the former, the children of migrants have education and labour market outcomes that tend to be at least at par with those of the children of natives. In the European OECD countries (with the exception of Switzerland), both education and labour market outcomes of the children of immigrants tend to be much less favourable. • Part of the differences in labour market outcomes observed in most European OECD countries is due to the fact that the children of immigrants tend to have a lower educational attainment than the children of natives. However, significant gaps remain in many of these countries even after correcting for differences in average educational attainment. • The remaining gaps are particularly large for the offspring of migrants from Turkey and from certain non-OECD countries such as Morocco. In all countries, children with parents from middle-and low-income countries have lower outcomes than children of immigrants from highincome countries. The differences are particularly large for young immigrant women. • On average over the OECD countries for which data are available, the children of immigrants have an unemployment rate that is about 1.6 times higher than that of the children of natives, for both genders. The children of immigrants also have lower employment rates – the gaps compared with the children of natives are about 8 percentage points for men and about 13 percentage points for women. • For women, one observes much better results for the native children of immigrants than for young immigrants, suggesting that having been fully raised and educated in the country of residence brings some additional benefit. However, this is not observed for men, where the native-born children of immigrants do not seem to fare better than the young immigrants, particularly after accounting for the lower educational attainment of the latter group. • The less favourable picture for the female children of migrants compared with their male counterparts is less clear-cut after controlling for socio-demographic characteristics, in particular marital status and number of children. Part of the “double disadvantage” for the female offspring of immigrants seems to be due to the fact that in the age range under consideration (20-29 years), they are overrepresented among those who are (already) married and have children. Indeed, once controlling for this, native-born women who have parents from the Maghreb region or Southern Europe, as well those with Turkish parental origin, tend to have higher employment rates - relative to comparable natives - than their male counterparts. • When in employment, children of immigrants are in occupations similar to those of the children of natives. They are also widely spread throughout the economy, but tend to remain underrepresented in the public sector.<BR>Les principales conclusions qui s’en dégagent sont résumées ci-dessous. • Dans la moitié environ de l’ensemble des pays de l’OCDE, les enfants d’immigrés (aussi bien ceux nés dans le pays hôte de parents immigrés que ceux nés à l’étranger et qui ont immigré avec leurs parents avant d’avoir atteint l’âge adulte) représentent au moins dix pour cent des jeunes adultes (jeunes âgés de 20 à 29 ans) présents sur le marché du travail. • Les parents des enfants immigrés sont le plus souvent originaires de pays à revenu faible ou intermédiaire, et la proportion d’enfants dont les parents sont dans ce cas est plus forte parmi ceux qui sont nés à l’étranger que parmi les enfants nés dans le pays hôte. • Parmi les enfants nés dans un pays européen de l’OCDE de parents immigrés, ceux dont les parents sont originaires de Turquie sont les plus nombreux, suivis des enfants d’origine marocaine. Quand on compare les pays d’origine des parents immigrés d’enfants nés dans le pays hôte et d’enfants nés à l’étranger, on observe, dans les pays européens de l’OCDE, un fort recul de l’importance des pays d’origine correspondant à la vague de migration de travail de l’après- Deuxième Guerre mondiale. Cette observation concerne notamment la Turquie, mais aussi le Maroc, l’Italie, le Portugal et le Pakistan. • Dans tous les pays hormis l’Allemagne et la Suisse, une grande majorité des enfants nés sur le territoire de parents immigrés ont obtenu la nationalité de leur pays de résidence. • Le Programme international de l’OCDE pour le suivi des acquis des élèves (PISA) a démontré que, dans la plupart des pays européens de l’Organisation, les enfants d’immigrés obtenaient de piètres résultats lors des évaluations. Il existe un lien étroit entre les acquis scolaires mesurés par PISA et les niveaux d’études atteints. Dans les pays où l’on relève d’importantes disparités entre les enfants d’immigrés et les enfants de parents autochtones du point de vue des notes obtenues lors des tests PISA, les premiers sont aussi fortement surreprésentés parmi les personnes peu instruites. • On relève une nette différence entre les pays non européens de l’OCDE (Australie, Canada, États-Unis et Nouvelle-Zélande), d’une part, et les pays européens de l’Organisation, d’autre part. Dans le premier groupe, les enfants d’immigrés affichent généralement, au regard de l’éducation et de l’emploi, des résultats au moins égaux à ceux des enfants de parents autochtones. Mais dans les pays européens de l’OCDE (à l’exception de la Suisse), les résultats des enfants d’immigrés au regard de l’éducation et de l’emploi sont généralement moins bons. |
| JEL: | J13 J15 J21 L29 |
| Date: | 2009–10–29 |
| URL: | http://d.repec.org/n?u=RePEc:oec:elsaab:97-en&r=lab |
| By: | Theodore P. Gerber; Brienna Perelli-Harris (Max Planck Institute for Demographic Research, Rostock, Germany) |
| Abstract: | Maternity leave policies are designed to ease the tension between women’s employment and fertility, but whether they actually play such a role remains unclear. We analyze the individual-level effects of maternity leave on employment outcomes and on second conception rates among Russian first-time mothers from 1985-2000 using retrospective job and fertility histories from the Survey of Stratification and Migration Dynamics in Russia. During this period Russia experienced tremendous economic and political turbulence, which many observers believed would undermine policies like maternity leave and otherwise adversely affect the situation of women. Nevertheless, we find that maternity leave helped women maintain a foothold in the labor market, especially during the more turbulent post-transition period. Also, women who took extended leave in connection with their first birth had elevated rates of second conceptions once they returned to the workforce. |
| Keywords: | Russia, employment, fertility, maternity leave |
| JEL: | J1 Z0 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:dem:wpaper:wp-2009-028&r=lab |
| By: | Ortega, Francesc (Universitat Pompeu Fabra); Polavieja, Javier G. (IMDEA) |
