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on Labour Economics |
| By: | Anne Busch; Elke Holst |
| Abstract: | The study analyses the gender pay gap in private-sector management positions in Germany based on data from the German Socio-Economic Panel Study (SOEP) for the years 2001-2008. It focuses in particular on gender segregation in the labor market, that is, on the unequal distribution of women and men across different occupations and on the effects of this inequality on earnings levels and gender wage differentials in management positions. Our paper is, to our knowledge, the first in Germany to use time-constant unobserved heterogeneity and gender-specific promotion probabilities to estimate wages and wage differentials for persons in managerial positions. The results of the fixed effects model show that working in a more “female” job, as opposed to a more “male” job, affects only women’s wages negatively. This result remains stable after controlling for human capital endowments and other effects. Mechanisms of the devaluation of jobs not primarily held by men also negatively affect pay in management positions (evaluative discrimination) and are even more severe for women (allocative discrimination). However, the effect is not linear; the wage penalties for women occur only in “integrated” (more equally male/female) jobs as opposed to typically male jobs, and not in typically female jobs. The devaluation of occupations that are not primarily held by men becomes even more evident when promotion probabilities are taken into account. An Oaxaca/Blinder decomposition of the wage differential between men and women in management positions shows that the full model explains 65 percent of the gender pay gap. In other words: Thirty-five percent remain unexplained; this portion reflects, for example, time-varying social and cultural conditions, such as discriminatory policies and practices in the labor market. |
| Keywords: | Gender pay gap, managerial positions, gender segregation, glass-ceiling effects, Oaxaca/Blinder decomposition, fixed effects, selection bias |
| JEL: | J31 J16 J24 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp357&r=lab |
| By: | BELLOU Andriana; KAYMAK Baris |
| Abstract: | This paper examines the cyclical behavior of hours and wages in a unique panel of 11 European countries, and documents signi?cant history dependence in wages. Workers who experience favorable market conditions during their tenure on the job, have higher wages, and work fewer labor hours. Unobserved differences in productivity, such as varying job quality, or match-speci?c productivity are not likely to explain this variation. The results instead point to the importance of contractual arrangements in wage determination. In economies with decentralized bargaining practices, such arrangements resemble self-enforcing insurance contracts with onesided commitment (by the employer). On the other hand, in countries with strong unions and centralized wage bargaining, wage behavior is better approximated by full-commitment insurance contracts. |
| Keywords: | Business Cycles; Wage Rigidity; Implicit Contracts |
| JEL: | E32 J31 J41 |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:irs:cepswp:2011-13&r=lab |
| By: | Margherita Comola (PSE - Paris-Jourdan Sciences Economiques - CNRS : UMR8545 - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole des Ponts ParisTech - Ecole Normale Supérieure de Paris - ENS Paris - INRA, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris); Luiz De Mello (OECD - Economics Department - Paris - OECD) |
| Abstract: | This paper uses household survey (Sakernas) data from 2004 to estimate the determinants of earnings in Indonesia, a country where non-salaried work is widespread and where earnings data are available for salaried employees only. We deal with the selection bias by estimating a full-information maximum likelihood system of equations, where earnings are observed for salaried employees, and selection into the labour market is modelled in a multinomial setting. We also deal with reverse causality between educational attainment and earnings by instrumenting years of schooling in both the multinomial selection and the earnings equations. Our identification strategy, following Duflo (2001), uses information on exposure to a large-scale school construction programme implemented in the 1970s. Duflo recognizes that schooling may affect an individual's probability of working as a salaried employee, which creates a simultaneity bias, but does not directly deal with this issue. We find that the parameters of the earnings equation estimated under multinomial selection differ from standard OLS estimates, which ignore the selection bias, and from a binomial selection procedure "à la Heckman" (1979). In particular, the estimated parameters that vary the most are those related to the variables with the strongest impact on individual selection into the different labour-market statuses. We also find that workers with higher educational attainment are most likely to find a job as salaried employees, and that non-salaried work is as an alternative to inactivity. |
| Keywords: | Indonesia ; employment ; earnings ; multinomial selection |
| Date: | 2010–02 |
| URL: | http://d.repec.org/n?u=RePEc:hal:psewpa:halshs-00564835&r=lab |
| By: | Andrea Bassanini (ERMES - Equipe de recherche sur les marches, l'emploi et la simulation - CNRS : UMR7017 - Université Panthéon-Assas - Paris II, IZA - Institute for the Study of Labor - IZA, OECD - OECD); Thomas Breda (PSE - Paris-Jourdan Sciences Economiques - CNRS : UMR8545 - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole des Ponts ParisTech - Ecole Normale Supérieure de Paris - ENS Paris - INRA, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris); Eve Caroli (PSE - Paris-Jourdan Sciences Economiques - CNRS : UMR8545 - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole des Ponts ParisTech - Ecole Normale Supérieure de Paris - ENS Paris - INRA, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris, EconomiX - CNRS : UMR7166 - Université de Paris X - Nanterre); Antoine Rebérioux (EconomiX - CNRS : UMR7166 - Université de Paris X - Nanterre) |
| Abstract: | We study the compensation package offered by family firms. Using matched employer-employee data for a sample of French establishments in the 2000s, we first show that family firms pay on average lower wages to their workers. This family/non-family wage gap is robust to controlling for several establishment and individual characteristics and does not appear to be due either to the differential of productivity between family and non-family firms or to unobserved establishment and individual heterogeneity. Moreover, it is relatively homogeneous across workers with different gender, educational attainment and age. By contrast, the family/non-family wage gap is found to be larger for clerks and blue-collar workers than for managers, supervisors and technicians, for whom we find no significant wage gap. As a second step, we investigate why workers stay in family firms while being paid less. We show that these firms offer greater job security. We find evidence that the rate of dismissal is lower in family than in non-family firms. We also show that family firms rely less on dismissals and more on hiring reductions when they downsize. These results are confirmed by subjective data: the perceived risk of dismissal is significantly lower in family firms than in non-family ones. We speculate that our results can be explained either by a compensating wage differential story or by a model in which workers sort in different firms according to their preferences. |
| Keywords: | family firms ; wages ; job security ; linked employer-employee data |
| Date: | 2010–11 |
| URL: | http://d.repec.org/n?u=RePEc:hal:psewpa:halshs-00564972&r=lab |
| By: | Böckerman, Petri; Bryson, Alex; Ilmakunnas, Pekka |
| Abstract: | Using nationally representative survey data for Finnish employees linked to register data on their wages and work histories we find wage effects of high involvement management (HIM) practices are generally positive and significant. However, employees with better wage and work histories are more likely to enter HIM jobs. The wage premium falls substantially having accounted for employees’ work histories suggesting that existing studies’ estimates are upwardly biased due to positive selection into HIM. Results do not differ significantly when using propensity score matching as opposed to standard regression techniques. The premium rises with the number of HIM practices and differs markedly across different types of HIM practice. |
| Keywords: | wages; high involvement management; high performance work system; incentive pay; training; team working; information sharing; propensity score matching |
| JEL: | M53 J31 J24 M12 M54 J33 M52 M50 |
| Date: | 2011–02–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:28711&r=lab |
| By: | Daniel F. Heuermann (Institute for Labour Law and Industrial Relations in the EC, University of Trier) |
