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on Labour Economics |
| By: | Chulhee Lee; Jinkook Lee |
| Abstract: | This paper explores how and why the probability of retirement differs between self-employed and wage-and-salary workers. It finds self-employed workers are less likely to retire than wage-and-salary ones, and that differences in retirement incomes, health, productivity, job characteristics, and compulsory retirement practices do not explain the disparity. This study suggests that the difference between self-employed and wage-and-salary workers in the quality of matching between the job and the worker (i.e., required and desired amount of work efforts) explains the later retirement of the self-employed. It notes the implications of these findings for labor-force participation at older ages and how policies might boost employment of the elderly. |
| Keywords: | Retirement, Self-employment, Employment, Aging, Job Flexibility |
| JEL: | J1 |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:ran:wpaper:834&r=lab |
| By: | Jaanika Meriküll |
| Abstract: | The paper investigates the dynamics of worker flows and the duration of different labour market states during the recent boom and bust of 2001-2010 in Estonia. We find that labour market adjustment has mostly taken place through massive worker reallocation, resulting in a high unemployment rate. Despite high worker flows from employment to unemployment, labour market mobility has fallen in many ways during the recession: job tenure and unemployment spells have increased, while job-to-job transitions and mobility across industries and occupations have fallen. The unemployed with the lowest level of education and non-Estonians have the lowest mobility to enter employment and run the highest risk of long-term unemployment. There is evidence of softer ways of adjustments to the crisis, where more workers are engaged in remote work, part-time work or jobs that do not match their skills. Internal migration has small potential to alleviate the high unemployment. The current crisis has hit the country more evenly across its regions than the Russian crisis did. Unemployment has increased similarly in all regions and unemployment inequality has dropped. Even so, there are some signs of marginalisation. The situation is worst in the north-eastern part of the country with unemployment hitting 25% |
| Keywords: | worker reallocation, unemployment and employment duration, business cycle |
| JEL: | J60 E32 J61 J62 J64 |
| Date: | 2011–02–22 |
| URL: | http://d.repec.org/n?u=RePEc:eea:boewps:wp2011-01&r=lab |
| By: | Peter McHenry (Department of Economics, College of William and Mary) |
| Abstract: | This paper provides new empirical evidence about how workers’ locations affect measurements of earnings inequality (and their changes over time) in the United States. Part of the inequality observed in any given U.S. sample is due to the fact that workers with different skills (and therefore earnings) are not distributed symmetrically across locations that are more and less productive (and therefore pay higher and lower wages). In particular, I estimate that a significant and rising proportion of the college wage premium is due to college graduates living in and moving toward higher-paying locations than high school graduates. Furthermore, I assess the impact of location on real wage inequality (adjusting for local costs of living). The higher wages that college graduates enjoy as a result of their location choices are mostly counterbalanced by higher costs of living. From this, I infer that college graduates choose to live in more economically productive labor markets than do workers with less education, but college graduates are not necessarily more capable of exploiting locational wage differences for their own advantage. |
| Keywords: | Earnings inequality, Migration, Regional labor markets |
| JEL: | J31 R23 J61 |
| Date: | 2011–02–21 |
| URL: | http://d.repec.org/n?u=RePEc:cwm:wpaper:112&r=lab |
| By: | Mazza, Jacopo (University of Amsterdam); van Ophem, Hans (University of Amsterdam); Hartog, Joop (University of Amsterdam) |
| Abstract: | We apply a recently proposed method to disentangle unobserved heterogeneity from risk in returns to education. We replicate the original study on US men and extend to US women, UK men and German men. Most original results are not robust. A college education cannot universally be considered an insurance against unpredictability of wages. One conclusion is unequivocally confirmed: uncertainty strongly dominates unobserved heterogeneity. |
| Keywords: | wage inequality, wage uncertainty, unobserved heterogeneity, selectivity, education, replication |
| JEL: | C01 C33 C34 J31 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5531&r=lab |
| By: | Asuyama, Yoko |
| Abstract: | This paper proposes a mechanism that links industry’s technological characteristics (i.e. quality of non-labor inputs, which is proxied by the length of industry production chains), industry-specific skill wage premium, and skill sorting across industries. It is hypothesized that high-skilled workers are sorted into industries where they can receive a higher skill wage premium, by working with better quality non-labor input. The quality of non-labor inputs is assumed to be worse in industries with longer production chains due to the increased involvement of low-skilled labor and poor infrastructure over the sequential production. By examining Indian wage and employment data for 1999-2000, empirical evidence to support this mechanism can be obtained: First, the skill wage premium is lower [higher] in industries with longer [shorter] production chains. Second, the skill wage premium is lower [higher] in industries with a higher [lower] proportion of low-skilled workers producing inputs outside their own industry. Third, the proportion of high-skilled workers is larger in industries with shorter production chains and lower ratio of low-skilled labor involved, i.e., a skill sorting trend can be observed. |
| Keywords: | India, Labor market, Wages, Manufacturing industries, Employment, Labor conditions, Industry wage, Production chains, Sequential production, Skill wage premium, Skill sorting |
| JEL: | J24 J31 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:jet:dpaper:dpaper278&r=lab |
| By: | Kampkötter, Patrick (University of Cologne); Sliwka, Dirk (University of Cologne) |
| Abstract: | We investigate wage differences between newly hired and incumbent employees. We show in a formal model that when employees care for wages as well as match-specific utility, incumbents earn less than new recruits if and only if firm-specific human capital is not too important. The existence and structure of these wage premia is then investigated empirically using detailed personnel data from a large number of banks. We find that, on average, new hires earn more than comparable incumbent colleagues on the same job. But the size of the wage premia varies between jobs and indeed strongly depends on a measure of human capital specificity. |
| Keywords: | wages, job mobility, wage premia, human capital, new hires |
| JEL: | J31 J44 J62 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5538&r=lab |
| By: | Paulo Bastos (Inter-American Development Bank and GEP, University of Nottingham); Natália P. Monteiro (Universidade do Minho - NIPE); Odd Rune Straume (Universidade do Minho - NIPE) |
| Abstract: | We examine the impact of privatisation on wage formation in unionised labour markets. Using longitudinal worker-firm data for Portugal spanning the period 1991-2007, we find that privatisation leads to higher wages, and show that this effect is driven by the fact that privatised firms tend to pay larger mark-ups on the union wage floor. These findings accord with a theoretical model in which actual paid wages are determined via sector-wide collective bargaining and firm-specific "fair-wage" policies, and where private ownership affects wage-setting incentives in both of these stages. |
| Keywords: | Privatisation, wage formation, trade unions. |
| JEL: | D21 J31 J51 L13 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:nip:nipewp:07/2011&r=lab |
| By: | Masaru Sasaki (Osaka University); Miki Kohara (Osaka University); Tomohiro Machikita (IDE-JETRO) |
| Abstract: | This paper estimates matching functions to measure search frictions in the Japanese labor market and presents determinants of search duration to explain the effect of unemployment benefits on a job seekerfs behavior. We employ administrative microdata that track the job search process of individuals who left or lost their job in August 2005 and subsequently registered at their local public employment service. Our finding is that the matching function would exhibit decreasing returns-to-scale for job seekers and vacancies, rather than constant return-to-scale. We also find that generous unemployment benefits lengthen (shorten) the duration of job search for job seekers who voluntarily (involuntarily) leave employment. |
| Keywords: | Job Search, Matching Model, Unemployment, Unemployment Benefits |
| JEL: | J64 J65 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:osk:wpaper:1107&r=lab |
