nep-lab New Economics Papers
on Labour Economics
Issue of 2010‒05‒29
33 papers chosen by
Stephanie Lluis
University of Waterloo

  1. Labour market status, transitions and gender: a European perspective By Mathilde Guergoat-Larivière; Christine Erhel
  2. The gender reservation wage gap: evidence from British panel data By Sarah Brown; Jennifer Roberts; Karl Taylor
  3. Changes in the wage structure in EU countries By Rebekka Christopoulou; Juan F. Jimeno; Ana Lamo
  4. Does providing childcare to unemployed affect unemployment duration? By Vikman, Ulrika
  5. The margins of labour cost adjustment: survey evidence from european firms By Jan Babecký; Philip Du Caju; Theodora Kosma; Martina Lawless; Julián Messina; Tairi Rõõm
  6. Unemployment and Product Market Competition in a Cournot Model with Efficiency Wage By Zhiqi Chen; Bo Zhao
  7. Is Rural Child Labour Declining in India? By Uma Kambhampati
  8. A Statistical Profiling Model of Long-Term Unemployment Risk in Ireland By O'Connell, Philip J.; McGuinness, Seamus; Kelly, Elish
  9. The economic situation of first-and second-generation immigrants in France, Germany, and the UK. By Algan, Y.; Dustmann, C.; Glitz, A.; Manning, A.
  10. Manitoba’s Demographic Challenge: Why Improving Aboriginal Education Outcomes Is Vital for Economic Prosperity By Colin Busby
  11. Employment and Asset Prices By Gylfi Zoega
  12. Political Cycles in Active Labor Market Policies By Mechtel, Mario; Potrafke, Niklas
  13. Are wages rigid in Colombia?: Empirical evidence based on a sample of wages at the firm level By Ana María Iregui B.; Ligia Alba Melo B.; María Teresa Ramírez G.
  14. Labor Market Structures and the Sacrifice Ratio.. By Bowdler, Christopher; Nunziata, Luca
  15. Length of compulsory education and voter turnout: evidence from a staged reform. By Pelkonen, P.
  16. An Empirical Model of Tax Convexity and Self-Employment By J.-F. Wen; Daniel Gordon
  17. An Empirical Model of Tax Convexity and Self-Employment By Jean-Francois Wen; Daniel V. Gordon
  18. Economic Reform, Education Expansion, and Earnings Inequality for Urban Males in China, 1988-2007 By Xin Meng; Kailing Shen; Sen Xue
  19. Time Packages and Their Effect on Life Satisfaction By Marina Della Giusta; Zella King
  20. Emigration of Skilled Labor under Risk Aversion: The Case of Medical Doctors from Middle Eastern and North African Economies By Driouchi, Ahmed; Kadiri, Molk
  21. Performance Measurement and Incentive Plans By Antti Kauhanen; Sami Napari
  22. What did abolishing university fees in Ireland do? By Kevin Denny
  23. Incorporating Employee Heterogeneity Into Default Rules for Retirement Plan Selection By Gopi Shah Goda; Colleen Flaherty Manchester
  24. Shocks, Stocks, and Socks: Smoothing Consumption over a Temporary Income Loss.. By Browning, Martin; Crossley, Thomas F.
