|
on Labour Economics |
| By: | Natalya Y. Shelkova (Guilford College and University of Connecticut) |
| Abstract: | This paper examines unemployment dynamics through the lens of a wage-posting model with two sectors and two types of workers. The model assumptions include collusion at a non-binding minimum wage, costly entry and intersectoral labor mobility. Model simulations demonstrate that collusion at a non-binding minimum wage induces entry into the low-wage sector. This dampens the overall negative employment impact of economic downturns. The excess of low-wage vacancies has shown not only to secure low unemployment rates for the low-skilled workers, but also to provide employment opportunities for the high-skilled when their industries substantially decline. |
| Keywords: | unemployment, search, minimum wage, collusion |
| JEL: | J30 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:uct:uconnp:2009-41&r=lab |
| By: | van Praag, Mirjam (University of Amsterdam); van Witteloostuijn, Arjen (University of Antwerp); van der Sluis, Justin (University of Amsterdam) |
| Abstract: | How valuable is education for entrepreneurs' performance as compared to employees'? What might explain any differences? And does education affect peoples' occupational choices accordingly? We answer these questions based on a large panel of US labor force participants. We show that education affects peoples' decisions to become an entrepreneur negatively. We show furthermore that entrepreneurs have higher returns to education than employees (in terms of the comparable performance measure 'income'). This is the case even when estimating individual fixed effects of the differential returns to education for spells in entrepreneurship versus wage employment, thereby accounting for selectivity into entrepreneurial positions based on fixed individual characteristics. We find these results irrespective of whether we control for general ability and/or whether we use instrumental variables to cope with the endogenous nature of education in income equations. Finally, we find (indirect) support for the argument that the higher returns to education for entrepreneurs is due to fewer (organizational) constraints faced by entrepreneurs when optimizing the profitable employment of their education. Entrepreneurs have more personal control over the profitable employment of their human capital than wage employees. |
| Keywords: | entrepreneurship, self-employment, returns to education, performance, personal control, locus of control, human capital, wages, incomes |
| JEL: | J23 J24 J31 J44 M13 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4628&r=lab |
| By: | Shigeru Fujita; Makoto Nakajima |
| Abstract: | Worker flows and job flows behave differently over the business cycle. The authors investigate the sources of the differences by studying quantitative properties of a multiple-worker version of the search/matching model that features endogenous job separation and intra-firm wage bargaining. Their calibration incorporates micro- and macro-level evidence on worker and job flows. The authors show that the dynamic stochastic equilibrium of the model replicates important cyclical features of worker flows and job flow simultaneously. In particular, the model correctly predicts that hires from unemployment move countercyclically while the job creation rate moves procyclically. The key to this result is to allow for a large hiring flow that does not go through unemployment but is part of job creation, for which procyclicality of the job finding rate dominates its cyclicality. The authors also show that the model generates large volatilities of unemployment and vacancies when a worker's outside option is at 83 percent of aggregate labor productivity. |
| Keywords: | Employment ; Business cycles |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedpwp:09-33&r=lab |
| By: | Hudson, John; Sessions, John |
| Abstract: | We examine the impact of parental education on the shape of an individual’s experience-earnings profile. A number of factors suggest that parental education will affect the ability of an individual to translate labor market experience into earnings. Our empirical analysis of US data suggests that this is indeed the case. Higher parental education shifts the earnings profile significantly to the left – the profile of individuals with parents who both have 15 years of education peaks at 16 years of experience when their wages are 52% (24%) greater than those whose parents both have only 5 (10) years of education. |
| Keywords: | Parental education; human capital; earnings |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:eid:wpaper:14/09&r=lab |
| By: | Åslund, Olof (IFAU - Institute for Labour Market Policy Evaluation); Hensvik, Lena (IFAU - Institute for Labour Market Policy Evaluation); Nordström Skans, Oskar (IFAU - Institute for Labour Market Policy Evaluation) |
| Abstract: | We show that immigrant managers are substantially more likely to hire immigrants than are native managers. The finding holds when comparing establishments in the same 5-digit industry and location, when comparing different establishments within the same firm, when analyzing establishments that change management over time, and when accounting for within-establishment trends in recruitment patterns. The effects are largest for small and owner managed establishments in the for-profit sector. Separations are more frequent when workers and managers have dissimilar origin, but only before workers become protected by EPL. We also find that native managers are unbiased in their recruitments of former co-workers, suggesting that information deficiencies are important. We find no effects on entry wages. Our findings suggest that a low frequency of immigrant managers may contribute to the observed disadvantages of immigrant workers. |
| Keywords: | Minority workers; Labor mobility; Workplace segregation |
| JEL: | J15 J21 J62 M51 |
| Date: | 2009–12–07 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2009_024&r=lab |
| By: | Pendakur, Krishna (Simon Fraser University); Woodcock, Simon D. (Simon Fraser University) |
| Abstract: | We investigate whether immigrant and minority workers’ poor access to high-wage jobs – that is, glass ceilings – is attributable to poor access to jobs in high-wage firms, a phenomenon we call glass doors. Our analysis uses linked employer-employee data to measure mean- and quantile-wage differentials of immigrants and ethnic minorities, both within and across firms. We find that glass ceilings exist for some immigrant groups, and that they are driven in large measure by glass doors. For some immigrant groups, the sorting of these workers across firms accounts for as much as half of the economy-wide wage disparity they face. |
| Keywords: | glass ceilings, wage differentials, immigration, visible minorities, quantile regression, linked employer-employee data |
| JEL: | J15 J71 J31 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4626&r=lab |
| By: | Fabian Kindermann |
| Abstract: | This paper studies the long-run macroeconomic, distributional and welfare effects of tuition policy and student loans. We therefore form a rich model of risky human capital investment based on the seminal work of Heckman, Lochner and Taber (1998). We extend their original model by variable labor supply, borrowing constraints, idiosyncratic wage risk, uncertain life-span, and multiple schooling decisions. This allows us to build a direct link between students and their parents and make the initial distribution of people over different socio-economic backgrounds endogenous. Our simulation indicate that privatization of tertiary education comes with a vast reduction in the number of students, an increase in the college wage premium and longrun welfare losses of around 5 percent. Surprisingly, we find that from privatization of tertiary education, students are better off compared to workers from other educational classes, since the college wage premium nearly doubles. In addition, our model predicts that income contingent loans on which students don’t have to pay interest, improve the college enrolment situation for agents from all kinds of backgrounds. |
| Keywords: | public vs. private education, schooling choice, human capital investment, idiosyncratic uncertainty |
| JEL: | I22 J24 H52 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp246&r=lab |
| By: | Michael B Coelli |
| Abstract: | Parental job loss from layoffs and business failures that occur when youth complete high school completion are found to be negatively correlated with enrolment at university and community college. Estimates from a year-to-year education transition model using longitudinal data on youth and their parents are employed to identify both immediate and lagged effects of parental job loss on education transitions. It is argued that these results can be interpreted as evidence of a potential causal effect of parental income on youth education attainment, as job losses are likely to have persistent and exogenous negative effects on parental income. |
