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on Labour Economics |
| By: | Anna Batyra; Henri R. Sneessens (CREA, University of Luxembourg) |
| Abstract: | We use a calibrated general equilibrium model with heterogeneous labor and search to evaluate the quantitative effects of various labor tax cut scenarios. The focus is on skill heterogeneity combined with downward wage rigidities at the low end of the skill ladder. Workers can take jobs for which they are overeducated. We compare targeted and nontargeted tax cuts, both with or without over-education effects. Introducing over-education changes substantially the employment, productivity and welfare effects of a tax cut, although tax cuts targeted on the least skilled workers always have larger effects. |
| Keywords: | Minimum Wage, Job Creation, Job Destruction, Job Competition, Search Unemployment, Taxation, Computable General Equilibrium Models |
| JEL: | C68 E24 J64 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:luc:wpaper:10-01&r=lab |
| By: | Torbjørn Hægeland, Lars Johannessen Kirkebøen, Oddbjørn Raaum and Kjell G. Salvanes (Statistics Norway) |
| Abstract: | There is massive cross-sectional evidence that children of more educated parents outperform their schoolmates on tests, grade repetition and in educational attainment. However, evidence for causal interpretation of this association is weak. Within a rich census level data set for Norway, we examine the causal relationship using two approaches for identification: cousins with twin parents and adopted children. In line with most of the literature, we find no effect of mothers’ education on children’s school performance using the children-of-twins approach. However, for adopted children, mother’s education has a positive effect, but only a third of the size of the effect found in biological relationships in adopting families. Carefully tracking the work experience of parents during offspring childhood, we find no support for the hypothesis that the small causal effects of parental education can be explained by detrimental effects of higher labour force participation among more educated mothers. |
| Keywords: | Intergenerational transmission; education; pupil achievement |
| JEL: | I21 J24 J62 |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:ssb:dispap:628&r=lab |
| By: | Anna Ruzik; Magdalena Rokicka |
| Abstract: | This paper addresses the issue of the gender pay gap in the formal and informal labour markets in Poland. The authors verify the hypothesis of the existence of a gender pay gap in informal work and compare this gap with the one observed in the formal (registered) labour market. Various analyses of available data show that size and characteristics of gender pay gap differ depending on the level of earnings. The inequality of earnings among unregistered women and men is more pronounced at the bottom tail of the earnings distribution. In the case of formal employees, inequality at the top of the distribution tends to be larger, confirming the existence of a ‘glass ceiling’. The decomposition of the gender pay gap for selected quintiles indicates that it would be even higher if women had men’s characteristics. A possible explanation of the results is the lack of minimum wage regulations in the informal market and the greater flexibility in agreement on wages in the higher quantiles. |
| Keywords: | gender pay gap, informal employment, quantile regression |
| JEL: | J31 O17 J71 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:sec:cnstan:0406&r=lab |
| By: | Cristian Bartolucci |
| Abstract: | Hellerstein and Neumark (1999) developed a straightforward method to detect wage discrimination using matched employer-employee data. In this paper a new method to measure wage discrimination is proposed, that builds on the ideas first developed by Hellerstein and Neumark. It has four main advantages: it is robust to labor market segregation, it does not impose linearity on the wage setting equation, it avoids the problematic estimation of production functions, and it is not only a test for discrimination but also produces measures of discrimination. Using matched employer-employee data from Germany, I find that immigrants are being discriminated against. They receive wages which are 13 percent lower than native workers in the same firm. |
| Keywords: | Labor market discrimination; immigration; matched employer-employee data |
| JEL: | J71 J64 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:cca:wpaper:150&r=lab |
| By: | Yuki Hashimoto; Ayako Kondo |
| Abstract: | This study aims to examine how each cohort's family formation is affected by labor market conditions experienced in youth in Japan. Although deterioration in youth employment opportunities has often been blamed for Japan's declining marriage and fertility rates, the effects of slack labor market conditions on marriage and fertility are theoretically unclear. We estimate the effects of regional labor market conditions on marriage and fertility, controlling for nation-wide year effects and prefecture fixed effects, and find the following. First, the male unemployment rate is negatively correlated with marriage of women in the local labor market, although the correlation is weak and concentrated on the less educated group. Second, high school-educated women who experienced a recession while entering the labor market are less likely to have children and tend to marry later. In contrast, a recession at entry to the labor market rather increases fertility among college-educated women. The overall impact of labor market conditions experienced in youth on family formation is relatively weak, compared to the substantial losses in earnings and employment stability documented by the existing studies. |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:dpr:wpaper:0789&r=lab |