| By: | Miki Kohara (Osaka School of International Public Policy, Osaka University); Masaru Sasaki (Institute of Social and Economic Research, Osaka University); Tomohiro Machikita (Institute of Developing Economies, Inter-disciplinary Studies Center, Japan External Trade) |
| Abstract: | This paper examines whether or not a prolonged unemployment period can raise the quality of job matching after unemployment. We focus on job tenure as an indicator of a good quality job match after unemployment. We match two sets of Japanese administrative data compiled by the public employment security offices: one includes information about the circumstances of job seekers receiving unemployment insurance, and the other includes information about job seekers applying for jobs. We first show a negative relationship between unemployment duration and the subsequent job duration. Restricting the sample to job seekers who lower their reservation wage in the final 59 days before expiration of unemployment insurance, we secondly show an even greater negative effect of unemployment duration on the following job duration. The importance lies not only in the duration of unemployment. If job seekers keep a high reservation wage because of the benefits of unemployment insurance, and lower it in response to the expiration of insurance, prolonged unemployment will result in short job duration after unemployment. |
| Keywords: | job search, quality of job match, unemployment duration, unemployment insurance |
| JEL: | J64 J65 J68 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:osp:wpaper:11e001&r=lab |
| By: | Leuven, Edwin (CREST (ENSAE)); Oosterbeek, Hessel (University of Amsterdam) |
| Abstract: | This paper surveys the economics literature on overeducation. The original motivation to study this topic were reports that the strong increase in the number of college graduates in the early 1970s in the US led to a decrease in the returns to college education. We argue that Duncan and Hoffman’s augmented wage equation – the workhorse model in the overeducation literature – in which wages are regressed on years of overschooling, years of required schooling and years of underschooling is at best loosely related to this original motivation. We discuss measurement and estimation issues and give an overview of the main empirical findings in this literature. Finally we given an appraisal of the economic lessons learned. |
| Keywords: | mismatch, overschooling, underschooling, wage equation |
| JEL: | I2 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5523&r=lab |
| By: | Dale, Stacy (Mathematica Policy Research); Krueger, Alan B. (Princeton University) |
| Abstract: | We estimate the monetary return to attending a highly selective college using the College and Beyond (C&B) Survey linked to Detailed Earnings Records from the Social Security Administration (SSA). This paper extends earlier work by Dale and Krueger (2002) that examined the relationship between the college that students attended in 1976 and the earnings they self-reported reported in 1995 on the C&B follow-up survey. In this analysis, we use administrative earnings data to estimate the return to various measures of college selectivity for a more recent cohort of students: those who entered college in 1989. We also estimate the return to college selectivity for the 1976 cohort of students, but over a longer time horizon (from 1983 through 2007) using administrative data. We find that the return to college selectivity is sizeable for both cohorts in regression models that control for variables commonly observed by researchers, such as student high school GPA and SAT scores. However, when we adjust for unobserved student ability by controlling for the average SAT score of the colleges that students applied to, our estimates of the return to college selectivity fall substantially and are generally indistinguishable from zero. There were notable exceptions for certain subgroups. For black and Hispanic students and for students who come from less-educated families (in terms of their parents’ education), the estimates of the return to college selectivity remain large, even in models that adjust for unobserved student characteristics. |
| Keywords: | return to higher education, college quality, payoff to college selectivity |
| JEL: | I21 J31 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5533&r=lab |
| By: | Bergemann, Annette (Department of Economics, University of Mannheimn); Caliendo, Marco (DIW Berlin); van den Berg, Gerard J. (IFAU - Institute forLabour Market Policy Evaluation); Zimmermann, Klaus F. (University of Bonn) |
| Abstract: | Labor market programs may affect unemployed individuals’ behavior before they enroll. Such ex ante effects may differ according to ethnic origin. We apply a novel method that relates self-reported perceived treatment rates and job search behavioral outcomes, such as the reservation wage or search intensity, to each other. We compare German native workers with migrants with a Turkish origin or Central and Eastern European (including Russian) background. Job search theory is used to derive theoretical predictions. We examine the omnibus ex ante effect of the German ALMP system, using the novel IZA Evaluation Data Set, which includes self-reported assessments of the variables of interest as well as an unusually detailed amount of information on behavior, attitudes and past outcomes. We find that the ex ante threat effect on the reservation wage and search effort varies considerably among the groups considered. |
| Keywords: | Immigrants; policy evaluation; reservation wage; search effort; expectations; unemployment duration; program evaluation; active labor market policy. |
| JEL: | C21 D83 D84 J61 J64 |
| Date: | 2011–02–07 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2011_004&r=lab |
| By: | Sanjay Chugh; Christian Merkl |
| Abstract: | We characterize efficient allocations and business cycle fluctuations in a labor selection model. Due to forward-looking hiring and labor supply decisions, efficiency entails both static and intertemporal margins. We develop welfare-relevant measures of marginal rates of transformation and efficiency along each margin that nest their counterparts in frictionless labor markets. In a calibrated version of the model, efficient fluctuations feature highly volatile unemployment and job-finding rates, in line with empirical evidence. We show analytically in a simplified version of the model that volatility arises from selection effects, rather than general equilibrium effects. We also develop sufficient conditions on wages, which are independent of the wage-determination process, that decentralize efficient allocations. Unlike the Hosios condition for matching models, there is no simple restriction on Nash bargaining that guarantees that Nash wages can support efficient allocations. Cyclical fluctuations in the Nash-bargaining economy display even larger amplification of productivity shocks into labor market outcomes than in the efficient economy, without extreme assumptions about bargaining shares, inflexibility of wages, or the size of surpluses that govern labor demand. The results establish normative and positive foundations for DSGE labor selection models |
| Keywords: | labor market frictions, efficiency, amplification, selection |
| JEL: | E24 E32 J20 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:kie:kieliw:1684&r=lab |
| By: | Faccini, Renato (Bank of England); Millard, Stephen (Bank of England); Zanetti, Francesco (Bank of England) |
| Abstract: | We estimate a New Keynesian model with matching frictions and nominal wage rigidities on UK data. We are able to identify important structural parameters, recover the unobservable shocks that have affected the UK economy since 1971 and study the transmission mechanism. With matching frictions, wage rigidities have limited effect on inflation dynamics, despite improving the empirical performance of the model. The reason is that with matching frictions, marginal costs depend on unit labour costs and on an additional component related to search costs. Wage rigidities affect both components in opposite ways leaving marginal costs and inflation virtually unaffected. |
| Keywords: | DSGE models; Bayesian estimation; labour market search; unemployment |
| JEL: | E24 E32 E52 J64 |
| Date: | 2011–02–21 |
| URL: | http://d.repec.org/n?u=RePEc:boe:boeewp:0408&r=lab |
| By: | Marx, Paul (IZA) |
| Abstract: | The paper addresses an often neglected question in labour market research: to which extent do outcomes aggregated on the national level disguise occupational diversity in employment conditions? In particular, how and why do occupational groups differ with regard to the incidence of non-standard employment? To explore these questions, the paper derives a detailed occupational scheme from the literature, capturing the variety of labour market outcomes within countries. In a second step, the scheme is theoretically linked to the topic of non-standard work. It is argued that different degrees of skill specificity across occupational groups produce diverging incentives for flexible and long-term employment, respectively. This leads to the expectation of (some) service-sector occupations showing stronger tendencies towards non-standard employment than those in the industrial sector. Based on European and German micro data, the categorisation is used to decompose various labour market indicators. The results clearly demonstrate the unequal incidence of non-standard employment along the lines of the suggested categorisation. Moreover, the longitudinal perspective suggests that traditionally functioning occupational groups will be crowded out by more destandardised ones. |