| Abstract: | Inspired by the literature on the role of local career networks for the quality of labor market matches we investigate whether human capital externalities arise from a higher job matching efficiency in skilled regions. Using two samples of highly qualified workers in Germany we find that an increase in the regional share of highly qualified workers by one standard deviation is associated with between-job wage growth of about three percent and an increase in the annual probability of a job change of up to four percent. Wage gains are incurred only by workers changing jobs within industries. Consistently, workers in skilled regions are about fifty percent more likely to change jobs within rather than between industries. Taken together, these findings suggest that human capital externalities partly arise because workers in skilled regions have better access to labor market information, which allows them to capitalize on their industry-specific knowledge when changing jobs. |
| Keywords: | Human Capital Externalities, Job Matching |
| JEL: | D62 J24 J31 R11 |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:iaa:wpaper:201101&r=lab |
| By: | Thomas Breda (PSE - Paris-Jourdan Sciences Economiques - CNRS : UMR8545 - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole des Ponts ParisTech - Ecole Normale Supérieure de Paris - ENS Paris - INRA, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris) |
| Abstract: | In this paper, I study the wage differential between firms' union representatives and their coworkers using a linked employer-employee dataset. On the employee side of the data, the surveyed workers are asked if they are unionized but we do not know which unionized workers are union representatives. On the employer side of the data, I have access to the number of union representatives and unionized workers in each firm. I use this information to construct an indicator of the firm-level probability for a randomly drawn unionized worker to be union representative. This indicator is then used to split the directly observable wage differential between unionized and non-unionized workers into two differentials: one between union representatives and non-unionized workers and another one between unionized workers who are not a union representative and non-unionized workers. Estimates that control for individual characteristics and firm-level fixed effects show that union representatives' wages are 10% lower than those of other unionized workers and non-unionized workers. Additional tests suggest that this gap can be understood as the result of a non-cooperative strategic interaction between employers and union representatives. |
| Keywords: | unions ; wage differentials ; representative ; probability-based estimator |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:hal:psewpa:halshs-00564905&r=lab |
| By: | Vimefall, Elin (Department of Business, Economics, Statistics and Informatics) |
| Abstract: | This paper determines which children work and how much children work in Kenya. The results show that the educational level of the head of household is important, but it does not matter if the head has primary or higher education. Social norms have a strong effect on the child’s probability of working and access to the labor market is important. The overall finding is not consistent with the view that it is children from the poorest families who work. |
| Keywords: | Child labor; Education; Kenya |
| JEL: | D19 J22 J81 O12 |
| Date: | 2011–02–07 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:oruesi:2011_003&r=lab |
| By: | Leo Kaas (Department of Economics, University of Konstanz, Germany); Philipp Kircher (Department of Economics, London School of Economics and University of Pennsylvania, USA) |
| Abstract: | The introduction of firm size into labor search models raises the question how wages are set when average and marginal product differ. We develop and analyze an alternative to the existing bargaining framework: Firms compete for labor by publicly posting long-term contracts. In such a competitive search setting, firms achieve faster growth not only by posting more vacancies, but also by offering higher lifetime wages that attract more workers which allows to fill vacancies with higher probability, consistent with empirical regularities.The model also captures several other observations about firm size, job flows, and pay. In contrast to bargaining models, efficiency obtains on all margins of job creation and destruction, both with idiosyncratic and aggregate shocks. The planner solution allows a tractable characterization which is useful for computational applications. |
| Keywords: | Labor market search, multi-worker firms, job creation and job destruction |
| JEL: | E24 J64 L11 |
| Date: | 2011–01–20 |
| URL: | http://d.repec.org/n?u=RePEc:knz:dpteco:1101&r=lab |
| By: | Renato Aguilar (Departamento de Economía, University of Gothenburg, Sweden); Ruben Tansini (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República) |
| Abstract: | This paper aims at explaining the academic performance of a sample of children starting their first year at public schools in Montevideo, Uruguay, during 1999. We are mainly in- terested in the effect of preschool education on the children’s academic results. Previous probit and OLS estimations suggested that preschool education has a positive impact on short and long term school performance. However, these results could be biased because a rather strong endogeinity of the preschool education variable. We solved this problem us- ing bivariate probit and treatment effects estimations. The results confirmed the bias and suggested that our previous estimations underestimated the positive effect of preschool educations. Thus, we found fairly strong empirical evidence suggesting that preschool education has a short and long term positive effect on these children’s results |
| Keywords: | preschool education, school results, bivariate probit, treatment effects, Uruguay |
| JEL: | I21 |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:3310&r=lab |
| By: | M. DUMONT; G. RAYP; P. WILLEMÉ |
| Abstract: | This paper extends the assessment of the impact of globalization on the bargaining power of employees by taking worker heterogeneity into account. In contrast with previous studies, two separate unions - representing low-skilled and high-skilled workers respectively - are considered. Using Belgian firm-level data, labour bargaining power and relative wage preference have been estimated by skill level. Subsequently regressing these estimates on a set of potential determinants, the bargaining power of low-skilled workers appears to fall with imports and offshoring, whereas the bargaining power of high-skilled workers remains unaffected. In addition, a significant effect of globalization is found on the relative preference of unions for wages over employment, indicating that the effect of globalization on the behaviour of labour unions is more encompassing than frequently assumed. A positive impact of R&D intensity on the bargaining power of low-skilled workers is the only effect related to technological change that is found to be statistically significant. |
| Date: | 2010–11 |
| URL: | http://d.repec.org/n?u=RePEc:rug:rugwps:10/687&r=lab |
| By: | Thomas Breda (PSE - Paris-Jourdan Sciences Economiques - CNRS : UMR8545 - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole des Ponts ParisTech - Ecole Normale Supérieure de Paris - ENS Paris - INRA, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris) |
| Abstract: | In this paper, I study the wage premium associated with firm-level union recognition in France and show that this premium is due to a rent-extraction phenomenon. Using a large matched employer-employee dataset from a 2002 survey in France, I first estimate a series of wage determination models that control for individual and firm-level characteristics. I find that union recognition is associated with a 2-3% wage premium. To show that this premium results from a non-competitive phenomenon, I construct a bargaining model and estimate it empirically using a smaller but very detailed matched employer-employee dataset for 2004. The model predicts in particular that the wage premium obtained by unions should increase both with their bargaining power and with the amount of quasi-rents per worker available in the firms they organize. These predictions are validated empirically when I use the firms' market share as a proxy for their quasi-rents and the percentage of unionized as a proxy for the unions' bargaining power. All the results remain valid when I control for the firm-level workers' average productivity. |
| Keywords: | union wage premium ; rent sharing ; bargaining |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:hal:psewpa:halshs-00564903&r=lab |
| By: | Marisa Bucheli (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Graciela Sanromán (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República) |
| Abstract: | In this paper we analyze the racial wage gap in Uruguay in the period 2006-2009 using data from the Household Survey collected by INE (the National Statistics Institute). We select a sample of full-time men workers aged 25-59. We decompose the gap between log hourly-wages of Whites and Afro-descendants at the mean and at each percentile of the wage distribution using the distributional regression approach proposed in Chernozhukov et al. (2009). We find that Afro-descendants are paid less in all position of the wage distribution and that the gap increases from the median up. It is around 0.20 until the median and reaches 0.60 at percentile 90. The results from the decomposition show that both the gap that can be explained by selected characteristics (years of schooling, potential experience and region) and the residual widen at the upper tail of the distribution. |