| By: | Luthra R (Institute for Social and Economic Research) |
| Abstract: | Exploiting the 2005 Mikrozensus, the first dataset to allow the full disaggregation of different immigrant origin groups in Germany, this paper examines the effect of context of reception, citizenship, and intermarriage on the labor force participation, employment, and occupational status of the children of immigrants in Germany. Most second generation men have much higher unemployment than native Germans, even after controlling for human capital. Disadvantage is less pronounced among second generation women, and among the employed. There is considerable heterogeneity across immigrant origins, but citizenship and intermarriage have only modest impacts. |
| Date: | 2010–09–09 |
| URL: | http://d.repec.org/n?u=RePEc:ese:iserwp:2010-30&r=lab |
| By: | Brown, Alessio J. G.; Merkl, Christian; Snower, Dennis J. |
| Abstract: | This paper examines the labour market matching process by distinguishing its two component stages: the contact stage, in which job searchers make contact with employers and the selection stage, in which they decide whether to match. We construct a theoretical model explaining two-sided selection through microeconomic incentives. Firms face adjustment costs in responding to heterogeneous variations in the characteristics of workers and jobs. Matches and separations are described through firms' job offer and firing decisions and workers' job acceptance and quit decisions. Our calibrated model for the U.S. can account for important empirical regularities that the conventional matching model cannot. |
| Keywords: | Matching; incentives; adjustment costs; unemployment; employment; quits; firing; job offers; job acceptance; |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ner:ifwkie:info:hdl:10419/37391&r=lab |
| By: | Ren, Weiwei (University of Western Australia); Miller, Paul W. (Curtin University of Technology) |
| Abstract: | This paper examines the gender differential in the payoff to schooling in China. The analyses are conducted separately for rural and urban areas, and are based on a framework provided by the over education/required education/under education literature, and the decomposition developed by Chiswick and Miller (2008). It shows that the payoff to correctly matched education in rural China is much higher for females than for males. Associated with this, the wage penalty where workers are under qualified in their occupation is greater for females than for males. Both of these factors are shown to be linked to the higher payoff to schooling for females than for males. Over educated females, however, are advantaged compared with their male counterparts, though this has little effect on the differential in the payoff to schooling between males and females in rural China. These findings are interpreted using the explanations offered for the gender differential in the payoff to schooling in the growing literature on earnings determination in China. The payoffs to actual years of schooling for males and females in urban China are remarkably similar in this study. |
| Keywords: | China, schooling, earnings, rates of return |
| JEL: | J31 J62 J70 |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5179&r=lab |
| By: | Roberto Henrique Gonzalez (Institute for Applied Economic Research) |
| Abstract: | Although Brazil has had consolidated labour-market institutions since the 1940s, policies to help unemployed workers find a job only began in the 1970s. This was made possible by the creation of the National Employment System (Sistema Nacional de Emprego, SINE). Before that there was only one compensation mechanism for workers who lost their jobs, the Severance Pay Indemnity Fund (Fundo de Garantia por Tempo de Serviço, FGTS), as well as some assistance of very limited scope for the unemployed. (...) |
| Keywords: | Employment Policies in Brazil: History, Scope and Limitations |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:ipc:opager:116&r=lab |
| By: | Rupayan Pal; Bibhas Saha |
| Abstract: | Whether the outcome of bargaining over wage and employment between an incumbent firm and a union remains efficient under entry threat is examined. The workers\' reservation wage is not known to the entrant, and entry is profitable only against the high reservation wage. The entrant observes the pre-entry price, but not necessarily the wage agreements. When wage is not observed, contracts feature over-employment. Under separating equilibrium the low type is over-employed, and under pooling equilibrium the high type is over-employed. But when wage is observed, pooling equilibrium may not always exist, and separating equilibrium does not involve any inefficiency. [Working Paper No. 2010-016]. |
