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on Labour Economics |
| By: | Glocker, Daniela; Steiner, Viktor |
| Abstract: | Incentives to invest in higher education are affected by both the direct wage effect of human capital investments and the indirect wage effect resulting from lower unemployment risks and shorter spells in unemployment associated with higher educated. We analyse the returns to education in Austria, Germany, Italy, Sweden and the United Kingdom, countries which differ significantly regarding both their education systems and labour market structure. We estimate augmented Mincerian wage equations accounting for the effects of unemployment on individual wages using EU-SILC data. Across countries we find a high variation of the effect of education on unemployment duration. Overall, the returns to education are estimated to be the highest in the UK, and the lowest for Sweden. A wage decrease due to time spent in unemployment results in a decline in the hourly wages in Austria, Germany and Italy. |
| Keywords: | EU-SILC; returns to education; unemployment |
| JEL: | H42 I21 J31 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:8568&r=lab |
| By: | Johnston, David W. (Monash University); Lee, Wang-Sheng (RMIT University) |
| Abstract: | An explanation for the gender wage gap is that women are less able or less willing to 'climb the job ladder.' However, the empirical evidence on gender differences in job mobility has been mixed. Focusing on a subsample of younger, university-educated workers from an Australian longitudinal survey, we find strong evidence that the dynamics of promotions and employer changes worsen women's labour market position. |
| Keywords: | promotions, job changes, gender, wage gap |
| JEL: | J16 J33 J71 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5970&r=lab |
| By: | Raquel Carrasco (Universidad Carlos III); Juan F. Jimeno (Banco de España); A. Carolina Ortega (Universidad Nacional de Tucumán) |
| Abstract: | Despite a rapid decrease in unemployment and strong GDP and employment growth, real wages barely increased in Spain over the period 1995-2006. An explanation of this lack of growth may rely on employment composition effects derived from structural changes, such as the rise in the weights of employment in the construction and services sectors, the increase in female employment participation, and the arrival of large immigration inflows. Using data from three waves of the Structure of Earnings Survey, we break down observed wage changes into those due to varying worker and job characteristics and variations of the returns to those characteristics. Quantile regressions are used to estimate wage equations at different percentiles and to construct the counterfactual wage distributions that would have been observed had individual and job characteristics remain constant over time. Our main finding is that the lack of growth of Spanish real wages over the period 1995-2006 is mainly due to the decrease of returns to characteristics, specially education and labour market experience, which is more noticeable at the upper deciles of the wage distribution, and not to changes in employment composition, which when taken over a wide set of worker and job characteristics, had positive effects on wages. |
| Keywords: | keyword, Wage structure, quantile regressions, composition effects |
| JEL: | J31 J21 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:bde:wpaper:1120&r=lab |
| By: | Andrea Bassanini |
| Abstract: | I examine the effect of labour market policies and institutions on the transmission of macroeconomic shocks to the labour market, using both aggregate and industry-level annual data for 23 OECD countries, 23 business-sector industries and up to 29 years. I find that high and progressive labour taxes and generous unemployment benefits amplify labour income fluctuations. By contrast, statutory minimum wages reduce the difference in the sensitivity of wages to aggregate shocks between low-wage and high-wage industries. Dismissal regulations are found to mitigate the impact of shocks on both earnings and employment. Moreover, this mitigation effect is greater in industries where firms have a greater propensity to make staffing changes through dismissals. Stringent dismissal regulations also appear to reduce the counter-cyclicality of the earnings dispersion between high and low-educated labour. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:oec:elsaab:123-en&r=lab |
| By: | Antón, José Ignacio; Muñoz de Bustillo, Rafael |
| Abstract: | This work assesses the impact of the minimum wage on youth employment, unemployment and education enrolment in Spain. Using a difference-in-differences approach, we take advantage of the fact that the minimum wage for people aged 16 and 17 years old, which was approximately two thirds the level of the standard minimum wage, was raised to reach full convergence with the latter in a period of three years (from 1995 to 1998). The empirical analysis suggests that this policy intervention depressed the employment levels of the affected group, raised unemployment among them and decreased the probability of remaining in formal education. |
| Keywords: | minimum wage; Spain; difference-in-differences; employment |
| JEL: | J38 J24 J23 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:33488&r=lab |
| By: | Angela Cipollone; Marcella Corsi; Carlo D'Ippoliti |
| Abstract: | By considering the case of Italy we show that despite much rhetoric and expectations about the fact that women have gradually overcome men in terms of educational attainments, they still lack behind in terms of the main skills and competencies that can profitably be used in the market. On the one hand, women lack both general and specific knowledge related to the labour market, on the other hand the skills and competencies they acquire by carrying on unpaid work do not seem to be positively valued by the market. However, women also appear to exhibit higher returns to knowledge, both in terms of returns to education and of returns to work-related knowledge. Women’s employment is more determined by the joint impact of care burdens and knowledge-determined opportunities, and their wages are more significantly affected by our indicators of knowledge. More than for men, while specialisation improves “insider” women’s wages, it reduces “outsider” women’s ability to obtain a job. |
| Keywords: | gender differentials; returns to knowledge; human capital |
| JEL: | J24 J16 C43 J71 C14 |
| Date: | 2011–02–04 |
| URL: | http://d.repec.org/n?u=RePEc:dul:wpaper:2013/97186&r=lab |
| By: | Glenda Quintini |
| Abstract: | Ensuring a good match between skills acquired in education and on the job and those required in the labour market is essential to make the most of investments in human capital and promote strong and inclusive growth. Unfortunately, in the OECD on average, about one in four workers are over-qualified – i.e. they possess higher qualifications than those required by their job – and just over one in five are under-qualified – i.e. they possess lower qualifications than those required by their job. In addition, some socio-demographic groups are more likely than others to be over-qualified – notably, immigrants and new labour market entrants who take some time to sort themselves into appropriate jobs – or under-qualified – notably, experienced workers lacking a formal qualification for the skills acquired on the labour market… |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:oec:elsaab:120-en&r=lab |
| By: | Zsófia L. Bárány |
| Abstract: | While there has been intense debate in the empirical literature about the effects of minimum wages on inequality in the US, its general equilibrium effects have been given little attention. In order to quantify the full effects of a decreasing minimum wage on inequality, I build a dynamic general equilibrium model, based on a two-sector growth model where the supply of high-skilled workers and the direction of technical change are endogenous. I find that a permanent reduction in the minimum wage leads to an expansion of low-skilled employment, which increases the incentives to acquire skills, thus changing the composition and size of high-skilled employment. These permanent changes in the supply of labour alter the investment flow into R&D, thereby decreasing the skill-bias of technology. The reduction in the minimum wage has spill-over effects on the entire distribution, affecting upper-tail inequality. Through a calibration exercise, I find that a 30 percent reduction in the real value of the minimum wage, as in the early 1980s, accounts for 15 percent of the subsequent rise in the skill premium, 18.5 percent of the increase in overall inequality, 45 percent of the increase in inequality in the bottom half, and 7 percent of the rise in inequality at the top half of the wage distribution. |
| Keywords: | Minimum wage, education, technology, wage inequality |
| JEL: | E24 E65 J31 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1076&r=lab |
| By: | David J. Deming; Justine S. Hastings; Thomas J. Kane; Douglas O. Staiger |
| Abstract: | We study the impact of a public school choice lottery in Charlotte-Mecklenburg (CMS) on postsecondary attainment. We match CMS administrative records to the National Student Clearinghouse (NSC), a nationwide database of college enrollment. Among applicants with low-quality neighborhood schools, lottery winners are more likely than lottery losers to graduate from high school, attend a four-year college, and earn a bachelor’s degree. They are twice as likely to earn a degree from an elite university. The results suggest that school choice can improve students’ longer-term life chances when they gain access to schools that are better on observed dimensions of quality. |