| Abstract: | This paper re-examines the role of labor-market competition as a determinant of attitudes toward immigration. We claim two main contributions. First, we use more sophisticated measures of the degree of exposure to competition from immigrants than previously done. Specifically, we focus on the protection derived from investments in job-specific human capital and from specialization in communication-intensive jobs, in addition to formal education. Second, we explicitly account for the potential endogeneity arising from job search. Methodologically, we estimate, by instrumental variables, an econometric model that allows for heterogeneity at the individual, regional, and country level. Drawing on the 2004 European Social Survey, we obtain three main results. First, our estimates show that individuals that are currently employed in less exposed jobs are relatively more pro-immigration. This is true for both our new measures of exposure. Second, we show that the protection granted by job-specific human capital is clearly distinct from the protection granted by formal education. Yet the positive effect of education on pro-immigration attitudes is greatly reduced when we control for the degree of communication intensity of respondents' occupations. Third, OLS estimates are biased in a direction that suggests that natives respond to immigration by switching to less exposed jobs. The latter finding provides indirect support for the endogenous job specialization hypothesis postulated by Peri and Sparber (2009). |
| Keywords: | immigration attitudes, labor market, job-specific human capital, communication skills, international migration |
| JEL: | F1 F22 J61 J31 R13 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4519&r=lab |
| By: | Boudarbat, Brahim (University of Montreal); Chernoff, Victor (University of Montreal) |
| Abstract: | This study uses data from the Follow-up of Graduates Survey – Class of 2000, to look at the determinants of education-job for Canadian university graduates. From a public policy perspective, the question of education-job match is relevant given the substantial investment society puts into its post secondary institutions, and the role devoted to human capital in economic development. Our results indicate that one graduate out of three (35.1%) is in a job that is not closely related to his or her education. The most important result is that demographic and socioeconomic characteristics (gender and family background) do not matter very much in the match. On the other hand, education characteristics significantly influence match, with field specific programs (such as "Health sciences" and "Education") having the highest likelihood of obtaining an education-job match. In addition, the level of education (i.e. graduates with a postgraduate degree vs. a bachelor degree), as well as good grades, strongly affect the match. Employment characteristics also affect the match, but to a mixed extent, with certain characteristics, such as industry, as well as working full-time (vs. part time) affecting the match to a strong extent, while others, such as the permanence of employment, as well as the method used to obtain employment not having a significant effect on match. |
| Keywords: | education-job match, university graduates, Canada, Follow-up of Graduates Survey |
| JEL: | J24 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4513&r=lab |
| By: | Algan, Yann (Sciences Po, Paris); Dustmann, Christian (University College London); Glitz, Albrecht (Universitat Pompeu Fabra); Manning, Alan (London School of Economics) |
| Abstract: | A central concern about immigration is the integration into the labour market, not only of the first generation, but also of subsequent generations. Little comparative work exists for Europe’s largest economies. France, Germany and the UK have all become, perhaps unwittingly, countries with large immigrant populations albeit with very different ethnic compositions. Today, the descendants of these immigrants live and work in their parents’ destination countries. This paper presents and discusses comparative evidence on the performance of first- and second-generation immigrants in these countries in terms of education, earnings, and employment. |
| Keywords: | immigration, second-generation immigrants, integration |
| JEL: | J61 F22 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4514&r=lab |
| By: | Weber, Andrea (RWI Essen); Zulehner, Christine (University of Vienna) |
| Abstract: | According to Becker's (1957) famous theory on discrimination, entrepreneurs with a strong prejudice against female workers forgo profits by submitting to their tastes. In a competitive market their firms lack efficiency and are therefore forced to leave. We present new empirical evidence for this prediction by studying the survival of startup firms in a large longitudinal matched employer-employee data set from Austria. Our results show that firms with strong preferences for discrimination, i.e. a low share of female employees relatively to the industry average, have significantly shorter survival rates. This is especially relevant for firms starting out with female shares in the lower tail of the distribution. They exit about 18 months earlier than firms with a median share of females. We see no differences in survival between firms at the top of the female share distribution and at the median, though. We further document that highly discriminatory firms that manage to survive submit to market powers and increase their female workforce over time. |
| Keywords: | firm survival, profitability, female employment, discrimination, market test, matched employer-employee data |
| JEL: | J16 J71 L25 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4526&r=lab |
| By: | Kraft, Kornelius (University of Dortmund); Neimann, Stefanie (University of Dortmund) |
| Abstract: | Using German panel data from 1984 to 2007, we analyze the impact of labor division between husband and wife on the risk of divorce. Gary Becker’s theory of marriage predicts that specialization in domestic and market work, respectively, reduces the risk of separation. Traditionally, the breadwinner role is assigned to the husband, however, female labor force participation and their wages have risen substantially. Our results suggest that there are gender-specific differences, e.g. female breadwinner-couples have a substantially higher risk of divorce than male breadwinner-couples. In contrast, the equal division does not significantly alter the probability of separation. |
| Keywords: | divorce, labor division, Germany |
| JEL: | J12 J22 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4515&r=lab |
| By: | Dur, Robert (Erasmus University Rotterdam); Sol, Joeri (Erasmus University Rotterdam) |
| Abstract: | Social interaction with colleagues is an important job attribute for many workers. To attract and retain workers, managers therefore need to think about how to create and preserve high-quality co-worker relationships. This paper develops a principal-multi-agent model where agents do not only engage in productive activities, but also in social interaction with their colleagues, which in turn creates co-worker altruism. We study how financial incentives for productive activities can improve or damage the work climate. We show that both team incentives and relative incentives can help to create a good work climate. |
| Keywords: | social interaction, altruism, incentive contracts, co-worker satisfaction |
| JEL: | D86 J41 M50 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4532&r=lab |
| By: | David R. Howell; Miriam Rehm |