| Keywords: | firm, employment, Efficient Bargaining, Entry Threat, Signalling, Inefficiency, wage, employed, equilibrium, inefficiencey, contracts, price, enttrant, reservation, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2833&r=lab |
| By: | Franciscos Koutentakis (University of Crete) |
| Abstract: | The paper investigates unemployment dynamics in six European countries with a particular focus on the gender dimension. Applying a recently established methodology on widely available LFS annual data it calculates the job finding and separation rates and estimates their relative contributions to the fluctuations of male and female unemployment rates. It finds that gender differences in the separation rate explain both the determination and the evolution of the gender unemployment gap. It attributes these differences to female attachment to the labour force. |
| Keywords: | Gender unemployment gap, labour market flows |
| JEL: | J16 J6 E23 |
| Date: | 2010–08–30 |
| URL: | http://d.repec.org/n?u=RePEc:crt:wpaper:1010&r=lab |
| By: | Osorio, Juan Carlos Parra; Wodon, Quentin |
| Abstract: | Fe y Alegria is a catholic network of schools that started operations in Colombia in 1971, and in 2009 served more than 72,000 students in 61 schools. This paper assesses the performance of Fe y Alegria secondary schools in Colombia using test scores for Spanish and mathematics, as well as detailed information on the characteristics of the household to which students belong. Simple statistics suggest that Fe y Alegria schools perform worse than other schools for all years in the sample. However, Fe y Alegria schools also cater to poorer students who come from disadvantaged backgrounds. Once controls are included for student background, Fe y Alegria schools actually often perform as well and in some cases better than other schools for mathematics and Spanish, thus partially reversing the previous finding. |
| Keywords: | Tertiary Education,Secondary Education,Gender and Education,Teaching and Learning,Primary Education |
| Date: | 2010–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5413&r=lab |
| By: | Annette Bergemann; Regina T. Riphahn |
| Abstract: | German family policy underwent a reform in 2007, when the new instrument of "Elterngeld" replaced the previous "Erziehungsgeld". The transfer programs differ in various dimensions. We study the effects on the labor supply of young mothers, by comparing behavior before and after the reform. We separately consider women of high and low incomes, which were treated differently under the old "Erziehungsgeld"-regime, and differentiate the periods before and after the expiration of transfer receipt. Our results mainly confirm expectations based on a labor supply framework. |
| Keywords: | Female labor supply, fertility, child subsidy, parents money |
| JEL: | J13 J21 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp315&r=lab |
| By: | Atanas Hristov |
| Abstract: | This paper studies the interaction of financing constraints and labor market imperfections on the labor market and economic activity. My analysis builds on the agency cost framework of Carlstrom and Fuerst [1998. Agency costs and business cycles. Economic Theory, 12(3):583-597]. The aim of this article is to show that financing constraints can substantially amplify and propagate total factor productivity shocks in cyclical labor market dynamics. I find that under the Nash bargaining solution financing constraints increase substantially the volatility of wages, and in turn, amplification for the labor variables falls short of the observed volatilities in the data. Atop of this, the comovement between output and labor share is counterfactual. However, there is substantial scope for any type of wage rigidity and financing constraints to reinforce each other, and to generate the observed volatilities in the labor market, moreover, to produce a wide range of comovements between output and labor share. |
| Keywords: | Credit and search frictions, Labor market, Unemployment |
| JEL: | E24 E32 J64 G24 |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:hum:wpaper:sfb649dp2010-044&r=lab |
| By: | Cockx, B.; Picchio, M. (Tilburg University, Center for Economic Research) |
| Abstract: | This paper assesses whether short-lived jobs (lasting one quarter or less and involuntarily ending in unemployment) are stepping stones to long-lasting jobs (enduring one year or more) for Belgian long-term unemployed school-leavers. We proceed in two steps. First, we estimate labour market trajectories in a multi-spell duration model that incorporates lagged duration and lagged occurrence dependence. Second, in a simulation we find that (fe)male school-leavers accepting a short-lived job are, within two years, 13.4 (9.5) percentage points more likely to find a long-lasting job than in the counterfactual in which they reject short-lived jobs. |
| Keywords: | event history model;transition data;state dependence;short-lived jobs;stepping stone effect;long-lasting jobs. |
| JEL: | C15 C41 J62 J64 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubcen:201095&r=lab |