| Keywords: | Wage gap, Afro-descendants, Discrimination, Counterfactual estimation |
| JEL: | C14 C21 D31 J31 J71 |
| Date: | 2010–10 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:1410&r=lab |
| By: | Clément Imbert (EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris) |
| Abstract: | This paper studies the labor market in Vietnam during the transition towards market economy (1993-2006): we show that the public-private sector wage gap markedly increased, but that wage inequality decreased overall. Our aim is to assess how much of this evolution can be explained by workers' productive skills and their allocation between sectors. We use a simple, yet innovative, method that allows us to take into account workers' unobservable characteristics and their remuneration in each sector. Throughout the period we consider, public sector workers are more skilled than private sector workers. However, rising returns to workers' skills in the public sector play a major role in the increase of the public-private sector gap. Against all expectations, the public sector grew richer as Vietnam moved towards market economy. Finally, a greater homogeneity among labor market participants seems to explain the overall decline in wage inequality. |
| Keywords: | transition ; inequality decomposition ; public sector |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-00564653&r=lab |
| By: | Gabrielle Demange (PSE - Paris-Jourdan Sciences Economiques - CNRS : UMR8545 - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole des Ponts ParisTech - Ecole Normale Supérieure de Paris - ENS Paris - INRA, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris); Robert Fenge (University of Rostock - University of Rostock, CESifo - CESifo) |
| Abstract: | This paper analyzes in a two-country model the impact of students' mobility on the country-specific level of higher educational quality. Individuals decide whether and where to study based on their individual ability and the implemented quality of education. We show that the mobility of students affects educational quality in countries and welfare in a very different way depending on the degree of return migration. With a low return probability, countries choose suboptimally differentiated levels of educational quality, or even no differentiation at all. |
| Keywords: | higher education ; migration ; tuition fees ; education quality ; vertical differentiation |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:hal:psewpa:halshs-00564912&r=lab |
| By: | Silvana Grosso (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República) |
| Abstract: | This paper analyzes key factors for educational success in vulnerable populations, using the experience of “Programa de Aulas Comunitarias” (PAC) of INFAMILIA-CES. This program –an institutional arrangement new for Uruguay- consists in formal and informal education based on OSC territorial experience. The objective is to attract teens who drop- out at the first year of lower secondary, with an emphasis on motivational, integration and interactional issues. By the estimation of probit models, we present evidence that such programs are successful in situations of educational failure at disadvantaged students, and that their teaching approach has relevance both in achievement and permanence in the system. Family involvement plays an important role in at student's performance. However, there exist some "hard core" of students that the program cannot retain, consisting mainly in those who work or perform tasks at home. It will be necessary to evaluate additional measures to reach all them. |
| Keywords: | school success, educational policies, disadvantaged students, Programa de Aulas Comunitarias (PAC) |
| JEL: | I28 |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:2510&r=lab |
| By: | Isis Gaddis (Georg-August-University Göttingen); Stephan Klasen (Georg-August-University Göttingen) |
| Abstract: | There is a sizable literature that claims that female labor force participation rates follow a U-shaped trend in the course of economic development. As the economy moves from an agrarian society with close linkages between household and market production to an industrial and service-based formal economy where the place of work and the household are separated, female labor force participation rates fall. Spurred by increases in education, fertility decline, and reduced barriers to female employment, female labor force participation rates increase in later stages of economic development. There has been some empirical support for this trend, largely based on cross-sectional and some panel analysis. In this note we use panel econometric methods, updated data sources, and important covariates to show that the finding of a feminization U is not robust and does not find confirmation when the best data and methods are used. This hypothesis should therefore no longer be treated as a generally accepted stylized fact. |
| Keywords: | Female Labor Force Participation; Economic Growth; Feminization U; Panel; GMM |
| JEL: | J16 J21 J22 O15 |
| Date: | 2011–02–08 |
| URL: | http://d.repec.org/n?u=RePEc:got:gotcrc:071&r=lab |
| By: | Philipp C. Bauer; Christoph A. Schaltegger |
| Abstract: | Is income equality a precondition for higher school performance and higher educational mobility? Or is the opposite true? We test empirically whether school performance and intergenerational transmission of educational attainment is depending on income equality on the local level. Using Swiss data, we take advantage of an exogenous variation across 2740 local municipalities. Our results point to a beneficial effect of income inequality on school performance for children with middle educated parents. In contrast, children with poorly educated parents as well as children with highly educated parents perform worse in more unequal communities. However, the popular idea that societies with a more equal income distribution inevitably enhance the upward mobility of disadvantaged children cannot be confirmed. |
| Keywords: | inequality; intergenerational transmission; mobility; educational attainment; income distribution; human capital |
| JEL: | I2 I21 I30 J24 D30 D31 D63 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:cra:wpaper:2011-03&r=lab |
| By: | Aysit Tansel (Middle East Technical University and Economic Research Forum (ERF) Cairo, Egypt); Fatma Bircan (Karaelmas University) |
| Abstract: | This paper investigates the male wage inequality and its evolution over the 1994-2002 period in Turkey by estimating Mincerian wage equations using OLS and quantile regression techniques. Male wage inequality is high in Turkey. While it declined at the lower end of the wage distribution it increased at the top end of wage distribution. Education contributed to higher wage inequality through both within and between dimensions. The within-groups inequality increased and between-groups inequality decreased over the study period. The latter factor may have dominated the former contributing to the observed decline in the male wage inequality over the 1994-2002. Further results are provided for the wage effects of experience, cohort effects, public sector employment, geographic location, firm size, industry of employment and their contribution to wage inequality. Recent increases in FDI inflows, openness to trade and global technological developments are discussed as contributing factors to the recent rising within-groups wage inequality. |
| Keywords: | Wage Inequality, Returns to Education, Quantile Regression, Turkey |
| JEL: | J31 J23 J24 I21 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:koc:wpaper:1102&r=lab |
| By: | J. HINDRIKS; M. VERSCHELDE; G. RAYP; K. SCHOORS |
| Abstract: | Educational tracking is a very controversial issue in education. The tracking debate is about the virtues of uniformity and vertical dierentiation in the curriculum and teaching. The pro- tracking group claims that curriculum and teaching better aimed at children's varied interest and skills will foster learning efficacy. The anti-tracking group claims that tracking systems are inef- cient and unfair because they hinder learning and distribute learning inequitably. In this paper we provide a detailed within-country analysis of a specific educational system with a long history of early educational tracking between schools, namely the Flemish secondary school system in Belgium. This is interesting place to look because it provides a remarkable mix of excellence and inequality. Indeed the Flemish school system is repeatedly one of the best performer in the international harmonized PISA tests in math, science and reading; whereas it produces some of the most unequal distributions of learning between schools and students. Combining evidence from the PISA 2006 data set at the student and school level with recent statistical methods, we show first the dramatic impact of tracking on social segregation; and then, the impact of social segregation on equality of educational opportunity (adequately measured). It is shown that tracking, via social segregation, has a major effect on inequality of opportunity. Children of dierent economic classes will have different access to knowledge. |