| Keywords: | temporary employment, low-pay, labour market dualisation, occupational groups, post-industrial labour markets, Germany |
| JEL: | J21 J24 J31 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5521&r=lab |
| By: | Christian Dustmann (CReAM, University College London); Albrecht Glitz (CReAM, Universitat Pompeu Fabra) |
| Abstract: | Sjaastad (1962) viewed migration in the same way as education: as an investment in the human agent. Migration and education are decisions that are indeed intertwined in many dimensions. Education and skill acquisition play an important role at many stages of an individual’s migration. Differential returns to skills in origin- and destination country are a main driver of migration. The economic success of the immigrant in the destination country is to a large extent determined by her educational background, how transferable these skills are to the host country labour market, and how much she invests into further skills after arrival. The desire to acquire skills in the host country that have a high return in the country of origin may also be an important reason for a migration. From an intertemporal point of view, the possibility of a later migration may also affect educational decisions in the home country long before a migration is realised. In addition, the decisions of migrants regarding their own educational investment, and their expectations about future migration plans may also affect the educational attainment of their children. But migration and education are not only related for those who migrate or their descendants. Migrations of some individuals may have consequences for educational decisions of those who do not migrate, both in the home and in the host country. By easing credit constraints through remittances, migration of some may help others to go to school. By changing the skill base of the receiving country, migration may change incentives to invest in certain types of human capital. Migrants and their children may create externalities that influence educational outcomes of non-migrants in the destination country. This chapter will discuss some of the key areas that connect migration and education. |
| Keywords: | Migration, Education, Human Capital, Return Migration, Immigrant Selection, Second-generation Immigrants. |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:201105&r=lab |
| By: | Denice Cavero; Verónica Montalva; José Rodríguez (Departamento de Economía- Pontificia Universidad Católica del Perú) |
| Abstract: | An approach to progress through school is relevant since it allows us to analyze a broad range of educational levels, if a student is able to progress to the next grade, if he or she repeats the grade, or if he or she drops out of school. Our aim is to determine which are the factors associated with these educational results in Peru, where access and continuance in school is still a worrying matter. Our methodology comprises the estimation of both probit and multinomial models. It is important to mention that both models provide very similar results among those results which are comparable. Among the different factors, adolescent and child labor stands out as a constant disadvantage for individuals seeking to stay in the educational system. This result is maintained throughout the educational levels. The study focused particularly on rural areas of Peru and within this area on gender inequality. In rural areas of Peru, educational transition from primary to secondary school is clearly a breaking point because the proportion of individuals who progress in this transition is significantly lower than in other transitions. The situation of rural women is very interesting. We find that although they have lower repetition probabilities during primary school, they have greater dropout probabilities in the primary-secondary transition, which can turn out to be more detrimental for their long-term education acquisition. Doing chores is one of the factors that more significantly affects rural women’s dropout rate in the primary-secondary transition. Also, being behind in school (being older than one’s classmates) has a greater negative effect on women than on men. Finally, adolescent pregnancy prevents women’s progress to a large extent during secondary school. Although we do not consider our results as conclusive, we do believe that they contribute to deepen the knowledge about the dynamic of progress through school in Peru. |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:pcp:pucwps:wp00309&r=lab |
| By: | Lindo, Jason M. (University of Oregon); Swensen, Isaac D. (University of Oregon); Waddell, Glen R. (University of Oregon) |
| Abstract: | We consider the effect of legal access to alcohol, which is known to increase drinking behavior, on academic performance. We first estimate the effect using an RD design but argue that this approach is not well-suited to the research question in our setting. Our preferred approach instead exploits the longitudinal nature of the data, essentially identifying the effect by comparing a student's academic performance before and after turning 21. We find that students' grades fall below their expected levels upon being able to drink legally, but by less than previously documented. We also show that there are effects on women and that the effects are persistent. The main results are robust to the inclusion of individual fixed effects, individual trends, and individual quadratics, in addition to other controls, that account for the expected evolution of performance as students make progress towards their degrees. |
| Keywords: | alcohol, post-secondary education, minimum legal drinking age |
| JEL: | I21 I18 K32 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5525&r=lab |
| By: | Dickson, Matt (University of Bristol); Smith, Sarah (University of Bristol) |
| Abstract: | The 1973 Raising of the School Leaving Age in England and Wales has been used to identify returns to years’ schooling. However, the reform affected the proportion with qualifications, as well as schooling length. To shed light on whether the returns reflect extra schooling or qualifications, we exploit another institutional rule – the Easter Leaving Rule – to obtain unbiased estimates of the effect of qualifications. We find sizeable returns to academic qualifications – increasing the probability of employment by 40 percentage points. This is more than 70% of the estimated return based on RoSLA, suggesting that qualifications drive most – but not all – of the returns to education. |
| Keywords: | returns to education, RoSLA, qualifications |
| JEL: | I21 I28 J24 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5524&r=lab |
| By: | Berlinschi, Ruxanda; Van Herck, Kristine; Swinnen, Johan F.M. |
| Abstract: | Agricultural employment in industrialized countries has been steadily decreasing despite important levels of farm subsidies. We argue that one explanation to this puzzle is the positive impact of subsidies on the education levels of farmersâ children. If farmers are credit constrained, they may underinvest in their childrenâs education. By increasing farmersâ revenues, subsidies increase investment in education. If more educated children are less willing to become farmers, one long term effect of subsidies is to reduce labor supply in the agricultural sector. We provide a theoretical model and some empirical evidence supporting this argument. |
| Keywords: | Agricultural Employment, Farm Subsidies, Education, Credit Constraints, Agricultural and Food Policy, Q12, Q18, I20, J62, |
| Date: | 2011–02–10 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa122:99424&r=lab |
| By: | Ruud Muffels; Bauke Kemperman |
| Abstract: | The study examines the effects of work orientations and work-leisure choices alongside the effect of genes or personality traits on subjective well-being (SWB). The former effects are assumed to be mediated by the match between women’s preferred and actual number of working hours indicating labor market and time constraints. Data come from 24 waves of the German (SOEP) Household Panel (1984-2007). Random and fixed-effect panel regression models are estimated. Work orientations and work-leisure choices indeed matter for women’s SWB but the effects are strongly mediated by the job match especially for younger birth cohorts and higher educated women. Therefore, apart from the impact of genes or personality traits preferences and choices as well as labor market and time constraints matter significantly for the well-being of women, providing partial support to the role (scarcity-expansion) theory and the combination pressure thesis while at the same time challenging set-point theory |
| Keywords: | Subjective well-being, set-point theory, life satisfaction, preference formation theory, role (scarcity-expansion) theory, job match, work-leisure choices, panel regression models |
| JEL: | I32 J21 J24 J64 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp361&r=lab |
| By: | Charles Kenny |
