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on Labour Economics |
| By: | Longhi, Simonetta (ISER, University of Essex) |
| Abstract: | The wage curve literature consistently finds a negative relationship between regional unemployment rates and regional wages; the most widely accepted theoretical explanations interpret the unemployment rate as a measure of job competition. This paper proposes new ways of measuring job competition, alternative to the unemployment rate, and finds that the negative relationship still holds when job competition is measured following the job search literature. While for men the wage impact of the theoretically-based measures of job competition is rather similar to the wage impact of the unemployment rate, for women the difference is substantial. |
| Keywords: | wage curve, unemployment, on-the-job search |
| JEL: | J31 R23 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4777&r=lab |
| By: | Dean R Hyslop; David C Mare |
| Abstract: | Matched employer-employee data research has found that workersf wages are affected by the characteristics of the firms they work in, and that higher skilled workers tend to be employed by higher paying firms. This paper examines the contribution of workersf job mobility to their wage dynamics. We focus on the possible trade-off between moving to a better paying firm and losing a firm-tenure specific component of earnings, and examine what types of workers benefit from changing firms, rather than staying with their existing employer. Our analysis provides four main findings. First, although the raw earnings gains to jobmovers and stayers are about the same, we find that, after controlling for observable differences, job-movers have about 1.3 percent lower annual earnings growth than nonmovers. Second, we estimate that job-movers gain 0.3 percent per year on average from moving to higher paying firms, but lose 1.6 percent in transitory earnings associated with changing jobs. The gains from moving to better firms are larger for both younger and new entrant workers, while the transitory earnings losses are smaller. We interpret these findings as being due to an earnings growth trade-off for workers between moving to a higher paying firm and losing their tenure-related earnings at their existing firm. Third, we estimate that, on average, workers gain (almost) all of the change in firm earnings premiums when they change jobs. However, such gains are not equally shared by all workers. In particular, our estimates suggest that it is the higher ability workers (as measured by the estimated worker earnings premiums) whose earnings gain (or lose) the most from moving to a firm with higher (or lower) earnings premiums. Finally, we find that workersf earnings also benefit on average from a change in the average earnings of their co-workers. Controlling for other factors, we estimate that a 1 standard deviation change in the estimated average peer earnings is associated with about 0.25 percent change in a workerfs earnings on average. |
| Keywords: | Earnings, Linked Employer-Employee Data, worker mobility, job turnover |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:hst:ghsdps:gd09-107&r=lab |
| By: | Ben Greiner; Axel Ockenfels; Peter Werner |
| Abstract: | We study the effect of wage changes on performance under varying contract schemes in a real-effort experiment. Without transparency about peer wages, an increase or decrease of wages does not affect performance. With transparency about peer wages, higher paid workers tend to work more accurately, and lower paid workers shirk more if wages are piece rate rather than flat. |
| Keywords: | labor market experiments, real effort, social comparison, wage schemes |
| JEL: | C91 J33 M52 |
| Date: | 2010–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:kls:series:0048&r=lab |
| By: | Paul Beaudry; David A. Green; Benjamin M. Sand |
| Abstract: | In search and bargaining models, the effect of higher wages on employment is determined by the elasticity of the job creation curve. In this paper, we use U.S. data over the 1970-2007 period to explore whether labor market outcomes abide by the restrictions implied by such models and to evaluate the elasticity of the job creation curve. The main difference between a job creation curve and a standard demand curve is that the former represents a relationship between wages and employment rates, while the latter represents a relationship between wages and employment levels. Although this distinction is quite simple, it has substantive implications for the identification of the effect of higher wages on employment. The main finding of the paper is that U.S. labor market outcomes observed at the city-industry level appear to conform well to the restrictions implied by search and bargaining theory and, using 10-year differences, we estimate the elasticity of the job creation curve with respect to wages to be -0.3. We interpret this relatively low elasticity as reflecting a low propensity for individuals to become more entrepreneurial and create more jobs when labor costs are lower and variable profits are higher. |
| JEL: | E24 J21 J23 J3 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15790&r=lab |
| By: | Addabbo, Tindara; Favaro, Donata |