| By: | Soo Khoon Goh; Koi Nyen Wong |
| Abstract: | Using multivariate cointegration and error-correction modeling techniques, this paper attempts to examine whether there exists a productivity-wageunemployment relationship in Malaysia at the macroeconomic level. The main findings show that unemployment is dichotomized from the long-run equilibrium relationship between labor productivity and real wages, implying labor productivity is an important long-run factor in determining real wages, while unemployment has negligible effect on the real wage rates. However, the real wages are very responsive to a change in labor productivity, signaling the labor market is tight that leads to an increase in unit labor cost. To be more resilient to rising wages and productivity gap in a globally competitive environment, the Malaysian industries should move up the value chain, and promote skill- and technology-intensive production. |
| Keywords: | Real wages, productivity, Malaysia |
| JEL: | J39 |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:mos:moswps:2010-12&r=lab |
| By: | Addison, John T. (University of South Carolina); Altemeyer-Bartscher, Martin (Chemnitz University of Technology); Kuhn, Thomas (Chemnitz University of Technology) |
| Abstract: | The poor performance often attributed to many public employment services may be explained in part by a delegation problem between the central office and local job centers. In markets characterized by frictions, job centers function as match-makers, linking job seekers with relevant vacancies. Because their search intensity in contacting employers and collecting data is not verifiable by the central authority, a typical moral hazard problem can arise. To overcome the delegation problem and provide high-powered incentives for high levels of search effort on the part of job centers, we propose output-related schemes that assign greater staff capacity to agencies achieving high strike rates. |
| Keywords: | matching unemployment, public employment service, delegation problem, moral hazard, search theory |
| JEL: | J64 D82 |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5170&r=lab |
| By: | Roberto Henrique Gonzalez (Institute for Applied Economic Research) |
| Abstract: | The objective of this paper is to present the main characteristics of the public employment system in Brazil, focusing on its history, scope and current coverage. It seeks to contribute to the debate on social and employment policies, especially as regards creating job opportunities that help people escape from poverty. A conceptual caveat: throughout the paper, the expression ?employment policies? is used in a narrow sense to encompass policies ?whose specific objectives promote direct and explicit actions within the labour market? (Barbosa and Moretto, 1998: 20). The paper therefore omits other policies that act on macroeconomic factors, labour relations, access to social security and healthcare. While these greatly influence the level and quality of employment in the economy, their actions are beyond the scope of the paper. On the other hand, regulation of certain aspects of working conditions and wages has been regarded as falling within the scope of ?employment policy? whenever the goal of such regulation was to affect labour market outcomes directly. This includes setting a minimum wage, for example, but it excludes workplace health and safety standards. The term ?public employment system? is reserved for the set of employment policies that are seen as acting together to ensure individuals? entry or reintegration into the labour market. The paper is divided into three parts. The first outlines the history of employment-related government policies, from the compensation scheme for newly terminated employees and supplemental pay to the design of what it known as the employment system. The second section maps out the scope of existing employment policies and points to the limitations of the public employment system as currently understood by the Brazilian government; it also presents selected indicators concerning the public system?s coverage relative to the Brazilian labour market. The final section highlights a number of issues faced by the public employment system today as regards its ability to reintegrate workers into the labour market. (...) |
| Keywords: | Employment Policies in Brazil: History, Scope and Limitations |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:ipc:wpaper:70&r=lab |
| By: | vinod Mishra; Russell Smyth |
| Abstract: | This paper examines economic returns to schooling for China’s Korean minority in the urban labour market using ordinary least squares (OLS) and two-stage least squares. The OLS estimates of the returns to schooling are similar to findings from recent studies for the Chinese urban labour market. We use father’s education, mother’s education and spouse’s education to instrument for education. The two-stage least squares estimates are considerably higher than the OLS estimates for returns to schooling and slightly higher than existing two-stage least squares estimates of the returns to schooling for the Chinese urban labour market. The two stage least squares estimates of the returns to schooling for the Korean minority living in urban areas are high compared with the Asian average and world average. The economic returns to schooling reported in this study assists to explain why private demand for education among the Korean minority in China is strong and provides a justification for the Korean minority’s focus on educational attainment. |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:mos:moswps:2010-37=&r=lab |