| Abstract: | There has been considerable progress constructing schools worldwide over the past 50 years, a lot of progress hiring teachers, and global improvement in enrollment rates, recently encouraged by the rollout of payments for attendance around the world. Nonetheless, while education requires schools, it also needs students to be in class, motivated and able to learn. And they need teachers who are skilled and resourced enough to teach, and those teachers need an incentive to instruct. There is considerable evidence that these prerequisites are not met with alarming frequency across the developing world. Tested methods to strengthen the link between schooling and learning include school choice, conditional cash transfers to students on the basis of attendance and scores, decentralization combined with published information on learning outcomes, and teacher pay based on attendance and performance. Nonetheless learning outcomes (and especially development impact) are primarily affected by the broader social and economic environment in which students live. This suggests a need for realism regarding what can be accomplished by education ministries and a focus on that broader environment – for example health and media interventions that might have considerable returns in learning. |
| Keywords: | education, learning, schooling |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:cgd:wpaper:236&r=lab |
| By: | Eliason, Marcus (IFAU - Institute for Labour Market Policy Evaluation) |
| Abstract: | This paper studies the earnings and employment consequences of involuntary job loss in Sweden during the crisis years of the 1990s among assistant and auxiliary nurses. These two occupational groups were by far those in the public sector that experienced the largest number of job losses. While public service employment traditionally has been perceived as secure and permanent, Sweden witnessed far-reaching restructuring of the public sector and job loss truly became a reality for public sector employees during these years. The estimates show an immediate annual earnings loss of on average about SEK 12 000 and long-term losses of SEK 5 000 per year. An analysis of the distributional effect shows that the job losses did not affect the whole earnings distribution but mostly the lower part. This suggests that a few bore the whole loss from downsizing but most went on unaffected at least considering earnings and employment. From a policy perspective this points to the importance to early identify these redundant workers and to develop targeted policies improving their situation instead of general policies to all redundant workers. |
| Keywords: | Job displacement; public sector; mass-layoff; earnings losses |
| JEL: | J45 J63 J65 |
| Date: | 2011–01–19 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2011_001&r=lab |
| By: | Makoto Nakajima |
| Abstract: | This paper measures the effect of extensions of unemployment insurance (UI) benefits on the unemployment rate using a calibrated structural model that features job search and consumption-saving decision, skill depreciation, UI eligibility, and UI benefit extensions that capture what has happened during the current downturn. The author finds that the extensions of UI benefits contributed to an increase in the unemployment rate by 1.2 percentage points, which is about a quarter of an observed increase during the current downturn (a 5.1 percentage point increase from 4.8 percent at the end of 2007 to 9.9 percent in the fall of 2009). Among the remaining 3.9 percentage points, 2.4 percentage points are due to the large increase in the separation rate, while the staggering job-finding probability contributes 1.4 percentage points. The last extension in December 2010 moderately slows down the recovery of the unemployment rate. Specifically, the model indicates that the last extension keeps the unemployment rate higher by up to 0.4 percentage point during 2011. |
| Keywords: | Unemployment insurance ; Unemployment |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedpwp:11-8&r=lab |
| By: | Forslund, Anders (IFAU - Institute for Labour Market Policy Evaluation); Fredriksson, Peter (Department of Economics, Stockholm University); Vikström, Johan (IFAU - Institute for Labour Market Policy Evaluation) |
| Abstract: | This paper discusses the case for expanding active labor market policy in recession. We find that there is reasonable case for relying more heavily on certain kinds of programs. The argument is tied to the varying size of the lock-in effect in boom and recession. If programs with relatively large lock-in effects should ever be used, they should be used in a downturn. The reason is simply that the cost of forgoing search time is lower in recession. We also provide new evidence on the relative effectiveness of different kinds of programs over the business cycle. In particular we compare an on-the-job training scheme with (traditional) labor market training. We find that labor market training is relatively more effective in recession. This result is consistent with our priors since labor market training features relative large lock-in effects. |
| Keywords: | Active labor market policy; business cycle; unemployment |
| JEL: | J08 J64 J68 |
| Date: | 2011–01–26 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2011_002&r=lab |
| By: | Jorge González-Chapela (Universidad de Alicante) |
| Abstract: | The predicted labor supply responses to variations in wages and prices are important for discussions of the economic efficiency of taxes and subsidies, and their extent may be also relevant to the analysis of economic fluctuations. This paper presents new estimates of the wage intertemporal substitution elasticity (ISE) for the intensive margin of female labor supply, and explores this margin’s sensitivity to price changes of goods consumed in recreation and home production activities. Our estimated wage ISE, .9, implies that, at average values for the allocation of time, female labor force participants will increase annual labor supply by some 14 hours when faced with a 1% grow in the wage rate. Of this increase, approximately 7 hours will come from less leisure and the other 7 from less home production. Keeping constant the price of home consumption goods, the intensive margin of female labor supply is unaffected by variations in recreation goods prices. We also estimate an elasticity of substitution between time and goods in home production of approximately 2. |
| Keywords: | female labor supply, intertemporal substitution, system GMM estimation |
| JEL: | J22 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:ivi:wpasad:2011-04&r=lab |
| By: | Christian Daude |
| Abstract: | Income is very unequally distributed in Latin America - but so too are opportunities for upward mobility. Early childhood development is a powerful mechanism to level the social playing field. More and better secondary education is key. Better administration of schools, combining greater flexibility with more accountability, a modern system of evaluation and incentives for school administrators and teachers are important ingredients for reforms. |
| Date: | 2010–11 |
| URL: | http://d.repec.org/n?u=RePEc:oec:devaac:92-en&r=lab |
| By: | Gema Zamarro |
| Abstract: | One of the most significant long term trends in the labor market in most OECD countries has been the increase in the proportion of working mothers. However, not all countries show the same pattern. Countries in Southern Europe (Italy, Greece and Spain) show an average participation rate of about 45% whereas the participation rates in Northern countries (Denmark, Sweden) are around 75%. The characteristics of child care systems also differ significantly across OECD countries. This along with the characteristics of the labor market may have led families to get the necessary social services in an alternative way, i.e. through grandmothers. This paper analyzes how and to what extent child care is provided by grandmothers and how this task is combined with paid work in 10 European countries. Moreover, it studies whether the child care provided by grandmothers is encouraging the labor participation of their sons and, especially, their daughters. For this aim, it uses a sample drawn from the Survey of Health, Aging and Retirement in Europe (SHARE) which provides detailed information about grandmothers (the units of observation) as well as their offspring with children. The econometric model considered takes into account the simultaneity of labor market decisions and care-giving activities, while controlling for unobserved heterogeneity in care-giving decisions. Here it exploits the fact that, information about multiple offsprings with children is usually available for each grandmother. It finds a negative and very significant effect of participating in the labor market on the probability of taking care of the grandchildren on a regular basis. It also finds evidence that, for some countries, the child care provided by grandmothers has a positive effect on the labor participation of their daughters. |
| Keywords: | Binary choice, Female labor participation, Child care decisions, Simultaneous estimation, Panel data |
| JEL: | J13 J21 C30 |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:ran:wpaper:833&r=lab |
| By: | Marcotte, Dave E. (University of Maryland, Baltimore County) |