  25. Technology Choice and Incentives under Relative Performance Schemes By Matthias Kräkel; Anja Schöttner
  26. How performance related pay affects productivity and employment. By Gielen, A. C.; Kerkhofs, M.; Ours, J.C. van
  27. Immigration, wages, and compositional amenities. By Card, D.; Dustmann, C.; Preston, I.
  28. Growth and Inverted U in Child Labour: A Dual Economy Approach By Nigar Hashimzade; Uma Kambhampati
  29. Social Interaction and Stock Market Participation: Evidence from British Panel Data By Sarah Brown; Karl Taylor
  30. What Explains Schooling Differences Across Countries? By Marla Ripoll; Juan Carlos Cordoba
  31. Food Security, Gender and Occupational Choice among Urban Low-Income Households By Maria Floro; Ranjula Bali Swain
  32. Higher education export service delivery by the University of Stellenbosch By Emile du Plessis
  33. Three Papers on Bargaining By Dan Usher

  1. By: Mathilde Guergoat-Larivière (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris, CEE - Centre d'études de l'emploi - Ministère de l'Enseignement Supérieur et de la Recherche Scientifique); Christine Erhel (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, CEE - Centre d'études de l'emploi - Ministère de l'Enseignement Supérieur et de la Recherche Scientifique)
    Abstract: This article analyses the determinants of labour market statuses (choice between part time employment, full time employment, and non employment) and yearly transitions between non employment and employment in Europe, using cross sectional 2006 EU-SILC database. The results show a strong positive effect of initial education level on full time employment integration and on the probability to find a job when initially in non employment. Gender and family variables also exert a strong influence on labour market statuses and mobility: being a woman, and even more a mother of a young child, increases the probability to be in non employment, or in part time employment, and also to experience a bad transition. In terms of policies, the article shows that the use of childcare has a positive impact on parents'employment and transitions. Finally, the heterogeneity inside the EU appears high, with significant country effects on both statuses and flows.
    Keywords: labour market status; labour market flows; European comparison; childcare
    Date: 2010–05–10
    URL: http://d.repec.org/n?u=RePEc:hal:cesptp:halshs-00484577_v1&r=lab
  2. By: Sarah Brown (Department of Economics, The University of Sheffield Author-Person=pbr160); Jennifer Roberts (Department of Economics, The University of Sheffield Author-Person=pro228); Karl Taylor (Department of Economics, The University of Sheffield Author-Person=pta44)
    Abstract: Our findings suggest the existence of a gender reservation wage gap, with a differential of around 10%. The presence of children, particularly pre-school age children, plays an important role in explaining this differential. For individuals without children, the explained component of the differential is only 5%, which might indicate that perceived discrimination in the labour market influences the reservation wage setting of females.
    Keywords: Reservation Wages, Wage Decomposition
    JEL: J13 J24 J64
    Date: 2010–05
    URL: http://d.repec.org/n?u=RePEc:shf:wpaper:2010010&r=lab
  3. By: Rebekka Christopoulou (Bronfenbrenner Life Course Center, Beebe Hall, Cornell University, Ithaca, NY 14853, USA.); Juan F. Jimeno (Banco de España, Alcalá 50, 28014 Madrid, Spain.); Ana Lamo (European Central Bank, Kaiserstrasse 29, 60311 Frankfurt am Main, Germany.)
    Abstract: We study changes in the wage structures in nine EU countries over 1995-2002 and the role of demand, supply and institutional developments in shaping these changes. Using comparable cross-country microeconomic data, we compute for each country and at each decile of the wage distribution, the part of the observed wage change that is due to changes in the composition of workers, employers, and jobs’ characteristics, and the part due to changes in the returns to these characteristics. We find that composition effects derived from changes in age, gender or education of the labour force, largely exogenous to economic developments, had a minor contribution to the observed wage dynamics. In contrast, return and composition effects from characteristics likely driven by economic developments are found most relevant to explain the observed changes. We relate wages and their various components with macroeconomic and institutional trends and find that technology and globalisation are associated with wage increases; migration is associated with declines in wages; whereas the effect of labour market institutions has been mixed. JEL Classification: J31.
    Keywords: Wage Structure, Quantile Regressions.
    Date: 2010–05
    URL: http://d.repec.org/n?u=RePEc:ecb:ecbwps:20101199&r=lab
  4. By: Vikman, Ulrika (Department of Economics, Uppsala University)
    Abstract: This paper examines if the probability of leaving unemployment changes for unemployed parents with young children when childcare is available. To investigate this, I use the heterogeneity among Swedish municipalities before the implementation of a 2001 Swedish childcare reform making it mandatory for municipalities to offer child¬care to unemployed parents for at least 15 hours per week. In the study difference-in-differences and difference-in-difference-in-differences methods are used. The results indicate a positive effect on the probability of leaving unemployment for mothers when childcare is available, but no effect is found for fathers. For mothers, some heterogeneous effects are also found, with a greater effect on the probability of leaving unemployment for work when childcare is available for mothers with only compulsory schooling or university education and mothers with two children.