| By: | David R. Howell |
| Abstract: | The Bureau of Labor Statistics publishes six alternative indicators of labor underutilization, ranging from the long-term unemployed (U-1) and the standard unemployment rate (U-3) to a measure that includes all unemployed, involuntary part-time, and ‘marginally attached’ workers (U-6). These capture important dimensions of underutilization, but in recessions they miss millions of ‘displaced’ workers – those who are not counted in the U-6 measure but would have been working but for the economic downturn. For example, over the course of 2009 (2008:4 to 2009:4), employment fell by 5.8 million workers, but unemployed job losers and marginally attached (including discouraged) workers increased by less than 4.3 million, leaving over 1.5 million uncounted in the BLS underutilization rates. These include those who no longer qualify as ‘marginally attached’ or have simply disappeared from the data (e.g., workers returning to Mexico).<span> </span>If we take into account the growth in the working age population and apply a 2007 employment rate of 63%, the number of missing underutilized workers in 2009:4 increases to about 3.1 million. |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:uma:periwp:wp232&r=lab |
| By: | Booth, Alison L. (University of Essex); Katic, Pamela (Australian National University) |
| Abstract: | In this paper we estimate the elasticity of the labour supply to a firm, using data from the Household, Income and Labour Dynamics in Australia (HILDA) Survey. Estimation of this elasticity is of particular interest not only in its own right but also because of its relevance to the debate about the competitiveness of labour markets. The essence of monopsonistically competitive labour markets is that labour supply to a firm is imperfectly elastic with respect to the wage rate. The intuition is that, where workers have heterogeneous preferences or face mobility costs, firms can offer lower wages without immediately losing their workforce. This is in contrast to the perfectly competitive extreme, in which the elasticity is infinite. Therefore a simple test of whether labour markets are perfectly or imperfectly competitive involves estimating the elasticity of the labour supply to a firm. We find that the Australian wage elasticity of labour supply to a firm is around 0.71, only slightly smaller than the figure of 0.75 reported by Manning (2003) for the UK. These estimates are so far from the perfectly competitive assumption of an infinite elasticity that it would be difficult to make a case that labour markets are perfectly competitive. |
| Keywords: | monopsony, imperfect competition, separation, labour supply elasticity |
| JEL: | J42 J21 J71 |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5167&r=lab |
| By: | Ines Kaempfer; Joanne Xiaolei Qian; Russell Smyth |
| Abstract: | This paper examines the determinants of working excessive hours, defined as working in excess of 60 hours per week or for more than six consecutive days, in Chinese and Thai supply-chain factories. We use a matched employer-employee dataset collected from 15 Chinese and Thai footwear and sporting apparel supply-chain factories, which supply international brands. Matched employer-employee data allows us to examine the effect of worker and firm characteristics on hours worked. We find that in addition to the demographic and human capital characteristics of workers, firm-level characteristics and worker awareness of how to refuse overtime are important factors in explaining variation in hours worked. |
| Keywords: | China, hours worked, supply chain factories |
| JEL: | J22 J24 O15 |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:mos:moswps:2010-28&r=lab |
| By: | Deepti Goel (Delhi School of Economics); Kevin Lang (Boston University and NBER, IZA) |
| Abstract: | We show that increasing the probability of obtaining a job offer through the network should raise the observed mean wage in jobs found through formal (non-network) channels relative to that in jobs found through the network. This prediction also holds at all percentiles of the observed wage distribution, except the highest and lowest. The largest changes are likely to occur below the median. We test and confirm these implications using a survey of recent immigrants to Canada. We also develop a simple structural model, consistent with the theoretical model, and show that it can replicate the broad patterns in the data. For recent immigrants, our results are consistent with the primary effect of strong networks being to increase the arrival rate of offers rather than to alter the distribution from which offers are drawn. |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:201022&r=lab |
| By: | Dillon, Andrew; Bardasi, Elena; Beegle, Kathleen; Serneels, Pieter |