| Keywords: | tracking, ability grouping, educational performance, social segregation, inequality, PISA |
| JEL: | I28 H52 D63 |
| Date: | 2010–11 |
| URL: | http://d.repec.org/n?u=RePEc:rug:rugwps:10/690&r=lab |
| By: | Keisuke Kawata (Graduate School of Economics, Osaka University); Yasuhiro Sato (Graduate School of Economics, Osaka University) |
| Abstract: | This study develops an on-the-job search model involving spatial structure. In this model, workers are either employed and commuting frequently to a central business district (CBD) or unemployed and commuting less frequently to the CBD to search for a job. When an unemployed worker succeeds in off-the-job search, the quality of the job match is determined stochastically: a good match yields high-productivity whereas a bad match yields low-productivity. Although a high-productivity worker does not search for a new job, a lowproductivity worker decides whether to conduct an on-the-job search, which would require additional commuting to the CBD. Analysis of this model demonstrates that in equilibrium, the relocation path of workers corresponds to their career path, while welfare analysis demonstrates that such a spatial structure distorts firmsf decision regarding the posting of vacancies. |
| Keywords: | City structure; On-the-job search; Unemployment; Efficiency; Relocation and career paths; |
| JEL: | J64 R14 R23 |
| Date: | 2011–03 |
| URL: | http://d.repec.org/n?u=RePEc:osk:wpaper:1103&r=lab |
| By: | Clémence Berson (Centre d'Economie de la Sorbonne) |
| Abstract: | Discrimination models have diffivulties to study discrimination without assuming that prejudiced firms are more productive and results lead to workers' segregation. In this article, the model uses oligopsony and heterogeneity of workers' preferences to obtain a persistent discrimination. Firms hire both thpes of workers and pay a lower wage to the workers discriminated against whatever their taste for discrimination. A single prejudiced firm leads to a substancial wage gap in all firms. Consequently, the existence of discrimination allows a non-zero profit for unprejudiced firms and they have also no incentives to push out prejudiced firms. Moreover, the wage gap is affected by firms' spread out as well as by the number of prejudiced firms in the market. Government policies decrease the impact of taste for discrimination on wages but governments are not interested in. |
| Keywords: | Discrimination, oligopsony, wage gap. |
| JEL: | J42 J71 L13 |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:mse:cesdoc:11005&r=lab |
| By: | Luc Behaghel (Paris School of Economics (Inra)); Didier Blanchet (Insee-D3E); Thierry Debrand (IRDES institut for research and information in health economics); Muriel Roger (Paris School of Economics, Inra, Insee-D3E) |
| Abstract: | The French pattern of early transitions out of employment is basically explained by the low age at “normal” retirement and by the importance of transitions through unemployment insurance and early-retirement schemes before access to normal retirement. These routes have exempted French workers from massively relying on disability motives for early exits, contrarily to the situation that prevails in some other countries where normal ages are high, unemployment benefits low and early-retirement schemes almost non-existent. Yet the role of disability remains interesting to examine in the French case, at least for prospective reasons in a context of decreasing generosity of other programs. The study of the past reforms of the pension system underlines that disability routes have often acted as a substitute to other retirement routes. Changes in the claiming of invalidity benefits seem to match changes in pension schemes or controls more than changes in such health indicators as the mortality rates. However, our results suggest that increases in average health levels over the past two decades have come along with increased disparities. In that context, less generous pensions may induce an increase in the claiming of invalidity benefits partly because of substitution effects, but also because the share of people with poor health increases. |
| Keywords: | Pensions, Social Security, Disability, Early Retirement, Unemployment, Senior. |
| JEL: | H55 J26 J14 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:irh:wpaper:dt38&r=lab |
| By: | B. COCKX; M. DEJEMEPPE |
| Abstract: | Since July 2004 the job search effort of long-term unemployed benefit claimants is monitored in Belgium. We exploit the discontinuity in the treatment assignment at the age of 30 to evaluate the effect of a notification sent at least 8 months before job search is verified. The threat of monitoring increases transitions to employment, but of lower quality. In the less prosperous region, Wallonia, the impact is smaller, despite of the presence of specific counseling for the notified workers, and more heterogeneous. Moreover, in this region, the threat induces women to substitute sickness for unemployment benefits. |
| Keywords: | evaluation, monitoring job-search, threat effect, regression-discontinuity, grouped data. |
| JEL: | J64 J65 J68 H43 |
| Date: | 2010–11 |
| URL: | http://d.repec.org/n?u=RePEc:rug:rugwps:10/685&r=lab |
| By: | Luc Behaghel (PSE - Paris-Jourdan Sciences Economiques - CNRS : UMR8545 - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole des Ponts ParisTech - Ecole Normale Supérieure de Paris - ENS Paris - INRA, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris, CREST - Centre de Recherche en Économie et Statistique - INSEE - École Nationale de la Statistique et de l'Administration Économique); David M. Blau (OSU - Ohio State University - Ohio State University) |
| Abstract: | We use a US Social Security reform as a quasi-experiment to provide evidence on framing effects in retirement behavior. The reform increased the full retirement age (FRA) from 65 to 66 in two month increments per year of birth for cohorts born from 1938 to 1943. We find strong evidence that the spike in the benefit claiming hazard at 65 moved in lockstep along with the FRA. Results on self-reported retirement and exit from employment are less clear-cut, but go in the same direction. The responsiveness to the new FRA is stronger for people with higher cognitive skills. We interpret the findings as evidence of reference dependence with loss aversion. We develop a simple labor supply model with reference dependence that can explain the results. The model has potentially important implications for framing of future Social Security reforms. |
| Keywords: | social security ; framing ; loss aversion ; retirement |
| Date: | 2010–11 |
| URL: | http://d.repec.org/n?u=RePEc:hal:psewpa:halshs-00564950&r=lab |
| By: | Rupayan Pal (Indira Gandhi Institute of Development Research); Bibhas Saha (University of East Anglia) |
| Abstract: | We examine whether the outcome of bargaining over wage and employment between an incumbent firm and a union remains efficient under entry threat. 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. |
| Keywords: | Efficient Bargaining, Entry Threat, Signalling, Inefficiency |
| JEL: | J51 L12 D43 J58 |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:ind:igiwpp:2010-016&r=lab |
| By: | Peter Huber (WIFO) |
| Abstract: | I describe the extent and structure of cross-border commuting in the EU 27 to show that this is important only in a small number of border regions with strong linguistic, historic or institutional ties. Cross-border commuters are mostly medium skilled, male manufacturing workers, who have higher over- but lower under-education rates than non-commuters, internal commuters and established migrants. These findings can mostly be attributed to cross-border commuters from the 12 new EU member countries. Cross-border commuters from the EU 15 have higher under- and lower over-education rates than non-commuters. |
| Keywords: | Commuting, Selection, Education-job Mismatch |
| Date: | 2011–02–08 |
| URL: | http://d.repec.org/n?u=RePEc:wfo:wpaper:y:2011:i:388&r=lab |
| By: | Renato Aguilar (Departamento de Economía, University of Gothenburg, Sweden); Ruben Tansini (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República) |
| Abstract: | The outcomes of the cohort of first year pupils of primary school of Montevideo in 1999 reveal effectiveness, efficiency and equity problems of the system. The pupils do not complete primary cycle on schedule, the worst results are obtained by those who attend to schools of unfavorable socioeconomic context and half fails to finish the school cycle on schedule. One of the actions to address these shortcomings was the expansion of public pre-school education. Previous work on the cohort, by probit and OLS estimates, confirmed that preschool education has had a positive impact on short and long term school performance. However, these estimates could be biased by endogeneity of the variable pre-school, which in this paper we try to remedy through bivariate probit and treatment effects models. These new results confirm that in previous estimation by probit and OLS models, we underestimated the positive impacts of preschool attendance both in the short and the long run. |