| JEL: | H4 I2 I21 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:17438&r=lab |
| By: | Arnaud Chéron (GAINS - Université du Maine); Jean-Olivier Hairault (EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris, CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, IZA - Institute for the Study of Labor); François Langot (IZA - Institute for the Study of Labor, GAINS-TEPP - Université du Mans, CEPREMAP - Centre pour la recherche économique et ses applications) |
| Abstract: | This paper examines the age-related design of firing taxes by extending the theory of job creation and job destruction to account for a finite working life-time. We first argue that the potential employment gains related to employment protection are high for older workers, as they are magnified by the proximity to retirement. But higher firing taxes for these workers increase job destruction rates for the younger generations. Furthermore, from a normative standpoint, when firms cannot ex-ante age-direct their search, the impact of each generation of unemployed workers on the average return on vacancies makes the internalization of the search costs for the other generations imperfect through the ex-post Nash bargaining process. We show that the first best age-profile of firing taxes is typically hump-shaped, partially in contradiction with existing policies in some European countries. Taking into account the fact that the human capital of older workers is more specific than general tends to exacerbate these results. |
| Date: | 2011–09–14 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:hal-00623282&r=lab |
| By: | Marco de Pinto (University of Kassel); Jochen Michaelis (University of Kassel) |
| Abstract: | This paper analyzes how trade liberalization influences the unemployment rate of workers with different abilities. We refine the Melitz (2003) framework to account for trade unions and heterogeneous workers, who differ with respect to their abilities. Our main ?findings are: (i) high ability workers profit from trade liberalization in terms of higher wages and higher employment; (ii) the least efficient workers loose their job and switch to long-term unemployment (worker-selection effect); (iii) if a country is endowed with a large fraction of low-skilled workers, trade liberalization leads to a rise in aggregate unemployment. In this case, trade liberalization may harm a countrys welfare. |
| Keywords: | trade liberalization, trade unions, skill-specific unemployment |
| JEL: | F1 F16 J5 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:mar:magkse:201127&r=lab |
| By: | Frédéric Gavrel, University of Caen Basse-Normandie, France - CREM-CNRS |
| Abstract: | This paper reexamines the issue of the division of the labor force between the two sub-markets (formal and informal) of a developing economy. The formal sector is represented by a matching model with vertically differentiated workers. Assuming that firms hire their best applicants, we state that the formal sector is too small in terms of its labor force but too large in terms of job creation. Next we show that introducing a minimum wage increases the size of the formal sector with respect both to its labor force and to job creation. In accordance with the well-known paradox of Harris and Todaro, the enlargement of the formal market is accompanied by a rise in unemployment. However, when associated with a tax on job creation, the introduction of a minimum wage in the formal sector improves the efficiency of the labor market by making the formal sector more attractive to workers. |
| Keywords: | Formal and informal labor markets, applicant ranking, efficiency, minimum wage |
| JEL: | O17 J64 J68 |
| Date: | 2011–07 |
| URL: | http://d.repec.org/n?u=RePEc:tut:cremwp:201108&r=lab |
| By: | Pavel Ryska (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic); Jan Prùša (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic) |
| Abstract: | In this paper we tackle two shortcomings of present efficiency wage models. Firstly, they do not fully account for labour heterogeneity, thus implying that high-effort and low-effort units of labour are interchangeable. Secondly, building on this assumed homogeneity of labour, the models derive involuntary unemployment from effort decisions of workers, which are patently voluntary. We offer a consistent reformulation of the theory: Each of the effort or quality levels is regarded as a separate market which has its own clearing quantity and price. As such unemployment is a result of workers' reluctance to adjust to the prevailing market conditions on the respective labour sub-market. To further clarify heterogeneity in labour markets, we propose to employ the demand for workers' characteristics instead of the demand for workers. This microeconomic approach shows that in standard equilibrium employers will not choose among all workers but only select specific characteristic-types. Therefore to become attractive, an unemployed worker has to significantly alter either his wage or the bundle of offered characteristics. Both these modifications reinforce our central claim that free market interaction cannot lead to unemployment other than voluntary. |
| Keywords: | labour market; efficiency wages; involuntary unemployment; demand for heterogeneous goods. |
| JEL: | J64 J20 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:fau:wpaper:wp2011_28&r=lab |
| By: | Kuhn, Peter J. (University of California, Santa Barbara); Mansour, Hani (University of Colorado Denver) |
| Abstract: | While the Internet has been found to reduce trading frictions in a number of other markets, existing research has failed to detect such an effect in the labor market. In this paper, we replicate Kuhn and Skuterud's (2004) study – which found that Internet job search (IJS) was associated with longer unemployment durations in 1998/2000 – using comparable data from a decade later. We find that IJS now appears to be effective: it reduces individual workers' unemployment durations by about 25 percent. This finding is robust to controls for workers' AFQT scores and detailed indicators of Internet access. IJS appears to be most effective in reducing unemployment durations when used to contact friends and relatives, to send out resumes or fill out applications, and also to look at ads. We detect no effect of IJS on wage growth between jobs. |
| Keywords: | Internet, job search, unemployment, durations |
| JEL: | J64 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5955&r=lab |
| By: | Duncan, Brian (University of Colorado Denver); Trejo, Stephen (University of Texas at Austin) |
| Abstract: | Over the last several decades, two of the most significant developments in the U.S. labor market have been: (1) rising inequality, and (2) growth in both the size and the diversity of immigration flows. Because a large share of new immigrants arrive with very low levels of schooling, English proficiency, and other skills that have become increasingly important determinants of success in the U.S. labor market, an obvious concern is that such immigrants are a poor fit for the restructured American economy. In this chapter, we evaluate this concern by discussing evidence for the United States on three relevant topics: the labor market integration of immigrants, the socioeconomic attainment of the U.S.-born descendants of immigrants, and the impact of immigration on the wages and employment opportunities of native workers. We show that low-skilled immigrants have little trouble finding paid employment and that the wages they earn are commensurate with their skills. Overall, the U.S.-born second generation has achieved economic parity with mainstream society; for some Hispanic groups, however, this is not the case. Finally, we survey the pertinent academic literature and conclude that, on the whole, immigration to the United States has not had large adverse consequences for the labor market opportunities of native workers. |
| Keywords: | immigrant labor, assimilation, generational progress |
| JEL: | J61 J62 J68 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5964&r=lab |
| By: | Benjamin Elsner (Department of Economics, Trinity College Dublin); |
| Abstract: | This paper studies the impact of a large emigration wave on real wages in the source country. Following EU enlargement in 2004, a large share of the workforce of the Central and Eastern Europe emigrated to Western Europe. Using data from Lithuania for the calibration of a factor demand model I show that emigration had a significant short-run impact on real wages in the source country. In particular, emigration led to a change in the wage distribution between young and old workers. The wages of young workers increased by 6%, whereas the wages of old workers decreased by around 1%. On the contrary, I find no effect on the wage distribution between workers of different education levels. |
| Keywords: | Emigration, EU Enlargement, European Integration, Wage Distribution |
| JEL: | F22 J31 O15 R23 |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:tcd:tcduee:tep1311&r=lab |
| By: | Julia Reilich |
| Abstract: | Looking at smoking-behavior it can be shown that there are differences concerning the time-preference-rate. Therefore this has an effect on the optimal schooling decision in the way that we appear a lower average human capital level for smokers. According to a higher time-preference-rate additionally we suppose a higher return to education for smokers who go further on education. With our empirical findings we can confirm the presumptions. We use interactions-terms to regress the average rate of return with IV. Therefore we obtain that smokers have a significantly higher average return to education than non-smokers. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:pot:vwldis:103&r=lab |