| Abstract: | Child labor statistics are critical for assessing the extent and nature of child labor activities in developing countries. In practice, widespread variation exists in how childlabor is measured. Questionnaire modules vary across countries and within countries over time along several dimensions, including respondent type and the structure of the questionnaire. Little is known about the effect of these differences on child labor statistics. This paper presents the results from a randomized survey experiment in Tanzania focusing on two survey aspects: different questionnaire design to classify children work and proxy response versus self-reporting. Use of a short module compared with a more detailed questionnaire has a statistically significant effect, especially on child labor force participation rates, and, to a lesser extent, on working hours. Proxy reports do not differ significantly from a child’s self-report. Further analysis demonstrates that survey design choices affect the coefficient estimates of some determinants of child labor in a child labor supply equation. The results suggest that low-cost changes to questionnaire design to clarify the concept of work for respondents can improve the data collected. |
| Keywords: | Street Children,Labor Markets,Youth and Governance,Children and Youth,Labor Policies |
| Date: | 2010–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5414&r=lab |
| By: | Olga Nottmeyer |
| Abstract: | Taking advantage of the panel structure of the data, the impact of intermarriage on labor market productivity as measured by earnings is examined. Contrarily to previous studies which rely on instrumental variable techniques, selection issues are addressed within a fixed effects framework. The model accounts for short and long term effects as well as general differences between those who intermarry and those who do not. Once unobserved heterogeneity is incorporated, advantageous effects from intermarriage vanish and do not differ from premiums from marriage between immigrants. However, immigrants who eventually intermarry receive greater returns to experience indicating better labor market integration. |
| Keywords: | intermarriage, integration, labor market, migration |
| JEL: | J1 J12 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp314&r=lab |
| By: | Daniel Boothby (Industry Canada); Torben Drewes (Trent University) |
| Abstract: | Among OECD countries, Canada has the highest percentage of postsecondary graduates in the population 25-64 years old, which is due to having a large proportion of nonuniversity postsecondary graduates from colleges and trade schools. By considering the financial returns to types of postsecondary education, which reflect demand and supply, this paper examines whether Canada has produced too many postsecondary graduates in general, or too many graduates from colleges or trade schools in particular. The answers to both questions is no. There are high rates of return to higher education, with the exception of women graduates of trade schools. |
| Keywords: | Education Papers, postsecondary education, OECD countries |
| JEL: | I21 J24 |
| Date: | 2010–08 |
| URL: | http://d.repec.org/n?u=RePEc:cdh:ebrief:104&r=lab |
| By: | Fouarge, Didier (ROA, Maastricht University); Schils, Trudie (Maastricht University); de Grip, Andries (ROA, Maastricht University) |
| Abstract: | Several studies document the fact that low-educated workers participate less often in further training than high-educated workers. The economic literature suggests that there is no significant difference in employer willingness to train low-educated workers, which leaves the question of why the low educated invest less in training unanswered. This paper investigates two possible explanations: Low-educated workers invest less in training because of 1) the lower economic returns to these investments or 2) their lower willingness to participate in training. Controlling for unobserved heterogeneity that can affect the probability of enrolling into training, we find that the economic returns to training for low-educated workers are positive and not significantly different from those for high-educated workers. However, low-educated workers are significantly less willing to participate in training. This lesser willingness to participate in training is driven by economic preferences (future orientation, preference for leisure), as well as personality traits (locus of control, exam anxiety, and openness to experience). |
| Keywords: | returns to training, preferences, non-cognitive skills |
| JEL: | J24 J31 C21 |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5180&r=lab |
| By: | Fumio Ohtake (Professor, Institute of Social and Economic Research, Osaka University); Miki Kohara (Associate Professor, Osaka School of International Public Policy (OSIPP)) |
| Abstract: | This paper examines the effect of unemployment rates on crime rates, using two types of Japanese data: time-series data from 1976 to 2008 and prefectural panel data from 1975 to 2005. An analysis using time-series data shows that an increase in unemployment rates raises crime rates, while the number of police officers decreases them. It should be noted, however, that the effects are different among the various types of crime. An analysis using prefectural panel data shows similar results; however, the increase in poverty rates raises crime rates more than the increase in unemployment. Our empirical evidence also suggests that occurrences of crime are attributed to both labor market conditions related to the opportunity cost of crime, and the number of policies related to crime deterrent, as the theory of crime suggests. |
