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on Labour Economics |
| By: | Hasan, Rana (Asian Development Bank); Jandoc, Karl Robert L. (Asian Development Bank) |
| Abstract: | Analysis of labor force survey data from 1994 to 2007 reveals that the structure of the Philippines labor force has been changing in several important ways. One is the movement from self-employment, the most predominant form of employment, to wage employment across a wide range of production sectors. How does one evaluate this change in terms of workers’ earnings—arguably the most important element of job quality? Since labor force survey data do not provide information on earnings of the self-employed, we combine information on household incomes (disaggregated by source) from the Family Income and Expenditure Survey (FIES) with information on household members’ employment-related activities from the Labor Force Survey (LFS) to shed light on this question. We also examine broad trends in the structure of employment, wages, and earnings. Our findings suggest that the decline of self-employment is no bad thing. For the most part, the earnings and educational profiles of the self-employed are very similar to those of casual wage earners, and clearly dominated by those of permanent wage earners even when observable worker characteristics are controlled for. An implication is that the self-employed do not seem to be “capitalists in waiting” as noted in recent literature. As selfemployment gives way to wage employment, especially casual wage employment in the services sector, the key challenge for policy is tackling the slow growth of wages and earnings indicated by both LFS and FIES data |
| Date: | 2010–02–04 |
| URL: | http://d.repec.org/n?u=RePEc:ris:adbewp:0148&r=lab |
| By: | Carlo Dell'Aringa (DISCE, Università Cattolica); Laura Pagani (Università Milano Bicocca) |
| Abstract: | In this paper we study the assimilation of immigrants into the Italian labour market using over-education as an indicator of labour market performance. The main objective is to assess the extent to which work experience in the host country’s labour market favours the international transferability of immigrants’ human capital. Using data from the Istat Labour Force Survey for the years 2005-2007, we find that foreigners are much more likely to be over-educated than natives upon their arrival in Italy and that work experience gained in the country of origin is not valued in the Italian labour market. Moreover, we find that not even experience acquired in Italy is helpful in improving immigrants’ educational job matches, suggesting that catch-up by foreigners seems unachievable, even after they adapt their skills to the host country labour market. |
| Keywords: | Assimilation, Over education |
| JEL: | F22 J24 J61 |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:ctc:serie4:ieil0058&r=lab |
| By: | Neubäumer, Renate (University of Koblenz-Landau) |
| Abstract: | Our paper investigates the relative effects of wage subsidies and further vocational training on the subsequent employment prospects of previously unemployed program participants. First, we outline a theoretical approach based on a firm's hiring decision. For the relative effectiveness of both labor market programs the assumption concerning the formation of human capital is crucial and leads to competing hypotheses for the medium and long term. On the assumption that wage subsidies have no effect on human capital they improve individuals’ employment prospects less than training programs. Contrariwise, on the assumption that the formation of human capital on subsidized jobs equals that by formal training subsidization has the same employment effect as a training program. Second, we test the two hypotheses empirically, using a large administrative data set from Germany and statistical matching techniques. Our treatment groups consist of unemployed persons taking up subsidized employment or entering a further vocational training program, respectively, during March 2003. To exclude unemployment after program end we estimate the effect of keeping a subsidized job versus participating in training and taking up a job immediately afterwards. The results strongly support the latter of our competing hypotheses: Previously subsidized individuals and trained individuals who found a job immediately afterwards have the same employment rates. This leads to the conclusion that firms value training on a subsidized job as much as formal training programs. |
| Keywords: | evaluation of active labor market programs, training programs, wage subsidies, propensity score matching |
| JEL: | J68 J64 J65 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4864&r=lab |
| By: | Bockerman, Petri; Ilmakunnas, Pekka; Johansson, Edvard |
| Abstract: | We examine the effects of establishment- and industry-level labor market turnover on employees’ well-being. The linked employer-employee panel data contain both survey information on employees’ subjective well-being and comprehensive register-based information on job and worker flows. Labor market turbulence decreases well-being as experienced job satisfaction and satisfaction with job security are negatively related to the previous year’s flows. We test for the existence of compensating wage differentials by explaining wages and job satisfaction with average uncertainties, measured by an indicator for a high moving average of past excessive turnover (churning) rate. The results are consistent with compensating wage differentials, since high uncertainty increases real wages, but has no effect on job satisfaction. |
| Keywords: | job flows; worker flows; job satisfaction; perceived security; job instability |
| JEL: | J31 J63 J28 |
| Date: | 2010–04–08 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:21961&r=lab |
| By: | Jenny Willson (Department of Economics, The University of Sheffield) |
| Abstract: | In Britain, part time employment is typically used to combine work and motherhood: 60% of employed mothers in Britain work part time, and this usually involves a transition from full time employment around the first childbirth. Part time jobs are often situated in lower level occupational groups and so a transition from full to part time employment may reduce the wage. Using the British Household Panel Survey this study investigates the wage impact of switching from full to part time employment. Furthermore, mother-specific wage impacts of re-entering employment after childbirth via part time employment are analysed. A mother of one child receives a pay penalty of 7%, switching to part time employment increases this to 15%. Mothers who move from full to part time employment over childbirth receive lower wages than mothers who remained in full or part time employment over childbirth for 10 years after the birth. |
| Keywords: | Part time, Motherhood pay penalty, Childbirth |
| JEL: | J13 J16 J21 |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:shf:wpaper:2010002&r=lab |
| By: | David A. Green; James Townsend |
| Abstract: | <p><p>We examine the wage patterns of Canadian less skilled male workers over the last quarter century by organizing workers into job entry cohorts. We find entry wages for successive cohorts declined until 1997, and then began to recover. Wage profiles steepened for cohorts entering after 1997, but not for cohorts entering in the 1980s - a period when start wages were relatively high. We argue that these patterns are consistent with a model of implicit contracts with recontracting in which a worker's current wage is determined by the best labour market conditions experienced during the current job spell.</p></p> |
| JEL: | J31 O33 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:ifs:ifsewp:09/22&r=lab |
| By: | Darrell J. Glaser (United States Naval Academy); Ahmed S. Rahman (United States Naval Academy) |
| Abstract: | This paper explores the role of human capital on earnings and other measures of job performance during the late 19th century. During this time, U.S. Naval ocers belonged either to a regular or an engineer corps and had tasks assigned to their specialized training and experience. To test for the eects of specialized skills on performance, we compile educational data from original-source Naval Academy records for the graduating classes of 1858 to 1905. We merge these with career data extracted from official Navy registers for the years 1859 to 1907. This compilation comprises one of the longest and earliest longitudinal records of labor market earnings, education and experience of which we are aware. Our results suggest that greater technical skill translated into higher earnings early in careers, but wage premia diminished as careers progressed. From this evidence we argue that technical progress was more skill-depreciating than skill-biased during this period. |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:usn:usnawp:28&r=lab |
| By: | Immervoll, Herwig (OECD); Pearson, Mark (OECD) |
| Abstract: | The twin problem of in-work poverty and persistent labour market difficulties of low-skilled individuals has been one of the most important drivers of tax-benefit policy reforms in OECD countries in recent years. Employment-conditional cash transfers to individuals facing particular labour-market challenges have been a core element of “make-work-pay” policies for some time and are now in use in more than half of the OECD countries. They are attractive because they redistribute to low-income groups while also creating additional work incentives. But like all social benefits, they have to be financed, which creates additional economic costs for some. This paper discusses the rationale for in-work benefits (IWB), summarises the main design features of programmes operated in OECD countries, and provides an update of what is known about their effectiveness in terms of reducing inequalities and creating employment. As policies aiming to promote self-sufficiency, wage subsidies and minimum wages share a number of the objectives associated with IWB measures. We review evidence on the effectiveness of minimum wages and wage subsidies and discuss links between these policies and IWBs. Finally, we outline some potential consequences of weakening labour markets for the effectiveness of make-work-pay policies. |
| Keywords: | labor market, tax-benefit reform, in-work benefits, low-skilled workers |
| JEL: | J20 J30 H24 H31 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izapps:pp3&r=lab |
| By: | Vera A. Adamchik (University of Houston-Victoria); Josef C. Brada (Arizona State University and Macedonian Academy of Sciences and Arts); Arthur E. King (Lehigh University) |
| Abstract: | We examine the extent to which workers in transition and developed market economies are able to obtain wages that fully reflect their skills and labor force characteristics. We find that workers in two transition economies, the Czech Republic and Poland, are able to better attain the maximum wage available than are workers in a sample of developed market economies. This greater wage-setting efficiency in the transition economies appears to be more the result of social and demographic characteristics of the labor force than of the mechanisms for setting wages or of labor market policies. |
| Keywords: | labor markets, wage inefficiency, job search, stochastic frontier, economic transition |
| JEL: | J31 P23 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:ost:wpaper:278&r=lab |
| By: | Rodolphe Desbordes (Department of Economics, University of Strathclyde); Céline Azémar (Department of Economics, University of Glasgow) |
| Abstract: | We investigate the effect of a rise in non-wage labour costs (NWLC) on real manufacturing labour costs in OECD countries, taking into account the degree of coordination in the wage bargaining process. We find that, in countries in which wage bargaining is not highly coordinated, 55% of an increase in NWLC appears to be shifted to workers in the long run, whereas in countries operating under a highly coordinated bargaining regime, full shifting occurs. Overall, our results suggest that high NWLC can be associated with a high equilibrium unemployment rate, but only in those OECD countries that do not have highly coordinated wage bargaining. |
| Keywords: | labour costs, tax wedge, wage determination, bargaining coordination |
| JEL: | H22 H30 H55 J32 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:str:wpaper:1004&r=lab |
| By: | Alessandro Tampieri |
| Abstract: | This paper studies how social background a¤ects schooling attainment and job opportunities from a theoretical perspective. We analyse the interaction between a school and an employer when students attend school and then go to the job market. Students di¤er in ability and belong to different social groups. Our results suggest that the employer makes use of social background in the recruitment decisions: this favours advantaged students, as they are more likely to have high ability. In turn, the school optimally provides disadvantaged students with less teaching than advantaged students, given the same level of ability. |
| Keywords: | Social Background; Ability |
| JEL: | C73 I21 J24 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:lec:leecon:09/26&r=lab |
| By: | Stefan Boeters; Nico van Leeuwen |
| Abstract: | This paper describes a labour market extension for the CGE model "WorldScan". The labour market module features endogenous labour supply at two margins: participation and hours of work. Involuntary unemployment is captured through a collective bargaining ("right to manage") set-up. The paper explains how these two labour market mechanisms interact and how they are calibrated to empirical elasticities. Illustrative simulations that can be placed in the context of the "double dividend" literature show the working mechanisms of the module. |
| Keywords: | WorldScan; computable general equilibrium model; labour market; labour supply; involuntary unemployment |
| JEL: | C68 D58 J20 J50 |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpb:docmnt:201&r=lab |
| By: | Sara Lemos |
| Abstract: | The enlargement of the European Union in May 2004 triggered a relatively large and rapid migration inflow into Wales which was concentrated into narrow areas and occupations. As this inflow was larger and faster than anticipated, it arguably corresponds more closely to an exogenous supply shock than most migration shocks studied in the literature. This helps to some extent to circumvent identification issues arising from simultaneity bias which usually pose difficulties when estimating the effect of migration inflows on the labour market. We found little evidence that the inflow of accession migrants contributed to a fall in wages or a rise in claimant unemployment in Wales between 2004 and 2006. In particular, we found no evidence of an adverse impact on young, female or low-skilled claimant unemployment and no evidence of an adverse impact on the wages of the low-paid. If anything, we found a positive effect on the wages of higher paid workers and some weak evidence of a potentially favourable impact on claimant unemployment. |
| Keywords: | Migration; Employment; wages; Central and Eastern Europe; UK; Wales. |
| JEL: | J22 |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:lec:leecon:10/03&r=lab |
| By: | Cuevas, Sining (Asian Development Bank); Mina, Christian (Asian Development Bank); Barcenas, Marissa (Asian Development Bank); Rosario, Aleli (Asian Development Bank) |
| Abstract: | The paper attempted to use the February 2007 round of Indonesia’s National Labor Force Survey (Sakernas) for a comparative analysis of wages and benefits of formal and informal workers. While Sakernas was not designed for this purpose, the study explored questions in the existing survey that can be used to distinguish formal and informal workers. Because of data limitation, workers were classified as employed informally or “mixed”—a category composed of workers who cannot be identified, with precision, to be engaged in either formal or informal employment. Given this constraint, informal employment was estimated at the minimum to be at 29.1% of total employment in Indonesia. Informal employment is also highly concentrated in rural areas and is prevalent in agriculture and construction sectors. More women are likely to be informally employed than men, and women generally receive lower pay and are mostly unpaid family workers. To the extent possible the study was able to examine informal employment in Indonesia and to identify the gaps in the Sakernas questionnaire that can be addressed in future rounds of the survey for a successful comparative analysis between formal and informal workers. |
| Keywords: | Indonesia; informal employment; informal sector; gender analysis; wage differentials |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:ris:adbewp:0156&r=lab |
| By: | Bardasi, Elena; Beegle, Kathleen; Dillon, Andrew; Serneels, Pieter |