    Keywords: Unemployment duration; childcare
    JEL: J13 J64
    Date: 2010–05–06
    URL: http://d.repec.org/n?u=RePEc:hhs:ifauwp:2010_005&r=lab
  5. By: Jan Babecký (Czech National Bank); Philip Du Caju (National Bank of Belgium); Theodora Kosma (Bank of Greece); Martina Lawless (Central Bank and Financial Services Authority of Ireland); Julián Messina (World Bank and University of Girona); Tairi Rõõm (Bank of Estonia)
    Abstract: Firms have multiple options at the time of adjusting their wage bills. However, previous literature has mainly focused on base wages. We broaden the analysis beyond downward rigidity in base wages by investigating the use of other margins of labour cost adjustment at the firm level. Using data from a unique survey, we find that firms make frequent use of other, more flexible, components of compensation to adjust the cost of labour. Changes in bonuses and non-pay benefits are some of the potential margins firms use to reduce costs. We also show how the margins of adjustment chosen are affected by firm and worker characteristics.
    Keywords: J30, C81, P5
    Date: 2009–12
    URL: http://d.repec.org/n?u=RePEc:bog:wpaper:108&r=lab
  6. By: Zhiqi Chen (Department of Economics, Carleton University); Bo Zhao (School of International Trade and Economics, University of International Business and Economics)
    Abstract: This paper analyzes the impact of product market competition on unemployment, wage and welfare in a model where unemployment is caused by efficiency wage considerations and oligopolistic firms compete in quantity. It is shown that while more intensive competition in product market increases output and reduces price, it does not necessarily lead to a lower unemployment rate or a higher wage for workers. Consequently, the relationship between the intensity of competition and the level of employment (respectively, wage, welfare) is not monotonic, and, in some instances, has an inverted-U shape.
    Keywords: Cournot competition, unemployment, efficiency wage
    Date: 2010–05–17
    URL: http://d.repec.org/n?u=RePEc:car:carecp:10-04&r=lab
  7. By: Uma Kambhampati (School of Economics, University of Reading)
    Abstract: This paper will look at the patterns of child work, schooling and ‘idleness’ across the major states of India and over two years - 1993 and 2004. We analyse two rounds of the NSS dataset to see whether the patterns of schooling and child work have changed over this period or not. The analysis concentrates on the rural sector and finds that the proportion of children in work has increased between 1993 and 2004. While current attendance at school has increased, the proportion of children whose primary activity is schooling has decreased. We hypothesise that this may be because, in a growing economy, there are more opportunities for employment and therefore a larger number of children are likely to combine work and schooling.
    Date: 2010–05–02
    URL: http://d.repec.org/n?u=RePEc:rdg:emxxdp:em-dp2009-06&r=lab
  8. By: O'Connell, Philip J.; McGuinness, Seamus; Kelly, Elish
    Abstract: This paper develops a statistical profiling model of long-term unemployment risk in Ireland using a combination of administrative data and information gathered from a unique questionnaire that was issued to all jobseekers making a social welfare claim between September and December 2006 who were then tracked for eighteen months. We find that factors such as a recent history of long-term unemployment, advanced age, number of children, relatively low levels of education, literacy/numeracy problems, location in urban areas, lack of personal transport, low rates of recent labour market engagement, spousal earnings and geographic location all significantly impact the likelihood of remaining unemployed for 12 months or more. While the predicted probability distribution for males was found to be relatively normal, the female distribution was bimodal, indicating that larger proportions of females were at risk of falling into long-term unemployment. We find evidence that community based employment schemes for combating long-term unemployment have little effect as participants re-entering the register typically experience extended durations. Finally, we argue that the adoption of an unemployment profiling system will result in both equity and efficiency gains to Public Employment Services.
    Keywords: Ireland/Long-term Unemployment/risk/Statistical Profiling/children/transport/employment
    Date: 2010–05
    URL: http://d.repec.org/n?u=RePEc:esr:wpaper:wp345&r=lab
  9. By: Algan, Y.; Dustmann, C.; Glitz, A.; Manning, A.
    Abstract: A central concern about immigration is the integration into the labour market, not only of the first generation, but also of subsequent generations. Little comparative work exists for Europe’s largest economies. France, Germany and the UK have all become, perhaps unwittingly, countries with large immigrant populations albeit with very different ethnic compositions. Today, the descendants of these immigrants live and work in their parents’ destination countries. This paper presents and discusses comparative evidence on the performance of first- and second-generation immigrants in these countries in terms of education, earnings, and employment.