| By: | Alejandro Justiniano; Claudio Michelacci |
| Abstract: | We set-up a real business cycle model with search and matching frictions driven by several shocks, which nests full Nash Bargaining and wage rigidity as special cases and includes other transmission mechanisms suggested by the literature for the propagation and amplification of disturbances. The model is estimated using full information methods for two Anglo-Saxon countries (the US and the UK), two Continental European countries (France and Germany) and two Scandinavian countries (Norway and Sweden). We conduct inference with mixed frequency data, combining quarterly series for unemployment, vacancies, GDP, consumption, and investment, with annual data on unemployment flows. Parameters and shocks are estimated separately for each country, which can then vary in terms of search and hiring costs, workers' bargaining power, unemployment benefits levels, wage rigidity and the stochastic properties of disturbances. Overall, the structural model accounts reasonably well for differences in labor market dynamics observed between the two sides of the Atlantic and within Europe. Our estimates indicate that there is considerable cross-country variation in the contribution of technology shocks to the cyclical fluctuations of the labor market. Technology shocks alone replicate remarkably well the volatility in vacancies, unemployment and finding probabilities observed in US, with mixed success in Europe. In contrast, matching shocks and job destruction shocks play a larger role in most European countries relative to the US. |
| JEL: | E0 E24 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:17429&r=lab |
| By: | Gábor Kézdi (Central European University, Nador u. 9, 1051 Budapest, Hungary; IEHAS and Magyar Nemzeti Bank.); István Kónya (Magyar Nemzeti Bank, 1054 Szabadság tér 8/9, 1850 Budapest and Central European University.) |
| Abstract: | This paper presents new evidence on the flexibility of the Hungarian labor market, with special emphasis on wages. The results are based on a new survey on wage setting among Hungarian firms. The survey is part of the Eurosystem Wage Dynamics Network (WDN), and it is a harmonized questionnaire administered in 17 countries in Europe, including almost all Euro Area countries as well as five Central and Eastern European countries. The survey results show that the Hungarian labor market, while institutionally flexible, appears to be surprisingly rigid. The survey evidence points to low turnover and possibly more rigid wages than previously thought. JEL Classification: C83, J01, J30. |
| Keywords: | Wage setting, survey, wage dynamics network, Hungary. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20111378&r=lab |
| By: | Pradhan, Menno; Suryadarma, Daniel; Beatty, Amanda; Wong, Maisy; Alishjabana, Armida; Gaduh, Arya; Artha, Rima Prama |
| Abstract: | This study evaluates the effect of four randomized interventions aimed at strengthening school committees, and subsequently improving learning outcomes, in public primary schools in Indonesia. All study schools were randomly allocated to either a control group receiving no intervention, or to treatment groups receiving a grant plus one or a combination of three interventions: training for school committee members, a democratic election of school committee members, or facilitated collaboration between the school committee and the village council, also called linkage. Nearly two years after implementation, the study finds that measures to reinforce existing school committee structures, the grant and training interventions, demonstrate limited or no effects; while measures that foster outside ties between the school committee and other parties, linkage and election, lead to greater engagement by education stakeholders and in turn to learning. Test scores improve in Indonesian by 0.17 standard deviations for linkage and 0.22 standard deviations for linkage+election. The election intervention alone leads to changes in time household members accompany children studying per week, but this does not lead to learning. Linkage is the most cost effective intervention, causing a 0.13 change in standard deviation in Indonesian test scores for each 100 dollars (US) spent. |
| Keywords: | Education For All,Tertiary Education,Primary Education,Teaching and Learning,Disability |
| Date: | 2011–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5795&r=lab |
| By: | Alan L. Gustman (Dartmouth College and NBER); Thomas L. Steinmeier (Texas Tech University); Nahid Tabatabai (Dartmouth College) |
| Abstract: | Studies using data from the early 1990s suggested that while the progressive Social Security benefit formula succeeded in redistributing benefits from individuals with high earnings to individuals with low earnings, it was much less successful in redistributing benefits from households with high earnings to households with low earnings. Wives often earned much less than their husbands. As a result, much of the redistribution at the individual level was effectively from high earning husbands to their own lower earning wives. In addition, spouse and survivor benefits accrue disproportionately to women from high income households. Both factors mitigate redistribution at the household level. This paper compares outcomes for the earlier cohort with those of a cohort born twelve years later. With greater growth in women's earnings, the aim of the study is to see whether, after the recent growth in two earner households, and the growth in women's labor market activity and earnings, the Social Security system now fosters somewhat more redistribution from high to low earning households. We use data from the Health and Retirement Study to study a population consisting of members of households with at least one person age 51 to 56 in either 1992 or in 2004. We use four different measures of redistribution: the ratio of the present value of benefits to taxes for households arrayed by decile of covered earnings; the fraction of total Social Security benefits redistributed from households with high earnings to those with low earnings; the share of total benefits paid to members of each cohort redistributed from households falling in the highest deciles of earners to those with lower covered earnings; and the rate of return to Social Security taxes for members with different amounts of covered earnings. Considering differences in earnings between cohorts, women enjoyed a more rapid growth of labor force participation, hours of work and covered earnings than men. This increased the redistribution of Social Security benefits among households. Nevertheless, a considerable gap remains between the labor market activities and earnings of women versus men. As a result, the Social Security system remains much less successful in redistributing benefits from households with high covered earnings to those with lower covered earnings than in redistributing benefits from individuals with high covered earnings to those with lower covered earnings. |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:mrr:papers:wp248&r=lab |
| By: | Kampelmann, Stephan (University of Lille 1); Rycx, Francois (Free University of Brussels) |
| Abstract: | Labour economists typically assume that pay differences between occupations can be explained with variations in productivity. The empirical evidence on the validity of this assumption is surprisingly thin and subject to various potential biases. The authors use matched employer-employee panel data from Belgium for the years 1999-2006 to examine occupational productivity-wage gaps. They find that occupations play distinct roles for remuneration and productivity: while the estimations indicate a significant upward-sloping occupational wage-profile, the hypothesis of a flat productivity-profile cannot be rejected. The corresponding pattern of over- and underpayment stands up to a series of robustness tests. |
| Keywords: | labour productivity, wages, occupations, production function, matched employer-employee data |
| JEL: | J24 J31 J44 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5951&r=lab |
| By: | Frédéric Gavrel, University of Caen Basse-Normandie, France - CREM-CNRS |
| Abstract: | In a circular matching model, firms rank their applicants and pick the best suited one. Job creation appears to lower the average output. As firms do not internalize this effect, jobs are too many in the laissez-faire equilibrium under the Hosios condition. Due to similar externalities firms' search intensities are too strong whereas workers' search intensities are too weak. |
| Keywords: | Matching, Differentiation of skills, Applicant ranking, Labor market, efficiency |
| JEL: | D8 J6 |
| Date: | 2011–02 |
| URL: | http://d.repec.org/n?u=RePEc:tut:cremwp:201107&r=lab |
| By: | Joanne Lindley; Stephen Machin |