| Keywords: | Education; human capital; job loss; income shocks; causal effect |
| JEL: | I29 J63 I39 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:mlb:wpaper:1060&r=lab |
| By: | Olof Åslund (Institute for Labour Market Policy Evaluation (IFAU), Uppsala University); Lena Hensvik (Institute for Labour Market Policy Evaluation (IFAU), Uppsala University); Oskar Nordström Skans (Institute for Labour Market Policy Evaluation (IFAU), Uppsala University) |
| Abstract: | We show that immigrant managers are substantially more likely to hire immigrants than are native managers. The finding holds when comparing establishments in the same 5-digit industry and location, when comparing different establishments within the same firm, when analyzing establishments that change management over time, and when accounting for within-establishment trends in recruitment patterns. The effects are largest for small and owner-managed establishments in the for-profit sector. Separations are more frequent when workers and managers have dissimilar origin, but only before workers become protected by EPL. We also find that native managers are unbiased in their recruitments of former co-workers, suggesting that information deficiencies are important. We find no effects on entry wages. Our findings suggest that a low frequency of immigrant managers may contribute to the observed disadvantages of immigrant workers. |
| Keywords: | Minority workers, Labor mobility, Workplace segregation. |
| JEL: | J15 J21 J62 M51 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:200932&r=lab |
| By: | Christina Felfe |
| Abstract: | This study is the first to estimate mothers’ marginal willingness to pay (MWP) for job amenities directly. Its identification strategy relies on German maternity leave length. The key aspect of the maternal leave framework is that mothers can decide whether and when to return to their guaranteed job. Thus, in contrast to previous studies that analyze the job search of employed workers, this framework allows us to overcome the limitation of not observing the wage/amenity offer process. A theoretical model of the leave length decision is derived from a random utility approach. Using data from the German Socio-Economic Panel and the Qualification and Career Survey, this model is<br /> estimated by a discrete duration method. The MWP for amenities can be inferred through the estimated elasticities of the leave length with respect to the amenities and the wage. The results provide evidence that mothers are willing to sacrifice a significant fraction of their wage to reduce hazards (20%) and to enjoy a flexible working schedule (44-56%). |
| Keywords: | Marginal Willingness to Pay; Maternal Labor Supply; Discrete Duration Models |
| JEL: | J31 J33 J22 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp247&r=lab |
| By: | Manuel Hidalgo (Department of Economics, Universidad Pablo de Olavide & Ivie) |
| Abstract: | The analysis of wage inequality has had a lot of tradition since the early nineties, in particular seeking an explanation for residual wage inequality defined as the inequality which is not explained by observables characteristics. However, some assumptions made in order to delve into the causes of wage inequality evolution are far from realistic, as the one assuming constancy in the distribution of non-observed characteristics within each cohort of workers employed (ability distribution). In this work, this latter hypothesis is relaxed. The main contribution is that this paper explicitly considers and values the change in ability distribution and its effects on total wage inequality. The conclusion is that non considering the changes in ability distribution may overvalued the effects of other possibles causes, as for example changes in prices paid to unobserved skills. I use Spanish data to evaluate this new approximation. |
| Keywords: | ability distribution, residual wage inequality, education. |
| JEL: | J31 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:pab:wpaper:09.15&r=lab |
| By: | Fatih Guvenen; Burhanettin Kuruscu; Serdar Ozkan |
| Abstract: | Wage inequality has been significantly higher in the United States than in continental European countries (CEU) since the 1970s. Moreover, this inequality gap has further widened during this period as the US has experienced a large increase in wage inequality, whereas the CEU has seen only modest changes. This paper studies the role of labor income tax policies for understanding these facts. We begin by documenting two new empirical facts that link these inequality differences to tax policies. First, we show that countries with more progressive labor income tax schedules have significantly lower before-tax wage inequality at different points in time. Second, progressivity is also negatively correlated with the rise in wage inequality during this period. We then construct a life cycle model in which individuals decide each period whether to go to school, work, or be unemployed. Individuals can accumulate skills either in school or while working. Wage inequality arises from differences across individuals in their ability to learn new skills as well as from idiosyncratic shocks. Progressive taxation compresses the (after-tax) wage structure, thereby distorting the incentives to accumulate human capital, in turn reducing the cross-sectional dispersion of (before-tax) wages. We find that these policies can account for half of the difference between the US and the CEU in overall wage inequality and 76% of the difference in inequality at the upper end (log 90-50 differential). When this economy experiences skill-biased technological change, progressivity also dampens the rise in wage dispersion over time. The model explains 41% of the difference in the total rise in inequality and 58% of the difference at the upper end. |
| Keywords: | Wages ; Human capital ; Taxation |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedmsr:438&r=lab |
| By: | Michela Ponzo (Dipartimento di Economia e Statistica, Università della Calabria) |
| Abstract: | In this paper we study the impact of the degree of school competition on achievement of Italian students. Specifically, competition is measured as the number of schools available to students in a given area. The aim is to evaluate whether an increase in school choice improves the quality of education. Using the third cycle of the Programme for International Student Assessment (PISA 2006) we investigate with simple Least Squares regression models, controlling for a range of individual and schools characteristics, if secondary school students with a wider range of schools choices perform better than those students whose choice is more limited. We find a significant positive correlation between students’ academic performance and the degree of local schools competition. Moreover, we show that students achieve much better outcomes if schools operating in more competitive environments also experience a higher pressure on academic standards coming from parents. |
| Keywords: | Educational Production Function, School Competition, Students Achievement, PISA |
| JEL: | J24 I2 I21 H72 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:clb:wpaper:200920&r=lab |
| By: | Dlugosz, Stephan; Stephan, Gesine (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Wilke, Ralf A. |
| Abstract: | "From 2002 - 2004, the German government passed several laws that curtailed the generosity of the unemployment compensation system. One of the most ambitious changes was a considerable reduction in unemployment benefit entitlement lengths for older unemployed, which was effective during 2006 and 2007. We apply a difference-in-differences approach to show that the highly disputed reform induced a considerable decline in unemployment incidence among older workers. It thus sealed an important leak in the unemployment insurance system. Furthermore, we find a strong anticipation effect; unemployment entries of elderly workers peaked during the months preceding the reform." (author's abstract, IAB-Doku) ((en)) |
| Keywords: | ältere Arbeitnehmer, arbeitsmarktpolitische Maßnahme, Arbeitslosengeld, Leistungsbezug - Dauer, Wirkungsforschung |
| JEL: | J63 J65 |
| Date: | 2009–12–10 |
| URL: | http://d.repec.org/n?u=RePEc:iab:iabdpa:200925&r=lab |
| By: | Natalya Y. Shelkova (Guilford College and University of Connecticut) |
| Abstract: | Empirical wage and wage offer distributions exhibit substantial clustering in economies with a mandated minimum wage, the phenomenon knows as the minimum wage spike, as well as wage dispersion. Existing search-theoretic literature does not replicate both of the empirical phenomena simultaneously. This paper attempts to reconcile the two under assumptions of wage-posting, urn-ball matching and firm productive heterogeneity. A non-degenerate minimum wage spike and wage dispersion are obtained when firm wage determination embodies both incentives for collusion at the minimum wage and competition at the same time, making the spike and the dispersion the outcomes of partially collusive equilibrium. Besides this main result, the paper also shows that a higher minimum wage may reduce unemployment. |