    Date: 2009–09
    URL: http://d.repec.org/n?u=RePEc:ner:ucllon:http://eprints.ucl.ac.uk/18265/&r=lab
  10. By: Colin Busby (C.D. Howe Institute)
    Abstract: As a wave of babyboomers retire, the upcoming decade will see only a modest expansion in Manitoba’s available workforce, and most of this net increase will depend on job-seeking young Aboriginals. Policy reforms should encourage more Aboriginal students to finish high school. Smart reforms to financial aid for postsecondary education would demonstrate aid availability to students early in their academic careers. This would bolster student educational aspirations during secondary studies for those on the margins of accessing postsecondary education. With large numbers of Aboriginal high-school dropouts, Manitoba cannot, and should not, rely solely on expanding international immigration to boost workforce growth.
    Keywords: Economic Growth and Innovation, Manitoba, Aboriginal youth, education
    JEL: J11 J15 J24
    Date: 2010–05
    URL: http://d.repec.org/n?u=RePEc:cdh:ebrief:99&r=lab
  11. By: Gylfi Zoega
    Abstract: A medium-term relationship exists between share prices, normalised by labour productivity, and the rate of unemployment in the OECD countries. A similar relationship appears to exist between unemployment and house prices. This helps explain decadal changes in mean unemployment, such as the shift to higher mean unemployment in the Continental European countries in the 1970s and 1980s that coincided with a fall in the level of share prices, as well as differences in mean unemployment between countries.
    Date: 2009–11
    URL: http://d.repec.org/n?u=RePEc:ice:wpaper:wp46&r=lab
  12. By: Mechtel, Mario; Potrafke, Niklas
    Abstract: This paper examines how electoral motives and government ideology influence active labor market policies (ALMP). We present a model that explains how politicians strategically use ALMP to generate political cycles in unemployment and the budget deficit. Election-motivated politicians increase ALMP spending before elections irrespective of their party ideology. Leftwing politicians spend more on ALMP than rightwing politicians. We test the hypotheses derived from our model using German state data from 1985:1 to 2004:11. The results suggest that ALMP (job-creation schemes) were pushed before elections.
    Keywords: active labor market policies, political cycles, labor market expenditures, opportunistic politicians, partisan politicians
    JEL: J08 E62 H72 H61 P16
    Date: 2009–03
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:22780&r=lab
  13. By: Ana María Iregui B.; Ligia Alba Melo B.; María Teresa Ramírez G.
    Abstract: This paper uses Colombian data at the firm level for the period 1999 to 2006 to provide microeconomic evidence on the existence and extent of downward nominal wage rigidity. To conduct the analysis, we use a rich panel of firms for white and blue collar workers, consisting of 1517 firms for the former and 781 firms for the latter. The presence of wage rigidity is determined by means of three statistic techniques used in recent literature, such as the analysis of the histograms of the distribution of wage changes, the LSW statistic and the Kahn test. The results suggest the existence of downward nominal wage rigidities; it is worth mentioning that rigidity is higher for blue collar workers than white collar workers, since the increase in the wages of the blue workers is generally done by taking into account the change in the minimum wage, which is why a higher rigidity would be expected.
    Keywords: Wage rigidity, Kahn test, LSW Statistic, Colombia. Classification JEL: J31, E24, C23
    URL: http://d.repec.org/n?u=RePEc:bdr:borrec:571i&r=lab
  14. By: Bowdler, Christopher; Nunziata, Luca
    Abstract: Using OECD panel data for 1961–2000 we provide evidence that the output cost associated with disinflation (the sacrifice ratio) decreases with coordination between wage-setters in the labor market. The relationship holds for alternative measures of labor market coordination and after controlling for standard sacrifice ratio determinants. The sign of the relationship is robust across alternative definitions of the sacrifice ratio, but its statistical significance varies. Our results also indicate that more stringent employment protection laws increase sacrifice ratios, but the effect is not significant at conventional levels. We provide explanations for our findings based on the speed of nominal wage adjustment in New Keynesian models.
    JEL: E30
    Date: 2010
    URL: http://d.repec.org/n?u=RePEc:ner:oxford:http://economics.ouls.ox.ac.uk/14595/&r=lab
  15. By: Pelkonen, P.
    Abstract: In this study, a long-term impact of additional schooling at the lower end of the educational distribution is measured on voter turnout. Schooling is instrumented with a staged Norwegian school reform, which increased minimum attainment by two years – from seven to nine. The impact is measured at two levels: individual, and municipality level. Both levels of analysis suggest that the additional education has no effect on the turnout rates. At the individual level, the impact of education is also tested on various measures of civic outcomes. Of these, only the likelihood of signing a petition is positively affected by education.