| Abstract: | This paper considers what has hitherto been a relatively neglected subject in the wage inequality literature, albeit one that has been becoming more important over time, namely the role played by increases in postgraduate education. We document increases in the number of workers with a postgraduate qualification in the United States and Great Britain. We also show their relative wages have risen over time as compared to all workers and more specifically to graduates with only a college degree. Consideration of shifts in demand and supply shows postgraduates and college only workers to be imperfect substitutes in production and that there have been trend increases over time in the relative demand for postgraduate vis-à-vis college only workers. These relative demand shifts are significantly correlated with technical change as measured by changes in industry computer usage and investment. Moreover, the skills sets possessed by postgraduates and the occupations in which they are employed are significantly different to those of college only graduates. Over the longer term period when computers have massively diffused into workplaces, it turns out that the principal beneficiaries of this computer revolution has not been all graduates, but those more skilled workers who have a postgraduate qualification. This has been an important driver of rising wage inequality amongst graduates over time. |
| Keywords: | Wage inequality, postgraduate education, computers |
| JEL: | J24 J31 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1075&r=lab |
| By: | Garloff, Alfred (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Pohl, Carsten (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Schanne, Norbert (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]) |
| Abstract: | "In this paper we study the effect of small labor market entry cohorts on (un)employment in Western Germany. From a theoretical point of view, decreasing cohort sizes may on the one hand reduce unemployment due to 'inverse cohort crowding' or on the other hand increase unemployment if companies reduce jobs disproportionately. Consequently, the actual effect of cohort shrinking on (un)employment is an empirical question. We analyze the relationship between (un)employment and cohort sizes using a long panel of Western German labor market regions. In this context, we account for both the likely endogeneity of cohort size due to migration of the (young) workforce across regions using lagged births as instruments as well as for temporal and spatial autocorrelation. Our results provide good news for the (Western) German labor market: small entry cohorts are indeed likely to decrease the overall unemployment rate and thus to improve the situation of job seekers. Accordingly, with regard to the employment rate we find that it is positively affected by a decrease in the youth share." (Author's abstract, IAB-Doku) ((en)) |
| Date: | 2011–09–12 |
| URL: | http://d.repec.org/n?u=RePEc:iab:iabdpa:201118&r=lab |
| By: | Randall S. Jones |
| Abstract: | While Japan has achieved outstanding scores on the PISA exams, further improving educational outcomes is important to sustain growth in the face of rapid population ageing. The government should step up investment in early childhood education and care and integrate childcare and kindergarten to improve its quality, while allowing some diversity in the type of institutions. Upgrading tertiary education, in part through stronger competition and internationalisation, is also important to increase human capital and boost the role of universities in innovation. Given the serious fiscal situation, reforms to further raise the efficiency of educational spending per student, which is above the OECD average for public and private outlays combined, are needed. The large share of private education spending, which accounts for one-third of the total, places heavy burdens on families, thereby discouraging fertility, and creates inequality in educational opportunities and outcomes. Reducing dependence on private after-school educational institutions known as juku would help reduce the burden and enhance fairness. This Working Paper relates to the 2011 OECD Economic Survey of Japan (www.oecd.org/eco/surveys/Japan).<P>La réforme de l'enseignement au Japon<BR>Le Japon obtient d’excellents résultats aux tests du PISA, mais il est néanmoins important d’améliorer encore les performances de l’enseignement afin de soutenir la croissance face au vieillissement rapide de la population. Les pouvoirs publics devraient accroître les investissements dans les services d’éducation et d’accueil des jeunes enfants, et regrouper les centres d’accueil et les maternelles pour en améliorer la qualité, tout en préservant une certaine diversité entre les types d’établissements. Il importe également de rendre l’enseignement supérieur plus efficace, notamment en renforçant la concurrence et l’internationalisation, afin de développer le capital humain et d’augmenter la contribution des universités à l’innovation. Compte tenu des graves difficultés budgétaires du pays, il est nécessaire de lancer des réformes visant à améliorer l’efficacité des dépenses unitaires d’éducation, lesquelles dépassent (dépenses privées et publiques confondues) la moyenne de l’OCDE. Le niveau élevé des dépenses privées d’éducation, qui représentent un tiers de l’ensemble, fait peser une lourde charge sur les familles – ce qui freine la natalité – et crée des inégalités en termes de perspectives et de retombées de l’enseignement. Réduire le recours aux instituts privés de soutien scolaire après la classe, appelés juku, contribuerait à diminuer les coûts pour les ménages et à renforcer l’égalité des chances. Ce Document de travail se rapporte à l’Étude économique de l’OCDE du Japon, 2011 (www.oecd.org/eco/etudes/japon). |
| Keywords: | Japan, dualism, employment protection, labour force participation rates, female employment, vocational training, non-regular workers, part-time workers, older workers, work-life balance, labour market, fertility rate, Japanese economy, dispatched workers, fixed-term contracts, Japon, marché du travail, travailleurs âgés, dualisme, protection de l'emploi, travailleurs non réguliers, formation professionnelle, travailleurs à temps partiel, activité des femmes, taux de fécondité, équilibre entre travail et vie familiale, travailleurs intérimaires, contrats à durée déterminée, taux d’activité |
| JEL: | I21 I23 I28 |
| Date: | 2011–09–06 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:888-en&r=lab |
| By: | Christopher Reicher |
| Abstract: | I evaluate the degree to which different wage-setting mechanisms in labor market search models can fit the aggregate facts on labor’s share. I find that staggered bargaining in nominal wages best allows the model to plausibly match the negative relationship between labor’s share and lagged productivity growth and inflation. I also evaluate the role of labor’s bargaining weight—a low bargaining weight seems plausible but by itself, it cannot generate the patterns observed in the data. Adding a standard sticky-price mechanism to the model actually degrades the match between the model and the data—in the data, labor’s share is countercyclical, while it is procyclical in the sticky-price model. Theory and data both agree that wage stickiness is relevant at the micro and macro levels |
| Keywords: | Sticky wages, sticky prices, staggered Nash bargaining, inflation, productivity, search and matching, labor’s share |
| JEL: | E24 E25 J23 J31 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:kie:kieliw:1733&r=lab |
| By: | Lundborg, Petter (Lunds University); Nilsson, Martin (IFAU - Institute for Labour Market Policy Evaluation); Vikström, Johan (Institute for Labout Market Policy Evaluation) |
| Abstract: | In this paper, we test for the existence of socioeconomic heterogeneity in the effect of health shocks on labor market outcomes using register data on the total population of Swedish workers. We estimate fixed effect models and use unexpected hospitalizations as a measure of health shocks. Our results suggest large heterogeneity in the effects, where low educated individuals suffer relatively more from a given health shock. This result holds across a wide range of different health shocks and our results suggest that the heterogeneity increases by age. We test several potential explanations to these results. Extensive sensitivity analyses, including a difference-in-differences matching model, show that our estimates are robust to a number of potential threats. We conclude that socioeconomic heterogeneity in the effect of health shocks offers one explanation to why the socioeconomic gradient in health widens during middle ages. |
| Keywords: | Health; health shocks; socioeconomic status; life-cycle |
| JEL: | I10 I12 |
| Date: | 2011–08–31 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2011_011&r=lab |
| By: | Glenda Quintini |
| Abstract: | Mismatches between workers’ competences and what is required by their job are widespread in OECD countries. Studies that use qualifications as proxies for competences suggest that as many as one in four workers could be over-qualified and as many as one in three could be under-qualified for their job. However, there is significant variation across countries and socio-demographic groups. Our meta-analysis of country studies suggests that over 35% of workers are over-qualified in Sweden compared with just 10% in Finland, with most other OECD countries located between these two extremes. There is also extensive evidence that youth are more likely to be over-qualified than their older counterparts and the same is found to be true for immigrant workers compared with a country’s nationals. On the other hand, no definitive evidence has been found of the persistence of qualification mismatch, with some papers showing that over-qualification is just a temporary phenomenon that most workers overcome through career mobility and others finding infrequent transitions between over-qualification and good job matches. Across the board, over-qualified workers are found to earn less than their equally-qualified and well-matched counterparts but more than appropriately-qualified workers doing the same job. Under-qualified workers are found to earn more than their equally-qualified and well-matched counterparts but less than appropriately-qualified workers doing the same job. Over-qualified workers are also found to be less satisfied about their job and more likely to leave their work than well-matched workers with the same qualifications…. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:oec:elsaab:121-en&r=lab |