| Abstract: | Generous unemployment benefits lie at the heart of the conventional explanation for persistent high unemployment. The effects of benefit generosity are more ambiguous in a broader behavioral framework in which workers get substantial disutility from unemployment controlling for income, and know that unemployment has scarring effects in the future. The micro evidence suggests modest effects of changes in generosity, but there are reasons to doubt that the impacts on national unemployment rates are consequential. The strongest evidence for the orthodox prediction comes from cross-country regressions on the OECD’s gross replacement rate (GRR), but we find little support in the pattern of annual changes in the GRR and the unemployment rate for OECD countries over the last three decades. We take advantage of newly released and much improved net replacement rate indicators from the OECD, which show little correlation with either the GRRs or with unemployment and employment rates. The evidence does not offer compelling support for the view that benefit generosity is at the root of high European unemployment. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:uma:periwp:wp201&r=lab |
| By: | Andrea Weber; Christine Zulehner |
| Abstract: | According to Becker's (1957) famous theory on discrimination, entrepreneurs with a strong prejudice against female workers forgo profits by submitting to their tastes. In a com- petitive market their firms lack efficiency and are therefore forced to leave. We present new empirical evidence for this prediction by studying the survival of startup firms in a large longitudinal matched employer-employee data set from Austria. Our results show that firms with strong preferences for discrimination, i.e. a low share of female employees relatively to the industry average, have significantly shorter survival rates. This is espe- cially relevant for firms starting out with female shares in the lower tail of the distribution. They exit about 18 months earlier than firms with a median share of females. We see no differences in survival between firms at the top of the female share distribution and at the median, though. We further document that highly discriminatory firms that manage to survive submit to market powers and increase their female workforce over time. |
| Keywords: | Firm survival, profitability, female employment, discrimination, market test, matched employer-employee data |
| JEL: | J16 J71 L25 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:jku:nrnwps:2009_26&r=lab |
| By: | Kornelius Kraft; Stefanie Neimann |
| Abstract: | Using German panel data from 1984 to 2007, we analyze the impact of labor division between husband and wife on the risk of divorce. Gary Becker's theory of marriage predicts that specialization in domestic and market work, respectively, reduces the risk of separation. Traditionally, the breadwinner role is assigned to the husband, however, female labor force participation and their wages have risen substantially. Our results suggest that there are gender-specific differences, e.g. female breadwinner-couples have a substantially higher risk of divorce than male breadwinner-couples. In contrast, the equal division does not significantly alter the probability of separation. |
| Keywords: | Divorce, labor division, Germany |
| JEL: | J12 J22 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp223&r=lab |
| By: | Olof Åslund (Uppsala University); Anders Böhlmark (Institute for social research (SOFI) and CReAM); Oskar Nordström Skans (IFAU, IZA and Uppsala University) |
| Abstract: | The paper studies childhood migrants and examines how age at migration affects their ensuing integration at the residential market, the labor market, and the marriage market. We use population-wide Swedish data and compare outcomes as adults among siblings arriving at different ages in order to ensure that the results can be given a causal interpretation. The results show that the children who arrived at a higher age had substantially lower shares of natives among their neighbors, coworkers and spouses as adults. The effects are mostly driven by higher exposure to immigrants of similar ethnic origin, in particular at the marriage market. There are also non-trivial effects on employment, but a more limited impact on education and wages. We also analyze children of migrants and show that parents’ time in the host country before child birth matters, which implies that the outcomes of the social integration process are inherited. Inherited integration has a particularly strong impact on the marriage patterns of females. |
| Keywords: | Immigration, integration, segregation, age at migration, siblings. |
| JEL: | J12 J15 J13 J01 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:200927&r=lab |
| By: | Aslund, Olof (IFAU); Edin, Per-Anders (IFAU); Fredriksson, Peter (IFAU); Grönqvist, Hans (SOFI, Stockholm University) |
| Abstract: | Immigrants typically perform worse than other students in the OECD countries. We examine to what extent this is due to the population characteristics of the neighborhoods that immigrants grow up in. We address this issue using a governmental refugee placement policy which provides exogenous variation in the initial place of residence in Sweden. The main result is that, for a given share of immigrants in a neighborhood, immigrant school performance is increasing in the number of highly educated adults sharing the subject’s ethnicity. A standard deviation increase in the fraction of highly educated adults in the assigned neighborhood increases compulsory school GPA by 0.9 percentile ranks. This magnitude corresponds to a tenth of the gap in student performance between refugee immigrant and native-born children. We also provide tentative evidence that the overall share of immigrants in the neighborhood has a negative effect on GPA. |
| Keywords: | peer effects, ethnic enclaves, immigration, school performance |
| JEL: | J15 I20 Z13 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4521&r=lab |
| By: | Will Dobbie; Roland G. Fryer, Jr |
| Abstract: | Harlem Children’s Zone (HCZ), which combines community investments with reform minded charter schools, is one of the most ambitious social experiments to alleviate poverty of our time. We provide the first empirical test of the causal impact of HCZ on educational outcomes, with an eye toward informing the long-standing debate whether schools alone can eliminate the achievement gap or whether the issues that poor children bring to school are too much for educators alone to overcome. Both lottery and instrumental variable identification strategies lead us to the same story: Harlem Children’s Zone is effective at increasing the achievement of the poorest minority children. Taken at face value, the effects in middle school are enough to close the black-white achievement gap in mathematics and reduce it by nearly half in English Language Arts. The effects in elementary school close the racial achievement gap in both subjects. We conclude by presenting four pieces of evidence that high-quality schools or high-quality schools coupled with community investments generate the achievement gains. Community investments alone cannot explain the results. |
| JEL: | I20 J01 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15473&r=lab |
| By: | Dromel, Nicolas (University of Paris 1); Kolakez, Elie (University of Paris 2 - ERMES); Lehmann, Etienne (CREST-INSEE) |
| Abstract: | In this paper, we argue that credit market imperfections impact not only the level of unemployment, but also its persistence. For this purpose, we first develop a theoretical model based on the equilibrium matching framework of Mortensen and Pissarides (1999) and Pissarides (2000) where we introduce credit constraints. We show these credit constraints not only increase steady-state unemployment, but also slow down the transitional dynamics. We then provide an empirical illustration based on a country panel dataset of 20 OECD countries. Our results suggest that credit market imperfections significantly increase the persistence of unemployment. |