| Abstract: | In this paper, I consider the impact of the expansion of exams students must pass in order to graduate high school on dropout rates. "Exit exams," as these tests are known, have become more common, and more difficult. These exams are controversial, with opponents claiming they drive marginal students out of school, and proponents arguing they align student interests with those of the school and encourage teachers and administrators to provide effort and resources on the students' behalf. I make use of the fact that when states implement exit exams, they first affect a specific graduating class. So in some states, some students in high school are required to pass these exams, while students in the grade above are not. Using a state-grade panel constructed from the Common Core of Data I find evidence that the recent expansion of exit exams has resulted in a modest increase in high school dropout rates in the aggregate, but a large increase among students in 12th grade, where additional attempts to pass exams are not possible. I also find that a policy often used to limit the impacts of exit exams on high school completion has only limited effect: Dropout rates in states where students can earn a diploma or credential even when unable to pass exit exams, dropout increases in 12th grade at about the same rate as in other states without such alternative pathways. This suggests that at least some of the impact is due to stop-out on the part of students. |
| Keywords: | high school dropout, exit exams, accountability, attainment |
| JEL: | I2 I28 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5527&r=lab |
| By: | Giménez, José Ignacio (University of Zaragoza); Molina, José Alberto (University of Zaragoza) |
| Abstract: | We analyze the causal effect of the length of the worker’s commute on worker's productivity, by examining whether commuting time has any effect on worker's labour market supply. Using the Spanish Time Use Survey 2002-03, our GMM/IV estimation yields a positive causal impact of commuting time on the time devoted to the labour market, with one hour of commuting increasing the time devoted to the labour market by 35 minutes in a working day. Our results shed light on the relationship between commuting and workers behaviour, since daily labour supply should be considered in theoretical models to provide a comprehensive view of commuter behaviour. |
| Keywords: | commuting, labour supply, productivity, causality, Time Use Survey |
| JEL: | R23 J22 J24 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5529&r=lab |
| By: | D. ISEBAERT; F. HEYLEN; C. SMOLDERS |
| Abstract: | In a number of papers A.J. Oswald (1996, 1997) argues that high rates of home ownership may imply inferior labour market outcomes. This paper tests the Oswald hypothesis in a panel of 42 Belgian districts since the 1970s. The use of data going back to 1970 allows us to embed the Oswald hypothesis in a broader model including other key determinants of employment like labour costs and productivity, the skill level of the population, and demography. Considering that ownership may be endogenous to (shocks in) employment, we use IV estimation methods. Overall, we find evidence in favour of the Oswald hypothesis. We observe that a 1 percentage point rise in the rate of home ownership in a district implies a statistically significant fall in the employment rate by about 0.3 percentage points. Our results underscore the importance of including other determinants of employment, of controlling for unobserved fixed regional and time effects, and of appropriately dealing with endogeneity. Disregarding these issues, as is often done in the macro labour literature, may imply very different estimation results. Additional estimation reveals that the size of the Oswald effect falls in the fraction of high skilled in a district. |
| Keywords: | employment, home ownership, Oswald hypothesis, Belgian regions, panel data |
| JEL: | E24 J61 J64 R23 |
| Date: | 2010–12 |
| URL: | http://d.repec.org/n?u=RePEc:rug:rugwps:10/695&r=lab |
| By: | Emery, Herb; Ferrer, Ana; Green, David |
| Abstract: | Tight labour markets driven by resource booms could increase the opportunity cost of schooling and crowd out human capital formation. For oil producing economies like the Province of Alberta, the OPEC oil shocks of 1973 to 1981 may have had an adverse long term effect on the productivity of the labor force if the oil boom resulted in workers reducing their ultimate investment in human capital rather than merely altering the timing of schooling. We analyze the effect of this decade long oil-boom on the long-term human capital investments and productivity for Alberta birth cohorts that were of normal schooling ages before, during and after the oil boom. Our findings suggest that resource booms may change the timing of schooling but they do not reduce the total accumulation of human capital. |
| Keywords: | Resource booms, long term human capital accumulation, OPEC oil crisis |
| JEL: | J24 I21 I22 |
| Date: | 2011–02–22 |
| URL: | http://d.repec.org/n?u=RePEc:ubc:clssrn:clsrn_admin-2011-5&r=lab |
| By: | Brandén, Maria (Department of Sociology, Stockholm University); Ström, Sara (Department of Sociology, Stockholm University) |
| Abstract: | The aim with this study is to examine how career possibilities in the man’s and the woman’s occupations – in the country as a whole, as well as in the region where the couple resides – affect heterosexual couples’ regional mobility. The context is Sweden –a country with a strong dual earner norm combined with a very sex segregated labor market. In the analyses we perform logistic regressions on Swedish register data, 1998–2007. We study how four dimensions of career possibilities affect couples’ geographical mobility and are interested in if their effect varies by gender. The dimensions are geographical wage differences, current career, occupational level and wage compression in occupations. In summary, our findings indicate that male and female career opportunities affect the couple in different ways when one moves beyond focusing on the level of their occupations. In particular the effect from wage compression in occupations seems to be dependent on gender, with a clear effect for men and no effect for women. Even when including measures of career opportunities within professions, there exist some non-egalitarian patterns in whose career couples adjust to. It hence seems as if couples adapt somewhat more to the man's career possibilities than the woman’s, even when we adjust for the underlying gender differences in career possi-bilities. |
| Keywords: | Regional mobility; internal migration; sex segregation; career; gender |
| JEL: | J16 R23 |
| Date: | 2011–02–07 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2011_003&r=lab |
| By: | Mary Daly; Bart Hobijn; Rob Valletta |
| Abstract: | The U.S. economy is recovering from the financial crisis and ensuing deep recession, but the unemployment rate has remained stubbornly high. Some have argued that the persistent elevation of unemployment relative to historical norms reflects the fact that the shocks that hit the economy were especially disruptive to labor markets and likely to have long lasting effects. If such structural factors are at work they would result in a higher underlying natural or nonaccelerating inflation rate of unemployment, implying that conventional monetary and fiscal policy should not be used in an attempt to return unemployment to its pre-recession levels. We investigate the hypothesis that the natural rate of unemployment has increased since the recession began, and if so, whether the underlying causes are transitory or persistent. We begin by reviewing a standard search and matching model of unemployment, which shows that two curves—the Beveridge curve (BC) and the Job Creation curve (JCC)—determine equilibrium unemployment. Using this framework, our joint theoretical and empirical exercise suggests that the natural rate of unemployment has in fact risen over the past several years, by an amount ranging from 0.6 to 1.9 percentage points. This increase implies a current natural rate in the range of 5.6 to 6.9 percent, with our preferred estimate at 6.25 percent. After examining evidence regarding the effects of labor market mismatch, extended unemployment benefits, and productivity growth, we conclude that only a small fraction of the recent increase in the natural rate is likely to persist beyond a five-year forecast horizon. |
| Keywords: | Unemployment ; Labor market |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedfwp:2011-05&r=lab |
| By: | de Haan, Monique (University of Amsterdam); Leuven, Edwin (CREST (ENSAE)); Oosterbeek, Hessel (University of Amsterdam) |
| Abstract: | A large school consolidation reform in the Netherlands changed minimum school size rules underlying public funding. The supply of schools decreased by 15 percent, but this varied considerably across municipalities. We find that reducing the number of schools by 10 percent increases pupils' achievement by 3 percent of a standard deviation. A reduction in the supply of schools implies, for a given number of pupils, an increase in average school size. We present evidence that in our context scale economies dominated the effects of choice and competition. This points to an often ignored trade-off between scale and competition. |