| Abstract: | Labor market statistics are critical for assessing and understanding economic development. In practice, widespread variation exists in how labor statistics are measured in household surveys in low-income countries. Little is known whether these differences have an effect on the labor statistics they produce. This paper analyzes these effects by implementing a survey experiment in Tanzania that varied two key dimensions: the level of detail of the questions and the type of respondent. Significant differences are observed across survey designs with respect to different labor statistics. Labor force participation rates, for example, vary by as much as 10 percentage points across the four survey assignments. Using a short labor module without screening questions on employment generates lower female labor force participation and lower rates of wage employment for both men and women. Response by proxy rather than self-report yields lower male labor force participation, lower female working hours, and lower employment in agriculture for men. The differences between proxy and self reporting seem to come from information imperfections within the household, especially with the distance in age between respondent and subject playing an important role, while gender and educational differences seem less important. |
| Keywords: | Labor Markets,Labor Policies,Work&Working Conditions,Social Analysis,Housing&Human Habitats |
| Date: | 2010–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5192&r=lab |
| By: | Kuhnen, Camelia M. |
| Abstract: | This paper proposes and tests empirically a model of optimal job search using novel data on job seeking strategies of participants in the labor market for MBA graduates. Theoretically and empirically I find that the breadth of search that workers conduct depends on their ability, outside option, and fit with available jobs, as well as on the exogenous job application cost and the ex-ante probability of applications resulting in offers. These results illustrate the formation of the supply of human capital available to hiring companies, which drives the efficiency of matching between workers and firms and ultimately determines productivity. |
| Keywords: | job search; matching; human capital; MBA education; career choice |
| JEL: | J44 J64 M51 J24 M12 G30 |
| Date: | 2010–01–31 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:21975&r=lab |
| By: | Joanne Lindley (Department of Economics, The University of Sheffield); Steven McIntosh (Department of Economics, The University of Sheffield) |
| Abstract: | Much has been written about the impact of over-education on wages using cross-sectional data, although there have been few studies that analyse the returns to over-education in a dynamic setting. This paper adds to the existing literature by using panel data to investigate the impact and permanence of over-education wage penalties, whilst controlling for unobserved individual heterogeneity. Our fixed effects estimates suggest that the over-education wage penalty cannot solely be explained by unobserved heterogeneity. Over-education is permanent for many workers since around 50 percent of workers over-educated in 1991 are still over-educated in 2005. However, we also show that these workers are of lower quality compared to around 25 percent who find a match within five years of being over-educated. Finally, there is a significant scarring effect for workers over-educated in 1991 since they never fully reach parity compared to those who were matched in 1991, although this is not the case for graduates who manage to find a match within 5 years. |
| Keywords: | Over-education, Skills |
| JEL: | J24 J31 I2 |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:shf:wpaper:2010004&r=lab |
| By: | Alessandro Tampieri |
| Abstract: | This paper examines how educational decisions a¤ect job and marital satisfaction. We build up a model with educational assortative matching where individuals decide whether to attend university both for obtaining job satisfaction and for increasing the probability to be matched with an educated partner. The educational choices between future partners are simultaneously determined as a Nash equilibrium. The theoretical results suggest that, as assortative matching increases, the proportion of educated individuals increases. For educated individuals, job satisfaction falls and marital satisfaction increases. We test our model using the British Household Panel Survey. We carry out longitudinal analysis for years 2003-2006. Our empirical .ndings support the theoretical results. |
| Keywords: | Education; Marriage; Job Satisfaction; Educational Assortative Matching |
| JEL: | C78 I21 J12 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:lec:leecon:10/07&r=lab |
| By: | Yolanda Rebollo Sanz (Department of Economics, Universidad Pablo de Olavide); J. Ignacio García-Pérez (Universidad Pablo de Olavide, FEDEA & FCEA) |
| Abstract: | This article studies how job creation subsidies designed for several Spanish regional governments to foster the creation of new permanent contracts during the period 1997-2004 might affect the subsequent employment stability of the eligible workers. We use a triple difference approach that focuses on regional and temporal variability in individual eligibility conditions of these subsidies to obtain the causal effect of the policy. Our data comes from the Muestra Continua de Vidas Laborales (MCVL) and from a database that contains information on the policy analyzed. Our main result is that workers who are eligible for these subsidies face a higher probability of exiting from their current permanent contract than those who do not. These effects vary by age and gender, as well as by contract duration and contract type. This result is particularly relevant for male workers whose contracts also benefited with nationally subsidized payroll deductions and for women with such deductions but only during their first year of employment. During that initial first-year period, the exit rate among eligible workers in our sample increased by 9%, 21% and 16% for younger, middle-aged and older female workers, respectively, and by about 13% and 25% for younger and older male workers, respectively. |
| Keywords: | labour market rotation, permanent contracts, wage subsidies, triple difference, causal inference, average treatment effects, duration model. |
| JEL: | J38 J68 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:pab:wpaper:09.18&r=lab |
| By: | Wang-Sheng Lee (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne); Michael B. Coelli (Department of Economics, The University of Melbourne) |
| Abstract: | We provide estimates of the effects of completing a Vocational Education and Training (VET) qualification on several labour market outcomes: earnings from employment, plus the probabilities of being employed, being employed full-time if employed, and being employed in a permanent position. Estimates are provided for 1993, 1997, 2001 and 2005. The estimation methodology is based on matched comparisons of persons at each level of VET qualifications separately with Year 12 completers and non-completers. We find that compared to Year 12 completers, there is little benefit from obtaining certificate level qualifications, but there are positive employment and earnings outcomes associated with obtaining diploma level qualifications. Compared to non-completers of Year 12, however, there are benefits from obtaining any kind of VET qualification, including the lower level Certificate I/II qualifications. |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:iae:iaewps:wp2010n01&r=lab |
| By: | Ryo Kambayashi |
| Abstract: | By using microdata of Employment Status Survey between 1982 and 2007, this article describes several aspects on the non-regular employees in the Japanese labor markets. The main findings are as follows: (1) the increased non-regular employees are eregularf in terms of contractual length but enon-regularf in terms of their title in workplaces. (2) Typical attributes of non-regular workers with open-ended contract are young, over mandatory retirement age, and female. (3) Expansion of such workers since 1980s has not been punctually corresponded with the change of regular workers, for which the change of non-regular workers with fixed-term contract should be responsible. (4) The difference of contractual length does not affect the wage rate, labor hours, and training incentives than the difference of title does. These findings imply, in the Japanese labor markets, the actual title in workplaces may divide the workers' career much more than the contractual length would differentiate it. |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:hst:ghsdps:gd09-120&r=lab |
| By: | John Bound; Michael F. Lovenheim; Sarah Turner |
| Abstract: | Time to completion of the baccalaureate degree has increased markedly in the United States over the last three decades, even as the wage premium for college graduates has continued to rise. Using data from the National Longitudinal Survey of the High School Class of 1972 and the National Educational Longitudinal Study of 1988, we show that the increase in time to degree is localized among those who begin their postsecondary education at public colleges outside the most selective universities. In addition, we find evidence that the increases in time to degree were more marked amongst low income students. We consider several potential explanations for these trends. First, we find no evidence that changes in the college preparedness or the demographic composition of degree recipients can account for the observed increases. Instead, our results suggest that declines in collegiate resources in the less-selective public sector increased time to degree. Furthermore, we present evidence of increased hours of employment among students, which is consistent with students working more to meet rising college costs and likely increases time to degree by crowding out time spent on academic pursuits. |
| JEL: | I2 I21 I23 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15892&r=lab |
| By: | Donatella Gatti; Ryo Kambayashi; Sebastien Lechevalier |
| Abstract: | Two stylized facts characterized Japan during the so-called Lost Decade (1992-2005): rising wage inequalities and increasing productivity differentials at the firm level. Surprisingly, these features have never been connected in the literature. This paper attempts to fill this gap by proposing an explanation focusing on labor market mechanisms. We first construct an efficiency wage model with two types of firms distinguished by their job security schemes and associated incentive mechanisms. We show that a comparable negative productivity shock at the aggregate level leads to different firm reactions; namely, the model predicts increasing effort from workers in firms employing an efficiency wage mechanism. This leads to increasing productivity and wage differentials and a rise of the share of these firms in the total population of firms. We test this model using Japanese micro data. For the first time, we match the Basic Survey on Wage Structure and the Employment Trend Survey for 2005. The matched worker-firm dataset we obtain allows us to confirm the existence of an efficiency wage mechanism on average. We also divide our sample of firms into two groups using the unknown regime switching regression a la Dickens and Lang (1985), and find that the primary sector, unlike the secondary, is characterized by efficiency wages. We confirm this result with various robustness checks. Finally, we simulate the evolution of the share of the primary sector in the economy and find that it substantially increased between 1981 and 2005 in line with the predictions of our model. |
| Keywords: | heterogeneity of firms, efficiency wages, job security, effort, productivity differentials, wage inequalities |
| JEL: | L23 J24 J31 J42 |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:hst:ghsdps:gd09-127&r=lab |
| By: | Shoshana Neuman (Department of Economics Bar-Ilan University, CEPR London, IZA Bonn); Adrian Ziderman (Department of Economics Bar-Ilan University) |
| Abstract: | This study examines the extent, duration and timing of employment breaks amongst a large representative sample of Jewish workers in Israel over the 13-year time period, 1983-1995. Work histories are constructed from a new joint database, unique in Israel, which was derived from a linkage of 1995 Population Census data with monthly employment records of the National Insurance Institute. The paper focuses on gender differences in work history patterns and, within each gender, breakdowns are provided by ethnic origin, marital status, age, and education level. The main results are compatible with current economic theories of household behavior; yet some of the findings of the study are less expected, particularly those relating to the considerable amount of intermittent employment found amongst Israeli male workers. Also, women’s labor market attachment is stronger than is generally presumed. Gender differences in employment interruptions are greater for younger than older workers. |
| Keywords: | employment, gender, work histories, Israel |
| JEL: | J2 J6 R2 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:biu:wpaper:2009-21&r=lab |
| By: | Kerly Krillo; Jaan Masso |
| Abstract: | Unlike Western countries, there are no studies focusing on the fulltime/part-time wage gap in Central and Eastern Europe despite high wage inequalities observable in many of these countries. The focus of this paper is the incidence and reasons for the part-time wage gap in Estonia, a small Eastern European catch up economy. We use Estonian Labour Force Survey data for 1997–2007, and the part-time wage gap is decomposed using the Heckman selection model and Oaxaca-Blinder wage decompositions. The results for females indicate that the part-time premium observable is unexplained with the controls used. For males, the full-time raw premium exists, but it is to a large extent captured by explanatory variables. For both genders, the labour market situation is remarkably better for voluntary part-timers. The probable explanations for this are the generally low wage levels, the cyclical behaviour of wage gaps, black income and unobserved heterogeneity of employees and firms. |
| Keywords: | part-time work, wage gap, Central and Eastern Europe |
| JEL: | C13 J22 J31 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:mtk:febawb:65&r=lab |
| By: | Maria De Paola; Vincenzo Scoppa; Rosanna Nisticò (Dipartimento di Economia e Statistica, Università della Calabria) |
| Abstract: | In this paper we carry out an evaluation of the effectiveness of monetary incentives in enhancing student performance using a randomized experiment involving undergraduate students enrolled at a Southern Italian University. Students participating at the experiment were assigned to three different groups: a high reward group, a low reward group and a control group. Rewards were assigned following a tournament rule to the 30 best performing students in each treated group. Findings suggest that financial rewards increase student performance both in terms of number of credits earned and grades obtained at exams. High ability students react strongly while the effect is null for low ability students. When the “intention-to-treat” effects are adjusted for non-participation using IV, it emerges a stronger impact of the treatment on student performance. |
| Keywords: | Education Production Function, Student Effort, Incentives, Merit Scholarship, Higher Education, Randomized Evaluation |
| JEL: | I21 J31 D82 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:clb:wpaper:201006&r=lab |
| By: | Mazzotta, Fernanda (CELPE (Centre of Labour Economics and Economic Policy), University of Salerno, Italy) |
| Abstract: | This paper analyses the relationship between unemployment among young Italians and their parents’ economic and cultural background. A search theory model was used to identify the direct and indirect effects of household financial situation and parental cultural and educational status on their employment prospects. The empirical specification of the model featured Lancaster’s (1985a) simultaneous estimate of two variables: duration of unemployment and accepted starting wage in a new job. The data was sampled from the European Community Household Panel for an eight-year period (1994-2001) with a specific focus on unemployed Italians below the age of thirty-six years who were living with their parents while looking for work. The study revealed that young people from disadvantaged social backgrounds experienced greater difficulties in finding a job than their more privileged peers. This trend was particularly marked in southern regions of Italy where, paradoxically, the discrepancy was more pronounced at higher levels of educational qualifications. In Northern Italy, on the other hand, young male graduates who finished their degree courses without a delay were unemployed for shorter periods. Finally, work experience was an influential factor to finding employment for all young Italians, irrespective of their residential area and educational experience. |
| Keywords: | Simultaneous equation models; unemployment duration; job search; intergenerational mobility |
| JEL: | J62 J64 |
| Date: | 2010–04–12 |
| URL: | http://d.repec.org/n?u=RePEc:sal:celpdp:0113&r=lab |
| By: | Stefan Boeters |