| Keywords: | preschool education, school results, bivariate probit, treatment effects, Uruguay |
| JEL: | I21 |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:3110&r=lab |
| By: | Marisa Bucheli (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Natalia Melgar (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Máximo Rossi (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Tom W. Smith (NORC, University of Chicago) |
| Abstract: | We examine the factors that shape job satisfaction and in particular, the direct and indirect effects of the educational level. Our motivation is based on extending a large body of researches that is focused on private sector data by employing a larger and widely heterogeneous set of micro-data and by including non-linear effects and indirect effects of education. Our dataset includes 25 countries and it comes from the 2007 survey carried out by the International Social Survey Program. We estimate a probit model which includes country-effects in order to control for specific environmental factors. Findings indicate that job satisfaction is negatively related to being male, living in a big city, the number of worked hours per week, and not being self-employed. We also find that age registers a non-linear impact and we provide evidence that individual educational level shows a positive effect but with a decreasing growth rate and also an indirect effect through earned income. |
| Keywords: | job satisfaction, cross-country research |
| JEL: | J28 J81 I31 Z13 |
| Date: | 2010–08 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:1110&r=lab |
| By: | Michael Siegenthaler (KOF Swiss Economic Institute, ETH Zurich, Switzerland) |
| Abstract: | Due to a widely spread distrust in the signalling value of school grades, Swiss employers require external, standardized aptitude test results when recruiting new apprentices. However, the predictive quality of such test results has never been thoroughly researched. Therefore, this case study analyses whether external aptitude tests can improve the quality of predicting success in apprenticeship training. I find that such information is a) not correlated with school grades at the end of compulsory schooling but b) does not add information that would explain either the success in VET schooling (school grades in the first and second year of apprenticeship training), the probability of unexcused vocational school absences or the likelihood of a premature ending of the apprenticeship contract. |
| Keywords: | Apprenticeship, hiring, aptitude test, predictive validity, screening |
| JEL: | I21 J24 M51 M53 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:kof:wpskof:11-270&r=lab |
| By: | Beleva, Iskra |
| Abstract: | The study analyses the trends in the development of flexible forms of work organization in Bulgaria since its transition to market economy. It concentrates on different forms of part time work and temporary contracts, as well as on the development of new forms as telework, home work, self-employment, etc. The analysis of the flexible contractual and working time arrangements shows that the process of introducing and promoting new forms of employment and working time patterns undergoes development through significant diversification of the existing regulatory frameworks and their practical implementation. However, the role of the flexible forms as a “buffers” related to labour mobility in and out the labour market is still insignificant. The study draws out a number of recommendations for the further development of flexible contractual relationships and working hours so as to improve the labour force utilization and capacity. |
| Keywords: | flexible form of employment; full time; part time employment; permanent and temporary contracts; self-employment; home work; telework; labour flows in and out of the labour market |
| JEL: | J62 J41 |
| Date: | 2010–06–15 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:28709&r=lab |
| By: | Borooah, Vani / K |
| Abstract: | This paper argues that social exclusion robs people of their "confidence" and this loss adversely affects their capacity to function effectively. We may not be able to define confidence precisely but we know it when we have it and also when we lack it. In a “just” society, no group should unfairly suffer from a “confidence deficit” or enjoy a “confidence surplus”. However, affirmative action policies to boost a deprived group's employment rate suffer from several defects. In particular, they may have only a small effect (as with Dalits in India) when the group's educational base is low. Consequently, another prong of policy could, indeed should, focus on improving the educational standards of Dalits. The root of the problem of poor Dalit achievement lies in the many dysfunctional primary and secondary schools in the villages and towns of India. Admittedly, tackling the problem at its roots will only yield results after a long delay. Nor does the emphasis on effective learning at school carry the glamour associated with being a putative graduate of the Indian Institute of Technology, the Indian Institute of Management, or the All-India Medical Institute. But, before the vast mass of educationally and economically deprived children in India (many of whom are Dalits) can meaningfully enter the portals of Universities and Institutes of Higher Education they need to go to good schools. |
| Keywords: | Dalits; Discrimination; Social Exclusion; Deprivation |
| JEL: | J71 J15 K31 |
| Date: | 2010–12–25 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:28668&r=lab |
| By: | Zenou, Yves (Stockholm University and Research Institute of Industrial Economics (IFN), Sweden, and GAINS) |
| Abstract: | The aim of this paper is to provide a new mechanism based on social interactions explaining why distance to jobs can have a negative impact on workers’ labor-market outcomes, especially ethnic minorities. Building on Granovetter’s idea that weak ties are superior to strong ties for providing support in getting a job, we develop a model in which workers who live far away from jobs tend to have less connections to weak ties. Because of the lack of good public transportation in the US, it is costly (both in terms of time and money) to commute to business centers to meet other types of people who can provide other source of information about jobs. If distant minority workers mainly rely on their strong ties, who are more likely to be unemployed, there is then little chance of escaping unemployment. It is therefore the separation in both the social and physical space that prevents ethnic minorities finding a job. |
| Keywords: | Weak ties; labor market; social networks; land rent |
| JEL: | A14 J15 R14 Z13 |
| Date: | 2011–02–04 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sunrpe:2011_0005&r=lab |
| By: | Tjasa Loga; Saso Polanec; |
| Abstract: | The choice of college major is one of the most important decisions students make. In this paper we study the impact of ability on college major choice,using a data set for full-time students enrolled in four-year business and economics programs offered by the Faculty of Economics, University of Ljubljana. We distinguish between general and major-specific ability, which measure different dimensions of cognitive ability. We show that both measures are important in explaining individual decisions and that misleading results can follow from observing only commonly employed general ability. We also find important gender differences as males are more likely to base their major choice on the ability to complete coursework, while females are more likely to decide according to unobserved preferences. |
| Keywords: | College Majors, Ability, Gender Differences |
| JEL: | I23 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:lic:licosd:27411&r=lab |
| By: | Madalozzo, Regina; Bortoluzzo, Adriana Bruscato |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:ibm:ibmecp:wpe_223&r=lab |
| By: | Yamamura, Eiji |
| Abstract: | Using individual level data (the Japanese General Social Survey), this paper aims to explore how interaction between genders contributes to the cessation of smoking in Japan, where females are distinctly less inclined to smoke than males. Controlling for various socioeconomic factors and selection bias, I find through a Heckman-type selection estimation that rates of female employment in workplaces are negatively associated with male smoking but not with female smoking. These results suggest that male smokers are more inclined to cease smoking when they are more likely to have contact with nonsmokers of the opposite sex. Overall, this empirical study provides evidence that the psychological effect of the presence of people in one’s surroundings has a direct significant effect upon smoking behavior. However, this effect is observed only among males and not females. |
| Keywords: | Female labor participation; Labor market; Smoking behavior |
| JEL: | Z13 I10 |
| Date: | 2011–02–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:28698&r=lab |