| Abstract: | In this paper we study the effect of flexibility on both wages and the likelihood of work stabilisation, by focusing on flexibility when entering the labour market and on periods of career interruption. Our main goal is to evaluate how having entered the labour market with fixed-term contracts or having experienced periods of interruption of work can affect the likelihood of being given a permanent contract and the level of wages received in subsequent jobs. Unlike other works in the existing literature, this study deals with female and male workers separately. The analysis is carried out using a dataset put together by the Istituto per lo Sviluppo della Formazione Professionale dei Lavoratori – ISFOL (Institute for the Development of the Professional Training of Workers) based on a sample of Italian workers. The dataset is representative of the Italian population and contains detailed information on work experience previous to workers’ present occupation with details on types of contracts and causes of career interruptions. In the first part of the paper, we examine density functions of monthly and hourly wages relative to contractual characteristics of first jobs and the number of job changes and work interruptions. In the second part of the paper, we estimate separate earnings functions for the sample of men and women with full-time permanent contracts. We correct for selection in full-time work by estimating a first-stage equation of the probability to have a permanent job and including the Mill’s ratio in the second-stage wage function. Estimates show that flexibility affects men and women differently, both in terms of levels of wages, and the likelihood of accessing permanent jobs. Some differences also emerge with regard to the causes of career interruptions. |
| Keywords: | Flexibility; Access to permanent jobs; wage penalty |
| JEL: | J62 J31 C1 |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:21064&r=lab |
| By: | Österholm, Pär (National Institute of Economic Research) |
| Abstract: | This paper investigates the relationship between Swedish unemployment and labour-force participation. Cointegration analysis supports a robust long-run relationship between the two variables, regardless of whether aggregate or gender-specific rates are used. This finding puts the empiri-cal relevance of the unemployment invariance hypothesis into question. |
| Keywords: | Cointegration; Discouraged worker |
| JEL: | E24 |
| Date: | 2009–11–30 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:nierwp:0113&r=lab |
| By: | Maimaiti, Yasheng (University of Birmingham, UK); Siebert, W. Stanley (University of Birmingham, UK) |
| Abstract: | We hypothesise that women's participation in wage (off-farm) work is reduced when their greater water needs due to the menstrual cycle are not met because their household has poor access to water. For testing, we use the data from rural villages in China. Controlling for village fixed effects, poor access to water is found to decrease the probability of wage work participation of affected (pre-menopause) women by about 10 percentage points, a large effect. As expected, there is no adverse causal impact of poor household access to water for women post-menopause, or for men, ceteris paribus. |
| Keywords: | wage work, women, menopause, water engineering, rural development, China |
| JEL: | J16 J21 O15 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4776&r=lab |
| By: | Fernando Alexandre (Universidade do Minho - NIPE); Pedro Bação (GEMF and Universidade de Coimbra); João Cerejeira (Universidade do Minho - NIPE); Miguel Portela (Universidade do Minho - NIPE and IZA) |
| Abstract: | There is increasing evidence that the interaction between shocks and labour market institutions is crucial to understanding the dynamics of employment. In this paper, we show that the inclusion of labour adjustment costs in a trade model affects the impact of exchange rate movements on employment. We also explore how labour market rigidities interact with the degree of exposure to international competition and with the technology level. Our model-based predictions are consistent with estimates obtained using panel data for 23 OECD countries. Namely, our estimates suggest that employment in low-technology sectors that have a very high degree of openness to trade and are located in countries with more flexible labour markets are more sensitive to exchange rate changes. Our model and estimates therefore provide additional evidence on the importance of interacting external shocks and labour market institutions. |
| Keywords: | exchange rates, international trade, job ?ows, employment protection. |
| JEL: | J23 F16 F41 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:nip:nipewp:2/2010&r=lab |
| By: | Peter Haan; Victoria Prowse |
| Abstract: | In this paper we use a dynamic structural life-cycle model to analyze the employment, fiscal and welfare effects induced by unemployment insurance. The model features a detailed specification of the tax and transfer system, including unemployment insurance benefits which depend on an individual’s employment and earnings history. The model also captures the endogenous accumulation of experience which impacts on future wages, job arrivals and job separations. For better identification of the structural parameters we exploit a quasi-natural experiment, namely reductions over time in the entitlement period for unemployment insurance benefits which varied by age and experience. The results show that a policy cut in the generosity of unemployment insurance operationalized as a reduction in the entitlement period generates a larger increase in employment and yields a bigger fiscal saving than a cut operationalized as a reduction in the replacement ratio. Welfare analysis of revenue neutral tax and transfer reforms also favors a reduction in the entitlement period. |
| Keywords: | Unemployment insurance, Replacement ratio, Entitlement period, Life-cycle labor supply, Tax reform, Method of Simulated Moments |
| JEL: | C23 C25 J22 J64 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:478&r=lab |
| By: | Marisa Hidalgo-Hidalgo (Universidad Pablo de Olavide, Seville) |