| Abstract: | In labour markets with collective wage bargaining higher progressivity of the labour income tax creates a trade-off. On the one hand, wages are lowered and unemployment decreases, on the other hand, the individual labour supply decision is distorted at the hours-of-work margin. The optimal level of tax progressivity within this trade-off is determined using a numerical general equilibrium model with imperfect competition on the goods market, collective wage bargaining and a labour-supply module calibrated to empirically plausible elasticity values. The model is calibrated to macroeconomic and institutional parameters of both the OECD average and a number of individual OECD countries. In most cases the optimal degree of tax progressivity is below the actual level. A decomposition approach shows that the optimal level is increased by high unemployment and by the general tax level. |
| Keywords: | labour taxation; tax progressivity; optimal taxation; collective wage bargaining; unemployment |
| JEL: | H21 J22 J51 J64 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:cpb:discus:129&r=lab |
| By: | Fernando Muñoz-Bullón (Universidad Carlos III); J. Ignacio García-Pérez (Department of Economics, Universidad Pablo de Olavide, FEDEA & FCEA); Manuela Prieto-Rodríguez (Universidad Pablo de Olavide) |
| Abstract: | The fact that Spain has witnessed a sharp increase in the number of immigrants over the past decade has generated considerable interest, particularly as regards wages earned by immigrants in host industries. We analyze whether controlling for both observable and unobservable characteristics of employers —in addition to individual variables and the economic context— makes any difference as regards the debate regarding the existence of wage differences between immigrant and native workers in Spain. As we show, doing this considerably reduces (or even eliminates) the inequalities found in previous research, thereby questioning the results attained by previous studies on this issue. |
| Keywords: | Immigration, salaries, assimilation. |
| JEL: | J21 J11 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:pab:wpaper:10.05&r=lab |
| By: | René Böheim; Martina Zweimüller |
| Abstract: | A firm's decision to employ agency workers may be perceived as a replace- ment of directly employed workers or as way to curb union power, which trade unions would oppose. Alternatively, trade unions may encourage the (tem- porary) employment of agency workers in a firm, if they manage to bargain higher wages for their members. We estimate the relationship between hir- ing agency workers and trade union activity at the workplace, in particular, the type of collective bargaining agreements. We use British data from the Workplace Employment Relations Surveys (WERS) of 1998 and 2004. The empirical association between the employment of agency workers and union strength is weak, but positive. Furthermore, workplaces with collective bar- gaining have lower wages in the presence of agency workers, suggesting that agency workers are hired against the unions. |
| Keywords: | temporary work agency, collective bargaining, flexibility, Workplace Employment Relations Survey |
| JEL: | D21 J31 J40 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:jku:econwp:2009_12&r=lab |
| By: | Jairo Gillermo Isaza Castro |
| Abstract: | This paper assesses the effects of occupational segregation on the gender wage gap in urban Colombia between 1986 and 2000. The empirical methodology involves a two-step procedure whereby the occupational distributions of workers by gender are modelled using a multinomial logit model in the first stage. In the second stage, the multinomial logit estimates are used not only to derive a counterfactual occupational distribution of women in the absence of workplace discrimination but also to correct for selectivity bias in the wage equations for each occupational category using the procedure suggested by Lee (1983). Besides the explained and unexplained components in conventional decompositions of the gender wage gap, this methodology differentiates between the justified and unjustified effects of the gender allocation of workers across occupational categories. The results for urban Colombia indicate that controlling for selectivity bias at the occupational category level is found to be relevant in all years reviewed in this study. They also suggest that a changing composition of the female labour supply in terms of unobservables (i.e., ability and motivation) is playing a role in the dramatic reduction of the observed wage gap. |
| Date: | 2010–04–09 |
| URL: | http://d.repec.org/n?u=RePEc:col:000137:006889&r=lab |
| By: | Cory Koedel (Department of Economics, University of Missouri-Columbia) |
| Abstract: | This paper documents a startling difference in the grading standards between education departments and other academic departments at universities – undergraduate students in education classes receive significantly higher grades than students in all other classes. This phenomenon cannot be explained by differences in student quality or structural differences across departments (i.e., differences in class sizes). Drawing on evidence from the economics literature, the differences in grading standards between education and non-education departments imply that undergraduate education majors, the majority of whom become teachers, supply substantially less effort in college than non-education majors. If the grading standards in education departments were brought in line with those of other major academic departments, student effort would be expected to increase by at least 10-16 percent. |
| Keywords: | Grading Standards, Grade Inflation, Grading Standards in Departments of Education, Teacher Training |
| JEL: | I20 I23 |
| Date: | 2010–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:umc:wpaper:1002&r=lab |
| By: | Vincenzo Caponi (Department of Economics, Ryerson University, Toronto, Canada) |
| Abstract: | This paper presents an intergenerational self selection model of migration and education that is capable of explaining the evolution of earnings and education across three generations of immigrants. By structurally estimating the model it is possible to quantify the human capital level of Mexicans in light of the self-sacrifice made by the first generation of Mexican immigrants. The results suggest that there is a significant one time loss of human capital faced by immigrants upon migration that is not transmitted to their children. Also parents with larger amounts of human capital tend to migrate more and tend to choose to remain high school educated. However, given the better educational opportunities offered in the US, they migrate with the expectation of their children becoming college educated. Therefore, measures that rely on the earnings performance and educational attainment of immigrants underestimate the amount of human capital they bring into the host country. |
| Keywords: | International Migration; Mexico. |
| JEL: | F22 J24 J61 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:rye:wpaper:wp002&r=lab |
| By: | Hansen, Jørgen Drud (Department of Economics, Aarhus School of Business); Molana, Hassan (University of Dundee); Montagna, Catia (University of Dundee); Ulff-Møller Nielsen, Jørgen (Department of Economics, Aarhus School of Business) |
| Abstract: | We examine how openness interacts with the coordination of consumption-leisure decisions in determining the equilibrium working hours and wage rate when there are leisure externalities (e.g., due to social interactions). The latter are modelled by allowing a workers marginal utility of leisure to be increasing in the leisure time taken by other workers. Coordination takes the form of internalising the leisure externality and other relevant constraints (e.g., labour demand). The extent of openness is measured by the degree of capital mobility. We find that: coordination lowers equilibrium work hours and raises the wage rate; there is a U-shaped (inverse-U-shaped) relationship between work hours (wages) and the degree of coordination; coordination is welfare improving; and, the gap between the coordinated and uncoordinated work hours (and the corresponding wage rates) is affected by the extent and nature of openness. |
| Keywords: | coordination; corporatism; openness; capital mobility; social multiplier; welfare; work hours |
| JEL: | F20 J20 J50 |
| Date: | 2010–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:aareco:2010_004&r=lab |
| By: | Torberg Falch (Institutt for Samfunnsøkonomi (Department of Economics), Norges Teknisk- Naturvitenskaplige Universitet (NTNU) (Norwegian University of Science and Technology)); Justina A.V. Fischer (University of Hamburg, Institute for Public Finance) |
| Abstract: | Using a panel of international student test scores 1980 – 2000 (PISA and TIMSS), panel fixed effects estimates suggest that government spending decentralization is conducive to student performance. The effect does not appear to be mediated through levels of educational spending. |
| Keywords: | Fiscal Decentralization; Student Achievement; Federalism; PISA; TIMSS; Education; School Quality |
| JEL: | C33 H2 I2 H40 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:hce:wpaper:031&r=lab |
| By: | Daniele Nosenzo (University of Nottingham) |
| Abstract: | This study uses a three-person gift-exchange game experiment to examine the impact of pay comparisons on effort behavior. We compare effort choices made in a treatment where coworkers’ wages are secret with effort choices made in two ‘public wages’ treatments. The two ‘public wages’ treatments differ in whether co-workers’ wages are chosen by an employer, or are fixed exogenously by the experimenter. We find that pay comparison information has an overall detrimental impact on effort choices: employees respond less favorably to the wage offers made by the employer when they receive information about the wage paid to the co-worker as compared to the case where co-workers’ wages are secret. These effects are particularly pronounced in the treatment where the level of the co-worker’s wage is fixed exogenously. |
| Keywords: | social comparisons; wage comparisons; gift exchange; experiments |
| JEL: | C91 C92 J31 |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:cdx:dpaper:2010-03&r=lab |
| By: | Aysit Tansel (Department of Economics, METU); H. Mehmet Tasci (Department of Econometrics, Bal?kesir University) |
| Abstract: | There is little evidence on unemployment duration and its determinants in developing countries. This study is on the duration aspect of unemployment in a developing country, Turkey. We analyze the determinants of the probability of leaving unemployment for employment or the hazard rate. The effects of the personal and household characteristics and the local labor market conditions are examined. The analyses are carried out for men and women separately. The results indicate that the nature of unemployment in Turkey exhibits similarities to the unemployment in both the developed and the developing countries. |
| Keywords: | unemployment duration, hazard analysis, gender, Turkey |
| JEL: | J64 C41 J16 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:met:wpaper:0903&r=lab |
| By: | Keeney, Mary (Central Bank and Financial Services Authority of Ireland); Galu?s?c´ak, Kamil (Czech National Bank); Smets, Frank (European Central Ban); Nicolitsas, Daphne (Bank of Greece); Strzelecki, Pawel (National Bank of Poland); Vodopivec, Matija (Bank of Slovenia) |
| Abstract: | This paper uses information from a rich firm-level survey on wage and price-setting procedures, in around 15,000 firms in 15 European Union countries, to investigate the relative importance of internal versus external factors in the setting of wages of newly hired workers. The evidence suggests that external labour market conditions are less important than internal pay structures in determining hiring pay, with internal pay structures binding even more often when there is labour market slack. When explaining their choice firms allude to fairness considerations and the need to prevent a potential negative impact on effort. Despite the lower importance of external factors in all countries there is significant cross-country variation in this respect. Cross-country differences are found to depend on institutional factors (bargaining structures); countries in which collective agreements are more prevalent and collective agreement coverage is higher report to a greater extent internal pay structures as the main determinant of hiring pay. Within-country differences are found to depend on firm and workforce characteristics; there is a strong association between the use of external factors in hiring pay, on the one hand, and skills (positive) and tenure (negative) on the other. |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:cbi:wpaper:4/rt/10&r=lab |
| By: | Judith K. Hellerstein; Melissa McInerney; David Neumark |
| Abstract: | We specify and implement a test for the presence and importance of labor market network based on residential proximity in determining the establishments at which people work. Using matched employer-employee data at the establishment level, we measure the importance of these network effects for groups broken out by race, ethnicity, and various measures of skill. The evidence indicates that these types of labor market networks do exist and play an important role in determining the establishments where workers work, that they are more important for minorities and the less-skilled, especially among Hispanics, and that these networks appear to be race-based. |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:hst:ghsdps:gd09-132&r=lab |
| By: | Lance Lochner |
| Abstract: | This paper discusses the relationship between education and crime from an economic perspective, developing a human capital-based model that sheds light on key ways in which early childhood programs and policies that encourage schooling may affect both juvenile and adult crime. The paper first discusses evidence on the effects of educational attainment, school quality, and school enrollment on crime. Next, the paper discusses evidence on the crime reduction effects of preschool programs like Perry Preschool and Head Start, school-age programs that emphasize social and emotional development, and job training programs for low-skill adolescents and young adults. Finally, the paper concludes with a broad discussion of education policy and its potential role as a crime-fighting strategy. |
| JEL: | H23 I21 J24 K42 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15894&r=lab |
| By: | Zelalem Yilma Debebe |
| Abstract: | The author studies the effect of an agricultural shock and a labor sharing arrangement (informal social network) on child labor. Albeit bad parental preference to child labor (as the strand of literature claims), poor households face compelling situations to send their child to work. This is, especially, true when they are hit by an income shock and face a binding adult labor constraint. The author used panel data from the ERHS and employed a fixed effects model to pin down causal relation between shocks, membership in a labor sharing arrangement and child labor. It was found that child labor is, indeed, a buffer stock. Though a labor sharing arrangement doesn’t affect child labor at normal times, it helps households to lessen the pressure to rely on it when hit by idiosyncratic shocks. While almost the whole effect of these shocks is offset by participation in a labor sharing arrangement, the covariate shock is not. Even if this may well affect a child’s academic performance, school attendance doesn’t decrease. This differential effect of shocks on child labor in participant households might be because of the extra adult labor made available or due to mutual support that comes with these social networks. This paper is indicative of the importance of considering social networks in smoothing out consumption. Further, it highlights the difficulty to cope up with covariate shocks and hence, calls for development interventions that are particularly meant to address their impact. |
| Keywords: | child labor, shocks, labor sharing, social networks, Ethiopia |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:iss:wpaper:491&r=lab |
| By: | Lance Lochner (University of Western Ontario) |
| Abstract: | This paper discusses the relationship between education and crime from an economic perspective, developing a human capital-based model that sheds light on key ways in which early childhood programs and policies that encourage schooling may affect both juvenile and adult crime. The paper first discusses evidence on the effects of educational attainment, school quality, and school enrollment on crime. Next, the paper discusses evidence on the crime reduction effects of preschool programs like Perry Preschool and Head Start, school-age programs that emphasize social and emotional development, and job training programs for low-skill adolescents and young adults. Finally, the paper concludes with a broad discussion of education policy and its potential role as a crime-fighting strategy. |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:uwo:hcuwoc:20102&r=lab |
| By: | Fatih Guvenen (Institute for Fiscal Studies and University of Rochester); Burhanettin Kuruscu; Serdar Ozkan |