| By: | Andrew E. Clark (PSE - Paris-Jourdan Sciences Economiques - CNRS : UMR8545 - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole des Ponts ParisTech - Ecole Normale Supérieure de Paris - ENS Paris - INRA, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris, IZA - Institute for the Study of Labor - IZA) |
| Abstract: | The degree to which workers identify with their firms, and how hard they are willing to work for them, would seem to be key variables for the understanding of both firm productivity and individual labour-market outcomes. This paper uses repeated cross-section ISSP data from 1997 and 2005 to consider three of measures of worker commitment. There are enormous cross-country differences in these commitment measures, which are difficult to explain using individual- or job-related characteristics. These patterns do, however, correlate with some country-level variables. While unemployment and inflation are both associated with lower commitment to an extent, economic and civil liberties are positively correlated with worker effort and pride in the firm. |
| Keywords: | commitment ; reciprocity ; well-being |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:psewpa:halshs-00565205&r=lab |
| By: | B. HOFMANN; G. PEERSMAN; R. STRAUB |
| Abstract: | This paper explores time variation in the dynamic effects of technology shocks on U.S. output, prices, interest rates as well as real and nominal wages. The results indicate considerable time variation in U.S. wage dynamics that can be linked to the monetary policy regime. Before and after the "Great Inflation", nominal wages moved in the same direction as the (required) adjustment of real wages, and in the opposite direction of the price response. During the "Great Inflation", technology shocks in contrast triggered wage-price spirals, moving nominal wages and prices in the same direction at longer horizons, thus counteracting the required adjustment of real wages, amplifying the ultimate repercussions on prices and hence increasing inflation volatility. Using a standard DSGE model, we show that these stylized facts, in particular the estimated magnitudes, can only be explained by assuming a high degree of wage indexation in conjunction with a weak reaction of monetary policy to inflation during the "Great Inflation", and low indexation together with aggressive inflation stabilization of monetary policy before and after this period. This means that the monetary policy regime is not only captured by the parameters of the monetary policy rule, but importantly also by the degree of wage indexation and resultant second round effects in the labor market. Accordingly, the degree of wage indexation is not structural in the sense of Lucas (1976). |
| Keywords: | technology shocks, second-round effects, Great Inflation |
| JEL: | C32 E24 E31 E42 E52 |
| Date: | 2010–11 |
| URL: | http://d.repec.org/n?u=RePEc:rug:rugwps:10/691&r=lab |
| By: | Rafael Rofman (Human Development Department, Latin America and the Caribbean Regional Office (LCSHS), the World Bank); Leonardo Lucchetti (Human Development Department, Latin America and the Caribbean Regional Office (LCSHS), the World Bank); Guzmán Ourens (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República) |
| Abstract: | Pension systems’ performance around the world can be usually assessed by considering three dimensions: coverage, adequacy, and sustainability. This paper focuses on the coverage dimension, looking at empirical data in Latin America. It represents a review and expansion of a previous analysis (such as Rofman and Carranza, 2005), as it corrects a few methodological problems and expands the timeframe. Data were available for 18 countries, for a period that starts in the early 1990s to the mid 2000s. Recognizing the difficulties involved in comparing the available information, the paper presents a group of similar indicators that make it possible to measure coverage in the various countries, both among active workers and among the elderly. In addition, several socio-demographic characteristics of the covered population are presented and discussed, identifying relevant differentials. The covariates taken into account in the study are: age, geographical areas, sector of employment, level of education, gender, occupation, firm size, and income quintiles. |
| Keywords: | Coverage, Pension Systems, Latin America. |
| JEL: | I38 J14 J26 |
| Date: | 2010–04 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:0510&r=lab |
| By: | Beshears, John (Stanford University); Choi, James J. (Yale School of Management); Laibson, David (Harvard University); Madrian, Brigitte C. (Harvard Kennedy School) |
| Abstract: | We describe the pension plan features of the states and the largest cities and counties in the U.S. Unlike in the private sector, defined benefit (DB) pensions are still the norm in the public sector. However, a few jurisdictions have shifted towards defined contribution (DC) plans as their primary savings plan, and fiscal pressures are likely to generate more movement in this direction. Holding fixed a public employee's work and salary history, we show that DB retirement income replacement ratios vary greatly across jurisdictions. This creates large variation in workers' need to save for retirement in other accounts. There is also substantial heterogeneity across jurisdictions in the savings generated in primary DC plans because of differences in the level of mandatory employer and employee contributions. One notable difference between public and private sector DC plans is that public sector primary DC plans are characterized by required employee or employer contributions (or both), whereas private sector plans largely feature voluntary employee contributions that are supplemented by an employer match. We conclude by applying lessons from savings behavior in private sector savings plans to the design of public sector plans. |
| JEL: | G23 G28 H76 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:11-013&r=lab |
| By: | German Cubas (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República. Banco Central del Uruguay.) |
| Abstract: | I document differences in labor supply between a set of Latin American countries and the U.S, in the period 1990-2005. These differences are mostly explained by large differ-´ ences in female labor supply. In the U.S. the female labor force participation was 69% by 1990, while in Brazil and Mexico was 39% and 37%, respectively. Females began to participate more in the labor market of these countries when more households acquired access to basic infrastructure and when distortive policies affecting the price of household appliances were partially removed. I use a model of home production with endogenous labor force participation to account fore these facts. I conclude that the price of household appliances and access to infrastructure are quantitatively important in explaining cross-country labor supply differences. |
| Keywords: | Labor Force Participation, Latin America, Policy Distortions, Household Appliances. |
| JEL: | O11 O14 O33 |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:3510&r=lab |
| By: | Rei, Claudia |
| Abstract: | The different organizational structure of the Portuguese and Dutch merchant empires affected their ability to monitor workers. I test the theoretical implications of these differences using micro data of overseas workers' compensation from the sixteenth to the eighteenth century. The two merchant empires used significantly different compensation structures: working for the king of Portugal corresponded to a higher bonus share of compensation on average than that of the Dutch East India Company. These results are consistent with theoretical implications and provide additional support to the historical evidence we have on the organizational structure of merchant empires. |
| Keywords: | Merchant Empires; Labor Compensation; Incentives; Monitoring |
| JEL: | N34 J33 |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:28712&r=lab |
| By: | Rossana Patrón (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Inés Terra (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República) |
| Abstract: | The paper discusses the links between skill requirements in the labour market and trade patterns using a CGE applied on the SAM 2005 for Uruguay. The results for alternative scenarios in the long term show that, the wage gap would widen should the pattern of trade growth follow the current trend; however, an enhanced demand of commodities would favour a reduction in the wage gap. The exercises provide insights on the economy-wide effects in the long term of the interaction of trade and accumulation of skills, and thus on the role of the current policy of development of human resources. |
| Keywords: | Trade, Skills. |
| JEL: | F16 F17 |
| Date: | 2010–06 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:0810&r=lab |
| By: | Cavapozzi, Danilo; Garrouste, Christelle; Paccagnella, Omar |