| By: | Lee E. Ohanian; Andrea Raffo |
| Abstract: | We build a new quarterly dataset of aggregate hours worked consistent with standard NIPA constructs for 14 OECD countries over the last fifty years. We find that cyclical features of labor markets across countries differ markedly from the accepted empirical facts reported in the literature based on either just U.S. hours data, or based on cross-country employment data. We document that total hours worked in many OECD countries are about as volatile as output, that a relatively large fraction of labor market adjustment takes place along the intensive margin outside the United States, and that the volatility of total hours relative to output volatility has increased over time in almost all countries. We use these data to re-assess productivity and labor wedges during the Great Recession and during prior recessions. We find that the Great Recession in many OECD countries is a significant puzzle in that labor wedges are quite small, while those in the U.S. Great Recession - and those in previous European recessions - are much larger. These new data indicate that understanding cyclical labor fluctuations in OECD countries requires understanding why hours fluctuate so much more than previously considered, how and why labor markets changed so much in the last few years, why cyclical adjustment of hours per worker in countries with large firing costs is not even larger than observed, and why the Great Recession differs so much across countries. |
| JEL: | E0 F41 J22 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:17420&r=lab |
| By: | Anurag N Banerjee (Durham Business School); Parantap Basu (Durham Business School) |
| Abstract: | An optimal education subsidy formula is derived using an overlapping generations model with parental altruism. The model predicts that public education subsidy is greater in economies with lesser parental altruism because a benevolent government has to compensate for the shortfall in private education spending of less altruistic parents with a finite life. On the other hand, growth is higher in economies with greater parental altruism. Cross-country regressions using the World Values Survey for altruism lend support to our model predictions. The model provides insights about the reasons for higher education subsidy in richer countries. |
| Date: | 2011–02–16 |
| URL: | http://d.repec.org/n?u=RePEc:dur:durham:2011_08&r=lab |
| By: | Nicole Woo; Janelle Jones; John Schmitt |
| Abstract: | When most workers look at their pay stubs, they can see that the Social Security payroll tax rate is 12.4 percent – with the employee and employer each paying 6.2 percent. But many workers do not know that any annual wages above $106,800 are not taxed by Social Security. In other words, a worker who makes twice the Social Security wage cap – $213,600 per year – pays Social Security tax on only half of his or her earnings, and one who makes just over a million dollars per year pays the tax on only about a tenth. Raising the Social Security cap – which would make some or all earnings above $106,800 subject to the Social Security tax – has gotten some attention as a way to help alleviate Social Security’s long-term budget shortfall. U.S. Senator Bernie Sanders plans to introduce legislation to keep the current cap at $106,800, but to also apply the Social Security payroll tax to earnings over $250,000. It is similar to previous bills and echoes a proposal by then-Senator Obama on the campaign trail in 2008. While this would leave those making between the current cap of $106,800 and the proposed cap of $250,000 paying the lowest rates, it would help secure the solvency of the program and avoid an increase in taxes on the middle class. To help inform this policy debate, this paper examines Census Bureau data from the most recently available American Community Survey to determine how raising the cap would affect workers based on gender, race or ethnicity, age, and state of residence. |
| Keywords: | social security, retirement, wage cap |
| JEL: | H H5 H55 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:epo:papers:2011-19&r=lab |
| By: | Michael P. Keane; Richard Rogerson |
| Abstract: | The response of aggregate labor supply to various changes in the economic environment is central to many economic issues, especially the optimal design of tax policies. This paper surveys recent work that uses structural models and micro data to evaluate the size of this response. Whereas the earlier literature on this issue often concluded that aggregate labor supply elasticities were small, recent work has identified three key reasons that the aggregate elasticity may be quite large. First, earlier estimates abstracted from several key features, including human capital accumulation, leading to estimates that are dramatically negatively biased. Second, failure to understand that aggregate labor supply adjustments can occur along both the hours per worker and employment margins has led economists to misinterpret the implications of previous estimates for aggregate labor supply. Third, structural estimation of responses along the extensive (i.e., employment) margin are typically quite large. |
| JEL: | E24 J22 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:17430&r=lab |
| By: | Khanna, Gaurav (University of Michigan); Newhouse, David (World Bank); Paci, Pierella (World Bank) |
| Abstract: | This paper reviews evidence from 44 middle income countries on how the recent financial crisis affected jobs and workers' income. In addition to providing a rare assessment of the magnitude of the impact across several middle-income countries, the paper describes how labor markets adjusted and how the adjustments varied for different types of countries. The main finding is that the crisis affected the quality of employment more than the number of jobs. Overall, the slow-down in earning growth was considerably higher than that in employment, and the decline in GDP was associated with a sharp decline in output per worker, particularly in the industrial sector. In several counties, hours per workers declined and hourly wages changed little. But both the magnitude and nature of the adjustments varied considerably across countries. For a given drop in GDP, earnings declined more in countries with larger manufacturing sectors, smaller export sectors, and more stringent labor market regulations. In addition, overall employment became more sensitive to GDP growth. These findings have implications that go beyond the recent financial crisis as they highlight (i) the limitations of focusing policies responses on maintaining jobs and providing alterative employment or replacement income for the unemployed and (ii) the critical role of fast-track data systems, capable of monitoring ongoing labor market adjustment during economic downturns, in supporting the design of effective policy responses. |
| Keywords: | middle-income countries, labor markets, recession |
| JEL: | E24 E32 J21 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5956&r=lab |
| By: | Randall S. Jones; Satoshi Urasawa |
| Abstract: | Traditional Japanese labour market practices, which benefited both workers and firms during the highgrowth era, are no longer appropriate in the context of slow economic growth and rapid population ageing. Reforms are needed in light of the upward trend in non-regular employment to break down labour market dualism and to encourage greater labour force participation by women, the elderly and youth. A comprehensive approach that includes improving the social insurance coverage of non-regular workers and upgrading training programmes for them, preventing discrimination against non-regular workers and reducing effective employment protection for regular workers would increase labour market flexibility and human capital. Moreover, such reforms would increase equity across different segments of the labour force. Drawing more women into the labour force requires removing financial disincentives to work, creating more family-friendly workplaces and increasing the availability of childcare. The labour force participation of the elderly should be raised by promoting continuous employment and abolishing mandatory retirement. More effective vocational training is needed for younger workers. This Working Paper relates to the 2011 OECD Economic Survey of Japan (www.oecd.org/eco/surveys/Japan).<P>Réformer le marché du travail au Japon pour stimuler la croissance et améliorer l'équité<BR>Les pratiques traditionnellement suivies au Japon sur le marché du travail, bénéfiques aussi bien aux travailleurs qu’aux entreprises en période de forte croissance, ne sont plus de mise dans un contexte de ralentissement de la croissance économique et de vieillissement rapide de la population. Au vu de la tendance à la hausse de l’emploi non régulier, des réformes sont nécessaires pour mettre fin au dualisme du marché du travail et encourager une participation plus intense des femmes, des travailleurs âgés et des jeunes à la vie active. Une démarche globale incluant une amélioration de la couverture sociale et une augmentation des programmes de formation professionnelle pour les travailleurs non réguliers, une exclusion des discriminations contre eux et réduisant la protection de l’emploi dont bénéficient les travailleurs réguliers permettrait de renforcer la flexibilité du marché du travail et d’accroître le capital humain. Les réformes devraient en outre contribuer à améliorer l’équité entre les différents segments de la population active. Pour attirer davantage les femmes vers la vie active, il convient d’éliminer les mécanismes financiers qui jouent contre le travail, en créant des emplois plus conciliables avec la vie de famille et en développant les services de garde d’enfants. L’intégration des plus âgés sur le marché du travail doit être renforcée en favorisant leur maintien en activité et en supprimant l’âge de départ obligatoire à la retraite. Il faut également offrir aux jeunes une formation professionnelle plus efficace. Ce Document de travail se rapporte à l’Étude économique de l’OCDE du Japon, 2011 (www.oecd.org/eco/etudes/japon). |