| Abstract: | <p>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.</p> |
| Keywords: | Wage inequality, human capital, skill-biased technical change, tax policies |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:ifs:ifsewp:09/23&r=lab |
| By: | Hassink, Wolter (Utrecht University); Russo, Giovanni (VU University Amsterdam) |
| Abstract: | This paper examines the gender composition of the flow of new hirees along the organizational hierarchy of jobs. We find that women have a reduced chance to be hired at higher hierarchical levels. We refer to this phenomenon as the "glass door". The glass door consists of an absolute and a relative effect. First, there is a reduced probability of women being recruited for jobs at higher hierarchical levels. Second, a larger fraction of jobs below the focal level of hiring within the firm reduces the relative inflow of female hirees. The latter component leads women moving to firms in which the job has a lower relative position in the hierarchical structure. We explain the glass door phenomenon by a theoretical model of the firm’s decision to hire a woman. The model is based on two key assumptions. First, women have a higher probability of leaving due to their higher valuation of non-market activities. Second, a voluntary quit leads to a larger decrease in the production of lower level co-workers when the worker who leaves has a position in the upper tier of the hierarchy. The glass door implies that the value of women's outside option in the labor market is lower. It may provide an additional explanation of why a glass ceiling can be sustainable as an equilibrium phenomenon. |
| Keywords: | hiring, hierarchies, glass door, gender, outside option |
| JEL: | J16 J23 J41 J63 M51 |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4858&r=lab |
| By: | Lynn A. Karoly |
| Abstract: | In the 21st century knowledge economy, education plays an increasingly important role in preparing new labor market entrants for the workforce and providing skill upgrading throughout the working career. The vital role of education is propelled by the rapid pace of technological change, as well as the interdependent, global economy, forces that together demand a workforce with the capacity for leadership, problem solving, and collaboration and communication in a wide range of economic sectors. Within this context, the education and workforce development systems are critical for supporting human capital development throughout the life course. This paper reviews these broader trends regarding the role of education in the labor market and then considers the implications for education in the countries of Gulf Cooperation Council (GCC), namely Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates. Where data are available, the paper examines patterns of educational attainment overall in these countries, evidence of the quality of the education systems and the graduates they produce, and the labor market benefits of higher educational attainment. It also assesses gender differences, where possible, in each of these indicators of interest. The paper concludes by enumerating several key challenges facing the Gulf countries in promoting strong education systems and well functioning labor markets to meet the labor force needs in the private and public sectors in the 21st century global economy. |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:ran:wpaper:742&r=lab |
| By: | Sascha O. Becker; Karolina Ekholm; Marc-Andreas Muendler |
| Abstract: | We analyze the relationship between o®shoring and the onshore workforce composition tasks, occupations, and workforce skills. O®shoring is associated with a statistically signi¯cant shift towards more non-routine and more interactive tasks, and with a shift towards highly educated workers. Moreover, the shift towards highly educated work- ers is in excess of what is implied by changes in either the task or the occupational composition. Whether o®shored activities are located in low-income or high-income countries does not alter the direction of the relationship. We ¯nd o®shoring to predict between 10 and 15 percent of observed changes in wage-bill shares of highly educated workers and measures of non-routine and interactive tasks. |
| Keywords: | trade in tasks, multinational firms, demand for labor, linked-employer-employee data |
| JEL: | F16 F14 F23 J23 J24 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:iaw:iawdip:55&r=lab |
| By: | Jakubowski, Maciej; Patrinos, Harry Anthony; Porta, Emilio Ernesto; Wisniewski, Jerzy |
| Abstract: | Increasing the share of vocational secondary schooling has been a mainstay of development policy for decades, perhaps nowhere more so than in formerly socialist countries. The transition, however, led to significant restructuring of school systems, including a declining share of vocational students. Exposing more students to a general curriculum could improve academic abilities. This paper analyzes Poland’s significant improvement in international achievement tests and the restructuring of the education system that expanded general schooling to test the hypothesis that delayed vocational streaming improves outcomes. Using propensity score matching and differences-in-differences estimates, the authors show that delayed vocationalization had a positive and significant impact on student performance on the order of one standard deviation. |
| Keywords: | Tertiary Education,Secondary Education,Education For All,Primary Education,Teaching and Learning |
| Date: | 2010–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5263&r=lab |
| By: | Wolter H.J. Hassink; Giovanni Russo |
| Abstract: | This paper examines the gender composition of the flow of new hirees along the organizational hierarchy of jobs. We find that women have a reduced chance to be hired at higher hierarchical levels. We refer to this phenomenon as the "glass door". The glass door consists of an absolute and a relative effect. First, there is a reduced probability of women being recruited for jobs at higher hierarchical levels. Second, a larger fraction of jobs below the focal level of hiring within the firm reduces the relative inflow of female hirees. The latter component leads women moving to firms in which the job has a lower relative position in the hierarchical structure. We explain the glass door phenomenon by a theoretical model of the firm's decision to hire a woman. The model is based on two key assumptions. First, women have a higher probability of leaving due to their higher valuation of non-market activities. Second, a voluntary quit leads to a larger decrease in the production of lower level co-workers when the worker who leaves has a position in the upper tier of the hierarchy. The glass door implies that the value of women's outside option in the labor market is lower. It may provide an additional explanation of why a glass ceiling can be sustainable as an equilibrium phenomenon. |
| Keywords: | hiring; hierarchies; glass door; gender; outside option |
| JEL: | J16 J23 J41 J63 M51 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:use:tkiwps:1006&r=lab |
| By: | Christopher J. O'Leary (W.E. Upjohn Institute for Employment Research); Randall W. Eberts (W.E. Upjohn Institute for Employment Research) |
| Abstract: | This paper examines labor market conditions and public employment policies in the United States during what some are calling the Great Recession. We document the dramatic labor market changes that rapidly unfolded when the rate of gross domestic product growth turned negative, from the end of 2007 through early 2009. The paper reviews the resulting stress on labor market support programs and the broad federal response. That response came through modifications to existing programs and the introduction of new mechanisms to help Americans cope with job loss and protracted unemployment. The particular focus is on federally supported public programs for occupational job skills training and temporary income replacement. We also discuss procedures for evaluating the effectiveness of public reemployment efforts, and adjustments to these programs that were adopted during the crisis. |
| Keywords: | job training, unemployment, unemployment insurance, employment policy, federal stimulus, American Recovery and Reinvestment Act, evaluation, performance measurement, net impacts, cream skimming, adjustment methodology |
| JEL: | J65 J68 |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:upj:weupjo:10-161&r=lab |
| By: | F Mariotti; |
| Abstract: | This study investigates the effects of perceived unemployment risks on the distribution of bargaining power between spouses in a household context. As the replacement ratio is rarely above 50%, becoming unemployed has serious consequences on an individual’s consumption, savings and wealth. The risk of losing the job is shown to be a pertinent consideration when household members make consumption and labour supply decisions. This work sheds light on how unemployment risk may affect the interaction between spouses and their decision structure within the Collective model. |
| Keywords: | Labour supply; Unemployment; Risk; Household; Collective. |
| JEL: | J12 J22 J64 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:yor:yorken:10/06&r=lab |
| By: | Harley Frazis (U.S. Bureau of Labor Statistics); Mark A. Loewenstein (U.S. Bureau of Labor Statistics) |
| Abstract: | It has been argued that one of the functions of fringe benefits is to reduce turnover. However, due to a lack of data, the effect on quits of the marginal dollar of benefits relative to the marginal dollar of wages is an under-researched topic. This paper uses the benefit incidence data in the 1979 Cohort of the National Longitudinal Survey of Youth (NLSY79) and the cost information in the National Compensation Survey to impute benefit costs. The value of imputed benefits is then entered as an explanatory variable in a mobility equation that is estimated using turnover information in the NLSY. We find that the quit rate is much more responsive to fringe benefits than to wages; this is even more the case with total turnover. We also find that benefit costs are correlated with training provision. Due to the high correlation of the costs of individual benefits, it is not possible to disentangle the effects of separate benefits. An interesting feature of the model that we develop for interpreting the strong negative relationship between fringe benefits and turnover is that abstracting from heterogeneity, workers must at the margin place a higher valuation on a dollar of wages than a dollar of benefits since otherwise an employer could profit by switching compensation from wages to fringes. Worker heterogeneity modifies this result and reinforces any causal relationship between fringe benefits and turnover provided that more stable workers have a greater preference for compensation in the form of fringes. |
| Keywords: | Turnover, Fringe Benefits |
| JEL: | J63 J32 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:bls:wpaper:ec090040&r=lab |
| By: | Vodopivec, Milan (World Bank) |
| Abstract: | The paper identifies key labor market and institutional differences between developed and developing countries, analyzes how these differences affect the working of the standard, OECD-style unemployment insurance (UI) program, and derives a desirable design of unemployment benefit program in developing countries. It argues that these countries – faced by large informal sector, weak administrative capacity, large political risk, and environment prone to corruption – should tailor the OECD-style UI program to suit their circumstances. To minimize employment disincentives, to ensure affordability, and to minimize administration cots, such adaptations include: (i) relying on self-insurance (via unemployment insurance savings accounts – UISAs) as a main source of financing and complementing it by solidarity funding; (ii) simplifying monitoring of job-search behavior and labor market status, and even eliminating personal monitoring of continuing eligibility requirements in the early phases; (iii) keeping modest benefits both in terms of the replacement rate and potential benefit duration; (iv) drawing on employers’ and workers’ contributions as sources of financing; and (v) piggybacking on existing networks to administer benefits. Particularly attractive is the UISAs-cum-borrowing version that uses pension wealth as collateral, making the system proof to moral hazard and strategic behavior, and allowing it to be rapidly deployed, such as in response to the currently emerging global economic crises. |
| Keywords: | unemployment, unemployment insurance, unemployment insurance savings accounts |
| JEL: | J65 J68 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izapps:pp6&r=lab |
| By: | Kelly Foley; Giovanni Gallipoli (Institute for Fiscal Studies and University of British Columbia); David A. Green |
| Abstract: | <p><p><p>We use a large, rich Canadian micro-level dataset to examine the channels through which family socio-economic status and unobservable characteristics affect children's decisions to drop out of high school. First, we document the strength of observable socio-economic factors: our data suggest that teenage boys with two parents who are themselves high school dropouts have a 16% chance of dropping out, compared to a dropout rate of less than 1% for boys whose parents both have a university degree. We examine the channels through which this socio-economic gradient arises using an extended version of the factor model set out in Carneiro, Hansen, and Heckman (2003). Specifically, we consider the impact of cognitive and non-cognitive ability and the value that parents place on education. Our results support three main conclusions. First, cognitive ability at age 15 has a substantial impact on dropping out. The highest ability individuals are predicted never to drop out regardless of parental education or parental valuation of education. In contrast, the lowest ability teenagers have a probability of dropping out of approximately .36 if their parents have a low valuation of education. Second, parental valuation of education has a substantial impact on medium and low ability teenagers. A low ability teenager has a probability of dropping out of approximately .03 if his parents place a high value on education but .36 if their educational valuation is low. These effects are estimated while conditioning on ability at age 15. Thus, under some assumptions, they reflect parental influences during the upper teenage years and are in addition to any impact they might have in the early childhood years leading up to age 15. Third, parental education has no direct effect on dropping out once we control for ability and parental valuation of education. Overall, our results point to the importance of whatever determines ability at age 15 (including, potentially, early childhood interventions) and of parental valuation of education during the teenage years. Our work also provides a small methodological contribution by extending the standard factor based estimator to allow a more non-linear relationship between the factors and a co-variate of interest. We show that allowing for non-linearities has a substantial impact on estimated effects.</p></p></p> |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:ifs:ifsewp:09/21&r=lab |
| By: | Andy Dickerson (Department of Economics, The University of Sheffield Author-Person=pdi125); Rob Wilson |
| Abstract: | This paper examines the provision of training by employers and the participation in training by employees, conditional on employers´ training provision. Together these two dimensions of training determine its overall distribution in the workforce. The factors which affect employer training provision and employee training participation are considered simultaneously within an empirical model using data drawn primarily from the 2001 Employers Skill Survey. The results are consistent with high fixed costs but constant marginal costs of training provision, while also supporting many of the predictions regarding the relationship between training and workforce skills, skill-shortages, workplace and local labour market characteristics. |
| Keywords: | Training, Training incidence, Training intensity, Skill-shortages, Local labor markets |
| JEL: | J24 J31 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:shf:wpaper:2009012&r=lab |
| By: | Bell, David N.F.; Blanchflower, David G. |
| Abstract: | This paper reviews current issues in youth labour markets in developed countries. It argues that young people aged 16-25 have been particularly hard hit during the current recession. Using the USA and UK as cast studies, it analyses both causes and effects of youth unemployment using micro-data. It argues that there is convincing evidence that the young are particularly susceptible to the negative effects of spells of unemployment well after their initial experience of worklessness. Because the current youth cohort is relatively large, the longer-term outlook for youth unemployment is quite good, but there is a strong case for policy intervention now to address the difficulties that the current cohort is having in finding access to work. |