| Abstract: | Parental or socioeconomic background plays an important role in determining employment outcomes during the individual whole life-cycle. The extent to which individuals move (up or down) the social ladder relative to one¿s parents is known as inter-generational social mobility. In a relatively immobile society individual outcomes, such as education, occupation or incomes, tend to be strongly related to those of their parents. On the one hand, in less mobile societies human skills may be wasted or mis-allocated. On the other hand, the motivations, the effort, the individual productivity may be affected by the lack of equal economic opportunities. These in turn may affect the overall efficiency and growth potential of a country. The influence of parental socio-economic status on the descendants¿ education, incomes and occupation has been widely investigated in the literature (Solon, 2002; Corak, 2004; OECD, 2010). Even though no single indicator can summarize a so puzzling picture, a general pattern that emerges is that a group of countries (namely, Mediterranean countries) shows a low inter-generational social mobility, while another group of countries (for instance, Nordic countries) tends to be relatively mobile. In this contribution we exploit the richness of SHARELIFE information on household economic resources and social background of respondents at the age of 10 to investigate the relationship between their educational attainments, their labour market outcomes and the social environment where they grew up. |
| Keywords: | Retrospective survey; Childhood indicators; Human capital accumulation; Income inequalities |
| JEL: | E24 J24 |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:28729&r=lab |
| By: | Mario Pagliero (Department of Economics and Public Finance "G. Prato", University of Torino) |
| Abstract: | Entry into licensed professions requires meeting competency requirements, typically assessed through licensing examinations. In the market for lawyers, there are large differences in the difficulty of the entry examination both across states and over time. The paper explores whether the number and quality of individuals attempting to enter the profession (potential supply) affects the difficulty of the entry examination. The empirical results show that a larger potential supply leads to more difficult licensing exams and lower pass rates. This implies that licensing partially shelters the legal market from supply shocks. |
| Keywords: | occupational licensing, legal market, bar exam, minimum standards, entry regulation |
| JEL: | L4 L5 J44 K2 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:tur:wpaper:18&r=lab |
| By: | Gaetano Lisi (University of Cassino) |
| Abstract: | Recently, attempts have been made to formalize the assumptions of the ‘slippery slope’ framework about the effects of trust (in) and power (of) tax authorities on tax compliance. In this sense, the proposed theoretical work introduces the basic insights of the ‘slippery slope’ framework into the benchmark macroeconomic model of the labour market with tax evasion. The key result of this integration is the following: with the right mix of policy tools of deterrence and trust in tax authorities, a reduction in tax evasion may increase labour market tightness and decrease unemployment. |
| Keywords: | tax evasion, tax compliance, power and trust, job search theory |
| JEL: | H26 J64 K42 |
| Date: | 2011–02–06 |
| URL: | http://d.repec.org/n?u=RePEc:css:wpaper:2011-02&r=lab |
| By: | Dean Baker |
| Abstract: | This paper outlines a proposal for a default savings plan that is intended to provide an important supplement to retirement income for the bottom half of the workforce, most of whom have little other than Social Security to support themselves in retirement at present. Under the proposal, workers would make a default contribution of 3.0 percent on annual wages up to $40,000. They could opt out from this contribution if they choose. The contribution would be automatically turned into an annuity at retirement although workers would have the option to make a lump sum withdrawal after paying a modest penalty. The lowest income workers would get a modest contribution paid into the system by the government based on their earnings. This payment would be modeled along the lines of the Earned Income Tax Credit, with the payment increasing with earnings up to $8,000 and then phasing down to zero with earnings above $20,000. There would also be a match of savings that phases down to zero at $40,000. |
| Keywords: | social security, retirement |
| JEL: | H H5 H55 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:epo:papers:2011-03&r=lab |
| By: | Alvaro Forteza (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Guzmán Ourens (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República) |
| Abstract: | We present a new database of social security indicators for eleven Latin American countries designed to show how much they promise to pay in return to contributions. The indicators are based on micro-simulations according to existing norms. Our results indicate that most programs are progressive. In most programs, retirement ages do not have a sizeable impact on the rates of return, given the length of service. The length of service has a strong impact on the expected returns to contributions, mostly due to vesting period conditions. Because of this, several pension programs in Latin America may be exacerbating income risk. |
| Keywords: | Latin America, Social Security, Internal Rate of Return. |
| JEL: | H55 J14 J26 |
| Date: | 2010–10 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:1810&r=lab |
| By: | Quintas, Helena (University of Algarve); Gonçalves, José Alberto (University of Algarve) |
| Abstract: | School leadership has significant effects on the learning, development and academic success of the pupils and on the quality of educational organisations, so, to a large extent, the effectiveness of the school depends upon the way in which leadership is carried out. It is on this basis that we undertook our study which led in this article. In it we sought to characterise the leadership of schools and school clusters in the regions of the Algarve, Alentejo and Lisbon and Tagus Valley, globally and specifically, based on the analysis of the content of external evaluation reports produced by teams from the General Inspectorate of Education during the 2006/2007, 2007/2008 and 2008/2009 academic years. This analysis was carried out as part of the research project FSE/CED/83489/2008 under the responsibility of the Centre for Sociology Research and Studies from the Lisbon University Institute, the University of the Algarve and the Barafunda Association, and we were part of the respective research team. By analysing the data we have been able to establish a joint and per region “profile” of the leaderships in the schools and school clusters that were evaluated, although we onsider that their results cannot be extrapolated, given he imits in the wording of the valuation reports and the fact at these reports were produced by different teams from egion to region and even within the regions themselves |
| Keywords: | external evaluation of schools; external evaluation reports of schools; leadership of schools; exercising of leadership in schools |
| JEL: | I21 |
| Date: | 2010–12–30 |
| URL: | http://d.repec.org/n?u=RePEc:ris:cieodp:2010_011&r=lab |
| By: | Keefer, Philip; Khemani, Stuti |
| Abstract: | Does radio access improve public service provision? And if so, does it do so by increasing government accountability to citizens, or by persuading households to take advantage of publicly-provided services? Prior research has argued that citizens with greater access to mass media receive greater benefits from targeted government welfare programs, but has not addressed these questions for public services such as in education and health. Using unique data from Benin, this paper finds that literacy rates among school children are higher in villages exposed to signals from a larger number of community radio stations. The effect is identified based on a"natural experiment"in the northern communes of Benin where within-commune variation in village access to radio stations is exogenous to observed and unobserved village characteristics. In contrast to prior research, the authors find that this media effect does not operate through government accountability: government inputs into village schools and household knowledge of government education policies are no different in villages with greater access to community radio. Instead, households with greater access are more likely to make financial investments in the education of their children. |
| Keywords: | Education For All,Social Accountability,Population Policies,E-Business,Disability |
| Date: | 2011–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5559&r=lab |
| By: | Casarico, Alessandra (Bocconi University); Micheletto, Luca (Uppsala Center for Fiscal Studies); Sommacal, Alessandro (Faculty of Economics, University of Verona) |
| Abstract: | The paper characterizes the optimal tax policy and the optimal quality of day care services in a OLG model with warm-glow altruism where parental choices over child care arrangements affect the probability that the child becomes a high-skilled adult in a type-specific way. With respect to previous contributions, optimal tax formulas include type-specific Pigouvian terms which correct for the intergenerational externality in human capital accumulation. Our numerical simulations suggest that a public policy that disregards the effects of parental time on children's human capital entails a welfare loss that ranges from 0:2% to 5:7% of aggregate consumption. |