| Abstract: | Parents and policy makers often wonder whether, and how, the choice between a tracked or a mixed educational system affects the efficiency and equity of national educational outcomes. This paper analyzes this question taking into account their impact on educational results at later stages and two main results are found. First, it shows that tracking can be the efficient system in societies where the opportunity cost of college attendance is high or the pre-school achievement distribution is very dispersed. Second, this paper shows that tracking is the most equitable system for students with intermediate levels of human capital required to attend college. |
| Keywords: | Peer Effects, Tracking, Mixing, College attendance gap |
| JEL: | D63 I28 J24 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:inq:inqwps:ecineq2010-162&r=lab |
| By: | Dhuey, Elizabeth; Lipscomb, Stephen |
| Abstract: | This study extends recent findings of a relationship between the relative age of students among their peers and their probability of disability classification. Using three nationally representative surveys spanning 1988-2004 and grades K-10, we find that an additional month of relative age decreases the likelihood of receiving special education services by 2-5 percent. Relative age effects are strong for learning disabilities but not for other disabilities. We measure them for boys starting in kindergarten but not for girls until 3rd grade. We also measure them for white and Hispanic students but not for black students or differentially by socioeconomic quartiles. Results are consistent with the interpretation that disability assessments do not screen for the possibility that relatively young students are over-referred for evaluation. Lastly, we present suggestive evidence that math achievement gains due to disability classification may differentially benefit relatively young students. |
| Keywords: | Education, Relative Age, Special Education |
| JEL: | I20 |
| Date: | 2010–02–27 |
| URL: | http://d.repec.org/n?u=RePEc:ubc:clssrn:clsrn_admin-2010-7&r=lab |
| By: | J. Trent Alexander; Michael Davern; Betsey Stevenson |
| Abstract: | We discover and document errors in public use microdata samples ("PUMS files") of the 2000 Census, the 2003-2006 American Community Survey, and the 2004-2009 Current Population Survey. For women and men ages 65 and older, age- and sex-specific population estimates generated from the PUMS files differ by as much as 15% from counts in published data tables. Moreover, an analysis of labor force participation and marriage rates suggests the PUMS samples are not representative of the population at individual ages for those ages 65 and over. PUMS files substantially underestimate labor force participation of those near retirement ages and overestimate labor force participation rates of those at older ages. These problems were an unintentional by-product of the misapplication of a newer generation of disclosure avoidance procedures carried out on the data. The resulting errors in the public use data could significantly impact studies of people ages 65 and older, particularly analyses of variables that are expected to change by age. |
| Keywords: | Census ; Population ; Labor supply |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedfwp:2010-03&r=lab |
| By: | Rob French (Depatment of Quantitative Social Science - Institute of Education, University of London.); Geeta Kingdon (Depatment of Quantitative Social Science - Institute of Education, University of London.) |
| Abstract: | One of the many changes in India since economic liberalisation began in 1991 is the increased use of private schooling. There has been a growing body of literature to assess whether this is a positive trend and to evaluate the effects on child achievement levels. The challenge is to identify the true private school effect on achievement, isolating the effect of the schools themselves from other variables that might boost private school outcomes, such as a superior (higher ability) student intake. Using the ASER data for 2005 to 2007 a number of methodologies are used to produce a cumulative evidence base on the effectiveness of private schools relative to their government counterparts. Household fixed effects estimates yield a private school achievement advantage of 0.17 standard deviations and village level 3-year panel data analysis yields a private school learning advantage of 0.114 SD. Length: 39 pages |
| Keywords: | Student achievement, private and public schooling, India |
| JEL: | I21 |
| Date: | 2010–02–03 |
| URL: | http://d.repec.org/n?u=RePEc:qss:dqsswp:1003&r=lab |
| By: | Ryan D. Edwards |
| Abstract: | There is a large and robust correlation between adult health and education, part of which likely reflects causality running from education into health. Less clear is whether education obtained later in life is as valuable for health as are earlier years of schooling, or whether education raises health directly or through income or wealth. In this paper, I examine how the timing of educational attainment is important for adult health outcomes, income, and wealth, in order to illuminate these issues. Among military retirees, a subpopulation with large variation in the final level and timing of educational attainment, the health returns to a year of education are diminishing in age at acquisition, a pattern that is less pronounced for income and wealth. In the full sample, the marginal effects on the probability of fair or poor health at age 55 of a year of schooling acquired before, during, and after a roughly 25-year military career are –0.025, –0.016, and –0.006, revealing a decline of about half a percentage point each decade. These results suggest that education improves health outcomes more through fostering a lifelong accumulation of healthy behaviors and habits, and less through augmenting the flow of income or the stock of physical wealth. |
| JEL: | I12 I20 J24 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15778&r=lab |
| By: | Diane M. Harnak Hall (Department of Family Studies and Community Development, Towson University); Juergen Jung (Department of Economics, Towson University); Thomas Rhoads (Department of Economics, Towson University) |