| Keywords: | wages; recession; well-being; economic policy; Youth unemployment |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:stl:stledp:2010-04&r=lab |
| By: | Harley Frazis (U.S. Bureau of Labor Statistics); Jay Stewart (U.S. Bureau of Labor Statistics) |
| Abstract: | Hours worked is an important economic indicator. In addition to being a measure of labor utilization, average weekly hours are inputs into measures of productivity and hourly wages, which are two key economic indicators. However, the Bureau of Labor Statistics’ two hours series tell very different stories. Between 1973 and 2007 average weekly hours estimated from the BLS’s household survey (the Current Population Survey or CPS) indicate that average weekly hours of nonagricultural wage and salary workers decreased slightly from 39.5 to 39.3. In contrast, average hours estimated from the establishment survey (the Current Employment Statistics survey or CES) indicate that hours fell from 36.9 to 33.8 hours per week. Thus the discrepancy between the two surveys increased from about two-and-a-half hours per week to about five-and-a-half hours. Our goal in the current study is to reconcile the differences between the CPS and CES estimates of hours worked and to better understand what these surveys are measuring. We examine a number of possible explanations for the divergence of the two series: differences in workers covered, multiple jobholding, differences in the hours concept (hours worked vs. hours paid), possible overreporting of hours in CPS, and changes in the length of CES pay periods. We can explain most of the difference in levels, but cannot explain the divergent trends. |
| Keywords: | of work, Comparison of household and establishment surveys |
| JEL: | C81 J22 |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:bls:wpaper:ec100010&r=lab |
| By: | Kevin Denny (UCD School of Economics & UCD Geary Institute); Orla Doyle (UCD Geary Institute); Patricia O'Reilly (UCD Geary Institute); Vincent O'Sullivan (Department of Economics, University of Warwick) |
| Abstract: | There is a well established socioeconomic gradient in educational attainment, despite much effort in recent decades to address this inequality. This study evaluates a university access program that provides financial, academic and social support to low socioeconomic status (SES) students using a natural experiment which exploits the time variation in the expansion of the program across schools. The program has parallels with US affirmative actions programs, although preferential treatment is based on SES rather than ethnicity. Evaluating the effectiveness of programs targeting disadvantaged students in Ireland is particularly salient given the high rate of return to education and the lack of intergenerational mobility in educational attainment. Overall, we identify positive treatment effects on first year exam performance, progression to second year and final year graduation rates, with the impact often stronger for higher ability students. We find similar patterns of results for students that entered through the regular system and the ‘affirmative action’ group i.e. the students that entered with lower high school grades. The program affects the performance of both male and female students, albeit in different ways. This study suggests that access programs can be an effective means of improving academic outcomes for socio-economically disadvantaged students. |
| Keywords: | Education inequality, Access programs, Natural experiment, Economics of education |
| JEL: | I21 |
| Date: | 2010–04–09 |
| URL: | http://d.repec.org/n?u=RePEc:ucd:wpaper:201021&r=lab |
| By: | James Marton (Georgia State University); Stephen A. Woodbury (W.E. Upjohn Institute and Michigan State University) |
| Abstract: | We estimate the effect of employer offers of retiree health benefits (RHBs) on the timing of retirement using a sample of Health and Retirement Study (HRS) men observed over a period of up to 12 years. We hypothesize that the effect of RHBs differs for workers of different ages—a hypothesis we can test now that the main HRS cohort has aged sufficiently. We apply three wellknown panel data estimators and find that, for men in their 50s, RHBs have little or no effect on retirement decisions; however, a substantial effect emerges for men in their early 60s. We use simulations to illustrate how RHBs alter retirement patterns. |
| Keywords: | Retirement, Health Insurance, Employee Benefits, Panel Data |
| JEL: | J26 I18 D14 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:upj:weupjo:10-163&r=lab |
| By: | Keeney, Mary J. (Central Bank and Financial Services Authority of Ireland); Lawless, Martina (Central Bank and Financial Services Authority of Ireland) |
| Abstract: | This paper investigates the wage-setting behaviour of Irish firms. We place particular emphasis on the use of flexible pay components and examine how these allow firms to deal with shocks requiring a reduction in costs without having to cut base wages. The results presented in this paper are based on a survey of Irish firms undertaken as part of the Wage Dynamics Network (WDN), which is a Euro-system research network. Our main findings are that almost two-thirds of firms applied at least some elements of the national wage agreement in place at the time of the survey (Towards 2016). Wage cuts or freezes were reported by a very small percentage of firms but changes in bonuses and other flexible pay components were relatively common if the firm needed to reduce labour costs. When asked about the relevance of different explanations for avoiding cuts in base wages, worker morale and loss of experienced workers were the main concerns. Regulatory or collective bargaining obstacles to wage cuts were the lowest ranked. |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:cbi:wpaper:1/rt/10&r=lab |
| By: | Michael Elsby; Bart Hobjin; Aysegül Sahin |
| Abstract: | This paper documents the adjustment of the labor market during the recession, and places it in the broader context of previous postwar downturns. What emerges is a picture of labor market dynamics with three key recurring themes: 1. From the perspective of a wide range of labor market outcomes, the 2007 recession represents the deepest downturn in the labor market in the postwar era. 2. Until recently, the nature of labor market adjustment in the current recession has displayed a notable resemblance to that observed in past severe downturns. 3. During the latter half of 2009, however, the path of adjustment has exhibited important departures from that seen in prior deep recessions. |
| Keywords: | Labor market ; Unemployment ; Recessions |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedfwp:2010-07&r=lab |
| By: | Creina Day; Steve Dowrick |
| Abstract: | Developed economies, experiencing concomitant declining fertility and rising educational attainment, have introduced policies to boost fertility. We model substitution of bought in services for parental time in the rearing and education of children in an economy where technological progress leads households to choose fewer, but better educated, children. We analyse the effects on fertility and education of a baby bonus, paid maternity leave and child care subsidies. We establish conditions under which either maternity or child care benefits are more efficacious in raising fertility, and we establish that a lump sum baby bonus will increase fertility only if the bonus increases faster than income per capita. Policies that stimulate fertility also raise parental investment in education. |
| JEL: | H31 J13 O40 |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:acb:cbeeco:2010-516&r=lab |
| By: | Andy Dickerson (Department of Economics, The University of Sheffield); Steven McIntosh (Department of Economics, The University of Sheffield) |
| Abstract: | This paper uses data sources with the unique capacity to measure distances between home addresses and education institutions, to investigate, for the first time, the effect that such distance has on an individual's post-compulsory education participation decision. The results show that there is no overall net effect. However, when attention is focussed on young people who are on the margin of participating in post-compulsory education (according to their prior attainment and family background) and when post-compulsory education is distinguished by whether it leads to academic or vocational qualifications, then greater distance to nearest education institution is seen to have a significant impact on the decision to continue in full-time post-compulsory education. This finding has relevance for education participation in rural areas relative to urban areas. |
| Keywords: | post-compulsory education participation, travel distance |
| JEL: | J24 I20 |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:shf:wpaper:2010007&r=lab |
| By: | Roland G. Fryer, Jr |
| Abstract: | This paper describes a series of school-based randomized trials in over 250 urban schools designed to test the impact of financial incentives on student achievement. In stark contrast to simple economic models, our results suggest that student incentives increase achievement when the rewards are given for inputs to the educational production function, but incentives tied to output are not effective. Relative to popular education reforms of the past few decades, student incentives based on inputs produce similar gains in achievement at lower costs. Qualitative data suggest that incentives for inputs may be more effective because students do not know the educational production function, and thus have little clue how to turn their excitement about rewards into achievement. Several other models, including lack of self-control, complementary inputs in production, or the unpredictability of outputs, are also consistent with the experimental data. |
| JEL: | I20 J15 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15898&r=lab |
| By: | Nils Braakmann (Institute of Economics, Leuphana University of Lüneburg, Germany) |
| Abstract: | I test some predictions of Gary Becker’s theory of taste discrimination regarding discrimination of foreigners by employers, co-workers and customers. I combine a 2% sample of the German working population and a 50% sample of German plants with low-level regional data, including the vote shares of three right-wing parties as a proxy for regional racism. The results show that (a) foreigner-native wage differentials rise with the share of right-wing voters, (b) the exact magnitude of the effects varies between skill groups and by gender, the largest effects being found for high-skilled men and women, (c) average employment shares of natives vary very little with the share of right-wing voters, (d) segregated firms become more common in manufacturing and construction when support for right-wing parties rises, while no effects are found for services and gastronomy and (e) the negative wage effects are strongest for foreigners working in services, while no effects are found in manufacturing and gastronomy. These results broadly confirm the predictions from taste discrimination. |
| Keywords: | taste discrimination, segregated firms, wage differentials |
| JEL: | J23 J31 J71 |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:lue:wpaper:165&r=lab |
| By: | Greg Kaplan |
| Abstract: | This paper uses an estimated structural model to argue that the option to move in and out of the parental home is an important insurance channel against labor market risk for youths who do not attend college. Using data from the NLSY97, I construct a new monthly panel of parent-youth coresidence outcomes and use it to document an empirical relationship between these movements and individual labor market events. The data is then used to estimate the parameters of a dynamic game between youths and their altruistic parents, featuring coresidence, labor supply and savings decisions. Parents can provide both monetary support through explicit financial transfers, and non-monetary support in the form of shared residence. To account for the data, two types of exogenous shocks are needed. Preference shocks are found to explain most of the cross-section of living arrangements, while labor market shocks account for individual movements in and out of the parental home. I use the model to show that coresidence is a valuable form of insurance, particularly for youths from poorer families. The option to live at home also helps to explain features of aggregate data for low-skilled young workers: their low savings rates and their relatively small consumption responses to labor market shocks. An important implication is that movements in and out of home can reduce the consumption smoothing benefits of social insurance programs. |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedmwp:677&r=lab |
| By: | Arjan Lejour |
| Abstract: | The employment rate in de European Union has increased considerably between 2000 and 2008, but the Lisbon target of 70% will not be met in 2010. Employment has increased from 62% in 2000 to 66% in 2008, mainly due to women and elderly workers entering the labour market or extending their stay. This paper presents a proposal to develop country-specific employment goals for the time period 2010 to 2020. These goals have to be realistic and ambitious. We compare age and gender specific participation rates in the various EU Member States and the outcomes are used to sketch the options for higher employment rates in the next decade. Subsequently, we develop three scenarios with varying employment rate goals for the EU as a whole and for each Member State separately. |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:cpb:memodm:233&r=lab |
| By: | Burak Dindaroglu |
| Abstract: | I test the hypothesis that the mobility of scientific and technical personnel is a conduit for knowledge spillovers among innovative firms. Using a variant of the standard Tobin's Q equation, I show that firms who have access to large pools of externally created knowledge in their industrial and technological neighborhoods enjoy additional market value as a result of higher scientific labor mobility, while they suffer from higher mobility whenever external knowledge is limited. Specifically, a percentage point increase in the mobility rate (one additional job change for each 100 scientists) increases market value by 1% to 3.1% through spillovers for a firm that has access to the mean spillover pool. This effect is largely offset by the standalone negative impact of labor mobility on market value, thus the firm breaks even in terms of the net private value of increased labor turnover. These results are consistent with previous findings and anecdotal evidence, and provide further insight into why innovative firms cluster in industrial districts. |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:nya:albaec:10-01&r=lab |
| By: | Alessandro Tampieri |
| Abstract: | Educational assortative matching encourages individuals to acquire education so as to increase the probability of marrying a high-income partner. But since everyone is more educated, the chances of a good match do not change. Hence over education emerges, as in absence of educational assortative matching individuals could reach their optimal level of education by exploiting less educational resources. Over-education is stronger the higher the probability of educational assortative matching, the larger the relative importance of the partner.s income in determining utility and ability levels, and the lower the cost of education. Government intervention can reach a socially e¢ cient level of education through either a tax on education or income. |
| Keywords: | Educational Assortative Matching; Over-Education. |
| JEL: | I21 J12 |
| Date: | 2010–01 |
| URL: | http://d.repec.org/n?u=RePEc:lec:leecon:10/05&r=lab |
| By: | Barrett, Alan; Goggin, Jean |
| Abstract: | Using data from a large-scale survey of employees in Ireland, we estimate the extent to which people who have emigrated from Ireland and returned earn more relative to comparable people who have never lived abroad. In so doing, we are testing the hypothesis that migration can be part of a process of human capital formation. We find through OLS estimation that returners earn 7 percent more than comparable stayers. We test for the presence of self-selection bias in this estimate but the tests suggest that the premium is related to returner status. The premium holds for both genders, is higher for people with post-graduate degrees and for people who migrated beyond the EU to the US, Canada, Australia and New Zealand. The results show how emigration can be positive for a source country when viewed in a longer term context. |
| Keywords: | Ireland/US |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:wp337&r=lab |
| By: | Jennifer Roberts (Department of Economics, The University of Sheffield Author-Person=pro228); Robert Hodgson; Paul Dolan |