| Keywords: | wage-posting, minimum wage, minimum wage spike, wage dispersion, unemployment |
| JEL: | J30 J64 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:uct:uconnp:2009-40&r=lab |
| By: | Nicolas R. Ziebarth; Martin Karlsson |
| Abstract: | In 1999, in Germany, the statutory sick pay level was increased from 80 to 100 percent of foregone earnings for sickness episodes of up to six weeks. We show that this reform has led to an increase in average absence days of about 10 percent or one additional day per employee, per year. The estimates are based on SOEP survey data and parametric, nonparametric, and combined matching-regression difference-in-differences methods. Extended calculations suggest that the reform might have increased labor costs by about €1.8 billion per year and might have led to the loss of around 50,000 jobs. |
| Keywords: | Sickness absence, statutory sick pay, natural experiment, Socio-Economic Panel Study (SOEP) |
| JEL: | H51 I18 J22 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp245&r=lab |
| By: | Daniel Aaronson; Bhashkar Mazumder |
| Abstract: | The Black-White gap in completed schooling among Southern born men narrowed sharply between the World Wars after being stagnant from 1880 to 1910. We examine a large scale school construction project, the Rosenwald Rural Schools Initiative, which was designed to dramatically improve the educational opportunities for Southern rural Blacks. From 1914 to 1931, nearly 5,000 school buildings were constructed, serving approximately 36 percent of the Black rural school-aged Southern population. We use historical Census data and World War II enlistment records to analyze the effects of the program on school attendance, literacy, high school completion, years of schooling, earnings, hourly wages, and migration. We find that the Rosenwald program accounts for at least 30 percent of the sizable educational gains of Blacks during the 1910s and 1920s. We also use data from the Army General Classification Test (AGCT), a precursor to the AFQT, and find that access to Rosenwald schools increased average Black scores by about 0.25 standard deviations adding to the existing literature showing that interventions can reduce the racial gap in cognitive skill. In the longer run, exposure to the schools raised the wages of blacks that remained in the South relative to Southern whites by about 35 percent. For blacks the private rate of return to a year of additional schooling induced by Rosenwald was about 18 percent. Moreover, Rosenwald significantly increased Northern migration of young adult Blacks, with no corresponding impact on schoolage Blacks or young adult Whites, likely fueling further income gains. Across all outcomes, the improvements were highest in counties with the lowest levels of Black school attendance suggesting that schooling treatments can have a very large impact among those at the bottom of the skill distribution. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedhwp:wp-09-26&r=lab |
| By: | Friesen, Jane (Simon Fraser University); Javdani, Mohsen (Simon Fraser University); Woodcock, Simon D. (Simon Fraser University) |
| Abstract: | We estimate the effect of publicly disseminated information about school-level achievement on students' mobility between elementary schools. We find that students are more likely to leave their school when poor school-level performance is revealed. In general, parents respond to information soon after it becomes available. Once the information is absorbed, they do not respond to subsequent releases, even when it is reframed and given widespread media attention. Parents in low-income neighborhoods and those who speak a non-English language at home respond most strongly. However, non-English speaking parents only respond when information is widely disseminated and discussed in the media. |
| Keywords: | information, school choice |
| JEL: | I21 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4632&r=lab |
| By: | Rulof Burger (St Anthony's College, Oxford University and Department of Economics, University of Stellenbosch); Dieter von Fintel (Department of Economics, Universty of Stellenbosch) |
| Abstract: | This paper takes advantage of the wealth of cross-sectional household surveys conducted after South Africa’s political transition, in order to gain insights into the causes of the acceleration in the already high unemployment rate. A synthetic panel dataset is constructed to decompose unemployment and other labour market outcomes into cyclical, generational and life-cycle effects. This dynamic view isolates which groups are at risk across the period and allows a more nuanced understanding of the long-run and short-run impacts. Our results indicate that the higher unemployment rates faced by the young are predominantly due to the disadvantage of entering the labour market more recently, rather than being attributable to their age. We furthermore isolate what has driven this long-run increase in labour market participation. In particular, higher educational attainment and household formation decisions across generations fuel labour supply among the more recent entrants. We find some correspondence between the cyclical variation in unemployment and the business cycle. This suggests that jobless growth is not a relevant feature of the South African labour market. This paper confirms many of the causes of unemployment that are postulated in the literature. The dynamic nature of this study has furthermore allowed the separation of short-run and long-run aspects of unemployment. The decomposition approach adopted here has uncovered the linkages between the schooling system and the labour market across all generations, but, in particular, has isolated why the youngest generations have exhibited such distinct risks. The surge in labour supply amongst most recent generations (those aged 20 in 1995) can be explained by rapid exit rates from the education system resulting from over-age enrolment policies enacted in the post-apartheid period. This has pushed individuals into the labour market prematurely and without the adequate skills to be absorbed into the workplace. The importance of the generational aspects of unemployment relative to life cycle and business cycle impacts suggests that policies should address the structural issues affecting each of these birth cohorts, rather than focussing on age groups per se. |
| Keywords: | Unemployment, Participation, Feminisation of Labour Force, Education Policy, Birth Cohort Panels, Age-Period-Cohort Decompositions |
| JEL: | C4 J1 J2 J3 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:sza:wpaper:wpapers97&r=lab |
| By: | Grönqvist, Olof Åslund, Per-Anders Edin, Peter Fredriksson and Hans (Department of Economics) |
| 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 higly 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: | I20 J15 Z13 |
| Date: | 2009–12–10 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:uunewp:2009_017&r=lab |
| By: | Maria De Paola; Michela Ponzo; Vincenzo Scoppa (Dipartimento di Economia e Statistica, Università della Calabria) |
| Abstract: | In this paper we analyze class size effects on college students exploiting data from a project offering special remedial courses in Mathematics and Language skills to freshmen enrolled at an Italian medium sized public University. To estimate the effects of class size we take advantage of the fact that students and teacher where virtually randomly assigned to teaching classes of different sizes. From our analysis it emerges that, controlling for a number of individual characteristics, larger classes determine a significant and sizeable negative effect on student performance in Mathematics. Importantly, this negative effect is significantly larger for low ability students and negligible for high ability students. On the other hand, class size effects do not appear to be relevant for student achievement in Language Skills. |
| Keywords: | Class size, student achievement, educational production function |
| JEL: | C23 I21 J24 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:clb:wpaper:200919&r=lab |
| By: | Braakmann, Nils (Leuphana University Lüneburg); Wagner, Joachim (Leuphana University Lüneburg) |
| Abstract: | This paper considers labor market adjustments following a large import shock in the German clothing industry caused by the phasing out of the Multi-Fibre Arrangement. Using the German shoe industry as a control group and administrative data, we study adjustments on the individual and firm level using difference-in-differences. Our results suggest relatively small increases in unemployment risk and no wage effects on the individual level, despite a 30% increase in plant mortality. Part of the different effects found for plants and individuals can be attributed to the reallocation of workers into other industries and occupations. |