| Keywords: | school choice, competition, school consolidation, achievement, economies of scale |
| JEL: | I21 I22 H75 D40 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5528&r=lab |
| By: | Chang, Simon (Central University of Finance and Economics); Fleisher, Belton M. (Ohio State University); Kim, Seonghoon (Ohio State University); Liu, Shi-yung (Academia Sinica) |
| Abstract: | We estimate the effects of early childhood malaria exposure on education and health at older ages by exploiting variations in malaria exposure risk around birth that resulted from a universal malaria eradication campaign in colonial Taiwan in the early 20th century. We find that malaria exposure around birth leads to lower life-time educational attainment and to worse mental and physical health outcomes in old age as reflected in particular in worse cognitive function, a higher likelihood of cardiovascular diseases and a higher mortality hazard, compared to those who were not exposed. |
| Keywords: | malaria, early childhood, education, health, Taiwan |
| JEL: | I12 I18 I21 O15 O18 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5526&r=lab |
| By: | Vanzetti, David; Oktaviani, Rina |
| Abstract: | Trade negotiators are concerned about the possible negative effects of trade liberalisation on employment in specific sectors. The agricultural sector has characteristics that make it different from industrial or service sectors. These are an informal labour force, low productivity, relative absence of regulations and a tie to land. These characteristics help the sector adjust to trade shocks. In this application, a global computable general equilibrium model is used to determine trade shocks that are passed to a single country general equilibrium model to analyse employment and wage effects for four skills levels in Indonesian agriculture. Employment tends to move with output in the primary agricultural sector where capital-labour substitution is relatively low. However, factor substitution appears to be greater in the processed agricultural sector. The employment effects of trade shocks are quite small, with the possible exception of the highly protected sugar sector. Implications for trade and labour market policies are drawn. |
| Keywords: | Indonesia, agriculture, trade, employment, Agricultural and Food Policy, International Relations/Trade, F16, Q17, |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare11:100724&r=lab |
| By: | Tomi Kyyrä; Ralf A. Wilke |
| Abstract: | The retrospectively recalled calendar of activities in the European Community Household Panel is a prime resource for cross country analysis of unemployment experience. We investigate the reliability of these data and find that 26% of unemployed respondents misreported retrospectively their unemployment status in the subsequent interview. We observe large differences across countries: While the conditional probability of a successful recall is 96% in the UK, it is just 51% in Greece for a comparable individual. These evident data problems likely affect the results of cross country comparisons. |
| Keywords: | Recall error, unemployment, ECHP |
| JEL: | J64 C81 |
| Date: | 2011–01–31 |
| URL: | http://d.repec.org/n?u=RePEc:fer:wpaper:21&r=lab |
| By: | Zinovyeva, Natalia (IPP-CSIC); Bagues, Manuel F. (Universidad Carlos III de Madrid) |
| Abstract: | Several countries have recently introduced gender quotas in hiring and promotion committees at universities. This paper studies whether these policies increase the presence of women in top academic positions. The identification strategy exploits the random assignment mechanism in place between 2002 and 2006 in all academic disciplines in Spain to select the members of promotion committees. We find that a larger proportion of female evaluators increases the chances of success of female applicants to full professor positions. The magnitude of the effect is large: each additional woman on a committee composed of seven members increases the number of women promoted to full professor by 14%. Conversely, when committee members decide on promotions to associate professor positions, we do not observe any significant interaction between the gender of evaluators and the gender of candidates. If anything, in this case a larger share of female evaluators is associated with fewer successful female applicants. The evidence is consistent with the existence of ambivalent sexism. |
| Keywords: | academic promotion, gender discrimination, randomized natural experiment |
| JEL: | J71 J45 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5537&r=lab |
| By: | Ben Kriechel (Maastricht University and IZA Bonn); Samuel Muehlemann (University of Bern and IZA Bonn); Harald Pfeifer (Federal Institute for Vocational Education and Training (BIBB) Bonn); Miriam Schuette (Federal Institute for Vocational Education and Training (BIBB) Bonn) |
| Abstract: | We investigate the effects of works councils on apprenticeship training. The German law attributes works councils substantial information and co-determination rights on training-related issues. Thus, works councils may also have an impact on the cost-benefit relation of workplace training. Using detailed firm-level data containing information on the costs and benefits of apprenticeship training in Germany, we apply econometric matching methods to identify works council effects. We find that firms with works councils make a significantly higher net investment in apprenticeship training compared to firms without such an institution. However, we also find that the fraction of workers still employed with the same firm five years after training is significantly higher in the presence of works councils, enabling firms to recoup training investments over a longer time horizon. All works council effects, however, are much more pronounced for firms covered by collective bargaining agreements. |
| Keywords: | Works councils, collective bargaining agreement, apprenticeship training, firm-sponsored training |
| JEL: | J24 J50 M53 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:iso:educat:0057&r=lab |
| By: | Jennifer Foster |
| Abstract: | Do international students and/or students from non-English language speaking backgrounds (NESB students) perform worse than other students in Australian undergraduate classrooms? What happens to other students' marks when these students are added to classrooms? I provide new empirical evidence on these questions using very recent administrative panel data from the business faculties of two Australian Technology Network universities. Results show that both international students and NESB students perform significantly worse than other students, even controlling for selection into courses. Both effects are large and do not disappear after the first semester, but non-English speaking background predicts substantially more of a reduction in marks than international student status. Adding international NESB students to a tutorial leads to a reduction in the marks of English-speaking students in that tutorial, whereas the marks of all students benefit from the addition of domestic NESB students to tutorials.Finally, evidence of an upward buoying effect on marks is found from adding international NESB students to courses, which is likely due to the presence of grading on a curve at the course level, but this effect is only felt by international NESB students themselves. Logic suggests that this rise is unlikely to be due to a true learning effect, implying that on average, international NESB students' already low marks are inflated in courses with large fractions of such students. |
| Keywords: | higher education; Australia; peer effects; international students; NESB |
| JEL: | I23 J24 |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:swe:wpaper:2011-01&r=lab |
| By: | Millemaci, Emanuele; Sciulli, Dario |
| Abstract: | Applying a propensity score matching approach to UK National Child Development Study, we find that experiencing family difficulties during childhood determines a negative and long-lasting impact on adult employment probabilities and wage. Standard econometric techniques and simulation based sensitivity analysis support our findings. The intensity of the disadvantage appears to increase with the number of recorded family difficulties. Moreover, we find that housing and economic problems are responsible for the more serious disadvantage, while disability of family members and disharmony act statistically significantly only if associated with other problems. Finally, the effect appears not to decline over the cohort working life. |
| Keywords: | family difficulties; propensity score matching; labour market outcomes; simulation-based sensitivity analysis; long term causal effects |
| JEL: | J13 J12 C21 J0 |
| Date: | 2011–01–27 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:29026&r=lab |
| By: | Rebecca Morton (Department of Politics, New York University); Jean-Robert Tyran (Department of Economics, University of Vienna); Erik Wengström (Department of Economics, University of Copenhagen) |