| Keywords: | credit markets, labor markets, unemployment, credit constraints, search frictions |
| JEL: | E24 E44 J08 J64 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4501&r=lab |
| By: | Olof Åslund (Uppsala University); Per-Anders Edin (IFAU and Uppsala University); Peter Fredriksson (IFAU and Uppsala University); Hans Grönqvist (Institute for social research (SOFI), University of Stockholm) |
| Abstract: | Immigrants typically perform worse than other students in the OECD countries. We examine to what extent this is due to the population characteristics of the neighborhoods that immigrants grow up in. We address this issue using a governmental refugee placement policy which provides exogenous variation in the initial place of residence in Sweden. The main result is that, for a given share of immigrants in a neighborhood, immigrant school performance is increasing in the number of highly educated adults sharing the subject’s ethnicity. A standard deviation increase in the fraction of highly educated adults in the assigned neighborhood increases compulsory school GPA by 0.9 percentile ranks. This magnitude corresponds to a tenth of the gap in student performance between refugee immigrant and native-born children. We also provide tentative evidence that the overall share of immigrants in the neighborhood has a negative effect on GPA. |
| Keywords: | Peer effects; Ethnic enclaves; Immigration; School performance. |
| JEL: | J15 I20 Z13 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:200928&r=lab |
| By: | Nadja Dwenger; Johanna Storck; Katharina Wrohlich |
| Abstract: | Several German states recently introduced tuition fees for university education. We investigate whether these tuition fees influence the mobility of university applicants. Based on administrative data of applicants for medical schools in Germany, we estimate the effect of tuition fees on the probability of applying for a university in the home state. We find a small but significant reaction: The probability of applying for a university in the home state falls by 2 percentage points (baseline: 69%) for high-school graduates who come from a state with tuition fees. Moreover, we find that students with lower high-school grades react more strongly to tuition fees. This might have important effects on the composition of students across states. |
| Keywords: | mobility of high-school graduates, tuition fees, natural experiment |
| JEL: | I22 I28 H75 R23 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp926&r=lab |
| By: | Pablo Brañas-Garza (Universidad de Granada- España); Juan C. Cárdenas (Universidad de los Andes- Colombia); Máximo Rossi (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República) |
| 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 prosocial behavior. Lastly, we see that subjects’ expectations are crucial. |
| Keywords: | reciprocal altruism, gender, education |
| JEL: | C93 D64 J16 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:1609&r=lab |
| By: | Andrés Rodríguez-Pose (IMDEA Ciencias Sociales); Vassilis Tselios (University of Newcastle upon Tyne) |
| Abstract: | Relatively little attention has been paid to the role that externalities play in determining the pecuniary returns to migration. This paper addresses this gap, using microeconomic data for more than 100,000 individuals living in the European Union (EU) for the period 1994-2001 in order to analyse whether the individual economic returns to education vary between migrants and non-migrants and whether any observed differences in earnings between migrants and locals are affected by household and/or geographical (regional and interregional) externalities. The results point out that while education is a fundamental determinant of earnings, European labour markets – contrary to expectations – do not discriminate in the returns to education between migrants and non-migrants. The paper also finds that household, regional, and interregional externalities influence the economic returns to education, but that they do so in a similar way for local, intranational, and supra-national migrants. The results are robust to the introduction of a large number of individual, household, and regional controls. |
| Keywords: | individual earnings; migration; educational attainment; externalities; household; regions; Europe |
| Date: | 2009–11–03 |
| URL: | http://d.repec.org/n?u=RePEc:imd:wpaper:wp2009-15&r=lab |
| By: | Smyth, Emer; McCoy, Selina |
| Keywords: | qec |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:rb2009/3/3&r=lab |
| By: | Gunnar Andersson (Max Planck Institute for Demographic Research, Rostock, Germany); Michaela Kreyenfeld (Max Planck Institute for Demographic Research, Rostock, Germany); Tatjana Mika |
| Abstract: | This paper investigates the role of female earnings in childbearing decisions in two very different European contexts. By applying event history techniques to German and Danish register data during 1981-2001, we demonstrate how female earnings relate to first, second and third birth rates. Our study shows that female earnings are rather positively associated with fertility in Denmark, while the relationship is the opposite in West Germany. We interpret our findings based on our observation that Danish social policies tend to encourage Danish women to become established in the labor market before having children, while German policies during the 1980s and 1990s were not designed to encourage maternal employment. |
| Keywords: | Denmark, fertility |
| JEL: | J1 Z0 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:dem:wpaper:wp-2009-026&r=lab |
| By: | Francesco, D'Amuri |
| Abstract: | This article tests the power of a novel indicator based on job search related web queries in predicting quarterly unemployment rates in short samples. Augmenting standard time series specifications with this indicator definitely improves out-of-sample forecasting performance at nearly all in-sample interval lengths and forecast horizons, both when compared with models estimated on the same or on a much longer time series interval. |
| Keywords: | Google econometrics; Forecast comparison; Keyword search; Unemployment; Time series models. |
| JEL: | C53 E27 J60 J64 C22 |
| Date: | 2009–10–30 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:18403&r=lab |
| By: | Arie Kapteyn; James P. Smith; Arthur Van Soest |
| 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 the authors 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, they find differences in response scales across countries, partly related to social insurance generosity and employment protection. Furthermore, they find significant evidence of justification bias in the U.S. but not in Europe, suggesting differences in social norms concerning work. |
| Keywords: | work limiting disability, vignettes, reporting bias |
| JEL: | J28 I12 C81 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:ran:wpaper:696&r=lab |
| By: | Haan, Peter (DIW Berlin); Wrohlich, Katharina (DIW Berlin) |