| Keywords: | Japan, dualism, employment protection, labour force participation rates, female employment, vocational training, non-regular workers, part-time workers, older workers, work-life balance, labour market, fertility rate, Japanese economy, dispatched workers, fixed-term contracts, Japon, marché du travail, travailleurs âgés, dualisme, protection de l'emploi, travailleurs non réguliers, formation professionnelle, travailleurs à temps partiel, activité des femmes, taux de fécondité, équilibre entre travail et vie familiale, économie japonaise, travailleurs intérimaires, contrats à durée déterminée |
| JEL: | J11 J3 J5 J7 |
| Date: | 2011–09–06 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:889-en&r=lab |
| By: | Guner, Nezih (MOVE, Barcelona); Kaygusuz, Remzi (Sabanci University); Ventura, Gustavo (Arizona State University) |
| Abstract: | Based on well-known evidence on labor supply elasticities, several authors have concluded that women should be taxed at lower rates than men. We evaluate the quantitative implications of taxing women at a lower rate than men. Relative to the current system of taxation, setting a proportional tax rate on married females equal to 4% (8%) increases output and married female labor force participation by about 3.9% (3.4%) and 6.9% (4.0%), respectively. Gender-based taxes improve welfare and are preferred by a majority of households. Nevertheless, welfare gains are higher when the U.S. tax system is replaced by a proportional, gender-neutral income tax. |
| Keywords: | taxation, two-earner households, labor force participation |
| JEL: | E62 H31 J12 J22 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5962&r=lab |
| By: | Ichiue, Hibiki; Kurozumi, Takushi; Sunakawa, Takeki |
| Abstract: | Which labor market specification is better able to describe inflation dynamics, a widely-used sticky wage model or a recently-investigated labor market search model? Using a Bayesian likelihood approach, we estimate these two models with Japan’s data. This paper shows that the labor market search model is superior to the sticky wage model in terms of both marginal likelihood and out-of-sample forecast performance, particularly regarding inflation. The labor market search model is better able to replicate the cross-correlation among inflation, real wages, and output in the data. Moreover, in this model, real marginal cost is determined by both hiring cost and unit labor cost that varies with employment fluctuations, which gives rise to a high contemporaneous correlation between inflation and real marginal cost as represented in the New Keynesian Phillips curve. |
| Keywords: | Inflation dynamics; Marginal cost; Labor market search; Extensive margin; Bayesian estimation |
| JEL: | E32 E24 E37 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:33391&r=lab |
| By: | Alvaro Forteza (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Irene Mussio (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República) |
| Abstract: | We assess redistribution in the Uruguayan main pension and unemployment insurance programs on a lifetime basis. Using administrative records from social security, we simulate lifetime declared labor income and flows of contributions and benefits of affiliates to the programs. Expected present values of income and net flows are also computed. Equipped with these estimations we construct standard measures of distribution and redistribution of lifetime labor income through the social security system. Our findings suggest that these programs reduce income inequality. In particular, social Security reduces the Gini coefficient of expected lifetime formal labor income by almost 2 percentage points. |
| Keywords: | Redistribution; Social Security; Uruguay |
| JEL: | H55 J14 J2 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:1211&r=lab |
| By: | Caroline Rizza |
| Abstract: | This working paper aims to give an overview of the national policies that exist in the field of ICT and initial teacher education. Information on this topic was initially gathered via a survey, in the form of a country questionnaire, which was conducted as part of the analytical strand of the OECD study entitled “ICT and Initial Teacher Education”. In addition, desk research was conducted for 31 OECD countries. All of this work has been carried out under the auspices of the New Millennium Learners project. Responses to the survey were received from the following countries: Austria, Australia, Belgium (Flanders), Chile, Denmark, Finland, Poland, Slovakia, Spain, and the United Kingdom... |
| Date: | 2011–09–15 |
| URL: | http://d.repec.org/n?u=RePEc:oec:eduaab:61-en&r=lab |
| By: | Maria del Carmen Huerta; Willem Adema; Jennifer Baxter; Miles Corak; Mette Deding; Matthew C. Gray; Wen-Jui Han; Jane Waldfogel |
| Abstract: | More mothers with young children are in paid work than in the past. There is a long-running debate on possible negative effects of maternal employment on child development. For the first time, this paper presents an initial comparative analysis of longitudinal data on maternal employment patterns after birth on child cognitive and behavioural development. The paper examines data of five OECD countries with different types and intensity of support provided to families to reconcile work and family life. The evidence suggests that a return to paid work by mothers within six months after childbirth may have negative effects on child outcomes, particularly on cognitive development, but the effects are small and not universally observed. Other factors such as family income, parental education and quality of interaction with children have greater influences on child development than early maternal employment per se.<BR>Beaucoup plus de mères de jeunes enfants exercent aujourd’hui un emploi rémunéré qu’avant. Un débat ancien existe sur les effets potentiellement négatifs du travail maternel sur le développement de l'enfant. Pour la première fois, cet article présente une analyse comparative de données longitudinales concernant la relation de l'emploi maternel après la naissance sur le développement cognitif et comportemental de l'enfant. Le document examine les données de cinq pays de l'OCDE avec des soutiens aux familles pour concilier travail et vie de famille d’intensité et de types différents. Les résultats suggèrent qu'un retour au travail rémunéré par des mères dans les six mois après l'accouchement peut avoir des effets négatifs sur les résultats de l'enfant, notamment sur le développement cognitif, mais les effets sont petits et observés de façon non universelle. D'autres facteurs comme le revenu de la famille, l'éducation des parents et la qualité de l'interaction avec les enfants ont une plus grande influence sur le développement de l'enfant que le travail maternel en soi. |
| Keywords: | maternal employment, childcare, cognitive development, behavior problems, birth cohort studies |
| JEL: | D10 D60 J13 J16 J22 |
| Date: | 2011–08–30 |
| URL: | http://d.repec.org/n?u=RePEc:oec:elsaab:118-en&r=lab |
| By: | Mauricio Armellini (Durham Business School); Parantap Basu (Durham Business School) |
| Abstract: | An optimal education subsidy formula is derived using an overlapping generations model with parental altruism. The model predicts that public education subsidy is greater in economies with lesser parental altruism because a benevolent government has to compensate for the shortfall in private education spending of less altruistic parents with a finite life. On the other hand, growth is higher in economies with greater parental altruism. Cross-country regressions using the World Values Survey for altruism lend support to our model predictions. The model provides insights about the reasons for higher education subsidy in richer countries. |
| Date: | 2011–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:dur:durham:2011_07&r=lab |
| By: | Fernando Borraz (Banco Central del Uruguay y Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Nicolás Gonzalez Pampillón (Universidad de Montevideo) |
| Abstract: | This paper analyzes the role of the sharply increases in the minimum wage after 2004 in Uruguay in the slight decrease on wage inequality. We Önd no impact of the miminum wage increases on wage inequality. This results can be explained by the low starting level of the minimum wage or lack of compliance with it. The Uruguayan experience shows that the minimum wage is not always e§ective as a redistribution instrument. |
| Keywords: | minimum wage, wage inequality, IV, semiparametric estimation |