| Abstract: | The present study examines whether the college enrollment decision of young individuals (Student full-time, Student part-time, Non-student) depends on the availability of health insurance from their parents. Our findings indicate that the availability of parental health insurance has strong significant effects on the probability that a young individual enrolls as a full-time student. A young individual who has access to health insurance via a parent is up to 17.5 percent more likely to enroll as a full-time student than a student without parental health insurance. |
| Keywords: | Occupational choice, health insurance, educational choice, survey of income and program participation (SIPP). |
| JEL: | C35 I23 I10 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:tow:wpaper:2010-05&r=lab |
| By: | Levrero, Enrico Sergio |
| Abstract: | The aim of this paper is to clarify some aspects of Marx's analysis of the determinants of wages and of the peculiarities of labour as a commodity, concentrating upon three related issues. The first is that of Marx's notion of the subsistence (or natural) wage rate: subsistence wage will be shown to stem, according to Marx, from socially determined conditions of reproduction of an efficient labouring class. The second issue refers to the distinction between the natural and the market wage rate that can be found in Marx, and his critique of Ricardo's analysis of the determinants of the price of labour. Finally, Marx's analysis of the effects of technical progress on both absolute and relative wages will be considered, also relating it back to the long-standing debate on the Marxian law of the falling rate of profit. |
| Keywords: | Marx; subsistence wage; wages and productivity; Marxian law of the falling rate of profit |
| JEL: | B51 E25 B14 |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:20976&r=lab |
| By: | Tolga Aksoy (Yildiz Technical University, Economics Department, Istanbul, Turkey) |
| Abstract: | This paper examines the relationship between technology and demand for skilled labor both historically and empirically. First, it is pointed out that the Industrial Revolution substituted skilled labor with unskilled labor since it has a de-skilling characteristic. Second, the skill-bias feature of Information and Communication Technologies Revolution is suggested. Finally, the effect of technological progress on the demand for skilled labor is tested for Turkish Private Manufacturing Industries. According to the static panel data estimation results, there is a positive but weak relationship between technological progress and demand for skilled labor. |
| Keywords: | Skill bias, Technological change, Manufacturing |
| JEL: | O33 J23 J24 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:voj:wpaper:200925&r=lab |
| By: | Furdas, Marina (University of Freiburg); Kohn, Karsten (KfW Bankengruppe) |
| Abstract: | Women start fewer businesses than men. The start-up rate among women in Germany falls short of males' start-up rate by one third. We scrutinize this gender gap using individual-level data from the KfW Start-up Monitor, a large-scale population survey on start-up activity in Germany. As a unique feature, the data combine socio-demographic characteristics, entrepreneurship-related attitudes, and general personality traits of both business starters and non-starters. Estimating binary choice models and employing decomposition techniques, we find that gender differences in socio-demographics alone would even be in favor of higher start-up rates among women, while the distribution of personality traits is less favorable for business start-ups among women and explains about one third of the entire gender difference. Most substantially, men opt for a start-up more often even given identical human capital and related endowments. Qualificational policies targeted towards higher educational attainments of potential entrepreneurs do thus not suffice to increase the number of female business starters. |
| Keywords: | entrepreneurship, gender difference, start-up propensity, decomposition analysis, KfW Start-up Monitor, Germany |
| JEL: | J16 L26 M13 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4778&r=lab |
| By: | Van Bouwel, Linda; Veugelers, Reinhilde |
| Abstract: | We examine whether the (research) quality of a country’s higher education system drives macro-flows of foreign tertiary students in Europe. We use various measures on the quality of a country’s higher education system in an extended gravity model. We find that quality has a positive and significant effect on the size and direction of flows of students exchanged between 18 European countries. |
| Keywords: | international student mobility; higher education; university rankings; quality indicators; |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:ner:leuven:urn:hdl:123456789/256921&r=lab |
| By: | Lehmann, Hartmut (University of Bologna) |
| Abstract: | The paper was produced as a background paper on labor issues for the UNDP study "Convergence to the European Union: Challenges and Opportunities." It first looks at the issue of how the labor market institutions of an acceding country like Macedonia should be shaped to further the integration of the acceding economy into the European economic space. The successes and the failures of the labor market reform efforts of the new member states are discussed to give some guidance to the discussion. Second, we briefly discuss the assistance programs provided by the European commission to help candidate states in this reform process. Macedonia is the country in Europe with one of the highest unemployment rates and a very large incidence of long-term unemployment. A third area of discussion in the paper is, therefore, the development and implementation of passive and active labor market policies that guarantee an equitable and efficient use of governmental resources given the stylized facts of Macedonian unemployment. |