| Abstract: | In this paper we develop a structural model of female employment and fertility which accounts for intertemporal feedback effects between the two outcomes. We identify the effect of financial incentives on the employment and fertility decision by exploiting variation in the tax and transfer system which differs by employment state and number of children. To this end we simulate in detail the effects of the tax and transfer system including child care costs. The model provides estimates of structural preferences of women which can be used to study the effect of various policy reforms. In particular, we show that increasing child care subsidies conditional on employment increases labor supply of all women as well as fertility of the childless and highly educated women. |
| Keywords: | employment, fertility, financial incentives |
| JEL: | C23 C25 J22 J64 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4503&r=lab |
| By: | Vincenzo Caponi (Department of Economics, Ryerson University, Toronto, Canada) |
| Abstract: | This paper presents a general equilibrium model of regional unemployment dispersion based on the Mortensen and Pissarides (1999) framework. The model economy presented here has centralized institutions, such as a single central government and central unions, but regional labor markets with differences productivity. The model assumes that unions dislike wage dispersion across regions and the government dislikes population imbalance across the regions. The set up of the model is used to interpret the economic features of the Italian economy between the mid seventies and the end of the past century. By means of calibration using Italian data collected in the year 2000 the paper shows that the model economy explains the important regional dualism between the North and the South of Italy in terms of unemployment. Moreover, the model indicates that the interaction between unions and the government also generates low wage rates in the high productivity regions accompanied by low unemployment rates, even when the Northern worker is the median worker that determines the unions policies. |
| Keywords: | Italy, Regional Dualism, Mezzogiorno. |
| JEL: | E24 J51 J60 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:rye:wpaper:wp007&r=lab |
| By: | Elisabeth Cudeville (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I); Magali Recoules (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris) |
| Abstract: | We present a model of household behavior to explore the complex interactions between the decision-making process within the household and social norms. The household is viewed as two separate spheres – the female and the male – both linked by a public good and a "conjugal contract" trough which spouses exchange resources. The conjugal contract negotiated within the couple is partly influenced by social norms given the conformism of individuals. Social norms are endogenously determined as the average conjugal contract. We find that the closer spouses' wages are in the labor market, the more equally they share household tasks. Wage policies promoting gender wage equality lead all couples to renegotiate the terms of their conjugal contract, which in turn changes social norms. Even though spouses aim at maximizing the household's welfare, the resulting equilibrium allocation is not Pareto efficient and inefficiency increases with social conformism. |
| Keywords: | Conjugal contract ; social norms ; wage discrimination ; household behavior ; intra-household decision-making |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:halshs-00429609_v1&r=lab |
| By: | John T. Addison (Moore School of Business, University of South Carolina, Queen’s University School of Management, and GEMF, University of Coimbra); Alex Bryson (National Institute of Economic and Social Research and CEP); Paulino Teixeira (Faculdade de Economia/GEMF, University of Coimbra); André Pahnke (Institut für Arbeitsmarkt- und Berufsforschung, Bundesagentur für Arbeit); Lutz Bellmann (Friedrich-Alexander-Universität Erlangen-Nürnberg, Institut für Arbeitsmarkt- und Berufsforschung, Bundesagentur für Arbeit, and IZA) |
| Abstract: | Industrial relations are in flux in many nations, perhaps most notably in Germany and Britain. That said, comparatively little is known in any detail of the changing pattern of the institutions of collective bargaining and worker representation in Germany and still less in both countries about firm transitions between these institutions over time. The present paper maps changes in the importance of the key institutions, 1998-2004, and explores the correlates of two-way transitions, using successive waves of the German IAB Establishment Panel and both cross-sectional and panel components of the British Workplace Employment Relations Survey. We identify the workplace correlates of the demise of collective bargaining in Britain and the erosion of sectoral bargaining in Germany, and identify the respective roles of behavioral and compositional change. |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:gmf:wpaper:2009-14&r=lab |
| By: | Arne Feddersen (University of Hamburg); Wolfgang Maennig (University of Hamburg) |
| Abstract: | We estimate the economic effects of the 1996 Atlanta Olympic Games. Our difference in difference model checks for serial correlation and allows for a simultaneous test of level and trend effects, but otherwise follows HOTCHKISS, MOORE, & ZOBAY (2003) in this journal. We were not able to reconfirm their finding that the Games had significant positive employment effects. We do, however, reaffirm their result of no significant wage effects. |
| Keywords: | Olympic Games, sports economics, mega events |
| JEL: | H54 R12 L83 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:spe:wpaper:0916&r=lab |
| By: | Michal Myck; Richard Ochmann; Salmai Qari |
| Abstract: | There is by now a lot of evidence showing a sharp increase in cross-sectional wage and earnings inequality during the 2000s in Germany. Our study is the first to decompose this cross-sectional variance into its permanent and transitory parts for years beyond 2000. Using data from the German Socio-Economic Panel on fulltime working individuals for years of 1994 to 2006, we do not find unambiguous empirical support for the frequent claims that recent increases in inequality have been driven mainly by permanent disparities. From 1994 on, permanent inequality increases continuously, peaks in 2001 but then declines in subsequent years. Interestingly the decline in the permanent fraction of inequality occurs at the time of most rapid increases in cross-sectional inequality. It seems therefore that it is primarily the temporary and not the permanent component which has driven the strong expansion of cross-sectional inequality during the 2000s in Germany. |
| Keywords: | Variance decomposition, covariance structure models, earnings inequality, wage dynamics |
| JEL: | C23 D31 J31 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp929&r=lab |
| By: | Alonso Ortiz, Jorge |
| Abstract: | There are large differences in the employment to population ratio relative to the US across OECD countries, and these differences are even larger for the old age (55-69 years). There are also large differences in various features of social security, such as the replacement rate, the entitlement age or whether it is allowed to collect social security and working. These observations suggest that they might be an important factor. I assess quantitatively this hypothesis using a life cycle general equilibrium model of retirement. I find that the differences in social security can indeed account for the differences in employment to population ratio at old age in the OECD. I also evaluate which features of social security are most important in this context and find that generosity and whether it allows collecting social security while working are the most important contributors. |