| Abstract: | In this paper, we seek to explore the effects of commuting time on the psychological well-being of men and women in the UK. We use annual data from the British Household Panel Survey in a fixed effects panel framework that includes variables known to determine well-being, as well as factors which may provide compensation for commuting such as income, job satisfaction and housing quality. Our results show that, even after all these variables are considered, commuting still has an important detrimental effect on the well-being of women, but not men, and this result is robust to numerous different specifications. We explore possible explanations for this gender difference and can find no evidence that it is due to women´s shorter working hours or weaker occupational position. Rather women´s greater sensitivity to commuting time seems to be a result of their larger responsibility for day-to-day household tasks, including childcare. |
| Keywords: | Commuting, Happiness, Well-being |
| JEL: | D1 I1 R4 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:shf:wpaper:2009009&r=lab |
| By: | Dobbelaere, Sabien (VU University Amsterdam); Mairesse, Jacques (CREST-INSEE) |
| Abstract: | This article provides evidence of rent sharing from orthogonal directions by exploiting different dimensions in the same data. Taking advantage of a rich matched employer-employee dataset for France over the period 1984-2001, we consistently compare across-industry heterogeneity in rent-sharing parameters derived from three different approaches. The accounting approach and the standard labor economics approach are compatible with distinct labor bargaining settings (right-to-manage, efficient bargaining, labor hoarding) whereas the productivity approach hinges on the assumption of efficient bargaining. Across the different approaches, we evidently find differences in dispersion of the rent-sharing parameter estimates which could be attributable to differences in modeling assumptions and/or data requirements but these estimates lie within a comparable range. We interpret the latter finding as lending empirical support to efficient bargaining as the nature of the bargaining process in France over the considered period. |
| Keywords: | rent sharing, wage equation, production function, matched employer-employee data |
| JEL: | C23 D21 J31 J51 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4871&r=lab |
| By: | CHAGAS LOPES, MARGARIDA; FERNANDES, GRAÇA |
| Abstract: | ABSTRACT Despite the enormous increasing in Higher Education (HE) enrolment during the last decades in Portugal, retention rates remain very high when compared to most European Union countries'.This outcome is particularly meaningful for a set of 1st year's critical matters which failure severely conditions subsequent success as they are part of the scientific domain's basic knowledge.In this paper we investigate this feature for ISEG (School of Economics and Management of the Technical University of Lisbon) and consider its Pedagogic Observatory database which includes more than 1,500 individual data relative to the four graduation programmes. As relative failure expresses frequently under the form of longer time spells needed to complete thgose disciplines in this paper we adjusted a duration model (with control group)in order to assess the main determinants of the "survival" probabilities. After having controlled for ability, the results we obtained from Cox Regression show that the economic and social status of the family of origin, especially mother's and father's school level and occupation go on influencing students' results although not so meaningfully as in previous educational phases. Also the specific graduation track - Economics, Management, Mathematics applied to Economics & Management and Finances - appear to be deeply associated with success or retention. Nevertheless, the main determinant of relative success/failure is the student's situation towards the labour market, a meaningful proportion of them having to perform a paid occupation to afford to pay for education costs. Therefore our policy reccommendations are twofold: i) to shed light on the need for a more robust Government's Social Policy towards HE students especially now that the Bologna Reform imposes an heavier budgetary burden upon students; ii)to emphasize the finantial, organizational and syllabuses' reforms that HE institutions need to develope in order to capture and keep the "new publics" namely adult students for whom combining study and paid work represents the only available funding source. |
| Keywords: | Higher Education; Critical Matters; Time to successfully complete; Duration Models; Finantial Constraints; Portugal. |
| JEL: | A22 A23 C14 A2 |
| Date: | 2010–03–31 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:21953&r=lab |
| By: | Pierre Koning; Dinand Webbink; Nicholas G. Martin |
| Abstract: | This paper analyses the causal effect of education on starting and quitting smoking, using longitudinal data of Australian twins. The endogeneity of education, censoring of smoking durations and the timing of starting smoking versus the timing of completion of education are taken into account by using the flexible Mixed Proportional Hazard (MPH) specification. Unobserved effects in the specification are assumed to be twin specific and possibly correlated with completed education years. In addition, we use various unique control indicators reflecting the discounting behaviour of individuals that may affect both the smoking decision and the number of education years. In contrast to previous studies in our model specification, differences in the number of education years cannot explain differences in smoking behaviour at young ages. We find one additional year of education to reduce the duration of smoking with 9 months, but no significant effect of education on starting smoking. The effect of education on quitting smoking largely confines to male twins. This suggests that education policies that succeed in raising the level of education may improve public health through an increase of smoking cessation, but are not effective in preventing smoking at young ages. |
| Keywords: | Smoking; duration models; education |
| JEL: | C41 I21 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:cpb:discus:139&r=lab |
| By: | Brunello, Giorgio (University of Padova); Comi, Simona (University of Milan Bicocca); Sonedda, Daniela (University of Piemonte Orientale) |
| Abstract: | We use the variation of training policy over time and across Italian regions to identify the relationship between individual training and earnings. Using longitudinal data for the period 1999 to 2005, we find that the marginal effect of one additional week of formal training on monthly earnings is 4.4 percent. This effect declines rapidly over time and is equal to 0.86 percent 10 years after the investment. We also find that marginal returns are higher among small firms, which are more likely to be constrained by lack of economic resources in their training decisions. Since small firms train less than large firms, their higher returns from the training induced by training policies can simply reflect decreasing marginal returns to training. |
| Keywords: | training, training policies, Italy |
| JEL: | J24 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4861&r=lab |
| By: | Ionescu, Felicia (Department of Economics, Colgate University) |
| Abstract: | I consider the implications of alternative bankruptcy regimes for student loans in a heterogeneous model of life-cycle earnings and risky human capital accumulation. Findings suggest that the ability level of high-school graduates drives the decision to enroll in college, while the initial human capital level is crucial for completing college. Also, the correlation between parental wealth and ability and human capital stock is key in delivering enrollment and completion rates across income groups consistent with empirical findings. The model delivers higher college enrollment, dropout, and default rates when loans can be discharged. Under liquidation, financially constrained borrowers choose to default, whereas under reorganization borrowers default for other reasons rather than financial constraints. Dischargeability benefits college dropouts and students with low assets. It induces more human capital accumulation over the life-cycle relative to the reorganization regime. |
| Keywords: | Bankruptcy; Student loans; College Risk |
| JEL: | D91 G33 I22 |
| Date: | 2009–10–21 |
| URL: | http://d.repec.org/n?u=RePEc:cgt:wpaper:2009-01&r=lab |
| By: | Ricardo Bebczuk (Centro de Estudios Distributivos, Laborales y Sociales (CEDLAS) - Universidad Nacional de La Plata); Diego Battistón (Centro de Estudios Distributivos, Laborales y Sociales (CEDLAS) - Universidad Nacional de La Plata) |
| Abstract: | The paper investigates the effect of remittances on the coverage of financial deficits arising during youth and retirement years and their influence on some household behaviors. To this end, household survey information is used from Ecuador, Honduras, Mexico and Nicaragua to perform a number of econometric tests exploring the linkage between remittances and a battery of health, education and work outcomes dealing with young and elderly household members. The main overall finding is that, with variations across countries and regression specifications, remittances generally appear to exert a positive and robust impact. In particular, with few exceptions, remittances (a) respond to the lack of pensions and especially to overall household financial deficits; (b) encourage co-residence of the elderly with younger relatives; (c) facilitate elderly’s retirement; (d) increase household expenditures in health and education; (e) foster public and private school attendance, inhibits child labor, and improve anthropometric measures. |
| Keywords: | Latin America, remittances, life cycle, retirement |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:dls:wpaper:0094&r=lab |
| By: | Ana Rute Cardoso (IZA, Bonn and University of Minho, Portugal); Shoshana Neuman (Department of Economics Bar-Ilan University); Adrian Ziderman (Bar-Ilan University, Israel) |
| Abstract: | Using a unique eight-year data set, merging population census and national insurance data, the paper examines and compares patterns of wage mobility in Israel. First, the public and the private sectors are compared. Second, within each of these sectors, a distinction is made between sub-sector groupings that exhibit a high level of concentration and those that are more diffuse and unregulated. Based on alternative measures of wage mobility, the central finding of the paper is that the extent of wage mobility in a given economic sector is negatively related to the degree of concentration in that sector. |
| Keywords: | wage mobility, concentration, economic sectors, Israel |
| JEL: | J3 J6 L5 |
| Date: | 2009–07 |
| URL: | http://d.repec.org/n?u=RePEc:biu:wpaper:2009-20&r=lab |
| By: | Brambilla, Irene; Carneiro, Rafael Dix; Lederman, Daniel; Porto, Guido |
| Abstract: | The returns to schooling or the skill premium is a key parameter in various literatures, including globalization and inequality and international migration. This paper explores the skill premium and its link to exports in Latin America, thus linking the skill premium to the emerging literature on the structure of trade and development. Using data on employment and wages for over five million workers in sixteen Latin American economies, the authors estimate national and industry-specific skill premiums and study some of their determinants. The evidence suggests that both country and industry characteristics are important in explaining skill premiums. The analysis also suggests that the incidence of exports within industries, the average income per capita within countries, and the relative abundance of skilled workers are related to the underlying industry and country characteristics that explain skill premiums. In particular, higher sectoral exports are positively linked with the skill premium at the industry level, a result that supports recent trade models linking exports with wages and the demand for skills. |
| Keywords: | Labor Markets,Water and Industry,Tertiary Education,Labor Policies,Inequality |
| Date: | 2010–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5246&r=lab |
| By: | Zhao Chen; Ming Lu; Guanghua Wan |
| Abstract: | How significantly inter-industry wage differentials contribute to rising income inequality is an essential policy issue for transitional economies. Using regression-based inequality decomposition, this paper finds that inter-industrial wage differentials contributed increasingly to income inequality in urban China through 1988, 1995, and 2002, mainly due to rapid income growth in monopolistic industries. Factors such as region, education, ownership, occupation, and holding a second job also contribute increasingly to income inequality, while being employed the whole year and age have decreasing contributions. If China seeks to reduce urban income inequality, removing entry barriers in the labor market and breaking monopoly power in the goods market are essential policy prescriptions. |
| Keywords: | Inter-industry wage differntials, Income ineqality, Regression-based decomposition |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:hst:ghsdps:gd09-130&r=lab |
| By: | Alicia H. Munnell; Laura Quinby |
| Abstract: | Much attention has focused on the shift in the private sector from defined benefit to defined contribution plans, primarily 401(k)s. Often forgotten, however, is that, at any given moment in time, only about half of private sector workers are covered by any sort of employer-sponsored plan. This lack of coverage has two implications. First, a substantial proportion of households – roughly one-third – ends up with no pension coverage at all during their entire worklife and must rely exclusively on Social Security during retirement. And, even under current law, Social Security will provide less in the future relative to pre-retirement earnings than it has in the past. Second, with median job tenure of about four years in 2008, many employees move in and out of coverage so that they end up with inadequate 401(k) balances. This brief proceeds as follows. The first section describes the extent to which private sector workers are covered by any retirement plan. The second section explores the implications of the lack of universal coverage. The third section discusses policy initiatives to improve coverage. The key finding is that, absent a government initiative, pension coverage is unlikely to increase, which – coupled with declining earnings replacement under Social Security – means that many future retirees will end up with inadequate incomes. |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:crr:issbrf:ib2009-9-26&r=lab |
| By: | Isabelle Borras (LEPII - Laboratoire d'Économie de la Production et de l'Intégration Internationale - CNRS : UMR5252 - Université Pierre Mendès-France - Grenoble II); Thierry Berthet Collab. (SPIRIT - Science Politique Relations Internationales Territoire - CNRS : UMR5116 - Université Montesquieu - Bordeaux IV - Institut d'études politiques de Bordeaux); Étienne Campens Collab. (CER - Centre d'études et de recherches - Groupe Ecole supérieure de Commerce de Clermont); Claudine Romani (CEREQ - Centre d'études et de recherches sur les qualifications - Ministère de l'Education nationale, de l'Enseignement supérieur et de la Recherche - ministère de l'Emploi, cohésion sociale et logement) |
| Abstract: | The transformations occurring in work and employment at the present time are raising new expectations with respect to guidance policies. Public action concerning guidance is challenged by the growing complexity of educational and professional pathways and increasing career mobility. To deal with these new expectations with concerning guidance, its steering system needs to be reformed. The aim of this survey is to describe the reforms underway in France. French specificities will also be revealed by comparison with examples from other countries based on a literature review. |
| Keywords: | guidance policie ; career mobility ; France ; Europe |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-00451491_v1&r=lab |
| By: | Gianni De Fraja |
| Abstract: | This paper compares the organisation of the university sector under private provision with the structure which would be chosen by a welfare maximising government. It studies a general equilibrium model where universities carry out research and teach students. To attend university and earn higher incomes in the labour market, students pay a tuition fee. Each university chooses its tuition fee to maximise the amount of resources it can devote to research. Research bestows an externality on society because it increases labour market earnings. Government intervention needs to balance labour market efficiency considerations — which would tend to equalise the number of students attending each university — with considerations of efficiency on the production side, which suggest that the most productive universities should teach more students and carry out more research. We find that government concentrates research more that the private market would, but less than it would like to do if it had perfect information about the productivity of universities. It also allows fewer universities than would operate in a private system. |
| Keywords: | Higher education; The organisation of the university sector. |