| Keywords: | European Union, accession, labor market institutions, labor market reform, labor market policies, high and persistent unemployment, Macedonia |
| JEL: | J08 J20 J24 J26 J30 J48 P23 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izapps:pp14&r=lab |
| By: | Louis N. Christofides and Robert Swidinsky |
| Abstract: | In a country with two official languages, such as Canada, the demand for bilingualism may lead individuals born with one mother tongue to acquire the second official language. Knowledge of an additional official language may be associated with enhanced earnings for two reasons; its actual value in the workplace, or its value as a screening mechanism for ability. Previously available data did not indicate whether bilingual language skills were actually being used at work. However, the 2001 Census reports, for the first time, the primary and the secondary languages that an individual uses at work. Conditioning on both language knowledge and language use allow us to estimate the additional earnings that can be attributed to the use of a second official language. We find very substantial, statistically significant, rewards to second official use in Quebec and much smaller, not statistically significant, effects in the Rest-of-Canada. |
| Keywords: | Wages, language knowledge, language use |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:ucy:cypeua:4-2010&r=lab |
| By: | Masayoshi Hayashi; Yohei Kobayashi |
| Abstract: | This study examines the effects of central matching grants for the School Expense Assistance (SEA) in the midst of increasing child poverty in Japan. The 2005 reform replaced SEA grants with increases in general revenues through the system of Local Allocation Tax (LAT). By exploiting the facts that the replaced grants were closed]ended and that LAT disbursements were not made to every locality, we could not only identify the effects of the matching grants but also decompose the effects into price and income effects. We show that the 2005 change indeed suppressed SEA expenditures. The loss of matching grants reduced per]recipient SEA benefits by about JPN\5,000 (US$56) for first]year elementary school students and JPN\12,000 (US$133) for first]year junior high school students. The loss also reduced recipient percentage among students by 1.2-2.1 percentage points from 11.52 percent in 2004, although the eligibility criteria were barely affected. |
| Keywords: | school expense assistance,fiscal transfers, differnce-in-difference, Japan |
| JEL: | H73 H75 H77 |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:hst:ghsdps:gd09-118&r=lab |
| By: | Mark L. Hoekstra; Scott Carrell; James West |
| Abstract: | This paper examines the effect of alcohol consumption on student achievement by exploiting the discontinuity in drinking at age 21 at a college in which the minimum legal drinking age is strictly enforced. We find that drinking causes significant reductions in academic performance, particularly for the highest-performing students. This suggests that the negative consequences of alcohol consumption extend beyond the narrow segment of the population at risk of more severe, low-frequency, outcomes. Thus, our results indicate policies that combat drinking—particularly binge drinking that occurs around age 21—may well have large positive effects that are broader than previously known. |
| JEL: | I18 I21 |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:pit:wpaper:356&r=lab |
| By: | Ginther, Donna K. (Dept. of Economics, University of Kansas); Sundström, Marianne (Swedish Institute for Social Research, Stockholm University) |
| Abstract: | We examine whether marriage leads to specialization in Sweden by implementing a model that differentiates specialization in the household by cohabitation and marriage. Our paper evaluates this model using panel data to analyze trends in earnings before and after marriage between 1985 and 1995 for married and long-term cohabiting Swedish couples with children. To identify the effect of marriage on earnings we use the reform of the widow’s pension system that resulted in a marriage boom in Sweden in 1989 and difference-in-difference estimation. Our results show that most of the male marriage premium can be explained by positive selection whereas the female marriage penalty reflects increased specialization in home production and childcare. The findings suggest that the positive selection of men into marriage translates into the increased specialization of women. We also find evidence that marriage facilitates specialization in the few couples where mothers earn more than fathers, resulting in a marriage premium for women and a marriage penalty for men. Finally, we find that the net effect of marriage on family earnings is zero because the male marriage premium is offset by the female marriage penalty. Our results show that specialization results from the legal arrangement of marriage, not from the living arrangement of the household. |
| Keywords: | Marriage; Marriage premium; Specialization |
| JEL: | J12 J31 |
| Date: | 2010–02–11 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sofiwp:2010_001&r=lab |
| By: | E. Anthon Eff; Christopher C. Klein; Reuben Kyle |
| Abstract: | Consumers of higher education face a bewildering array of product and price combinations. We compare U. S. institutions with a Data Envelopment Analysis (DEA) multi-factor frontier using 2000-2001 data for 1,188 four-year institutions of higher education. The input is net price or tuition, fees, room, and board less per student financial aid. Outputs include SAT score, athletic expenditures, instructional expenditures, value of buildings, dorm capacity, and student body characteristics. The DEA efficiency scores indicate the distance of each institution from the “best buy” frontier, providing an objective means of ranking institutions as the best buys in higher education. |