| JEL: | J20 J31 J38 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:1711&r=lab |
| By: | Layte, Richard; McCrory, Cathal |
| Keywords: | children |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:rb2011/2/4&r=lab |
| By: | Frijters, Paul (University of Queensland); Kong, Tao (Australian National University); Meng, Xin (Australian National University) |
| Abstract: | We use a unique data of representative migrants and urban local workers in 15 Chinese cities to investigate entrepreneurship and credit constraints under labour market discrimination. We divide self employed into prefer to be self-employed and prefer to have a salaried job but cannot find one; and divide salaried workers into want-to-be entrepreneurs and happy-to-be salaried workers. Over 40 percent of migrant workers are either currently or want-to-be entrepreneurs. Both groups are very similar in terms of risk taking preferences and network size. Want-to-be entrepreneurs however suffer from credit constraints identified by negative financial shocks in the year before. Our back-of-envelope calculation reveals that overcoming the current level of credit constraints may be worth 2% of GDP per year direct earnings increases. |
| Keywords: | entrepreneurs, credit constraints, migration, China |
| JEL: | L26 J14 J70 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5967&r=lab |
| By: | Lehmann, Jee-Yeon |
| Abstract: | Minorities continue to be severely underrepresented at the top levels of most occupations despite making dramatic gains in initial access to them. This fact is particularly striking in the legal profession where blacks are well represented in each associate class yet face significantly lower probabilities of making partner. To explain this divergence in the career paths of blacks and whites, I develop a dynamic model of statistical discrimination in which firms diversify their workforce by lowering the hiring standard for blacks. Despite such a diversity goal at hiring, task assignment and promotion decisions are not constrained by this policy. In this institutional setting, the model predicts that although blacks are more likely to be hired compared to observably similar whites, they are more likely to be placed in worse tasks and less likely to be promoted conditional on the same set of observables. However, conditional on task assignment, blacks and whites face similar promotion rates. I test the model's predictions using new data from the After the JD study -- a unique longitudinal survey tracking the professional lives of more than 4,000 lawyers. Compared to whites of similar credentials, blacks are much more likely to be hired into the best law firms. However, they are assigned to worse tasks and are less likely to be a partner. This black-white difference in promotion rates can be explained by quality differences in task assignments early in the associates' careers even controlling for measures of effort and career preferences. Results from this paper provide a unique explanation for the underrepresentation of minorities at the top of professional ladders by revealing how incompatible strategies in job assignment can reduce the number of minority promotions compared to the case without affirmative action. |
| Keywords: | Discrimination; Job assignment; promotion; lawyers; statistical discrimination; inequality |
| JEL: | J0 J7 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:33466&r=lab |
| By: | Chen, Been-Lon; Chen, Hung-Ju; Wang, Ping |
| Abstract: | In a second-best optimal growth setup with only factor taxes as available instruments, is it optimal to fully replace capital by labor income taxation? The answer is generally positive based on Chamley, Judd, Lucas, and many follow-up studies. In the present paper, we revisit this important tax reform-related issue by developing a human capital-based endogenous growth framework with frictional labor search and matching. We allow each firm to create multiple vacancies and each worker to determine labor market participation endogenously. We consider a benevolent fiscal authority to finance direct transfers to households and unemployment compensation only by factor taxes. We then conduct dynamic tax incidence exercises using a model calibrated to the U.S. economy with a pre-existing 20% flat tax on both the capital and labor income. Our numerical results suggest that, due to a dominant channel via the interactions between the firm's vacancy creation and the worker's market participation, it is optimal to switch partly by a modest margin from capital to labor taxation in a benchmark economy where human capital formation depends on both the physical and human capital stocks. When the human capital accumulation process is independent of physical capital, the optimal tax mix features a slightly larger shift from capital to labor taxation; when we remove the extensive margin of the labor-leisure trade-off, such a shift is much larger. In either case, however, the optimal capital tax rate is far above zero. |
| Keywords: | Tax Incidence; Endogenous Human Capital Accumulation; Labor-Market Search and Matching Frictions |
| JEL: | E62 H22 O40 J20 |
| Date: | 2011–08–30 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:33209&r=lab |
| By: | Bøg, Martin; Kranendonk, Erik |
| Abstract: | This paper presents evidence from a field experiment designed to evaluate the efficacy of anonymous application procedures. While the policy evaluation itself is of interest, more importantly the experiment provides a unique opportunity to detect race based differential treatment in a controlled market environment. Over a 6 month period we observe all applications sent in response to local public sector vacancies. We observe both the callback and the job oer decision. We compare decisions of recruiters when they can observe ethnic markers (control) with a treatment condition where ethnic markers are absent. We find a substantial differential in the callback decision. Interestingly, we do not find evidence for differential treatment in the job offer decision. A follow up experiment provides indications that recruiters respond strategically to the announcement of the results of the first experiment. |
| Keywords: | Field Experiment; Discrimination; Public Sector; Anonymous Application Procedures |
| JEL: | J45 J71 J78 C93 |
| Date: | 2011–04–15 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:33332&r=lab |
| By: | Sarah Carmichael |
| Abstract: | This paper examines age at first marriage for women and spousal age gap as an indicator for female agency from 1950 until 2005. Using a dataset of 77 LDCs this paper seeks to explore which variables determine differences at a country level in marriage patterns. We look at the influence of urbanisation, education, percentage population of Muslim faith, and family type. We find that education is key in determining at what age women marry, having as would be expected a positive effect on age at first marriage and depressing spousal age gap. Urbanisation is significant, with a positive effect on age and negative on spousal age gap, although the effect is not very large. The percentage Muslim variable depresses female age at first marriage and increases spousal age gap but only when family type is not controlled for. The initially strong negative effect of percentage population Muslim over the period under consideration on age of first marriage has decreased, which raises some interesting questions about the role of Islam in female empowerment. |
| Keywords: | Marriage patterns, female agency, age at first marriage, spousal age gap |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:ucg:wpaper:0015&r=lab |
| By: | Clemens Hetschko; Andreas Knabe; Ronnie Schöb |
| Abstract: | Using data from the German Socio-Economic Panel from 1984-2009, we follow persons from their working life into their retirement years and find that, on average, employed people maintain their life satisfaction upon retirement, while long-term unemployed people report a substantial increase in their life satisfaction when they retire. These results are robust to controlling for changes in other life circumstances and suggest that retiring is associated with a switch in the relevant social norms that causes an increase in identity utility for the formerly unemployed. This is supportive of the idea that, by including identity in the utility function, results from the empirical life satisfaction literature can be reconciled with the economic theory of individual utility. |
| Keywords: | life satisfaction, retirement, unemployment, identity, social norm |
| JEL: | I31 J26 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp399&r=lab |
| By: | Lance Lochner; Alexander Monge-Naranjo |
| Abstract: | We review studies of the impact of credit constraints on the accumulation of human capital. Evidence suggests that credit constraints are increasingly important for schooling and other aspects of households' behavior. We highlight the importance of early childhood investments, since their response largely determines the impact of credit constraints on the overall lifetime acquisition of human capital. We also review the intergenerational literature and examine the macroeconomic impacts of credit constraints on social mobility and the income distribution. A common limitation across all areas of the human capital literature is the imposition of ad hoc constraints on credit. We propose a more careful treatment of the structure of government student loan programs as well as the incentive problems underlying private credit. We show that endogenizing constraints on credit for human capital helps explain observed borrowing, schooling, and default patterns and offers new insights about the design of government policy. |