| Keywords: | import shock, adjustment, clothing industry, Germany |
| JEL: | F13 F14 F16 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4633&r=lab |
| By: | Fjeldvig, Knut (Department of Economics, University of Oslo) |
| Abstract: | We use individual panel data to estimate ageearnings profiles for Norwegian physicians. Based on data covering the 19932006 period we find that the ageearning profiles of physicians share many of the attributes of the classical Mincer function. Physician`s earnings rise, but a decreasing rate, for the first 20 years after medical training; they peak between the ages of 55 and 59; and they decline slightly toward the end of the career. We observe that there will be complications when using the regular crosssectional methods because of cohort and period effects on income. Using fixedeffects method therefore provides a more accurate picture of the profiles. When looking at profiles by gender we find that there are large differences between the earnings of male and female physicians, some of which can be attributed to reduced labor supply during childrearing years and some to lower investments in specialization among female doctors. We also discover differences in the profiles of physicians educated in Norway and abroad and discuss alternative explanations for this pattern. <p> |
| Keywords: | Physicians; age-earnings; income; mincer function; gender; empirical analysis; Norway |
| JEL: | J31 J44 |
| Date: | 2009–12–14 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:oslohe:2009_011&r=lab |
| By: | Platt L (Institute for Social and Economic Research); Longhi S (Institute for Social and Economic Research); Nicoletti C (Institute for Social and Economic Research) |
| Abstract: | This paper provides a contemporary account of inequalities in pay of disabled people and those from selected minority ethno-religious groups. We aim to understand the causes for differences in pay by ethno-religious group and disability status and type. We investigate whether pay gaps are a consequence of individual earning potential as represented, for example, by educational qualifications, or whether they appear to stem from the particular occupations or types of occupation that the minority groups are concentrated into; or whether they are largely unaccounted for. In the case of remaining unexplained gaps in pay, we consider how far they might provide evidence of employer discrimination. |
| Date: | 2009–12–09 |
| URL: | http://d.repec.org/n?u=RePEc:ese:iserwp:2009-31&r=lab |
| By: | Tobias Wuergler |
| Abstract: | This paper studies the effect of financial booms and extreme asset valuations on the relative demand for skills and the wage structure. The substantial rise in wage inequality in the U.S. since the late 1970s has been accompanied by a major expansion of financial services, a series of asset bubbles, and rising relative wages and relative education in the financial industry. I motivate and develop a theoretical framework where financial institutions benefit from financial booms and asset bubbles. Yet the complexity and novelty of financial products and fundamentals surrounding bubbles favor the supremacy of skilled individuals in exploiting these opportunities. Hence financial booms increase opportunities for skilled labor, contributing to the rise in overall wage inequality in the economy. Simple extensions of the basic framework allow us to study the implications of financial regulation and globalization of financial services, as well as further topics. Finally, the paper documents and compares relative wage and employment patterns in the U.S., U.K., Germany, and France, providing suggestive evidence for the theoretical framework. |
| Keywords: | Skill demand, inequality, asset bubbles, financial institutions, financial regulation |
| JEL: | E24 E44 G20 G28 J24 J31 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:zur:iewwpx:460&r=lab |
| By: | Alberto Behar |
| Abstract: | We develop a model of endogenous skill-biased technical change in developing countries. The model reconciles wildly dispersed existing estimates of the elasticity of substitution between more and less educated workers. It also produces an estimating equation for the elasticity, which allow us to produce overdue estimates for developing countries. With four types of data, elasticity estimates for developing countries are consistently about 2. In a skill-biased technical change framework, this estimate makes sense of what appears to be little or no correlation between relative skill supply and wage inequality. |
| Keywords: | Skill-biased technical change, Elasticity of substitution, Wage premium |
| JEL: | I20 J23 J24 J31 O15 O33 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:467&r=lab |
| By: | Nils Braakmann (Institute of Economics, Leuphana University of Lüneburg, Germany); Joachim Wagner (Institute of Economics, Leuphana University of Lüneburg, Germany) |
| Abstract: | This paper considers labor market adjustments following a large import shock in the German clothing industry caused by the phasing out of the Multi-Fibre Arrangement. Using the German shoe industry as a control group and administrative data, we study adjustments on the individual and firm level using difference-in-differences. Our results suggest relatively small increases in unemployment risk and no wage effects on the individual level, despite a 30% increase in plant mortality. Part of the different effects found for plants and individuals can be attributed to the reallocation of workers into other industries and occupations. |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:lue:wpaper:155&r=lab |
| By: | Adriaan Kalwij (Utrecht School of Economics, Utrecht University and Networks for Studies on Pensions, Aging and Retirement, Tilburg University); Arie Kapteyn (RAND); Klaas de Vos (CentERdata, Tilburg University) |
| Abstract: | Policy makers have often argued that an additional benefit of facilitating early retirement is that it creates employment for the young. This may happen if older and younger workers are substitutes. Nowadays policy makers’ goals are to discourage early retirement to counter the economic consequences of an aging population and, interestingly, the consequences for youth employment appear to play no role in this. This paper studies the nexus between employment of older and younger workers in more depth, if only to put any concerns for adverse effects of later retirement to rest. To empirically investigate this issue we estimate a dynamic model of employment of the young, prime age and old people using panel data of 22 OECD countries over the time period 1960-2004. Our empirical analysis does not support the hypothesis that employment of the young and old are substitutes and finds some minor complementarities. This suggests that discouraging early retirement will have no adverse effect on youth employment. |
| Date: | 2009–12–16 |
| URL: | http://d.repec.org/n?u=RePEc:ucd:wpaper:200948&r=lab |
| By: | Smyth, Emer |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:rb2009/4/1&r=lab |
| By: | Luca Marchiori; Patrice Pieretti; Benteng Zou (CREA, University of Luxembourg) |
| Abstract: | What is the impact of high-skilled emigration on fertility and human capital in migrants’ origin countries? This question is analyzed within an overlapping generations model where parents choose to finance higher education to a certain number of their children. It follows that families are composed of high- and low-skilled children who may both emigrate with a certain probability when they reach adulthood. It is found that a brain drain leads to a change in children’s skill composition, with parents choosing to provide higher education to a larger number of their children. A calibration of the model suggests that, following a brain drain, the additional children benefiting from higher education might in the long run compensate for the loss of high-educated workers and lead to a brain gain. |
| JEL: | F22 J13 J24 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:luc:wpaper:09-04&r=lab |
| By: | Hinks, Timothy |
| Abstract: | This paper is the first to estimate job satisfaction equations in post-Apartheid South Africa. Earnings and relative earnings are both found to contribute to greater job satisfaction. Racial group is also an important predictor of job satisfaction but when interacted with a proxy for affirmative action legislation it is found that black job satisfaction is positively correlated with this legislation whereas coloured and to a lesser extent white job satisfaction is diminished. |
| Keywords: | Job satisfaction; Employment Equity; ordered probit; South Africa |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:eid:wpaper:23/09&r=lab |
| By: | Yolanda Chica (Universidad del País Vasco. Departamento Economía Financiera.); María Paz Espinosa (Universidad del País Vasco. Departamento Fundamentos del Análisis Económico II.) |