| Keywords: | Education, Data Envelopment Analysis, Comparative advantage |
| JEL: | I20 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:mts:wpaper:201004&r=lab |
| By: | Miroslav Verbic (Faculty of Economics, University of Ljubljana, Slovenia & Institute for Economic Research, Ljubljana); Franc Kuzmin (Faculty of Economics, University of Ljubljana, Slovenia & Institute for Economic Research, Ljubljana) |
| Abstract: | The article presents the underlying principles, derivation and properties of a simple descriptive measure of concordance between two analogous rank structures that we call the coefficient of structural concordance. It is based upon the idea of Kendalls coefficient of concordance, which we extend to two rank structures. As the coefficient of structural concordance is a pure intergroup measure of concordance, it is designed to complement the Kendalls intragroup coefficient of concordance. We apply this descriptive measure by exploring the relationship between wages and labour productivity in Slovenia for the period 19982007. We are able to confirm the hypothesis of high concordance between wages and labour productivity, which indicates a stimulative role of wages in production of market traded goods and services. |
| Keywords: | Coefficient of structural concordance, Kendalls coefficient of concordance, Labour productivity, Slovenia, Value added per employee, Wages. |
| JEL: | C10 C14 D24 J30 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:voj:wpaper:200923&r=lab |
| By: | Oriana Bandiera (London School of Economics); Luigi Guiso (European University Institute); Andrea Prat (London School of Economics); Raffaella Sadun (Harvard Business School, Strategy Unit; London School of Economics - Centre for Economic Performance) |
| Abstract: | We provide evidence on the match between firms, managers, and incentives using a new survey that contains information on managers’ risk preferences and human capital, on their compensation schemes, and on the firms they work for. The data is consistent with the equilibrium correlations predicted by a model where firms with di¤erent owner-ship structure and managers with different risk aversion and talent match endogenously through incentive contracts. The model predicts and the data support that, compared to widely-held firms, family firms use contracts that are less sensitive to performance; these contracts attract less talented and more risk averse managers; these managers work less hard, earn less, and display lower job satisfaction. |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:hbs:wpaper:10-073&r=lab |
| By: | Meng, Xin (Asian Development Bank Institute); Kong, Sherry Tao (Asian Development Bank Institute); Zhang, Dandan (Asian Development Bank Institute) |
| Abstract: | The employment shock of late 2008 in the People's Republic of China (PRC) may have been a product of three different events: (i) the contractionary macroeconomic policies introduced by the government and the central bank in 2007 to slow growth, (ii) the introduction of the new Labor Contract Law at the start of 2008, and (iii) the reduction in export orders due to the global financial crisis from the second half of 2008. These three events occurred sequentially, and their impact on employment has been borne most heavily by rural-urban migrants. Using unique data that track 5,000 migrant households in 15 cities from 2008 to 2009, this paper documents the size of the employment impact of the economic downturn, investigates the geographic location and industry distribution of the effect, and examines the types of migrant workers who lost their jobs in 2008 because of the economic downturn. We find that job loss is not confined to export manufacturing industries, nor is it restricted to coastal cities where export industries are located. We interpret this widespread job loss to indicate that the employment shock that took place in the PRC at the end of 2008 and early 2009 was a response to both the global financial crisis and domestic economic policies |
| Keywords: | labor; migrant; labor contract law; prc; employment shock |
| JEL: | J64 |
| Date: | 2010–02–12 |
| URL: | http://d.repec.org/n?u=RePEc:ris:adbiwp:0194&r=lab |
| By: | Peter Nurnberg; Morton Schapiro; David Zimmerman |
| Abstract: | The college choice process can be reduced to three questions: 1) Where does a student apply? 2) Which schools accept the students? 3) Which offer of admission does the student accept? This paper addresses question three. Specifically, we offer an econometric analysis of the matriculation decisions made by students accepted to Williams College, one of the nation’s most highly selective colleges and universities. We use data for the Williams classes of 2008 through 2012 to estimate a yield model. We find that—conditional on the student applying to and being accepted by Williams—applicant quality as measured by standardized tests, high school GPA and the like, the net price a particular student faces (the sticker price minus institutional financial aid), the applicant’s race and geographic origin, plus the student’s artistic, athletic and academic interests, are strong predictors of whether or not the student will matriculate. |
| JEL: | I21 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15772&r=lab |
| By: | Gergaud, Olivier; Smeets, Valérie; Warzynski, Frédéric |