| JEL: | I21 I28 H42 |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:lec:leecon:09/19&r=lab |
| By: | Yin King Fok (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne); Sung-Hee Jeon (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne); Roger Wilkins (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne) |
| Abstract: | A significant demographic trend in recent decades in Australia has been the growth in lone parent families as a proportion of all families, associated with which has been growth in welfare dependency. This has led to considerable policy focus on increasing lone parent participation in employment. A key issue that has arisen for the Government in pursuing this policy goal is whether, in the context of a welfare system that accommodates the combining of part-time employment with welfare receipt, part-time employment helps or hinders a progression to full-time employment, and whether and how this depends on characteristics such as the number and ages of dependent children. In this study, we investigate this issue using Australian panel data on female lone parents over the period 2001 to 2007. We estimate dynamic random effects multinomial logit models of three labour force states – not employed, employed part-time, and employed full-time – allowing investigation of whether part-time work represents a stepping stone to full-time employment. Evidence in support of the stepping stone hypothesis is found. Part-time employment increases the probability of full-time employment in the next year by approximately six percentage points. No (statistically significant) evidence is found that this stepping stone function varies by number of children or age of the youngest child. |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:iae:iaewps:wp2009n25&r=lab |
| By: | Nils Braakmann (Institute of Economics, Leuphana University of Lüneburg, Germany) |
| Abstract: | This paper provides first evidence on the social returns to education from both firm-level and regional human capital. Using panel data from German social security, both at an individual and aggregated at the plant and regional level, I estimate earnings functions incorporating measures of regional and firm-level human capital while controlling for various types of unobserved heterogeneity, demand shocks, regional physical capital and other regional and firm-level confounders. The results suggest negligibly small external returns to the firm-level shares of high-skilled workers. On the regional level, the results show no support for external returns to education, except for skilled workers. |
| Keywords: | Human capital externalities, social returns to education, error-component model |
| JEL: | D62 J24 J31 R11 |
| Date: | 2009–09 |
| URL: | http://d.repec.org/n?u=RePEc:lue:wpaper:143&r=lab |
| By: | Silva, Olmo (London School of Economics) |
| Abstract: | In this paper I survey the recent economics of education literature in order to identify which education policies can effectively improve the quality of primary schooling, as measured by pupil test-based achievements. Particular attention is devoted to the experience of England, a country which has made substantial investments over the past decade aimed at improving its primary education. Evidence suggests that broadly scoped resource-based programmes deliver less than more targeted policies. Additionally, a growing body of research shows that interventions that enhance choice and competition among education-service providers, and motivate teachers through pecuniary rewards, have some scope in raising education standards. I conclude my survey by discussing some broad concerns with modes of education provision centred on choice and competition, mainly pupil segregation along the lines of ability and family background. |
| Keywords: | primary schools, resources, choice and competition, incentives |
| JEL: | I20 I28 H52 J24 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izapps:pp5&r=lab |
| By: | Nil Demet Gungor (Department of Economics, Atilim University); Aysit Tansel (Department of Economics, METU) |
| Abstract: | The study estimates an empirical model of return intentions using a dataset compiled from an internet survey of Turkish professionals residing abroad. In the migration literature, wage differentials are often cited as an important factor explaining skilled migration. The findings of our study suggest, however, that non-pecuniary factors, such as the importance of family and social considerations, are also influential in the return or non-return decision of the highly educated. In addition, economic instability in Turkey, prior intensions to stay abroad and work experience in Turkey also increase non-return. Female respondents also appear less likely to return indicating a more selective migration process for females. |
| Keywords: | Skilled migration, brain drain, return intentions, Turkey |
| JEL: | F20 F22 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:met:wpaper:0902&r=lab |
| By: | Yolanda K. Kodrzycki; Ana Patricia Muñoz with Lynn Browne; DeAnna Green; Marques Benton; Prabal Chakrabarti; Richard Walker; Bo Zhao |
| Abstract: | As part of the Federal Reserve Bank of Boston's commitment to supporting efforts to revitalize the economy of Springfield, Massachusetts, this paper explores the causes of and potential remedies for the city's low resident employment rates. When compared to the state as a whole and to other midsize New England cities, the share of employed city residents is low, particularly for residents of downtown Springfield and its nearby neighborhoods. By analyzing the availability of jobs across Springfield's various neighborhoods and in nearby towns and cities, this paper's goal is to learn why so few Springfield residents are employed, and thus to identify policy priorities to increase employment. This study finds that solving Springfield's low resident employment rates will require a combination of new job creation, improved informational and physical access to jobs, and strengthening the citizenry's job skills. |
| Keywords: | Economic conditions - Massachusetts ; Job creation - Massachusetts ; Unemployment - Massachusetts |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbpp:09-11&r=lab |
| By: | Luciano Boggio (DISCE, Università Cattolica di Milano); Vincenzo Dall'Aglio (Università di Parma); Marco Magnani (Università di Parma) |
| Abstract: | We survey the rich literature studying the behaviour of labor shares in recent decades. To explain their dynamics – the main feature being the decline of European and American shares starting in the 1980s – such literature considers models that use either neoclassical or Leontief-type production functions, with both perfectly competitive markets and monopolistic competition coupled by bargaining between firms and workers. These empirical studies in general have produced results that are scarcely robust. However, they suggest that technical change has a negative and significant impact on the labor share. Evidence for a negative effect of globalization variables is clearly brought out for developing countries, whilst for advanced countries, this effect finds less support. Also, they show that product and labor market regulation issues have mixed effects on the labor share. An alternative to the econometric explanation of labor share is given in the final section. |
| Keywords: | Factor Shares, Functional Income Distribution |
| JEL: | E24 E25 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:ctc:serie6:itemq0957&r=lab |
| By: | Anselm Mattes |
| Abstract: | This paper analyzes the determinants and effects of firm-level FDI flows on the basis of German micro-level data. Concering the determinants of FDI, I differentiate between different target regions and motivations for FDI (market seeking/horizontal FDI versus cost reducing/vertical FDI). The main result is that most firms engage in FDI because of market access motives. Further, I focus on the employment effects of direct investment projects abroad. From a theoretical point of view, the effects of FDI flows on labor demand at the rm level are uncertain. Therefore, this paper analyzes this question empirically using theory-based labor demand re- gressions and and an econometric framework based on the generalized method of moments (GMM). As a main result I find that there is no negative effect of firm-level FDI flows on employment. Positive effects seem plausible in many specication. Further, theory and anecdotal evidence suggest that unskilled workers are aected worse than highly or medium-skilled employees. Hence, the analysis distinguishes between different skill groups. Again, I cannot find negative effects of firm-level FDI flows on any skill group. |
| Keywords: | FDI, horizontal FDI,vertical FDI, labor demand, skill gorups, GMM |
| JEL: | F16 F23 J23 |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:iaw:iawdip:59&r=lab |
| By: | María Laura Alzúa (Centro de Estudios Distributivos, Laborales y Sociales (CEDLAS) - Universidad Nacional de La Plata); Guillermo Cruces (Centro de Estudios Distributivos, Laborales y Sociales (CEDLAS) - Universidad Nacional de La Plata and CONICET); Laura Ripani (Inter-American Development Bank) |
| Abstract: | This paper studies the effect of welfare programs on work incentives and the labor supply of adults in developing countries. The document builds on the experimental evaluations of three programs implemented in rural areas: Mexico’s PROGRESA, Nicaragua’s Red de Protección Social (RPS) and Honduras’ Programa de Asignación Familiar (PRAF). The impact of welfare on labor supply has been widely studied in developed countries, where most recent initiatives attempt to mitigate negative effects on work incentives. The programs under study are conditional cash transfers (CCT), which combine monetary benefits with incentives for curbing child labor and fostering the accumulation of human capital. Unlike their counterparts in developed economies, however, they do not account for potential impacts on the labor supply of adults, and there is little systematic evidence on this aspect despite a wealth of empirical studies on their intended outcomes. Comparable results for the three countries indicate mostly negative but small and non-significant effects of the programs on the employment of adults, no reallocation of labor between agricultural and other sectors, and a reduction in hours worked by adults in eligible households in RPS. Moreover, PROGRESA had a positive effect on beneficiaries’ wages. The programs did not imply major disincentives to work, despite substantial transfers, but they had some effects on local labor markets. This mechanism is related to recent findings on the indirect impact of CCTs on ineligible households, and implies that future evaluation studies and designs should account for the equilibrium effects of the interventions. |
| Keywords: | welfare programs, income support, labor supply, adult work incentives, conditional cash transfers, randomized control trials, developing countries. |
| JEL: | J08 J22 I38 |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:dls:wpaper:0095&r=lab |
| By: | Alicia H. Munnell; Christopher Sullivan |
| Abstract: | Many data sources show a disparity among racial and ethnic groups regarding participation in and contributions to 401(k) plans. White workers participate at a higher rate and contribute a higher percentage than African American and Hispanic workers. However, few studies have explored whether these differences persist once other factors expected to impact these decisions are taken into consideration. One recent study by Ariel/Hewitt using client data found lower participation and contributions rates in 401(k) plans for African Americans and Hispanics than for Whites, even after controlling for age, tenure, and earnings. The question is whether racial and ethnic differentials remain after controlling for a broad or array of factors included in a nationally representative sample of households, the Federal Reserve’s Survey of Consumer Finances (SCF)... |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:crr:issbrf:ib2009-9-24&r=lab |
| By: | Tacsir, Ezequiel (UNU-MERIT, Maastricht University) |
| Abstract: | Student choice is at the center of many discussions about higher education policy. At the same time, and regardless of the emphasis put on achieving an important endowment of graduates trained in science and engineering, participation in these fields is stagnated or declining. Evidence suggests that the provision of additional scholarships for science and engineering students or abolishing the tuition fees will have practically no impact. The major problem seems to be that science and engineering programs suffer from a poor image, including as being difficult, leading to lower earning potentials than other specializations. The present study contributes to our understanding of the student choice process by highlighting by means of binomial probit with selection model (Van den Ven and Van Praag, 1981) the factors and dimensions that influence the choicew of field of study. Specifically, we will show the role that non-pecuniary rewards play in the selection process. Using results from a self-designed survey to young individuals finishing high school in Argentina, we show that when factors as the social respect and expected labour demand are considered, the income expectations become irrelevant for the decision about what type of career to follow at the university. Specifically, those inclined towards science, technology and engineering fields are motivated by the belief of obtaining important rewards in the form of social rewards (i.e., reputation) and the expectation of graduating from a highly demanded university career. |
| Keywords: | Occupational Choice, Professions, Public Policy |
| JEL: | J44 J48 J24 I21 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:unumer:2010014&r=lab |
| By: | Alexander M. Danzer (Royal Holloway, University of London, UK); Barbara Dietz (Osteuropa-Institut, Regensburg (Institut for East European Studies)) |
| Abstract: | This paper investigates patterns and determinants of temporary labour migration in Armenia, Belarus, Georgia, Moldova and Ukraine after EU enlargement in 2004. Migration incidence, destination choices and migration determinants differ between poorer and better-off countries. Although broadly in line with general results from the migration literature, we observe some peculiarities like the high share of older migrants and a modest role of family obligations in the migration decision process. We find no indication of a brain drain related to temporary migration in sending regions as the educational background of migrants is rather low. Migration is used as household insurance against unemployment and is associated with lower incidence of poverty. This finding remains robust when attempting to reduce the potential omitted variable bias with an instrumental variable approach. |
| Keywords: | Temporary migration, welfare, Eastern Europe, cross-country study |
| JEL: | F22 J61 I31 P23 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:ost:wpaper:273&r=lab |
| By: | F. HEYLEN; R. VAN DE KERCKHOVE; |
| Abstract: | We build and parameterize a general equilibrium OLG model for an open economy to study hours of work in three age groups, education of the young, and aggregate per capita growth. The composition of fiscal policy plays a crucial role. The government sets tax rates on labor, capital and consumption. It allocates its revenue to productive expenditures (mainly for education), consumption and ‘non‐employment’ benefits. Labor taxes and benefits may differ across age groups. We find that our model’s predictions match the facts remarkably well for all key variables in many OECD countries. We then use the model to investigate the effects of various fiscal policy shocks on employment by age and growth, as well as on welfare of current and future generations. We identify ‘non‐employment’ benefits and labor taxes as the main policy variables affecting employment. Productive government expenditures are the most effective with respect to long‐run output and growth. Long‐run output and growth may benefit also from labor tax cuts targeted at older workers. Considering welfare effects, however, these policy measures may not be the ones preferred most by current generations. |
| Keywords: | employment by age, endogenous growth, fiscal policy, overlapping generations |
| JEL: | E62 J22 O41 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:rug:rugwps:09/623&r=lab |
| By: | Martin Gächter; David A. Savage; Benno Torgler |
| Abstract: | The purpose of this study was to investigate the determinants of police officers' intentions to quit their current department. For this purpose, we analysed US survey data that included a large set of police officers from the Baltimore Police Department in Maryland. Our results indicate that more effective cooperation between units, a higher trust in the work partner (social capital), a higher level of interactional justice and a higher level of work-life-balance substantially reduces police officers' intentions to quit. On the other hand, high levels of physical and psychological strain and the experience of traumatic events were not correlated with the intentions to quit the department These findings suggest that police officers accept high levels of stress as inherent to the job of policing. |