| Abstract: | This paper analyzes the process of endogenous union formation in the context of a sequential bargaining model between a firm and several unions and tries to explain why workers may be represented by several unions of different sizes. We show that the equilibrium number of unions and their relative size depend on workers\' attitudes toward the risk of unemployment and union configuration is independent of labor productivity. |
| Keywords: | Endogenous union formation; Constant relative risk aversion; Sequential bargaining; M |
| JEL: | J51 J52 |
| Date: | 2009–12–10 |
| URL: | http://d.repec.org/n?u=RePEc:ehu:dfaeii:200907&r=lab |
| By: | Feldmann, Horst |
| Abstract: | Using data on 75 countries for six years in the period 1995 to 2003, this paper analyzes empirically whether and to what extent the quality of the legal system affects the performance of the labor market. According to the regression results, a legal system characterized by a dependent judiciary, biased courts, a lack of intellectual property protection and a lack of integrity increases unemployment and lowers the employment level. The magnitude of the effect seems to be substantial, particularly among young people. |
| Keywords: | employment; legal system; rule of law; unemployment |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:eid:wpaper:12/09&r=lab |
| By: | Tetsuji Okazaki (Faculty of Economics, University of Tokyo) |
| Abstract: | This paper analyses the effects of schooling, outside work experience and job tenure on human capital formation, using the personal history data of white collar employees of Mitsubishi Zaibatsu in prewar Japan. For all samples including both engineers and clerks, the rate of return to schooling was 4.19%, which was higher than those to outside work experience and tenure. In case we allow for difference in the effects of schooling, outside work experience and job tenure between engineers and clerks, the rate of return to schooling was 5.11% for engineers, while it was 2.61% for clerks. It is notable that for clerks the rate of return to schooling was lower than that to job tenure. These results imply that Mitsubishi differentiated the systems of human capital formation between engineers and clerks. That is, while schooling was the central measure for human capital formation for engineers, on-the-job-training inside the firm was that for clerks. |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:tky:jseres:2009cj216&r=lab |
| By: | Nils Karlson; Marcus Box; Almas HESHMATI (Technology Management, Economics and Policy Program(TEMEP), Seoul National University) |
| Abstract: | According to Buchanan and Congleton (1998), the generality principle in politics blocks special interests. Consequently, the generality principle should thereby promote economic efficiency. This study tests this hypothesis on wage formation and labor markets, by investigating whether generality defined as state neutrality could explain employment performance among OECD countries during 1970-2003. We identify three types of non-neutrality as concerns unemployment. These include the level or degree of government interference in the wage bargaining process over and above legislation which facilitate mutually beneficial wage agreements, the constrained bargaining range (meaning the extent to which the state favors or blocks certain outcomes of the bargaining process), and the cost shifting (which relates to state interference shifting the direct or indirect burden of costs facing the parties on the labor market). Our overall hypothesis is that non-neutrality or non-generality increases unemployment rates. The empirical results from the general conditional model suggest that government intervention and a constrained bargaining range clearly increase unemployment, while a few of the cost shifting variables have unexpected effects. The findings thus give some, but definitely not unreserved, support for the generality principle as a method to promote economic efficiency. One implication may be that the principle should be amended by other requirements if the political process indeed shall be able to promote economic efficiency. |
| Keywords: | generality, state neutrality, efficiency, unemployment, wage bargaining, cost shifting, OECD |
| JEL: | C23 C78 E24 J64 N30 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:snv:dp2009:200931&r=lab |
| By: | Suedekum, Jens (University of Duisburg-Essen); Wolf, Katja (IAB, Nürnberg); Blien, Uwe (IAB, Nürnberg) |
| Abstract: | During the last decade there have been marked changes in the composition of the non-native workforce in the German labour market. In particular there has been a notable increase in the diversity of nationalities of which the foreign workforce is composed. In this paper we investigate the effects of this diversity for native employees. Our analysis is conducted at the local level and uses a panel of 326 Western German regions over the time period 1995-2006. When considering high-skilled foreign workers, we find that both the size of this group and the diversification into different nationalities raise local wages and employment for native employees. For low-skilled foreign workers we find negative size effects. However, these negative effects can be partly offset if the group of low-skilled foreigners is culturally diversified. Our results imply that diversity raises productivity at the local level, but that it is important to distinguish the skill composition of the foreign workforce. These findings remain robust in a variety of robustness checks that take into account omitted variable bias, self-selection of foreigners into particular regions, and spatial autocorrelation. |
| Keywords: | regional labour markets, cultural diversity, immigration, spatial equilibrium |
| JEL: | R23 J21 J31 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4619&r=lab |
| By: | Nicolas R. Ziebarth; Martin Karlsson |
| Abstract: | This study estimates the reform effects of a reduction in statutory sick pay levels on various outcome dimensions. A federal law reduced the legal obligation of German employers to provide 100 percent continued wages for up to six weeks per sickness episode to 80 percent. This measure increased the ratio of employees having no days of absence by about 7.5 percent. The mean number of absence days per year decreased by about 5 percent. The reform might have reduced total labor costs by about €1.5 billion per year which might have led to the creation of around 50,000 new jobs. |
| JEL: | H51 I18 J22 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp244&r=lab |
| By: | Arie Kapteyn (RAND); James P. Smith (RAND); Arthur van Soest (Tilburg University, Netspar & RAND) |
| Abstract: | To analyze the effect of health on work, many studies use a simple self-assessed health measure based upon a question such as “do you have an impairment or health problem limiting the kind or amount of work you can do?” A possible drawback of such a measure is the possibility that different groups of respondents may use different response scales. This is commonly referred to as “differential item functioning” (DIF). A specific form of DIF is justification bias: to justify the fact that they don’t work, non-working respondents may classify a given health problem as a more serious work limitation than working respondents. In this paper we use anchoring vignettes to identify justification bias and other forms of DIF across countries and socio-economic groups among older workers in the U.S. and Europe. Generally, we find differences in response scales across countries, partly related to social insurance generosity and employment protection. Furthermore, we find significant evidence of justification bias in the U.S. but not in Europe, suggesting differences in social norms concerning work. |
| Keywords: | Work limiting disability, Vignettes, Reporting bias |
| JEL: | J28 I12 C81 |
| Date: | 2009–12–16 |
| URL: | http://d.repec.org/n?u=RePEc:ucd:wpaper:200946&r=lab |
| By: | Shiferaw, Admasu (University of Göttingen); Bedi, Arjun S. (Institute of Social Studies) |
| Abstract: | This paper analyzes the creation, destruction and reallocation of jobs in order to understand the micro-dynamics of aggregate employment change in African manufacturing. The nature and magnitude of gross job flows are examined using a unique panel data of Ethiopian manufacturing establishments over the period 1996-2007. We also assess the relative importance of firm demographics, industry effects and business cycles for job flows. The rates and patterns of job creation and destruction in our sample are comparable to the findings from developed and emerging economies suggesting that African firms adjust their labor force in a manner broadly similar to firms elsewhere and that African labor markets are not uniquely restrictive in terms of undermining job reallocation across firms. We also find, as in many other countries, that job reallocation is relatively higher in industries dominated by smaller and younger establishments. However, unlike other regions, job reallocation in our sample is pro-cyclical and its variation across industries bears little similarity to the patterns found in other developed and emerging economies. Small firms in Africa create jobs mainly at the point of market-entry and play a limited role in terms of contributing to manufacturing employment through post-entry expansion. |