| Keywords: | Crime, Unemployment, Empirical Analysis |
| JEL: | C2 J6 K42 |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:osp:wpaper:10j007&r=lab |
| By: | Neil Shephard (Nuffield College and Oxford-Mann Institute, Oxford University, Oxford.) |
| Date: | 2010–01–14 |
| URL: | http://d.repec.org/n?u=RePEc:nuf:econwp:1001&r=lab |
| By: | Geyer, Johannes (DIW Berlin); Myck, Michal (Centre for Economic Analysis, CenEA) |
| Abstract: | We analyse the role of health in determining the difference between desired and actual hours of work in a sample of German men using the Socio-Economic Panel Data for years 1996-2007. The effects of both self-assessed health and legal disability status are examined. About 60% of employees report working more than they would wish with the mean difference of -3.9 hours/week. We estimate static and dynamic model specifications allowing for auto-regressive nature of the dependent variable and testing for the role of lagged health status. Important differences are found between east and west German Länder. In the west we find statistically significant role of general health measures in determining the disequilibrium. Employees in bad health want to work on average by about 0.4 hour/week less according to the static specification, and by about 1 hour/week less if dynamics of health and of the disequilibrium are taken into account. This is respectively 10% and 25% of the mean difference. We find no effects of legal disability status on the disequilibrium which we interpret as a reflection of stronger legal position of disabled employees. In both east and west we find significant state dependence in the hours disequilibrium. |
| Keywords: | hours worked, health, disability, labour market flexibility |
| JEL: | J21 J14 |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5169&r=lab |
| By: | Lundqvist, Heléne (Uppsala University); Dahlberg, Matz (Uppsala University); Mörk, Eva (IFAU) |
| Abstract: | The effectiveness of public funds in increasing public employment has long been a question on public and labor economists’ minds. In most federal countries local governments employ large fractions of the working population, meaning that a tool for stimulating local public employment can substantially affect the overall unemployment level. This paper asks whether general grants to lower-level governments have the potential of doing so. Applying the regression kink design to the Swedish grant system, we are able to estimate causal effects of intergovernmental grants on personnel in different local government sectors. Our robust conclusion is that personnel in the central administration increased substantially after a marginal increase in grants, but that such an effect was lacking both for total personnel and personnel in child care, schools, elderly care, social welfare and in technical services. We suggest several potential reasons for these results, such as heterogeneous treatment effects and bureaucratic influence in the local decision-making process. |
| Keywords: | fiscal federalism, intergovernmental grants, public employment, regression kink design, instrumental variables |
| JEL: | C33 H11 H70 J45 |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5177&r=lab |
| By: | C. S. Murty |
| Abstract: | The literature on Rural Non-Agricultural Employment (RNAE) in India is replete with references as to its nature - whether or not it is residual. Vaidyanathan (1986) advanced the view that for the sector to be termed residual in nature two conditions should be satisfied: (1) the unemployment rate should be positively related to the RNAE and (2) the unemployment rate again should be negatively related to the wage ratio between the non-agricultural and agricultural sectors. These two propositions have become the corner stones of what has come to be termed as the Residual Sector Hypothesis (RSH). While the hypothesis as such seems to be theoretically sound, empirical evidence is rarely, if ever, consistent with the theoretical postulates. [Working Paper No. 67] |
| Keywords: | literature, rural, non-agricultural, employment, Vaidyanathan, Residual Sector Hypothesis |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2823&r=lab |
| By: | Kempkes, Gerhard |
| Abstract: | We analyse the adjustment of public education spending in response to rapidly decreasing student cohorts in East Germany where birth rates collapsed after German reunification. Previous results from the literature based on data from more stable demographic periods suggest that public resources are incompletely adjusted, and that large reductions in the student population would thus translate into major increases in spending per student. Our empirical analysis suggests, however, that resource adjustments in East Germany have been considerable, especially in the years when student cohorts actually decreased. Adjustments were less tight when student numbers began to stagnate. Although our results are restricted to public education, they may be interpreted as early evidence on fiscal adjustments during strong demographic change, which will play a growing role in the years to come. -- |