| Keywords: | Social security; retirement; idiosyncratic labor income risk |
| JEL: | J14 E24 H53 J26 |
| Date: | 2009–11–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:18563&r=lab |
| By: | David O. Meltzer; Zhuo Chen |
| Abstract: | Growing consumption of increasingly less expensive food, and especially “fast foodâ€, has been cited as a potential cause of increasing rate of obesity in the United States over the past several decades. Because the real minimum wage in the United States has declined by as much as half over 1968-2007 and because minimum wage labor is a major contributor to the cost of food away from home we hypothesized that changes in the minimum wage would be associated with changes in bodyweight over this period. To examine this, we use data from the Behavioral Risk Factor Surveillance System from 1984-2006 to test whether variation in the real minimum wage was associated with changes in body mass index (BMI). We also examine whether this association varied by gender, education and income, and used quantile regression to test whether the association varied over the BMI distribution. We also estimate the fraction of the increase in BMI since 1970 attributable to minimum wage declines. We find that a $1 decrease in the real minimum wage was associated with a 0.06 increase in BMI. This relationship was significant across gender and income groups and largest among the highest percentiles of the BMI distribution. Real minimum wage decreases can explain 10% of the change in BMI since 1970. We conclude that the declining real minimum wage rates has contributed to the increasing rate of overweight and obesity in the United States. Studies to clarify the mechanism by which minimum wages may affect obesity might help determine appropriate policy responses. |
| JEL: | I1 I28 J3 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15485&r=lab |
| By: | Peter Haan; Katharina Wrohlich |
| Abstract: | In this paper we develop a structural model of female employment and fertility which accounts for intertemporal feedback effects between the two outcomes. We identify the effect of financial incentives on the employment and fertility decision by exploiting variation in the tax and transfer system which differs by employment state and number of children. To this end we simulate in detail the effects of the tax and transfer system including child care costs. The model provides estimates of structural preferences of women which can be used to study the effect of various policy reforms. In particular, we show that increasing child care subsidies conditional on employment increases labor supply of all women as well as fertility of the childless and highly educated women. |
| Keywords: | Employment, fertility, financial incentives |
| JEL: | C23 C25 J22 J64 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp935&r=lab |
| By: | Bandiera, Oriana (London School of Economics); Larcinese, Valentino (London School of Economics); Rasul, Imran (University College London) |
| Abstract: | Over the last decade, many countries have experienced dramatic increases in university enrolment, which, when not matched by compensating increases in other inputs, have resulted in larger class sizes. Using administrative records from a leading UK university, we present evidence on the effects of class size on students’ test scores. We observe the same student and faculty members being exposed to a wide range of class sizes from less than 10 to over 200. We therefore estimate non-linear class size effects controlling for unobserved heterogeneity of both individual students and faculty. We find that (i) at the average class size, the effect size is -0.108; (ii) the effect size is however negative and significant only for the smallest and largest ranges of class sizes and zero over a wide range of intermediate class sizes; (iii) students at the top of the test score distribution are more affected by changes in class size, especially when class sizes are very large. We present evidence to rule out class size effects being due solely to the non-random assignment of faculty to class size, sorting by students onto courses on the basis of class size, omitted inputs, the difficulty of courses, or grading policies. The evidence also shows the class size effects are not mitigated for students with greater knowledge of the UK university system, this university in particular, or with greater family wealth. |
| Keywords: | class size, heterogeneity, university education |
| JEL: | A20 D23 I23 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4496&r=lab |
| By: | Sebastiano Daros; Neil Rankin |
| Abstract: | We analytically examine output persistence from monetary shocks in a DSGE model with staggered prices or wages under a Taylor Rule for monetary policy. The best known such model assumes Calvo-style staggering of prices and flexible wages and is known to yield no persistence under a Taylor Rule. Switching to Taylor-style staggering introduces lagged output into the model’s ‘New Keynesian Phillips Curve’ equation. Despite this, we show it generates no persistence, whether staggering is in wages or prices. Surprisingly, however, Calvo-style staggering of wages does generate persistence, if there are decreasing returns to labour. |
| Keywords: | Output Persistence, Staggered Prices/Wages, Taylor Rule. |
| JEL: | E32 E52 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:san:cdmacp:0906&r=lab |
| By: | Chris Manning |
| Abstract: | This paper examines the impact of the global financial crisis on the Vietnam labour market against the backdrop of economic performance and labour dynamics before the crisis. The impact on labour has been milder compared with several neighbouring countries, than might have been expected for a country with Vietnam’s degree of international exposure. This can attributed to the timely stimulus package of late 2008, the tight labour market before the crisis, the competitive nature of Vietnam’s key exports and the private sector’s capacity to compete globally. Although flexible labour markets have ensured low unemployment, we argue that aspects of the institutional environment have contributed to slower labour market adjustment. Shortages of skilled labour, labour market rigidities and an under-developed industrial relations system could delay recovery and constrain future growth. |
| Keywords: | global financial crisis, exports, FDI, employment, labour market adjustment, labour institutions, Vietnam |
| JEL: | J21 J23 J24 J48 O14 O15 O17 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:pas:papers:2009-17&r=lab |
| By: | Bollard, Albert (Stanford University); McKenzie, David (World Bank); Morten, Melanie (Yale University); Rapoport, Hillel (Bar-Ilan University) |