| Abstract: | In this paper, we analyze the careers from a sample of more than 1,000 top French chefs over more than twenty years and link it to the success or reputation of the restaurants where they have worked. This allows us to test what are the determinants of success but also to investigate the dynamics of performance and reputation, stressing the importance of the quality of apprenticeships, mentoring and entrepreneurship spirit. We find that the prestige of the restaurant where individuals work is on average declining along the career, and that the quality of apprenticeship is strongly related to the future success as chef. We also find that prices of restaurants with higher reputation are more sensitive to bad signals. |
| Keywords: | reputation; careeers; gastronomy |
| JEL: | D83 J24 L15 M50 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:21045&r=lab |
| By: | Goossens, Dries; Spieksma, Frederik |
| Abstract: | In a round robin tournament, it is often believed that each team has an effect on its opponent which carries over to the next game of that opponent. Indeed, if team C plays against team A, and subsequently against team B, C's performance against B can be affected by A, and we say that team B receives a carry-over effect from A. For instance, if team A is a very strong team, then team C could be exhausted and discouraged after this game, which could benefit its next opponent, team B. Clearly, any schedule will lead to carry-over effects. In this work, we develop an approach to measure whether carry-over effects have an influence on the outcome of football matches. We apply this method on the highest division in Belgium, using data from over 30 seasons. We find that there is no evidence to support the claim that carry-over effects affect the results. |
| Keywords: | Football; Carry-over effect; Existence; Measure; Scheduling; Fairness; |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:ner:leuven:urn:hdl:123456789/259196&r=lab |
| By: | van den Berg, Gerard J. (University of Mannheim); Deeg, Dorly J. H. (VU University Amsterdam); Lindeboom, Maarten (VU University Amsterdam); Portrait, France (VU University Amsterdam) |
| Abstract: | Cognitive functioning of elderly individuals may be affected by events such as the loss of a (grand)child or partner or the onset of a serious chronic condition, and by negative economic shocks such as job loss or the reduction of pension benefits. It is conceivable that the impact of such events is stronger if conditions early in life were adverse. In this paper we address this using a Dutch longitudinal database that follows elderly individuals for more than 15 years and contains information on demographics, socio-economic conditions, life events, health, and cognitive functioning. We exploit exogenous variation in early-life conditions as generated by the business cycle. We also examine to what extent the cumulative effect of consecutive shocks later in life exceeds the sum of the separate effects, and whether economic and health shocks later in life reinforce each other in their effect on cognitive functioning. |
| Keywords: | cognitive functioning, business cycle, bereavement, developmental origins, retirement, health, long-run effects, dementia |
| JEL: | I12 I10 J14 E32 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4780&r=lab |
| By: | Laura Hering; Tomohiko Inui; Sandra Poncet |
| Abstract: | In the present paper, we investigate whether previous findings of limited effects of investing abroad on the firm’s performance can be explained by the aggregation of heterogeneous effects depending on the FDI motives, sectors and locations. Results suggest, in line with previous work, that on average Japanese outward FDI has limited effects (whether positive or negative) on the activity of internationalizing firms. Fears of “Hollowing out” effects seem to be more justified in the case of FDI to low income countries, for which a contraction of employment and investment and exports is observed. By contrast, we observe a significant positive employment effect for FDI in services, presumably reflecting the operational complementarities between the affiliate and the parent. There is also some evidence of positive labour productivity gains deriving essentially from FDI in manufacturing in high GDP countries. |
| Keywords: | FDI; multinationals; offshoring; propensity score matching |
| JEL: | F14 F21 F23 |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:cii:cepidt:2010-01&r=lab |
| By: | Murat Arik; David A. Penn |
| Abstract: | Conveniently located between the Nashville and Huntsville MSAs, the southern middle Tennessee counties are well positioned for businesses seeking to expand or relocate their operations. Although location itself is a critical asset, for sustainable economic growth the scope and issues related to counties’ human capital should be fully analyzed and documented. The goal of this study is to identify and analyze the scope and characteristics of the available labor force in the study area. |
| Keywords: | underemployment, labor force, laborforce, Tennessee, southern middle Tennessee, counties, Bedford, Coffee, Franklin, Grundy, Lincoln, Moore, Warren, county, relocation, regional, human capital |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:mts:studys:201001&r=lab |
| By: | Charlotte Klempt (Max Planck Institute of Economics, Jena); Kerstin Pull (Eberhard-Karls-Universität Tübingen, Faculty of Economics and Business Administration) |
| Abstract: | Sanctions are widely used to promote compliance in principal-agent-relationships. While there is ample evidence confirming the predicted positive incentive effect of sanctions, it has also been shown that imposing sanctions may in fact reduce compliance by crowding-out intrinsic motivation. We add to the literature on the hidden costs of control by showing that these costs are restricted to situations where principals ex ante reveal their decision to sanction low compliance. If this decision is not revealed and agents do not know whether they will be sanctioned or not in case of low compliance, we do not find evidence of crowding-out - not even in those cases where agents firmly believe that they will be sanctioned in case of low performance. |