    Date: 2009–09
    URL: http://d.repec.org/n?u=RePEc:ner:ucllon:http://eprints.ucl.ac.uk/18631/&r=lab
  16. By: J.-F. Wen; Daniel Gordon
    Abstract: We extend the theoretical model of Rees and Shah (1986) to incorporate the effects of marginal tax rate progression and income transfers, as arguments in the individual's utility choice model between self-employment and paid- employment. Measures of the degree of progressivity in the tax and transfer system are constructed from the concept of tax convexity (Gentry and Hubbard, 2000, 2004). The earnings equations are corrected for self-selection bias and are combined with the Canadian Tax and Credit Simulator (Milligan, 2007) to calculate tax both the predicted net-of-tax earnings and the tax convexity variables in the self-employment/employed labor choice decision. The model is estimated using data spanning 1999-2005 from Statistics Canada's Survey of Labour and Income Dynamics. The principal Â…findings are that the tax convexity variables and the net income difference between self- and paid-employment have the predicted signs and high levels of statistical signfiÂ…cance in the structural probit model. We use the model to estimate the effects of federal tax rate reductions in 2001 on the rate of self-employment in Canada.
    Date: 2010–01–17
    URL: http://d.repec.org/n?u=RePEc:clg:wpaper:2010-09&r=lab
  17. By: Jean-Francois Wen; Daniel V. Gordon
    Abstract: We extend the theoretical model of Rees and Shah (1986) to incorporate the effects of marginal tax rate progression and income transfers, as arguments in the individual's utility choice model between self-employment and paid- employment. Measures of the degree of progressivity in the tax and transfer system are constructed from the concept of tax convexity (Gentry and Hubbard, 2000, 2004). The earnings equations are corrected for self-selection bias and are combined with the Canadian Tax and Credit Simulator (Milligan, 2007) to calculate tax both the predicted net-of-tax earnings and the tax convexity variables in the self-employment/employed labor choice decision. The model is estimated using data spanning 1999-2005 from Statistics Canada's Survey of Labour and Income Dynamics. The principal Â…findings are that the tax convexity variables and the net income difference between self- and paid-employment have the predicted signs and high levels of statistical signfiÂ…cance in the structural probit model. We use the model to estimate the effects of federal tax rate reductions in 2001 on the rate of self-employment in Canada.
    Date: 2010–01–17
    URL: http://d.repec.org/n?u=RePEc:clg:wpaper:2010-08&r=lab
  18. By: Xin Meng; Kailing Shen; Sen Xue
    Abstract: In the past 20 years the average real earnings of Chinese urban male workers have increased by 350 per cent. Accompanying this unprecedented growth is a considerable increase in earnings inequality. Between 1988 and 2007 the variance of log earnings increased from 0.27 to 0.48, a 78 per cent increase. Using a unique set of repeated cross-sectional data this paper examines the causes of this increase in earnings inequality. We find that the major changes occurred in the 1990s when the labour market moved from a centrally planned system to a market oriented system. The decomposition exercise conducted in the paper identifies the factor that drives the significant increase in the earnings variance in the 1990s to be an increase in the within-education-experience cell residual variances. Such an increase may be explained mainly by the increase in the price of unobserved skills. When an economy shifts from an administratively determined wage system to a market-oriented one, rewards to both observed and unobserved skills increase. The turn of the century saw a slowing down of the reward to both the observed and unobserved skills, due largely to the college expansion program that occurred at the end of the 1990s.