| Abstract: | Two of the most salient trends surrounding the issue of migration and development over the last two decades are the large rise in remittances, and an increased flow of skilled migration. However, recent literature based on cross-country regressions has claimed that more educated migrants remit less, leading to concerns that further increases in skilled migration will hamper remittance growth. We revisit the relationship between education and remitting behavior using microdata from surveys of immigrants in eleven major destination countries. The data show a mixed pattern between education and the likelihood of remitting, and a strong positive relationship between education and the amount remitted conditional on remitting. Combining these intensive and extensive margins gives an overall positive effect of education on the amount remitted. The microdata then allow investigation as to why the more educated remit more. We find the higher income earned by migrants, rather than characteristics of their family situations explains much of the higher remittances. |
| Keywords: | remittances, migration, brain drain, education |
| JEL: | O15 F22 J61 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4534&r=lab |
| By: | Andersson Joona, Pernilla (Stockholm University Linnaeus Center for Integration Studies - SULCIS); Wadensjö, Eskil (Stockholm University Linnaeus Center for Integration Studies - SULCIS) |
| Abstract: | Self-employment is very common among some immigrant groups in Sweden and many of them hire co-nationals in their firms. One reason might be that they want to give newly arrived co-nationals the possibility to earn an income. But what are the consequences for the employees of being employed by a co-national? This paper analyzes the impact on labour income and future employment prospects of being employed by self-employed co-nationals shortly after arrival to Sweden. We find that immigrants in this group have substantially lower incomes than newly arrived immigrants with other forms of employment. We also find that they are less likely to work as employees in the private sector (other than being employed by a self-employed) in the future and are much more likely to become self-employed. |
| Keywords: | ethnic economies; self-employment; income |
| JEL: | J15 J23 J31 L26 |
| Date: | 2009–10–30 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sulcis:2009_011&r=lab |
| By: | Voňková, Hana (Tilburg University); van Soest, Arthur (Tilburg University) |
| Abstract: | We study effects of financial incentives on the retirement age using stated preference data. Dutch survey respondents were given hypothetical retirement scenarios describing age(s) of (partial and full) retirement and replacement rate(s). A structural model is estimated in which utility is the discounted sum of within period utilities that depend on employment status and income. Parameters of the utility function vary with observed and unobserved characteristics. Simulations show that the income and substitution effects of pensions as a function of the retirement age are substantial and larger than according to studies using data on actual retirement decisions. |
| Keywords: | pensions, flexible retirement, gradual retirement, stated choices |
| JEL: | J22 J26 C81 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4505&r=lab |
| By: | Albert Bollard (Stanford University); David McKenzie (Development Research Group, World Bank); Melanie Morten (Yale University); Hillel Rapoport (Bar-Ilan University, EQUIPPE and CID, Harvard University) |
| Abstract: | Two of the most salient trends surrounding the issue of migration and development over the last two decades are the large rise in remittances, and an increased flow of skilled migration. However, recent literature based on cross-country regressions has claimed that more educated migrants remit less, leading to concerns that further increases in skilled migration will hamper remittance growth. We revisit the relationship between education and remitting behavior using microdata from surveys of immigrants in eleven major destination countries. The data show a mixed pattern between education and the likelihood of remitting, and a strong positive relationship between education and the amount remitted conditional on remitting. Combining these intensive and extensive margins gives an overall positive effect of education on the amount remitted. The microdata then allow investigation as to why the more educated remit more. We find the higher income earned by migrants, rather than characteristics of their family situations explains much of the higher remittances. |
| Keywords: | Remittances, Migration, Brain Drain, Education. |
| JEL: | O15 F22 J61 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:200926&r=lab |
| By: | De Paola, Maria; Scoppa, Vincenzo |
| Abstract: | We analyse peer effects among students of a middle-sized Italian public university. We explain students’ average grade in exams passed during their Second Level Degree course on the basis of their pre-determined measures of abilities, personal characteristics and peer group abilities. Thanks to a rich administrative dataset, we are able to build a variety of definitions of peer groups, describing different kinds of students’ interaction, based on classes attended together or exams taken in the same session. Self-selection problems are handled through Two-Stage Least Squares estimations using as an instrument, the exogenous assigning of students to different teaching classes in the compulsory courses attended during their First Level Degree course. We find statistically significant positive peer group effects, which are robust to the different definitions of peer group and to different measures of abilities. |
| Keywords: | Peer effects; Student performance; Educational production function; instrumental variables |
| JEL: | I21 Z13 J24 |
| Date: | 2009–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:18428&r=lab |
| By: | Davide Furceri; Annabelle Mourougane |
| Abstract: | This paper examines the effect of economic crises on structural unemployment using an Autoregressive Distributed Lags model and accounting for the role of institutional settings. Analysing an unbalanced panel of 30 OECD economies from 1970 to 2008, we found that downturns have, on average, a significant positive impact on the level of structural unemployment rate. The maximum impact varies with the severity of the downturn. Institutions (such as Employment Protection Legislation, average replacement ratio and product market regulation) influence both the extent of the initial shock and the adjustment pattern in the aftermath of a downturn.<P>Comment les institutions influencent-elles le chômage structurel en temps de crise ?<BR>Ce document examine l’effet des crises économiques sur le chômage structurel en utilisant un modèle Autorégressif à Retards Distribués et en prenant en compte l’effet des institutions. A partir d’un panel non cylindré de 30 économies de l’OCDE de 1970 à 2008, les crises économiques sont estimées avoir, en moyenne, un effet significatif et positif sur le niveau du taux de chômage structurel. L’effet maximal varie avec la sévérité de la crise. Les institutions (législation sur la protection de l’emploi, ratio de remplacement moyen et régulation sur les marchés des produits) influencent à la fois l’amplitude du choc initial et l’ajustement suivant le choc. |
| Keywords: | employment protection legislation, législation sur la protection de l'emploi, institutions, institutions, crisis, crise, structural unemployment, chômage structurel |
| JEL: | E62 H10 |
| Date: | 2009–11–03 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:730-en&r=lab |
| By: | Elodie Fabre |