| Abstract: | We find that cognitive abilities, educational attainment, and some personality traits indirectly affect ideological preferences through changes in income. The effects of changes in personality traits on ideology directly and indirectly through income are in the same direction. However, the indirect effects of cognitive abilities and education often offset the direct effects of these variables on ideological preferences. That is, increases in cognitive abilities and education significantly increase income, which reduces the tendency of individuals to express leftist preferences. These indirect effects are in some cases sizeable relative to direct effects. The indirect effects of cognitive abilities through income overwhelm the direct effects such that increasing IQ increases rightwing preferences. For ideological preferences over economic policy the indirect effects of advanced education also overwhelm the direct effects, such that individuals with higher education are more likely to express rightwing preferences than those with lower education. |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:kud:kuiedp:1108&r=lab |
| By: | Rita Da Costa; Juan Ramón de Laiglesia; Emmanuelle Martínez; Ángel Melguizo |
| Abstract: | Social protection coverage is quite low in Latin America. This situation, irrespective of the type of pension scheme, represents a challenge for public policy since these low levels of affiliation and irregular contribution histories indicate that pensions will be insufficient in the coming decades. This paper describes the relationship between pension protection and labour informality in Bolivia, Brazil, Chile and Mexico by income level, using several rounds of national household surveys. Our analysis highlights that labour formality is limited, even among the middle and the high income groups. Correspondingly, coverage rates (measured by contributors or affiliates over workers) range between 10% of the labour force in Bolivia to up to 62% in Chile. 76% of formal workers are covered on average, while coverage among the self-employed in agriculture is below 7%. Based on this prognosis, we discuss some alternative pension reforms.<BR>La couverture des pensions de retraite est relativement faible en Amérique latine. Indépendamment des types de systèmes de retraite, cette situation représente un défi pour les politiques publiques : aussi bien les faibles niveaux d’affiliation que les historiques de contribution irréguliers indiquent que les retraites des décennies à venir seront insuffisantes. Cet article décrit la relation existant entre les systèmes de couverture retraite et le phénomène d’informalité du marché du travail en Bolivie, au Brésil, au Chili et au Mexique, par niveau de revenu, et à partir des données d’enquêtes de ménage. L’analyse souligne le fait que le nombre de travailleurs formels est limité, et ce même parmi les groupes de revenus moyens et élevés. De même, les taux de couverture (mesurés par la proportion de contribuables ou d’affiliés par rapport au nombre total de travailleurs) varient de 10 % pour la force de travail en Bolivie, à 62 % au Chili. 76 % des travailleurs formels sont couverts en moyenne, tandis que parmi les travailleurs indépendants agricoles ce chiffre ne dépasse pas 7 %. En se basant sur ce pronostique, différentes alternatives de réformes de retraites sont examinées. |
| Keywords: | Latin America, informality, old-age pension, self-employment, pensions de retraite, Amérique latine, informalité, travailleurs indépendants |
| JEL: | H55 J32 O17 |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:oec:devaaa:295-en&r=lab |
| By: | Rolf Schenker (City of Zurich, Statistik, Switzerland); Martin Straub (KOF Swiss Economic Institute, ETH Zurich, Switzerland) |
| Abstract: | It is generally accepted that regional labor markets are characterized by strong interdependencies. However, only few studies include spatial elements to their estimations. Using the model framework proposed by Cliff and Ord (1973, 1981) and the estimation technique proposed by Kelejian and Prucha (1998), we estimate a spatial time series model for the Swiss cantonal unemployment rates on a quarterly level. Our model contains a spatial lag in the level and in the error term, as well as further exogenous explanatory variables. While both spatial lags turn out to be significant in our estimations, the dependency in the error term seems to be even stronger than the one in the level. |
| Keywords: | Regional Unemployment, Spatial Econometrics, Switzerland |
| JEL: | C31 C32 E24 R11 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:kof:wpskof:11-274&r=lab |
| By: | Ariizumi, Hideki; Schirle, Tammy |
| Abstract: | This study investigates the relationship between business cycle fluctuations and health in the Canadian context, given that a procyclical relationship between mortality rates and unemployment rates has already been well established in the U.S. literature. Using a fixed effects model and provincial data over the period 1977--â€2009, we estimate the effect of unemployment rates on Canadian age and gender specific mortality rates. Consistent with U.S. results, there is some evidence of a strong procyclical pattern in the mortality rates of middle--â€aged Canadians. We find that a one percentage point increase in the unemployment rate lowers the predicted mortality rate of individuals in their 30s by nearly 2 percent. In contrast to the U.S. data, we do not find a significant cyclical pattern in the mortality rates of infants and seniors. |
| Keywords: | Unemployment, Business Cycles, Health, Mortality |
| JEL: | I10 J20 E32 |
| Date: | 2011–02–22 |
| URL: | http://d.repec.org/n?u=RePEc:ubc:clssrn:clsrn_admin-2011-4&r=lab |
| By: | Ángel Melguizo |
| Abstract: | Informality remains pervasive in Latin American and Caribbean labour markets. Many "middle-sectors workers" (around the middle of the income distribution) are employed informally and contribute irregularly to a public or private pension. Governments should consider extending social pensions and stimulating (even financially, via defined matching contributions) individual savings. |
| Date: | 2010–11 |
| URL: | http://d.repec.org/n?u=RePEc:oec:devaac:91-en&r=lab |
| By: | Beuermann, Diether W. (Department of Economics, University of Maryland) |
| Abstract: | This paper provides evidence on the effects of access to telecommunications technologies on agricultural profitability and human capital investment decisions among highly isolated villages in rural Peru. I exploit a quasi-natural experiment, in which the Peruvian government through the Fund for Investments in Telecommunications (FITEL) provided at least one public (satellite) payphone to 6,509 rural villages that did not previously have any kind of communication services (either landlines or cell phones). The intervention provided these phones mainly between years 2001 and 2004. I show that the timing of the intervention was uncorrelated with baseline outcomes and exploit differences in timing using a uniquely constructed (unbalanced) panel of treated villages spanning the years 1997 through 2007. The main findings suggest that phone access generated increases of 16 percent in the value per kilogram received by farmers for their agricultural production, and a 23.7 percent reduction in agricultural costs. Moreover, this income shock translated into a reduction in child (6 – 13 years old) market work of 13.7 percentage points and a reduction in child agricultural work of 9.2 percentage points. Overall, the evidence suggests a dominant income effect in the utilization of child labor. |
| Keywords: | Telecommunications Technologies, Peru, Child Labor |
| JEL: | O1 O3 Q13 Q16 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:rbp:wpaper:2011-002&r=lab |
| By: | Adelaide Figueiredo (Faculty of Economics and LIAAD/INESC - Porto, University of Porto); Fernanda Figueiredo (Faculty of Economics, University of Porto and CEAUL); Natália P. Monteiro (Departament of Economics and NIPE, University of Minho); Odd Rune Straume (Departament of Economics and NIPE, University of Minho and University of Bergen) |
| Abstract: | We analyse the dynamics and evolution of the corporate restructuring process in the Portuguese banking sector, where 10 banks were privatised during the period 1989-1996. We apply a novel methodological approach in this context, using a multidimensional measure of restructuring that links product and labour market variables. We find evidence of considerable heterogeneity in the restructuring process, where firms adjust at different speeds and intensities. We also find that the wage level is by far the firm attribute that changed more, which is shown to reflect substantial changes in terms of composition, and not size, of the workforce. Our empirical evidence also suggests that privatisation is associated with a higher level of rent sharing. |
| Keywords: | Statis, Privatisation, Portuguese banking |
| JEL: | C49 D21 L33 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:por:fepwps:404&r=lab |
| By: | Asuyama, Yoko |
| Abstract: | This paper empirically examines the different comparative advantages of two emerging economic giants, China and India, in relation to the different skill distribution patterns in each country. By utilizing industry export data on China and India from 1983 to 2000, we find that a country with a greater dispersion of skills (i.e., India, especially in the earlier years) has higher exports in industries with shorter production chains, whereas a country with a more equal dispersion of skills (i.e., China, especially in the later years) is found to have higher exports in industries with longer production chains. The causal relationship is fairly robust across different specifications. This empirical evidence supports our assumption that the likely mechanism for these results is the negative impact of low-skilled workers on input quality, which accumulates and becomes larger as the length of production chains and the proportion of low-skilled workers in the economy increase. |