| Keywords: | Quit Intentions; Turnover Rates; Job Satisfaction; Stress; Police Officers; Work-Life Balance; Fairness; Acceptance |
| JEL: | I1 I12 I31 J24 J81 Z13 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:inn:wpaper:2010-05&r=lab |
| By: | King, Karen (Martin Prosperity Institute); Mellander, Charlotta (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology); Stolarick, Kevin (Martin Prosperity Institute) |
| Abstract: | While there has been increased interest in the role of occupations, little has been done from a methodological and empirical approach to find out exactly how occupational analysis plays out on the ground in real places and how the study of the relationships among occupations across industries can further illuminate national and regional economic performance. This descriptive research enhances the understanding of the relationships among industries and occupations. These relationships are analyzed and compared at both national (United States, Canada, Sweden) and sample regional (Boston, Toronto, Stockholm) levels. We uncovered significant differences in occupation mix between North American and Swedish industries. While the United States and Canada rely more heavily on service class occupations, which typically pay much lower wages, Sweden has transformed its reliance on low-wage service workers by increasing its creative employment across the entire economy (knowledge, service, and goods producing industry sectors). However, this transition has resulted in a much smaller knowledge industry than is found in both the United States and Canada, which could mean that Sweden has optimized for the short-term but with long-term consequences. |
| Keywords: | Occupations; Industries; Education; Industrial Structure |
| JEL: | J10 L00 O10 O50 R10 |
| Date: | 2010–02–11 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:cesisp:0221&r=lab |
| By: | Olof Åslund (Uppsala University); John Östh (Uppsala University); Yves Zenou (Stockholm University, Research Institute of Industrial Economics (IFN) and CREAM) |
| Abstract: | We study the impact of job proximity on individual employment and earnings. The analysis exploits a Swedish refugee dispersal policy to obtain exogenous variation in individual locations. Using very detailed data on the exact location of all residences and workplaces in Sweden, we find that having been placed in a location with poor job access in 1990-91 adversely affected employment in 1999. Doubling the number of jobs in the initial location in 1990-91 is associated with 2.9 percentage points higher employment probability in 1999. Considering that the 1999 employment rate was 43 percent among the refugees, this is a considerable effect. The analysis suggests that residential sorting leads to underestimation of the impact of job access. |
| Keywords: | Job access, endogenous location, natural experiment. |
| JEL: | J15 J18 R23 |
| Date: | 2009–10 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:200925&r=lab |
| By: | Erwin OOGHE; Erik SCHOKKAERT |
| Abstract: | Introducing school accountability may create incentives for efficiency. However, if the performance measure used does not correct for pupil characteristics, it will lead to an inequitable treatment of schools and create perverse incentives for cream-skimming. We apply the theory of fair allocation to show how to integrate empirical information about the educational production function in a coherent theoretical framework. The requirements of rewarding performance and correcting for pupil characteristics are incompatible if we want the funding scheme to be applicable for all educational production functions. However, we characterize an attractive subsidy scheme under specific restrictions on the educational production function. This subsidy scheme uses only information which can be controlled easily by the regulator. We show with Flemish data how the proposed funding scheme can be implemented. Correcting for pupil characteristics has a strong impact on the subsidies (and on the underlying performance ranking) of schools. |
| Date: | 2009–11 |
| URL: | http://d.repec.org/n?u=RePEc:ete:ceswps:ces09.22&r=lab |
| By: | Frederiksen, Anders (Aarhus School of Business) |
| Abstract: | The career prospects of newly recruited employees differ substantially within an organization. The stars experience a considerable growth in earnings; others can hardly maintain their entry salaries. This article sheds light on the mechanisms generating the observed heterogeneity in earnings progression by investigating the effects of on-the-job human capital acquisition, explicit short-run incentives and career concern incentives on earnings progression. The model leads to predictions about the incentive structure and the progression in both cross-sectional and individual earnings which are supported by the empirical analysis based on personnel records from a large bank. |
| Keywords: | explicit incentives, career concern incentives, performance, earnings dynamics, personnel economics |
| JEL: | J30 J41 M50 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp4863&r=lab |
| By: | Fabien Tripier (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - Université de Nantes : EA4272) |
| Abstract: | In a matching and intrafi rm bargaining economy with constant return to scale production and matching technologies, large fi rms hire and train workers efficiently. The efficiency of the competitive economy relies on the ability of large fi rm to take into account the consequences of training on the wages bargained inside the fi rm. This intrafi rm bargaining process solves the hold-up problem that is associated with training costs that would otherwise lead to inefficient decisions of hiring and training. |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-00449625_v1&r=lab |
| By: | Niels D. Grosse (University of Jena, Graduate College "The Economics of Innovative Change"); Gerhard Riener (University of Jena, Graduate College "The Economics of Innovative Change") |
| Abstract: | Gender-specific patterns of self-selection into competitive and cooperative environments may have multiple reasons. One of the most prominent explanations to this point is, that there are inherent differences between men and women when it comes to preferences regarding competition. We take a different point of view and claim that gender-task stereotypes are able to explain a large part of the under-representation of women in tournament like environments. We conduct an experiment with a quantitative task which has been shown to have a strong male connotation and a verbal task which we hypothesize to be gender neutral. After controlling for differences in performance, risk attitudes, and overconfidence, we find that women self-select significantly less into competition against men only in the quantitative task. This finding suggests that remaining gender differences for entry into competition are driven by gender-task stereotypes. As a robustness check, we explore the self-selection into incentive schemes given different gender compositions of groups and self-selection into single-sex groups given different incentive schemes. Furthermore, we report the results of a framed field experiment, where we explore a further task - throwing balls into a bucket - that has as well a male connotation. These additional results further strengthen our interpretation. |
| Keywords: | Competition, piece rate, revenue sharing, gender-task stereotype, experiment |
| JEL: | C91 J16 J24 M52 D81 |
| Date: | 2010–03–22 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2010-017&r=lab |
| By: | Arne Feddersen (Chair for Economic Policy, University of Hamburg); Wolfgang Maennig (Chair for Economic Policy, University of Hamburg) |
| Abstract: | Using the case of the 2006 FIFA World Cup, this study is the first to test the employment effects of a mega-sporting event on the basis of data that are both regional and sectoral. It is also the first study of sporting events to use a non-parametric test method. Earlier studies on the World Cup could not identify any employment effects. In contrast, we find a small but significant positive em-ployment effect on the hospitality sector and a negative effect on the construction sector. To our knowledge, this is the first time that such a crowding-out effect of public investment on the occasion of a mega-sporting event has been found in an empirical analysis. |
| Keywords: | FIFA, World Cup, Economic Impact, Ex-post Analysis, Sectoral Employment |
| JEL: | H54 R12 L83 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:hce:wpaper:033&r=lab |
| By: | Egbert Jongen |
| Abstract: | Individual savings accounts are a recurring reform option for unemployment insurance. Under a system of individual accounts, individuals are forced to save part of their income into an individual account out of which benefits are paid during unemployment. Individuals are allowed to have a negative balance and still have the same access to income during unemployment. When negative balances at the end of the working life are nullified, some risk pooling remains. To study the impact of introducing individual accounts for unemployment, we construct a simulation model, which we calibrate for the Netherlands. The simulations results suggest that an optimal combination of the forced savings rate and the replacement rate can slightly increase welfare, when unemployed are credit constrained. When credit constraints are not that important for unemployment, individual accounts are less interesting for unemployment, but then current UI replacement rates seem rather generous. Empirical studies suggest that credit constraints are not that important for unemployment. |
| Keywords: | individual savings accounts; benefits; unemployment; welfare state |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:cpb:docmnt:186&r=lab |
| By: | Hai Fang; Karen N. Eggleston; John A. Rizzo; Richard J. Zeckhauser |
| Abstract: | Data on 2,288 married women from the 2006 China Health and Nutrition Survey are deployed to study how off-farm female employment affects fertility. Such employment reduces a married woman’s actual number of children by 0.64, her preferred number by 0.48, and her probability of having more than one child by 54.8 percent. Causality flows in both directions; hence, we use well validated instrumental variables to estimate employment status. China has deep concerns with both female employment and population size. Moreover, female employment is growing quickly. Hence, its implications for fertility must be understood. Ramifications for China’s one-child policy are discussed. |
| JEL: | J13 J18 O15 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:15886&r=lab |
| By: | Sarah Bridges; Simona Mateut (Department of Economics, The University of Sheffield Author-Person=pma543) |
| Abstract: | This paper examines opposition towards immigration in Europe. Although we find evidence that both economic and non-economic variables shape attitudes towards the arrival of immigrants, the relative importance of these factors depends crucially on the race/ethnicity of the arriving immigrants. We find that more exposure to immigrants reduces opposition towards the arrival of different race immigrants, while fears over labour market competition are more likely to shape attitudes towards the arrival of same race immigrants. Social welfare considerations are also important in determining attitudes towards further immigration, but mainly towards those of a different race. |
| Keywords: | Attitudes, Immigration, European Union |
| JEL: | F1 F22 J61 |
| Date: | 2009–05 |
| URL: | http://d.repec.org/n?u=RePEc:shf:wpaper:2009008&r=lab |
| By: | Orla Doyle (UCD Geary Institute); Louise McEntee (UCD Geary Institute); Kelly A. McNamara (UCD Geary Institute) |
| Abstract: | Socioeconomic inequalities in children’s skills and capabilities begin early in life and can have detrimental effects on future success in school. The present study examines the relationships between school readiness and sociodemographic inequalities using teacher reports of the Short Early Development Instrument in a disadvantaged urban area of Ireland. It specifically examines socioeconomic (SES) differences in skills within a low SES community in order to investigate the role of relative disadvantage on children’s development. Differences across multiple domains of school readiness are examined using Monte-Carlo permutation tests. The results show that child, family and environmental factors have an impact on children’s school readiness, with attendance in centre-based childcare having the most consistent relationship with readiness for school. In addition, the findings suggest that social class inequalities in children’s skills still exist within a disadvantaged community. These results are discussed in relation to future intervention programmes. |
| Keywords: | School readiness, Socioeconomic inequalities, Monte-Carlo permutation tests |
| Date: | 2010–02–15 |
| URL: | http://d.repec.org/n?u=RePEc:ucd:wpaper:201014&r=lab |
| By: | Jaison R. Abel; Ishita Dey; Todd M. Gabe |
| Abstract: | We estimate a model of urban productivity in which the agglomeration effect of density is enhanced by a metropolitan area's stock of human capital. Estimation accounts for potential biases due to the endogeneity of density and industrial composition effects. Using new information on output per worker for U.S. metropolitan areas along with a measure of density that accounts for the spatial distribution of population, we find that a doubling of density increases productivity by 2 to 4 percent. Consistent with theories of learning and knowledge spillovers in cities, we demonstrate that the elasticity of average labor productivity with respect to density increases with human capital. Metropolitan areas with a human capital stock one standard deviation below the mean realize no productivity gain, while doubling density in metropolitan areas with a human capital stock one standard deviation above the mean yields productivity benefits that are about twice the average. |
| Keywords: | Urban economics ; Labor productivity ; Labor market ; Population ; Demography |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fednsr:440&r=lab |
| By: | Gergaud, Olivier (University of Reims); Smeets, Valérie (Department of Economics, Aarhus School of Business); Warzynski, Frédéric (Department of Economics, Aarhus School of Business) |
| 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: | No; keywords |
| JEL: | J24 |
| Date: | 2010–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:aareco:2010_002&r=lab |
| By: | Orla Doyle (Geary Institute, University College Dublin); Sarah Finnegan (Geary Institute, University College Dublin); Kelly A. McNamara (Geary Institute, University College Dublin) |
| Abstract: | Differential ratings by multiple informants are an important issue in survey design. Although much research has focused on differential reports of child behaviour, discrepancies between parent and teacher reports of children’s school readiness are less explored. |
| Date: | 2010–01–25 |
| URL: | http://d.repec.org/n?u=RePEc:ucd:wpaper:201011&r=lab |
| By: | Maria Emma Santos |
| Abstract: | This paper presents a model of a poverty trap that is caused by an unequal initial income and human capital distribution, and differences in the quality of education between children from the more and less advantaged social sectors. Under certain conditions, the economy converges to a situation with three stable and simultaneous equilibria, two of which constitute poverty traps, lowering the economy's current and steady-state aggregate output level as well as its growth rate. The model suggests that a policy oriented to equalizing the quality of education would, in the long run, have potential in reducing initial inequalities. |
| Keywords: | poverty trap, income distribution, quality of education, educational policy, equality of opportunity |
| JEL: | D31 O12 I21 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:qeh:ophiwp:ophiwp30&r=lab |
| By: | E. SCHOKKAERT; E. VERHOFSTADT; L. VAN OOTEGEM; |
| Abstract: | Job quality is a multi-dimensional concept that has become prominent on the agenda of policy-makers. There is no consensus about how to measure and how to monitor it. In this paper we compare often used objective and subjective indicators of job quality. We argue that objective indicators are .too objective, as they neglect interindividual differences in preferences, while subjective job satisfaction is .too subjective, as it also reflects differences in aspirations. We propose an alternative measure of job quality in terms of equivalent incomes that does respect individual preferences but rules out aspirations. We illustrate our approach with Flemish data on school-leavers (SONAR) using the information on the .rst job of the 1978 birth cohort. We compare the results for the equivalent income indicator with the results of objective and subjective indicators. |
| Keywords: | job quality, job satisfaction |
| JEL: | J28 J80 |
| Date: | 2009–12 |
| URL: | http://d.repec.org/n?u=RePEc:rug:rugwps:09/620&r=lab |