    Keywords: Earnings inequality, China
    JEL: J31 P2 P3
    Date: 2010–04
    URL: http://d.repec.org/n?u=RePEc:auu:dpaper:639&r=lab
  19. By: Marina Della Giusta (School of Economics, University of Reading); Zella King (School of Management, University of Reading)
    Abstract: The expected response of individuals to policy changes usually requires that they use their resources in a different way, according to the changed relative opportunity cost of undertaking each that the policy effects. However, it has often been noted that the allocation of time to different activities does not respond smoothly, and rather appears to be influenced by a range of non economic factors that lead to opportunity costs and trade-offs being different for different individuals, depending not just on the constraints they face, but also on the activities they are already ‘specialised’ at. In this paper we use the British Household Panel Survey to examine how time packages - the allocation of weekly hours to a combination of paid and unpaid work and leisure - affect life satisfaction, and the marginal returns from additional hours spent in paid work, overtime, caring and housework. We observe that for men in general, the marginal benefits of an additional hour of paid work, or extra work (in the form of overtime or a second job) are positive, while an additional hour of caring has a negative effect on life satisfaction. For men who are leisure rich, however, the marginal benefits of an additional hour of housework are positive. Leisure rich men appear to gain satisfaction from doing housework, in a way that other men do not. The same applies to women. Women are in general less satisfied by taking on overtime or second jobs, presumably preferring to use that discretionary time at home in leisure pursuits or with children. For women doing full-time paid work, the marginal effect of an additional hour of extra work (overtime or a second job) is negative; for women already stretched by full-time paid work, extra hours are an unwelcome burden. We discuss the role that different kinds of constraints, including gender attitudes, play in determining our results and the implications for policy design.
    Keywords: happiness, time use
    JEL: D13 I31
    Date: 2010–05–08
    URL: http://d.repec.org/n?u=RePEc:rdg:emxxdp:em-dp2010-03&r=lab
  20. By: Driouchi, Ahmed; Kadiri, Molk
    Abstract: Abstract This is a contribution to the new economics of skilled labor emigration that focuses on the mobility of medical doctors from sending Middle East and North African countries. Economic models under risk neutrality and aversion are used. The findings show that the relative expected benefits and the emigration rate have major effects on the net relative human medical capital that remains in the source country. The effects of relative wages in the destination and sending countries besides the yield of education are likely to change the emigration patterns. Comparisons of theoretical and observed relative human capital per country averages are conducted and ensured the statistical validity of the model. The empirical results based on the available data by Docquier and Marfouk (2006 and 2008) and Bhargava, Docquier and Moullan (2010) allowed further use of the model to understand the current trends in the emigration of medical doctors. These trends confirm the magnitude of relative wages besides the level of education and the attitude toward risk as determinants of the emigration of skilled labor. The countries included in the study are all exhibiting brain gain under 1991-2004 emigration data but two distinct groups of countries are identified. Each country is encouraged to anticipate the likely effects of this emigration on the economy with the increase of health demand, the domestic wages and the increase in education capacity for medical doctors.
    Keywords: Medical skilled emigration; wages; human capital; risks.
    JEL: F22 A20 J24 I1
    Date: 2010–05–20
    URL: http://d.repec.org/n?u=RePEc:pra:mprapa:22810&r=lab
  21. By: Antti Kauhanen; Sami Napari
    Abstract: This paper explores performance measurement in incentive plans. Based on theory, we argue that differences in the nature of jobs between blue- and white-collar employees lead to differences in incentive systems. We find that performance measurement for white-collar workers is broader in terms of the performance measures, the organizational level of performance measurement and the time horizon. The intensity of incentives is also stronger for white-collar employees. All of these findings are consistent with theory.
    Keywords: incentive pay, performance measurement, risk versus distortion trade-off, agency theory
    JEL: J33 M52 M54
    Date: 2010–05–18
    URL: http://d.repec.org/n?u=RePEc:rif:dpaper:1216&r=lab
  22. By: Kevin Denny (School of Economics and Geary Institute, University College Dublin)
    Abstract: University tuition fees for undergraduates were abolished in Ireland in 1996. This paper examines the effect of this reform on the socio-economic gradient (SES) to determine whether the reform was successful in achieving its objective of promoting educational equality. It finds that the reform clearly did not have that effect. It is also shown that the university/SES gradient can be explained by differential performance at second level which also explains the gap between the sexes. Students from white collar backgrounds do significantly better in their final second level exams than the children of blue-collar workers. The results are very similar to recent findings for the UK. I also find that certain demographic characteristics have large negative effects on school performance i.e. having a disabled or deceased parent. The results show that the effect of SES on school performance is generally stronger for those at the lower end of the conditional distribution of academic attainment.