| Abstract: | One of the most recent transformations of the structure of a state came in the aftermath of Belgian federalisation. The United Kingdom underwent a process of empowerment of regional entities after Labour’s landslide victory of 1997. British devolution, however, took a very different form, one that is both less extensive and more asymmetrical than the form of federalism chosen in Belgium. This paper describes the institutional set-up of devolution in Scotland and Wales, reports the results of the devolved elections and discusses the political debates on the future of devolution. It shows that devolution, which Labour envisioned as a way to settle the debates on self-rule in eth Celtic fringes, is instead a process. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:ete:vivwps:11&r=lab |
| By: | Rossana Patrón (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República) |
| Abstract: | The evidence of effects of education activities on growth is mixed. So, could education be good, neutral, or bad, depending on the case? While the model in this paper remains close to the Heckscher-Ohlin tradition, it is shown that, contrary to the standard results, it is the net effect of prices, taxation, and accumulation of endowments that determines the Rybczynski-type growth effects, which may help explain the lack of consensus in the empirical literature on education and growth. A central feature of the model is that the accumulation of endowments depends on the output of education, while the changes in labour supply, which determine the effective production possibilities frontier, also depend on individuals’ decisions on allocation of time. In the paper, the risks of a labour supplyreducing government intervention are discussed. The analysis has implications for policymakers in developing countries where education needs to be enhanced, as it reveals the possibility of a ‘bad tax reform’ where the intentions of reformers are not met by the results. A sufficient condition to avoid this situation is identified in the paper. |
| Keywords: | education, fiscal policy, developing countries |
| JEL: | I22 F16 |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:1709&r=lab |
| By: | Hannah von Ahlefeld |
| Abstract: | CELE’s International Pilot Project on Evaluating Quality in Educational Spaces aims to assist education authorities, schools and others to maximise the use of and investment in learning environments. This article provides an update on the pilot project, which is currently being implemented in Brazil, Mexico, New Zealand, Portugal and the United Kingdom.<P>Évaluer la qualité des espaces éducatifs : Étude pilote du CELE/OCDE<BR>L’Étude pilote internationale du CELE pour l’évaluation de la qualité des espaces éducatifs a pour objectif d’aider les autorités éducatives, les écoles et d’autres à optimiser les investissements et leur utilisation dans les environnements pédagogiques. Cet article donne un aperçu de l’avancement de l’étude pilote, qui est actuellement mise en œuvre au Brésil, au Mexique, en Nouvelle-Zélande, au Portugal et au Royaume-Uni. |
| Keywords: | evaluation, learning environment, educational buildings, educational architecture, quality |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:oec:eduaac:2009/9-en&r=lab |
| By: | Juan Carlos Cuestas; Luis A. Gil-Alana |
| Abstract: | In this paper we aim to analyse the dynamics of unemployment in a group of Central and Eastern European Countries (CEECs). The CEECs are of special importance for the future of the European Union, given that most of them have recently become member states, and labour flows have been seen to rise with their accession. By means of unit root tests incorporating structural changes and nonlinearities, as well as fractional integration, we find that the unemployment rates for the CEECs are mean reverting processes, which is consistent with the NAIRU hypothesis, although shocks tend to be highly persistent. |
| Keywords: | Unemployment, NAIRU, hysteresis, unit roots, fractional integration |
| JEL: | C32 E24 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:nbs:wpaper:2009/6&r=lab |
| By: | James T. Bang; Aniruddha Mitra |
| Abstract: | We use a fixed effects panel data model to investigate the impact of institutions of governance on the educational attainment of immigrants to the United States over the period 1988 – 2000. Distinguishing between the quality and stability of political institutions in the countries of origin, we find that the two characteristics of institutional structure have conflicting impacts on the nature of brain drain. Immigrants from countries with a higher quality of political institutions tend to be better educated, on the average, than immigrants from countries with institutions of lower quality. However, immigrants from countries with greater political instability tend to be better educated than immigrants from countries with more stable governments. |
| Keywords: | Immigration, institutions, political instability, brain drain |
| JEL: | F22 J24 J61 J64 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:mdl:mdlpap:0919&r=lab |
| By: | Robert Pollin; Heidi Garrett-Peltier |
| Abstract: | In this study, produced in collaboration with the Institute for Policy Studies, Robert Pollin and Heidi Garrett-Peltier update their earlier analysis of the relative employment impacts of public investment in military versus other priorities, expanding their analysis to include clean energy investments and induced job creation. The authors compare the effects of a $1 billion military investment military and the same investment in clean energy, health care, education, or individual tax cuts. They show that non-military investments create a much larger number of jobs across all pay ranges. With a large share of the federal budget at stake, Pollin and Garrett-Peltier make a strong case that non-military spending priorities can create significantly greater opportunities for decent employment throughout the U.S. economy than spending the same amount of funds with the military. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:uma:perips:spending_priorities_peri&r=lab |
| By: | David Card (University of California Berkeley); Christian Dustmann (University College London); Ian Preston (University College London) |
| Abstract: | Economists are often puzzled by the stronger public opposition to immigration than trade, since the two policies have symmetric effects on wages. Unlike trade, however, immigration changes the composition of the local population, imposing potential externalities on natives. While previous studies have focused on fiscal spillovers, a broader class of externalities arise because people value the ‘compositional amenities’ associated with the characteristics of their neighbors and co-workers. In this paper we present a new method for quantifying the relative importance of these amenities in shaping attitudes toward immigration. We use data for 21 countries in the 2002 European Social Survey, which included a series of questions on the economic and social impacts of immigration, as well as on the desirability of increasing or reducing immigrant inflows. We find that individual attitudes toward immigration policy reflect a combination of concerns over conventional economic impacts (i.e., on wages and taxes) and compositional amenities, with substantially more weight on composition effects. Most of the difference in attitudes to immigration between more and less educated natives is attributable to heightened concerns over compositional amenities among the less-educated. |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:200929&r=lab |