| Keywords: | optimal taxation; day care quality; intergenerational transmission of skills; early childhood environment; warm-glow |
| JEL: | H21 H23 J13 J22 J24 |
| Date: | 2011–02–04 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:uufswp:2011_003&r=lab |
| By: | MIKUCKA Malgorzata |
| Abstract: | Subjective well-being literature shows that higher unemployment rate corresponds to lower psychological cost of own unemployment. The goal of the paper is to deepen the understanding of this regularity by investigating the role played by the work ethics and the strength of family ties. I analyze the European Values Study data (2008) for 36 countries using multilevel regression methodology. First, starting from the “stigma hypothesis” I postulate that higher unemployment rate is associated with weaker work values, which correspond to less social pressure and feeling of guilt, in turn lowering the psychological cost of own unemployment. This is only partly supported by the data: whereas stronger work values lower the well-being of unemployed, the country work ethics has no effect. According to the second hypothesis, stronger family ties raise the well-being of the unemployed. This prediction is con?rmed: people living in countries with stronger family ties and those declaring stronger norms for family support suffer less from being unemployed. However, the strength of family ties does not mediate the link between unemployment rate and effect of own unemployment. Moreover, weaker family ties contribute to lower well-being of unemployed in western Europe. |
| Keywords: | well-being; unemployment; work ethics; work values; stigma hypothesis; family ties; inter-family support |
| JEL: | A13 J60 |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:irs:cepswp:2011-14&r=lab |
| By: | Francesco D'Amuri (Bank of Italy) |
| Abstract: | Exploiting two unexpected variations in sickness absence policy for civil servants in Italy, this paper assesses the relative importance of monitoring and monetary incentives in determining a basic measure of effort: presence at work. When stricter monitoring was introduced together with an average 20% cut in replacement rates for civil servants on short sick leave, sickness absence decreased by 26.4%, eliminating the wedge in absence rates with comparable private sector workers. The impact substantially decreased when a subsequent policy change brought back monitoring to the pre-reform level, while leaving monetary incentives untouched. Results are confirmed by a variety of robustness checks and are not driven by the presence of attenuation bias. No shift is detected in other types of absence as a consequence of the reforms. Given that sickness absence rates are higher in the public than in the private sector in the US and Western Europe as well, these results provide useful insights on how to draw a successful strategy for addressing absenteeism. |
| Keywords: | monetary incentives, monitoring, effort, sickness absence |
| JEL: | J32 J38 J45 |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:wptemi:td_787_11&r=lab |
| By: | Jørn Rattsø and Hildegunn E. Stokke (Department of Economics, Norwegian University of Science and Technology) |
| Abstract: | Accumulation of education and geographic concentration of educated people in cities are expected to generate urban income growth. New economic geography predicts income divergence across regions. We investigate the dynamic process of accumulating tertiary education and regional income growth in Norway during the past four decades. The expansion of smart cities goes along with catching up of education level in the periphery and overall the education levels converge. Income levels also are shown to converge in distribution analysis using Kernel functions and first order Markov chains. However, the movements in the income distribution are unrelated to the accumulation of education. The hypothesis of equal income transition probabilities across subgroups of regions with different increases in education cannot be rejected. We conclude that accumulation of education has not been important for the pattern of income growth. Catching up from low income is not driven by education and income growth has not taken off in cities with increasing education level. |
| Date: | 2011–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:nst:samfok:11211&r=lab |
| By: | James Burke; Gerald Epstein; Seung-Yun Oh |
| Abstract: | Burke, Oh, and Epstein focus on new measures of foreign outsourcing to track changes in the offshoring of manufacturing activity and to explore how offshoring along with other factors are related to the dramatic dislocation of workers in the US manufacturing sector in recent years. They present past studies that have explored the impact on workers of growing offshoring in manufacturing industries, introduce a new measure of imported inputs, and examine the growth of foreign outsourcing activity in manufacturing industries from 1987 to 2002. The authors present a counterfactual analysis as a way to show the loss of manufacturing industry employment resulting from rising foreign outsourcing between 1987 and 2005, and then explore the effect of foreign outsourcing on employment in US manufacturing industries for the period 1990 to 2005 using a regression analysis of industry data. |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:uma:periwp:wp249&r=lab |
| By: | Seonglim Lee |
| Abstract: | This study uses the 2003-2004 Consumer Expenditure Survey to assess costs incurred by dual-income, married-couple households. It finds that, compared to one-earner households with equal income and similar demographics, dual-earner households pay significantly more in tax, social security and private pension contributions but, except for families with pre-school children, do not have more work-related expenditures. The findings indicate a convergence of consumption patterns between one-earner and two-earner households. They also indicate that dual-earner households save more for retirement through pension plans. |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:ran:wpaper:830&r=lab |
| By: | Patuelli, Roberto; Schanne, Norbert (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Griffith, Daniel A.; Nijkamp, Peter |
| Abstract: | "The geographical distribution and persistence of regional/local unemployment rates in heterogeneous economies (such as Germany) have been, in recent years, the subject of various theoretical and empirical studies. Several researchers have shown an interest in analysing the dynamic adjustment processes of unemployment and the average degree of dependence of the current unemployment rates or gross domestic product from the ones observed in the past. In this paper, we present a new econometric approach to the study of regional unemployment persistence, in order to account for spatial heterogeneity and/or spatial autocorrelation in both the levels and the dynamics of unemployment. First, we propose an econometric procedure suggesting the use of spatial filtering techniques as a substitute for fixed effects in a panel estimation framework. The spatial filter computed here is a proxy for spatially distributed region-specific information (e.g., the endowment of natural resources, or the size of the 'home market') that is usually incorporated in the fixed effects parameters. The same argument applies for the spatial filter modelling of the heterogenous dynamics. The advantages of our proposed procedure are that the spatial filter, by incorporating region-specific information that generates spatial autocorrelation, frees up degrees of freedom, simultaneously corrects for time-stable spatial autocorrelation in the residuals, and provides insights about the spatial patterns in regional adjustment processes. We present several experiments in order to investigate the spatial pattern of the heterogeneous autoregressive parameters estimated for unemployment data for German NUTS-3 regions. We find widely heterogeneous but generally high persistence in regional unemployment rates." (author's abstract, IAB-Doku) ((en)) |
| Keywords: | Arbeitslosenquote, Persistenz, Schätzung, regionale Disparität |
| JEL: | C31 E24 E27 R11 |
| Date: | 2011–02–10 |
| URL: | http://d.repec.org/n?u=RePEc:iab:iabdpa:201103&r=lab |
| By: | Stark, Oded; Hyll, Walter; Wang, Yong |
| Abstract: | This paper considers a setting in which the acquisition of human capital entails a change of location in social space that causes individuals to revise their comparison groups. Skill levels are viewed as occupational groups, and moving up the skill ladder by acquiring additional human capital, which in itself is rewarding, leads to a shift in the individualâs inclination to compare himself with a different, and on average better-paid, comparison group, which in itself is penalizing. The paper sheds new light on the dynamics of human capital formation, and suggests novel policy interventions to encourage human capital formation in the aggregate and, at the same time, reduce inter-group income inequality. |
| Keywords: | Human capital formation, Skill levels as occupational groups, Interpersonal comparisons, Relative deprivation, Tax policy, Subsidization, Labor and Human Capital, D11, H24, H30, J24, |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:ags:ubzefd:99415&r=lab |