| Keywords: | job creation, job destruction, job reallocation, firm dynamics, Sub-Saharan Africa, Ethiopia |
| JEL: | J20 J23 J49 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4623&r=lab |
| By: | Pierre M. Picard; David E. Wildasin (CREA, University of Luxembourg) |
| Abstract: | Economic regions, such as urban agglomerations, face external demand and price shocks that produce income risk. Workers in large and diversified agglomerations may benefit from reduced wage volatility, while firms may outsource the production of intermediate goods and realize benefits from Chamberlinian externalities. Firms may also protect workers from wage risks through fixed wage contracts. This paper explores the relationships between firms’ risks, workers’ contracts, and the structure of production in cities. |
| JEL: | R12 R23 J31 J65 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:luc:wpaper:09-05&r=lab |
| By: | Patrick Puhani; Katja Sonderhof |
| Abstract: | We evaluate the effects of a reduction in sick pay from 100 to 80% of the wage. Unlike previous literature, apart from absence from work, we also consider effects on doctor/hospital visits and subjective health indicators. We also add to the literature by estimating both switch-on and switch-off effects, because the reform was repealed two years later. We find a two-day reduction in the number of days of absence. Quantile regression reveals higher point estimates (both in absolute and relative terms) at higher quantiles, meaning that the reform predominantly reduced long durations of absence. In terms of health, the reform reduced the average number of days spent in hospital by almost half a day, but we cannot find robust evidence for negative effects on health outcomes or perceived liquidity constraints. |
| Keywords: | Sickness pay, absenteeism, health expenditure, hospitalization, difference-indifferences, switch on, switch off, quantile regression, intrinsic motivation |
| JEL: | I18 J58 J83 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:usg:dp2009:2009-34&r=lab |
| By: | Richter, Wolfram F. (University of Dortmund); Braun, Christoph (Ruhr Graduate School in Economics) |
| Abstract: | This paper studies second-best policies in an OLG model in which endogenous growth results from human capital accumulation. When young, individuals decide on education, saving, and nonqualified labour. When old, individuals supply qualified labour. Growth equilibria are inefficient in laissez-faire because of distortionary taxation. The inefficiency is exacerbated if selfish individuals externalize the positive effect of education on descendents' productivity. It is shown to be second best not to distort education if the human capital investment function is isoelastic. If the function is not isoelastic, a case is made for subsidizing education even relative to the first best. |
| Keywords: | OLG model, endogenous growth, endogenous labour, education and saving, intergenerational externalities, optimal taxation |
| JEL: | H21 I28 J24 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4629&r=lab |
| By: | Francesco Burchi |
| Abstract: | This paper examines the role of mother’s education in expanding children’s nutritional capabilities in Mozambique, a country where both educational and nutritional deprivations are dramatic. The econometric results, based on data from the 2003 DHS survey, suggest that mother’s schooling is a key determinant of children’s nutrition, but its direct marginal contribution is declining after completion of primary education. Children whose mothers have completed primary education are far more likely to be well nourished than children whose mothers have lower or no educational attainments. Primary education works through the increase of mother’s general knowledge and, to a less extent, of her nutrition knowledge. Mother’s secondary schooling, instead, contributes only indirectly, by increasing household wealth. A further empirical analysis shows that there is no substantial difference in the benefits of mother’s education depending on whether she resides in urban or rural areas. Finally, the paper provides empirical evidence that female education is essential to improve children’s wellbeing in Mozambique, and that only a small part of this influence works through the traditional economic channel. |
| Keywords: | Development economics; capability approach; nutrition; women’s education; Mozambique. |
| JEL: | J13 O15 I20 R20 O55 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:rtr:wpaper:0101&r=lab |
| By: | Simon Fietze; Elke Holst; Verena Tobsch |
| Abstract: | The female share in management positions is quite low in Germany. The higher the hierarchical level, the fewer women there are in such positions. Men have numerous role models to follow whereas women lack this opportunity: In the executive boards of the top 200 private companies in Germany, only 2.5 percent of members are female. Many studies have focused on the influence of human capital and other "objective" factors on career opportunities. In our study, we go a step further by also looking at the impact of self-reported personality traits on gender differences in career chances. We compare managers and other white-collar employees in Germany's private sector. While bivariate results based on data from the German Socio-Economic Panel (SOEP) in 2005 show that there are significant gender differences in personality traits, multivariate estimations clearly indicate that these differences cannot account for gender differences in career opportunities. Nevertheless, personality traits might indeed play a role, albeit more indirectly: Some of the stronger career effects, such as work experience, long working hours, and labour market segregation, can also reflect differences in personality traits. These might have been influenced at an early stage by a gender-biased environment. Our results strongly stress the need for a gender-neutral environment outside and inside companies in order to enforce equal career opportunities for women and men. |
| Keywords: | personality, gender, career, leadership |
| JEL: | J16 M12 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp955&r=lab |
| By: | Bauman, Yoram (University of Washington); Rose, Elaina (University of Washington) |
| Abstract: | A substantial body of research suggests that economists are less generous than other professionals and that economics students are less generous than other students. We address this question using administrative data on donations to social programs by students at the University of Washington. Our data set allows us to track student donations and economics training over time in order to distinguish selection effects from indoctrination effects. We find that economics majors are less likely to donate than other students and that there is an indoctrination effect for non-majors but not for majors. Women majors and non-majors are less likely to contribute than comparable men. |
| Keywords: | altruism, public goods |
| JEL: | A13 D64 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4625&r=lab |
| By: | Titus J. Galama (RAND Corporation); Arie Kapteyn (RAND Corporation); Raquel Fonseca (RAND Corporation); Pierre-Carl Michaud (RAND Corporation) |
| Abstract: | We formulate a stylized structural model of health, wealth accumulation and retirement decisions building on the human capital framework of health provided by Grossman. We explicitly assume a functional form of the utility function and carefully account for initial conditions, which allow us to derive analytic solutions for the time paths of consumption, health, health investment, savings and retirement. We argue that the Grossman literature has been unnecessarily restrictive in assuming that health is always at Grossman’s “optimal” health level. Exploring the properties of corner solutions we find that advances in population health (health capital) can explain the paradox that while population health and mortality have continued to improve in the developed world, retirement ages have continued to fall with retirees pointing to deteriorating health as an important reason for early retirement. We find that improvements in population health decrease the retirement age, while at the same time individuals retire when their health has deteriorated. In our model, workers with higher human capital (say white collar workers) invest more in health and because they stay healthier retire later than those with lower human capital (say blue collar workers) whose health deteriorates faster. Plausibly, most individuals are endowed with an initial stock of health that is substantially greater than the level required to be economically productive. |