| Keywords: | Subnational government spending,demographic change,public education |
| JEL: | I22 J18 H72 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:bubdp1:201016&r=lab |
| By: | Randall K. Q. Akee |
| Abstract: | Existing research examining the self-selection of immigrants suffers from a lack of information on the immigrants’ labor force activities in the home country, quotas limiting who is allowed to enter the destination country, and non-economic factors such as internal civil strife in the home country. Using a novel data set from the Federated States of Micronesia (FSM), a migration flow to the U.S. has been analyzed that suffers from none of these problems. Second, nearest neighbor matching for immigrants has been conducted prior to their leaving the home country using home country wages as the outcome variable to determine the nature of selection on unobservable characteristics. [Discussion Paper No. 3268] |
| Keywords: | immigrants, home country, Federated States of Micronesia (FSM), U.S., high-skilled workers, endogeneity, wages |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2829&r=lab |
| By: | Manzi, Jorge; San Martin, Ernesto; Van Bellegem, Sébastien |
| Abstract: | Value-added analysis is a common tool in analysing school performances. In this paper, we analyse the SIMCE panel data which provides individual scores of about 200,000 students in Chile, and whose aim is to rank schools according to their educational achievement. Based on the data collection procedure and on empirical evidences, we argue that the exogeneity of some covariates is questionable. This means that a nonvanishing correlation appears between the school-specific effect and some covariates. We show the impact of this phenomenon on the calculation of the value-added and on the ranking, and provide an estimation method that is based on instrumental variables in order to correct the bias of endogeneity. Revisiting the definition of the value-added, we propose a new calculation robust to endogeneity that we illustrate on the SIMCE data. |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:ide:wpaper:23155&r=lab |
| By: | Veronica Amarante; Rodrigo Arim; Gioia de Melo; Andrea Vigorito |
| Abstract: | Asignaciones Familiares is a child allowances program that was incepted in Uruguay in 1942 and significantly modified in 2008. The program is focused on children aged 0 to 18 and aims at alleviating poverty and promoting school attendance particularly among teen-agers. This paper presents an ex-ante evaluation on the effects of this reform on teenager school attendance, poverty, inequality and adult labour supply. Our ex-ante estimated effects indicate that teenage school attendance rates may increase by six to eight percentage points as a result of the new program, and that this change in school attendance shows a progressive pattern. The program also significantly reduces extreme poverty, and to a lesser extent, the intensity and severity of poverty. Effects on poverty incidence and inequality are of small magnitude. Finally, the transfer may influence adult labor supply, inducing a reduction of work hours for household heads and spouses. |
| Keywords: | Impact Evaluation, Conditional Cash Transfers, School Attendance, Poverty, Inequality |
| JEL: | I38 I32 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:lvl:pmmacr:2010-07&r=lab |
| By: | Jonathan Potter; Marco Marchese |
| Abstract: | This paper is written in the context of a coalition government in the Welsh Assembly which is committed to full employment (defined as an employment rate of 80%) based on quality jobs. At the outset it should be noted that not all activities relevant to the subject matter of this report have been devolved to the Welsh Assembly. Though the Assembly has powers relating to education and training it does not have responsibility for employment issues. It should also be emphasised that the Welsh Assembly has introduced many new policies and strategies and has recently integrated bodies such as Education and Learning Wales (ELWa) and the Welsh Development Agency into Government Departments. This report considers the transferability of ten policy audits focusing on specific policy interventions in different OECD countries in the fields of labour market participation, skills development and economic and physical regeneration. First, it considers the main policy challenges for Wales in relation to the labour market. It then examines evidence of policy gaps in the current approach of the Welsh Assembly Government. This leads on to an assessment of the policy options that might be considered in relation to the challenges facing Wales. The next section attempts to consider the potential role of the reviewed initiatives in filling these gaps. A final section draws conclusions and makes some policy recommendations. |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:oec:cfeaaa:2010/7-en&r=lab |