| Keywords: | Intrinsic Motivation, Monetary Incentives, Job Performance |
| JEL: | C72 C91 |
| Date: | 2010–03–03 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2010-013&r=lab |
| By: | Teles, Vladimir Kuhl; Joiozo, Renato |
| Abstract: | Panel cointegration techniques applied to pooled data for 27 economies forthe period 1960-2000 indicate that: i) government spending in education andinnovation indicators are cointegrated; ii) education hierarchy is relevant whenexplaining innovation; and iii) the relation between education and innovation canbe obtained after an accommodation of a level structural break. |
| Date: | 2010–02–22 |
| URL: | http://d.repec.org/n?u=RePEc:fgv:eesptd:245&r=lab |
| By: | Natalia (University of Padua) |
| Abstract: | Relying on the relevance of other-regarding preferences in workplaces, the paper provides a behavioral explanation for the puzzle of unpaid overtime. It characterizes the optimal compensation schemes offered by the employer which induce overtime by exploiting workers’ horizontal reciprocity under both symmetric and asymmetric information about workers’ action. Finally, the paper shows that reciprocity furnishes a rationale for the composition of teams of reciprocal workers when the production technology induces negative externality among the employees’ efforts. |
| Keywords: | Overtime, Horizontal Reciprocity, Negative Reciprocity. |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:pad:wpaper:0114&r=lab |
| By: | Anne Drumaux (Centre Emile Bernheim, Solvay Brussels School of Economics and Management, Université Libre de Bruxelles, Brussels.); Robert Fouchet (Institut de Management Public et Gouvernance Territoriale, Université Paul Cézanne Aix-Marseille III.); Emil Turc (Institut de Management Public et Gouvernance Territoriale, Université Paul Cézanne Aix-Marseille III.) |
| Abstract: | The Framework Law on Finance Acts (Loi Organique sur les Lois de Finance - LOLF) was passed by the French Parliament in 2001 and came into force in January 2006. As budget legislation it refocuses the relationship between rulers and ruled by modifying the connection between the state budget and operation of public structures, especially universities. These effects are interpreted in the present contribution with the help of a neo-institutionalist reference framework. In the first part, we set out a panoramic view of sectoral and organizational changes in higher education prior to LOLF. Despite various legislations during the 80s and 90s, the vast majority of universities failed to gain greater autonomy and to strengthen themselves as institutions, each with its own university-wide policies and governance. It is only with the LMD (licence-master-doctorate) reform that these professional bureaucracies started to destabilize. The study conducted at a pilot university experimenting with LOLF shows that the memory of earlier waves of reform is a structuring factor in players’ understanding of LOLF, paving the way for a deeper transformation. In the second part, the effects of LOLF are analysed in terms of their impact on information systems and of the tools put in place by universities. These include local management tools and those, like the four-year contact, introduced by the previous reforms of the sector. Based on a survey at two different universities, we point to a reorganization of interactions between the different bodies responsible for higher education, a reorganization that also is reflected within the university, particularly in relation to its component parts. At the heart of this process we observe a refocusing on the four-year contract, but "lolf-icized", and an impact on internal management tools, albeit highly dependent on local initiatives and internal capabilities. Part three discusses the possible extension of these results by bringing into the analysis the context created by the 2007 Law on University Freedoms and Responsibilities (Libertés et responsabilités universitaires - LRU). |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:sol:wpaper:10-018&r=lab |
| By: | Mirella Damiani; Andrea Ricci |
| Abstract: | Purpose – This study analyses the effects on productivity of Performance-Related Payments (PRP) and unions, and examines to what extent heterogeneity between firms characterises these influences. Design - For the Italian economy, the study presents firm-level quantile regressions for Total Factor Productivity (TFP) and controls for various observed characteristics of firms, worker composition and labour relations. Findings - The paper shows the significant effect of PRP and unions on the whole economy and on firms operating in the manufacturing industries. In these industries, the uniform incentive effects of PRP but the increasing impact of unions are estimated along the productivity distribution. Conversely, the role of management - significant in all sectors- is more efficacious in prospering large firms operating in services. Research limitations – The adoption of PRP schemes and the presence of unions maybe endogenous to firms’ productivity, and our estimates do not prove causal links but simply suggest correlations. Practical implications - The limited incentive effects of PRP schemes in services contribute towards explaining the slowdown in Italian productivity, whereas the role of unions is quite uniform among sectors. Originality- The paper addresses the hitherto poorly developed issue of firm heterogeneity and TFP, and offers the first Italian study of PRP and unions, which covers all dimensional classes of firms and non-agricultural sectors of the Italian economy. |
| Keywords: | Performance – related pay, productivity. |
| JEL: | J33 D24 |
| Date: | 2010–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:pia:wpaper:73/2010&r=lab |