| Keywords: | health, demand for health, health capital, medical care, labor, retirement |
| JEL: | I10 I12 J00 J24 J26 |
| Date: | 2009–12–16 |
| URL: | http://d.repec.org/n?u=RePEc:ucd:wpaper:200950&r=lab |
| By: | Violaine Faubert |
| Abstract: | This paper examines the current academic and policy literatures concerning school evaluation in primary and secondary education within the OECD countries. First, it provides a typology of the existing systems of school evaluation across the OECD. It encompasses the diverse criteria and instruments commonly used to carry out schools evaluation, as well as the players involved in the design and implementation of school evaluation. It also describes potential consequences for schools. Second, this paper analyses how school evaluation schemes are interrelated with other components of the evaluation framework, such as teacher evaluation and system evaluation. The potential complementarities, duplication and inconsistency of objectives stemming from these interrelations are discussed. Third, this paper presents the advantages and drawbacks of different approaches to school evaluation, the resistance and implementation difficulties resulting from misalignment of interests between different stakeholders, and possible ways to overcome impediments to implementation. Finally, it reviews the quantitative and qualitative evidence available on the impact of different school evaluation schemes on school performance, student learning and the incentives for the teaching staff. It concludes by considering the circumstances under which school evaluation schemes seem to be more conducive to school improvement. The effectiveness of school evaluation schemes relies on developing competencies for evaluation and for using feedbacks. Alignment of stakeholders' interests is also critical to have the support of those being assessed.<BR>Cet article dresse une revue de la littérature académique et empirique consacrée à l'évaluation des établissements scolaires primaires et secondaires au sein des pays de l'OCDE. Une typologie des différents systèmes d'évaluation existants est tout d'abord esquissée. Les différents instruments et critères utilisés pour procéder à l'évaluation des établissements scolaires, ainsi que les acteurs impliqués dans la conception et la mise en oeuvre des systèmes d'évaluation des écoles, sont précisés. Les conséquences induites par les résultats de l'évaluation pour les établissements sont également évoquées. Cette revue de littérature analyse ensuite les relations existant entre l’évaluation des établissement scolaires et autres composantes du cadre d'évaluation du système scolaire, notamment l'évaluation des enseignants et l'évaluation du système éducatif. Les sources de complémentarité, effets de doublon et possibles incompatibilités entre ces différentes composantes, sont évoqués. Les avantages et les inconvénients des différentes approches de l'évaluation des écoles, ainsi que les résistances et les difficultés rencontrées dans leur mise en oeuvre en raison des divergences d'intérêt et de point de vue des différents acteurs (autorités éducatives, inspecteurs, chefs d'établissement, corps enseignant…), sont soulignés. Les résultats quantitatifs et qualitatifs d'études empiriques destinées à tester l'impact de l'évaluation sur les performances des élèves, la gestion des établissements, la motivation des enseignants et, plus largement, sur les incitations des agents, sont mentionnés. Cette revue de littérature décrit enfin les environnements les plus favorables au développement des mécanismes d'évaluation les plus efficaces. Ceux-ci supposent notamment le développement de compétences en vue de procéder à des évaluations et d'en exploiter les résultats, ainsi que le soutien et la convergence de vues des acteurs impliqués dans le processus. |
| Keywords: | evaluation, évaluation |
| JEL: | I |
| Date: | 2009–12–15 |
| URL: | http://d.repec.org/n?u=RePEc:oec:eduaab:42-en&r=lab |
| By: | Nam TRAN-QUY; Almas HESHMATI (Technology Management, Economics and Policy Program(TEMEP), Seoul National University) |
| Abstract: | This study is an empirical investigation of causal factors of pay inequality and its relationship with firm performance using firm level data in Vietnam. Both nonparametric and parametric approaches are used for the purpose. The Gini coefficient and Theil-T index are employed to measure pay inequality. Linear and quadratic models are specified to identify determinants of pay inequality and to investigate the relationship between pay inequality and firm performance. The empirical results, based on a large sample of Vietnamese firms, suggest that capital-intensive sectors pay more equal wages than labour-intensive sectors while regions with a higher urbanization rate and economic development pay their employees quite unequally. The determinant factors contributing to pay inequality are firm size, volume of assets, share of temporary workers, debt ratio, provincial competitiveness and the market size. We also find a positive relationship between firm performance and pay inequality, which gives support to the ¡°tournament¡± theory. |
| Keywords: | pay inequality, firms, determinants, performance, Vietnam |
| JEL: | D63 D21 D33 J31 L25 P27 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:snv:dp2009:200930&r=lab |
| By: | Klein, Alexander (Department of Economics, University of Warwick) |
| Abstract: | This paper analyzes the rural-urban migration of families in the Bohemian region of Pilsen in 1900. Using a new 1300-family dataset from the 1900 population census I examine the role of children‘s education in rural-urban migration. I find that families migrated to the city such that the educational attainment of their children would be maximized and that there is a positive correlation between family migration and children being apprentices in urban areas. The results suggest that rural-urban migration was powered not only by the exploitation of rural-urban wage gaps but also by aspirations to engage in human capital investment. |
| Keywords: | migration ; human capital investment ; family decision-making |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:wrk:warwec:923&r=lab |
| By: | Sessions, John; Theodoropoulos, N. |
| Abstract: | We undertake the first empirical investigation of the relationship between the slope of the wagetenure profile and the level of monitoring. On the assumption that firms strive for the optimal trade-off between these various instruments, we hypothesise that increased monitoring leads to a decline in the slope of the wagetenure profile. Our empirical analysis, using two cross sections of matched employer-employee British data, provides robust support for this prediction. |
| Keywords: | Monitoring; tenure; efficiency wages; |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:eid:wpaper:27/09&r=lab |
| By: | G.C. Lim; R. Dixon; S. Tsiaplias |
| Abstract: | A time-varying Phillips curve was estimated as a means to examine the changing nature of the relationship between wage inflation and the unemployment rate in Australia. The implied time-varying equilibrium unemployment rate was generated and the analysis showed the important role played by variations in the slope of the Phillips curve in changing the equilibrium unemployment rate. The deviations of actual unemployment rates from the estimated equilibrium unemployment rates also performed remarkedly well as measures of inflationary pressure. |
| Keywords: | Phillips curve; equilibrium unemployment rate; inflation |
| JEL: | E24 E31 E32 E52 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:mlb:wpaper:1070&r=lab |
| By: | Manuel Hidalgo Pérez (Department of Economics, Universidad Pablo de Olavide); Walter García-Fontes (Universidad Pompeu Fabra y CREA) |
| Abstract: | We estimate the strength of schooling externalities for Spanish regions over the 1981-2001 period. Our empirical work employs both main approaches available in the literature. Both methodologies yield significant externalities. Using a growth accounting exercise, we find that human capital externalities account for one half of the increase in real wages for the period between 1981 and 2001. |
| Keywords: | externalities, human capital, constant composition. |
| JEL: | I21 J31 O47 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:pab:wpaper:09.17&r=lab |
| By: | Alba, Michael M.; Sugui, Jessaine Soraya C. |