    Keywords: tuition costs, university, fees, socio-economic background, educational attainment
    Date: 2010–05–20
    URL: http://d.repec.org/n?u=RePEc:ucd:wpaper:201026&r=lab
  23. By: Gopi Shah Goda; Colleen Flaherty Manchester
    Abstract: This paper examines the effect of incorporating individual-level heterogeneity into default rules for retirement plan selection. We use data from a large employer that transitioned from a defined benefit (DB) plan to a defined contribution (DC) plan, offering existing employees a choice of plans. Employees who did not make a choice were defaulted to switch to the DC plan if under age 45 or remain in the DB plan if age 45 or older. Using a regression discontinuity framework, we estimate that the default increased the probability of enrolling in one plan over the other by 60 percentage points. We develop a framework to solve for the optimal age-based default rule analytically and use our results to empirically evaluate the optimal age-based default rule for the firm in our setting. We show that for a broad range of levels of risk aversion, conditioning the default for the choice between pension plans on age can substantially improve outcomes relative to a uniform default policy. Our results suggest that considerable welfare gains are possible by varying defaults by observable characteristics.
    Date: 2010–05
    URL: http://d.repec.org/n?u=RePEc:crr:crrwps:wp2010-5&r=lab
  24. By: Browning, Martin; Crossley, Thomas F.
    Abstract: We investigate how households in temporarily straitened circumstances due to an unemployment spell cut back on expenditures and how they spend marginal dollars of unemployment insurance (UI) benefit. Our theoretical and empirical analyses emphasize the importance of allowing for the fact that households buy durable as well as non-durable goods. The theoretical analysis shows that in the short run households can cut back significantly on total expenditures without a significant fall in welfare if they concentrate their budget reductions on durables. We then present an empirical analysis based on a Canadian survey of workers who experienced a job separation. Exploiting changes in the unemployment insurance system over our sample period we show that cuts in UI benefits lead to reductions in total expenditure with a stronger impact on clothing than on food expenditures. Our empirical strategy allows that these expenditures may be non-separable from employment status. The effects we find are particularly strong for households with no liquid assets before the spell started. These qualitative findings are in precise agreement with the theoretical predictions.
    JEL: D12 D91 D11 J65
    Date: 2009–12
    URL: http://d.repec.org/n?u=RePEc:ner:oxford:http://economics.ouls.ox.ac.uk/14607/&r=lab
  25. By: Matthias Kräkel; Anja Schöttner
    Abstract: We identify a new problem that may arise when heterogeneous workers are motivated by relative performance schemes: If workers’ abilities and the production technology are complements, the firm may prefer not to adopt a more advanced technology even though this technology would costlessly increase each worker’s productivity. Due to the complementarity between ability and technology, under technology adoption the productivity of a more able worker increases more strongly than the productivity of a less able colleague, thereby reducing the motivation of both workers to exert effort under a relative incentive scheme. We show that this adverse incentive effect is dominant and, consequently, keeps the firm from introducing a better production technology if talent uncertainty is sufficiently high and/or monitoring of workers is sufficiently precise.
    Keywords: complementarities; heterogeneous workers; production technology; tournament.
    JEL: D82 D86 J33 M52
    Date: 2010–05
    URL: http://d.repec.org/n?u=RePEc:bon:bonedp:bgse10_2010&r=lab
  26. By: Gielen, A. C. (Tilburg University); Kerkhofs, M.; Ours, J.C. van (Tilburg University)
    Date: 2010
    URL: http://d.repec.org/n?u=RePEc:ner:tilbur:urn:nbn:nl:ui:12-3583553&r=lab
  27. By: Card, D.; Dustmann, C.; Preston, I.
    Abstract: Economists are often puzzled by the stronger public opposition to immigration than trade, since the two policies have symmetric effects on wages. Unlike trade, however, immigration changes the composition of the local population, imposing potential externalities on natives. While previous studies have focused on fiscal spillovers, a broader class of externalities arise because people value the ‘compositional amenities’ associated with the characteristics of their neighbors and co-workers. In this paper we present a new method for quantifying the relative importance of these amenities in shaping attitudes toward immigration. We use data for 21 countries in the 2002 European Social Survey, which included a series of questions on the economic and social impacts of immigration, as well as on the desirability of increasing or reducing immigrant inflows. We find that individual attitudes toward immigration policy reflect a combination of concerns over conventional economic impacts (i.e., on wages and taxes) and compositional amenities, with substantially more weight on composition effects. Most of the difference in attitudes to immigration between more and less educated natives is attributable to heightened concerns over compositional amenities among the less-educated.