| Keywords: | China, India, Manufacturing industries, Manufactures, Labor productivity, Labor conditions, International competition, Exports, Comparative advantage, Production chains, Sequential production, Skill distribution |
| JEL: | F14 F16 J2 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:jet:dpaper:dpaper277&r=lab |
| By: | Bonsang, Eric (ROA, Maastricht University); Klein, Tobias J. (Tilburg University) |
| Abstract: | We provide an explanation for the common finding that the effect of retirement on life satisfaction is negligible. For this we use subjective well-being measures for life and domains of life satisfaction that are available in the German Socio-Economic Panel (GSOEP) and show that the effect of voluntary retirement on satisfaction with current household income is negative, while the effect on satisfaction with leisure is positive. At the same time, the effect on health satisfaction is positive but small. Following the life domain approach we then argue that these effects offset each other for an average individual and that therefore the overall effect is negligible. Furthermore, we show that it is important to distinguish between voluntary and involuntary retirement. The effect of involuntary retirement is negative because the adverse effect on satisfaction with household income is bigger, the favorable effect on satisfaction with leisure is smaller, and the effect on satisfaction with health is not significantly different from zero. These results turn out to be robust to using different identification strategies such as fixed effects and first differences estimation, as well as instrumental variables estimation using eligibility ages and plant closures as instruments for voluntary and involuntary retirement. |
| Keywords: | retirement, subjective well-being, satisfaction measurement |
| JEL: | J26 J14 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5536&r=lab |
| By: | Marcus Böhme; Rainer Thiele |
| Abstract: | Employing a unique dataset that covers households from six West African capitals, this paper provides new evidence on the demand for informal sector products and services. We first investigate whether demand linkages exist between formal and informal products and distribution channels, and whether there is an overlapping customer base, which would imply that both formal sector wage earners and informal workers buy both formal and informal products using both formal and informal distribution channels. In a second step, we estimate demand elasticities based on Engel curves. We find a strongly overlapping customer base and strong demand-side linkages between the formal and informal sector, with the exception that informal goods are hardly bought through formal distribution channels. The estimated demand elasticities tend to show that rising incomes are associated with a lower propensity to consume informal sector goods and to use informal distribution channels. We therefore conclude that the informal sector in West Africa is likely to be constrained from the demand side |
| Keywords: | Informal sector; formal-informal linkages; Engel curve estimates; West Africa |
| JEL: | D12 O17 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:kie:kieliw:1683&r=lab |
| By: | van den Berg, Gerard J. (IFAU - Institute for Labour Market Policy Evaluation); Lundborg, Petter (Lund University); Nystedt, Paul (Nyköping University); Rooth, Dan-Olof (Linnaeus University Kalmar) |
| Abstract: | We identify the ages that constitute critical periods in children’s development towards their adult health status. For this we use data on families migrating into Sweden from countries that are poorer, with less healthy conditions. Long-run health is proxied by adult height. The relation between siblings’ ages at migration and their heights after age 18 allows us to estimate the causal effect of conditions at certain ages on adult height. Moreover, we compare siblings born outside and within Sweden. We apply fixed-effect methods to a sample of about 9,000 brothers. We effectively exploit that for siblings the migration occurs simultaneously in calendar time but at different developmental stages (ages). We find some evidence for a critical period at age 9. The effects are stronger in families migrating from poorer countries but weaker if the mother is well-educated. |
| Keywords: | Early-life conditions; migration; parental education; adult health; height retardation; age; fetal programming; developmental origins |
| JEL: | F22 I10 I12 I18 I20 I30 J10 N30 |
| Date: | 2011–02–14 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2011_005&r=lab |
| By: | Salvioni, Cristina; Sciulli, Dario |
| Abstract: | We use a conditional difference-in-difference matching estimator and a 2003-2007 balanced panel drawn from the FADN Italian sample to evaluate the impact at the farm level of the implementation of the first Italian Rural Development Programme (RDP). We find that, in average, farms receiving at least a RDP payment increased family labor, while they did not increase total labour employed on farm. In addition, they experienced an increase in labor profitability and added value, even though the estimate significance varies accordingly to the matching method used. Our findings, suggest that the implementation of the first RDP produced a positive direct impact on rural GDP, while it did not prove to be effective in terms of rural employment growth. |
| Keywords: | Common Agricultural Policy, Rural Development Policy, conditional diff-in-diff matching, Agricultural and Food Policy, Q12, Q18, C14, |
| Date: | 2011–02–10 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa122:99421&r=lab |
| By: | Michael Landesmann (The Vienna Institute for International Economic Studies, wiiw); Robert Stehrer (The Vienna Institute for International Economic Studies, wiiw); Robert Hierländer; Peter Huber; Anna Iara; Klaus Nowotny; Mary O'Mahony; Fei Peng; Catherine Robinson |
| Abstract: | The literature on international migration has repeatedly emphasized that the extent and structure of migration has an important impact on the competitiveness of regions and countries. This report provides an overview of the extent and the potential effects of high-skill migration to the EU27. It shows how many high-skilled migrants live in the EU, where these migrants come from, and how the European Union is positioned in the international competition for talent. Second, we examine how high-skilled migrants fare in European labour markets. Finally we address the issue of the effects of high-skill migration on multifactor productivity, gross value added and GDP per capita growth as well as patenting activities at the sectoral and regional levels. We find that - despite substantial heterogeneity among individual EU countries - high-skilled foreign-born are an important source for high-skilled labour in the EU27. There was some evidence that - on average - EU OECD economies (EU) had a lower share of highly qualified migrants than the (arithmetic) average of the (high migration) non-EU OECD economies. However, our results also suggest that this increasing selectivity of immigration regimes is countered by a relatively low qualification structure of short-term migrants in the EU. A second important policy relevant finding of this study is that high-skilled migrants in the EU face a number of challenges when entering the European labour market, that make them distinct from other migrant groups such as less skilled migrants. In particular the high-skilled migrants - in contrast to less skilled migrants - have lower labour market participation rates, higher unemployment rates and lower employment rates than comparable natives and face substantially higher risks of being employed in jobs that do not fit their skill structure. Our analysis regarding the impact of migration and of high-skilled migration in particular on sectoral productivity and gross value added (levels and growth) yielded a number of interesting results though still being preliminary. Particularly interesting was the difference of the impact of the share of migrants in levels and growth specifications, as well as the importance of a break-down by different groups of migrants (from EU and RoW). There was also a relatively robust result of a positive impact of the share of high-skill migrants and of an interactive effect of high-skill migrant share and ICT technology. As regards the analysis of migrants and regional growth and regional technological development (proxied by patents per capita) we found a positive relationship between the share of high-skilled employed persons and of high-skilled migrants and the growth rate of regional GDP per capita. |
| Keywords: | migration patterns, high-skill migration, job mismatch, productivity effects |
| JEL: | J61 I21 J11 |
| Date: | 2010–11 |
| URL: | http://d.repec.org/n?u=RePEc:wii:rpaper:rr:365&r=lab |