| Abstract: | The literature has focused on motives to explain remittance behavior. But as nonanonymous transfers, remittances are apt to be influenced by giving norms as well. We formulate an empirical specification that takes account of remittance motives involving worker-household pairs. We find that altruism dominates the exchange motive among overseas workers who are likely to be the primary breadwinners of their recipient households. We also find that in the subsample in which overseas workers are likely to be secondary breadwinners, (a) household labor income is an endogenous explanatory variable, and (b) the error covariance of the household income and remittance selection equations is positive. A possible reason for (a) is that secondary breadwinners use household income as an imperfect signal of opportunity cost or to detect unobserved effort, i.e., moral hazard, in generating income. As for (b), we surmise that it indicates the presence of incentive-compatible mechanisms against moral hazard. On giving norms, we find that, in samples that include overseas workers who are secondary breadwinners, remittance amounts are afflicted with negative selectivity. We present evidence that this is consistent with Filipino giving practices in which everyone gives but in modest amounts. |
| Keywords: | remittances, remittance motives, giving norms |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:phd:dpaper:dp_2009-26&r=lab |
| By: | Constant, Amelie F. (DIW DC, George Washington University); Zimmermann, Klaus F. (IZA, DIW Berlin and Bonn University) |
| Abstract: | This chapter deals with the economic and ethnic diversity caused by international labor migration, and their economic integration possibilities. It brings together three strands of literature dealing with the neoclassical economic assimilation, ethnic identities and attitudes towards immigrants and the natives, and provides an analysis in understanding their interactions. The issue of how immigrants fare in the host country especially in terms of their labor force participation and remuneration has been the core of research in the labor migration literature. If immigrants fare as well as the natives, then they are economically assimilated. While some immigrant groups do, most do not, especially in Europe. Of equal importance is how immigrants identify with the culture of their home and receiving countries, and if natives and immigrants have the right attitudes about each other. Ethnic identities and attitudes seem to be less affected by the economic environment but have implications for economic performance. |
| Keywords: | ethnicity, ethnic identity, acculturation, migrant assimilation, migrant integration, work, cultural economics |
| JEL: | F22 J15 J16 Z10 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4620&r=lab |
| By: | Amuedo-Dorantes, Catalina (San Diego State University, California); Puttitanun, Thitima (San Diego State University, California) |
| Abstract: | The literature has noted that native views about legal as opposed to undocumented immigration in the U.S. differ. Furthermore, native views about immigration are known to vary by gender. Yet, most surveys do not inquire native men and women about their views with regards to the two distinct immigrant groups, thus impeding an analysis of differences in preferences towards legal and undocumented immigrants from the same sample of natives. Using a recent San Diego County survey, we examine differences in native male and female opinions with regards to legal and undocumented immigration and their determinants. Native preferences towards immigration appear to significantly differ by gender as well as according to immigrants' legal status. In addition, public finance and welfare concerns are among the key factors driving native male and female preferences towards legal and undocumented immigration. However, native women's attitudes are also impacted by concerns regarding the social integration and economic assimilation of undocumented immigrants possibly related to the alleged prejudice factor. |
| Keywords: | gender, native preferences, undocumented immigration, legal immigration |
| JEL: | J61 F22 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4616&r=lab |
| By: | Saten Kumar (Department of Business Economics, Auckland University of Technology); Don J. Webber (Department of Business Economics, Auckland University of Technology and Department of Economics, UWE, Bristol); Geoff Perry (Department of Business Economics, Auckland University of Technology) |
| Abstract: | This paper presents an analysis of real wages, inflation and labour productivity interrelationships using cointegration, Granger-causality and, most importantly, structural change tests. Applications of tests to Australian data over the 1965-2007 period corroborate the presence of a structural break in 1985 and show that a 1 percent increase in manufacturing sector real wages led to an increase in manufacturing sector productivity of between 0.5 and 0.8 percent. Comparable estimates for the effect of inflation on manufacturing sector productivity have limited statistical significance. Granger causality test results suggest that real wages and inflation both Granger-cause productivity in the long run. |
| Keywords: | Labour productivity; Real wages; Inflation; Cointegration; Granger causality |
| JEL: | C50 E23 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:uwe:wpaper:0921&r=lab |
| By: | Maarten van Rooij; Annamaria Lusardi; Rob Alessie |
| Abstract: | The complexity of financial decisions households are faced with has increased tounprecedented levels. At the same time, recent research documents large differences ineconomic knowledge among households and indicates that household financial skills may beinadequate to cope with the increasing responsibility for making retirement decisions. In thispaper, we examine the relationship between financial knowledge and retirement planning inthe Netherlands. For this purpose, we have designed a customized module for the DNB (DeNederlandsche Bank) Household Survey. We identify a strong and positive associationbetween financial knowledge and retirement planning. Using information on economicseducation when young, we show that the nexus of causality goes from literacy to planningrather than the other way around. |
| Keywords: | Thinking about Retirement; Knowledge of Finance and Economics; FinancialSophistication; Economics Schooling. |
| JEL: | J26 D12 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:dnb:dnbwpp:231&r=lab |
| By: | Frank M. Fossen; Daniela Glocker |
| Abstract: | Taxation changes the expectations of prospective university students about their future level and uncertainty of after-tax income. To estimate the impact of taxes on university enrollment, we develop and estimate a structural microeconometric model, in which a high-school graduate decides to enter university studies if expected lifetime utility from this choice is greater than that anticipated from starting to work right away. We estimate the ex-ante future paths of the expectation and variance of net income for German high-school graduates, using only information available to those graduates at the time of the enrollment decision, accounting for multiple nonrandom selection and employing a microsimulation model to account for taxation. In addition to income uncertainty, the enrollment model takes into account university dropout and unemployment risks, as well as potential credit constraints. The estimation<br /> results are consistent with expectations. First, higher risk-adjusted returns to an academic education increase the probability of university enrollment. Second, high-school graduates are moderately risk averse, as indicated by the Arrow-Pratt coefficient of risk aversion estimated within the model. Thus, higher uncertainty among academics decreases enrollment rates. A simulation based on the estimated structural model indicates that a revenue-neutral, flat-rate tax reform with an unchanged basic tax allowance would increase enrollment rates for men in Germany because of the higher expected net income in the higher income range. |
| Keywords: | University enrollment, income taxation, flat tax, income risk, risk aversion |
| JEL: | H24 I20 I28 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp241&r=lab |
| By: | María Laura Alzúa (Centro de Estudios Distributivos, Laborales y Sociales (CEDLAS) - Universidad Nacional de La Plata y CONICET); Catherine Rodriguez (Universidad de los Andes); Edgar Villa (Pontificia Universidad Javeriana) |
| Abstract: | The harshness of punishment society chooses to impose on crime offenders is mandated by law. However, the quality of life in prison can make this punishment harsher. This creates a variation in the severity of punishment which is not legislated and may differ from society's taste for penalties. Indicators of in prison violence and conflicts seem to be appropriate proxy variables for prison conditions. Using indicators of in prison violent behavior, we use an exogenous source in education participation in educational programs in order to asses the effect of education on such measures of conflict. Applying instrumental variables techniques to census data for Argentine prisons, we find that educational programs significantly reduce indicators of property damages in prison. Such reductions amounts to a 60 percent decrease relative to the mean level of property damages. |
| Keywords: | Quality of life, prison, conflict, educational programs, education |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:dls:wpaper:0091&r=lab |