    Date: 2009–11
    URL: http://d.repec.org/n?u=RePEc:ner:ucllon:http://eprints.ucl.ac.uk/18906/&r=lab
  28. By: Nigar Hashimzade (School of Economics, University of Reading); Uma Kambhampati (School of Economics, University of Reading)
    Abstract: While it is commonly accepted that the main cause of child labour is poverty, empirical observations suggest that economic growth is not always associated with the reduction in child labour. We show, in a dual economy framework, that the e¤ect of productivity growth upon child labour may be positive or negative. In particular, changes in the productivity gap between the modern and the traditional sectors, due to the technological progress, can generate an increase in child labour. In a dynamic version of the model we also investigate how this e¤ect depends on the quality of schooling.
    Date: 2010–05–03
    URL: http://d.repec.org/n?u=RePEc:rdg:emxxdp:em-dp2009-07&r=lab
  29. By: Sarah Brown (Department of Economics, The University of Sheffield Author-Person=pbr160); Karl Taylor (Department of Economics, The University of Sheffield Author-Person=pta44)
    Abstract: This paper uses data from the British National Child Development Study to investigate the relationship between social interaction and participation in the stock market through holding stocks and/or shares at the individual level. In accordance with the existing literature, the results reveal that a positive relationship exists between social interaction and stock market participation, when both are measured concurrently. Furthermore, this relationship prevails across a range of measures of social interaction and social capital. In addition, we make a potentially important contribution to the existing literature by exploiting the panel nature of the data in order to explore the robustness of the cross-sectional findings. We find that the positive relationship between stock market participation and social interaction prevails within a fixed effects logit framework, which controls for time invariant unobserved effects.
    Keywords: Social Capital, Social Interaction, Stock Market Participation
    JEL: D12 D14 D71
    Date: 2010–04
    URL: http://d.repec.org/n?u=RePEc:shf:wpaper:2010008&r=lab
  30. By: Marla Ripoll; Juan Carlos Cordoba
    Abstract: . . .
    Date: 2010–05
    URL: http://d.repec.org/n?u=RePEc:pit:wpaper:392&r=lab
  31. By: Maria Floro; Ranjula Bali Swain
    Abstract: Rising urban poverty and food insecurity are serious concerns in developing countries today. Urban livelihoods and coping strategies remain poorly understood however. This paper examines the response of female and male household members in marginalized urban (predominantly squatter) areas to the risk of food shortage in terms of occupational choice. More specifically, we use probit analyses to investigate whether household vulnerability or the need to provide self-insurance for food security, alongside gender roles, influence a worker’s choice of enterprise activity. We focus our investigation on self-employed women and men using a data set drawn from the 1496 individual sample in 14 urban squatter communities in Bolivia, Ecuador, Philippines and Thailand. Our findings show that selfemployed women in households facing higher risk of food insecurity are likely to engage in food-related enterprise activities and this is especially true in Philippines and Thailand. This suggests the role of occupational choice in in helping urban squatter households in mitigating the risk of food shortage through the selection of an income-generating activity that allows the direct use of unsold inventories for food consumption.
    Keywords: food security, self-employment, occupational choice, urban informal sector
    Date: 2010–05
    URL: http://d.repec.org/n?u=RePEc:amu:wpaper:2010-06&r=lab
  32. By: Emile du Plessis (Department of Economics, University of Stellenbosch)
    Abstract: International trade in higher education services provides opportunities for stimulating economic development and fostering the mobility of knowledge, leading to increased intellectual capital, which is vital for a country to remain competitive in a globalising world. The aim of this paper is to explore the nature and scope of the delivery of higher education export services at the University of Stellenbosch. To this end, a questionnaire was constructed and distributed among 109 international students at the University of Stellenbosch during 2009. This pilot study investigates the factors that motivate international students to further their studies at the University of Stellenbosch. In addition, it provides an estimate of the associated economic impact on the hosting country of exporting higher education services.
    Keywords: Trade in Education Services, Comparative Advantage, Higher Education Services
    JEL: F10 F20 I23
    Date: 2010
    URL: http://d.repec.org/n?u=RePEc:sza:wpaper:wpapers107&r=lab
  33. By: Dan Usher (Queen's University)
    Abstract: 1) Bargaining Unexplained, page 2 2) Bargaining Assumptions in the Study of Politics, Law and War, page 27 3) Bargaining and Voting, page 49
    Keywords: bargaining, voting, fairness, equilibrium
    JEL: C70
    Date: 2010–05
    URL: http://d.repec.org/n?u=RePEc:qed:wpaper:1239&r=lab

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