| JEL: | D14 H52 I22 I23 J24 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:17435&r=lab |
| By: | Heibø Modalsli, Jørgen (Dept. of Economics, University of Oslo) |
| Abstract: | This paper reconciles neoclassical models of economic growth ("Solow") with the formation of social classes during economic transition ("Marx"). An environment with missing capital markets and no labor divisibility is shown to lead to a steady state with no aggregate inefficiencies, but a very polarized wealth distribution. When capital cannot be rented, people must choose between self-production, potentially including hiring workers, and wage employment. As the first path is more profitable for the rich than the poor, inequality increases. The model is calibrated to illustrate polarization and increasing inequality in early modern Europe, starting from a continuous pre-industrial wealth distribution. During the early industrializing period, when labor markets operate and capital markets do not, inequality increases and a distinct working class emerges. Even if capital markets later improve, the polarization is persistent. The mechanism also has relevance for modern developing countries, where capital market access is limited. If a substantial amount of capital is needed in order to earn the market return, the poor have few incentives to save. |
| Keywords: | Inequality; polarization; social class; economic growth; capital market frictions |
| JEL: | E21 G32 O11 O43 |
| Date: | 2011–09–14 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:osloec:2011_021&r=lab |
| By: | Alexander Ludwig (Universität zu Köln); Thomas Schelkle (London School of Economics); Edgar Vogel (Universität Mannheim) |
| Abstract: | This appendix of our paper, "Demographic Change, Human Capital and Welfare", contains further material that could not be included in the paper due to space limitations. It is organized as follows. Section A contains the formal equilibrium definition. Section B provides more results on the fit of our model to observed life-cycle profiles of hours and wages, the implied labor-supply elasticities of our model, additional results on predicted aggregate variables during the demographic transition as well as the associated welfare effects and a sensitivity analysis. Our population model is explained in Section C. Details on our computational procedures can be found in Section D. |
| Keywords: | Population aging; Human capital; Rate of return; Distribution of welfare |
| JEL: | C68 E17 E25 J11 J24 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:red:append:08-168&r=lab |
| By: | Aoyagi, Midori (Asian Development Bank Institute); Suda, Eiko (Asian Development Bank Institute); Shinada, Tomomi (Asian Development Bank Institute) |
| Abstract: | There is increasing evidence that climate change has an impact on natural disasters, such as flooding, and on agricultural production, both of which have implications for gender issues. In this paper the authors briefly review issues related to gender and poverty and examine the relationships between gender and various indices. They then look at systems of land ownership and inheritance, and discuss an example of job recovery after a disaster through interviews with three female agricultural workers in Japan. The results of the interviews demonstrate the recent empowerment of women in agricultural production and that these women have strong adaptive abilities. |
| Keywords: | climate change; natural disasters; gender issues; agricultural production |
| JEL: | J16 Q54 Q58 |
| Date: | 2011–09–12 |
| URL: | http://d.repec.org/n?u=RePEc:ris:adbiwp:0309&r=lab |
| By: | Fabrice Murtin; Romain Wacziarg |
| Abstract: | Over the last two centuries, many countries experienced regime transitions toward democracy. We document this democratic transition over a long time horizon. We use historical time series of income, education and democracy levels from 1870 to 2000 to explore the economic factors associated with rising levels of democracy. We find that primary schooling, and to a weaker extent per capita income levels, are strong determinants of the quality of political institutions. We find little evidence of causality running the other way, from democracy to income or education. |
| JEL: | N10 O43 O57 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:17432&r=lab |
| By: | Pedro Martins; Luca David Opromolla |
| JEL: | F16 J31 F15 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:ptu:wpaper:w201123&r=lab |
| By: | Furtado, Delia (University of Connecticut); Marcén, Miriam (University of Zaragoza); Sevilla-Sanz, Almudena (University of Oxford) |
| Abstract: | This paper explores the role of culture in determining divorce decisions by examining country of origin differences in divorce rates of immigrants in the United States. Because childhood-arriving immigrants are all exposed to a common set of US laws and institutions, we interpret relationships between their divorce tendencies and home country divorce rates as evidence of the effect of culture. Our results are robust to controlling for several home country variables including average church attendance and GDP. Moreover, specifications with country of origin fixed effects suggest that divorce probabilities are especially low for immigrants from countries with low divorce rates that reside amidst a large number of co-ethnics. Supplemental analyses indicate that divorce culture has a stronger impact on the divorce decisions of females than of males pointing to a potentially gendered nature of divorce taboos. |
| Keywords: | immigrants, culture, divorce |
| JEL: | J12 Z13 J61 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5960&r=lab |
| By: | Pettersson, Jan (Department of Economics) |
| Abstract: | We study re-entry to the workforce of fully retired persons, so-called unretirement, and whether the decision to resume work depends primarily on social or economic reasons. Using Swedish register data for already retired individuals older than 55, we find unretirement to vary between 6 and 14 per cent under two different definitions. Our results largely support an interpretation that unretirement is a life-style decision rather than a response to a realized negative economic situation post retirement. However, economic motives seem to be more important for younger pensioners. |
| Keywords: | Retirement; Unretirement; Pensions; Labour supply |
| JEL: | J14 J26 |
| Date: | 2011–09–09 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:uunewp:2011_014&r=lab |
| By: | Smith, Nina (University of Aarhus); Smith, Valdemar (Aarhus School of Business); Verner, Mette (Danish School of Media and Journalism) |
| Abstract: | In most OECD countries, only very few women succeed in reaching top executive positions. In this paper, the probability of promotion into VP and CEO positions is estimated based on employer-employee data on all Danish companies observed during the period 1997-2007. After controlling for a large number of family-related variables, including take-up history of maternity and paternity leave and proxies for 'female-friendly' companies, there is still a considerable gap in the promotion probabilities for CEO positions, but not for VP positions. Thus, the results cannot confirm recent theories on 'belief flipping' or disappearance of statistical discrimination against women who succeed getting into career track positions. The results reflect that the hiring decision and the decision to enter a top position as 'number one', i.e. CEO, in the organization is very different from the decision to hire or become VP, i.e. 'number two' or lower. |
| Keywords: | promotion, top executive positions, statistical discrimination |
| JEL: | G34 J16 J24 M51 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5961&r=lab |
| By: | Michael Luca (Harvard Business School, Negotiation, Organizations & Markets Unit); Jonathan Smith (Advocacy and Policy Center - College Board) |
| Abstract: | How do rankings affect demand? This paper investigates the impact of college rankings, and the visibility of those rankings, on students' application decisions. Using natural experiments from U.S. News and World Report College Rankings, we present two main findings. First, we identify a causal impact of rankings on application decisions. When explicit rankings of colleges are published in U.S. News, a one-rank improvement leads to a 1-percentage-point increase in the number of applications to that college. Second, we show that the response to the information represented in rankings depends on the way in which that information is presented. Rankings have no effect on application decisions when colleges are listed alphabetically, even when readers are provided data on college quality and the methodology used to calculate rankings. This finding provides evidence that the salience of information is a central determinant of a firm's demand function, even for purchases as large as college attendance. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:hbs:wpaper:12-014&r=lab |
| By: | Luis Aguiar (Departamento de Economía - Universidad Carlos III de Madrid); Philippe Gagnepain (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris) |
| Abstract: | The goal of this paper is to assess the impact on the performance of firms that participate in Research Joint Ventures (RJVs) funded by the Fifth European Framework Programme for Research and Technological Development (EU-FP5). A special emphasis is made on the User-friendly Information Society (IST) programme, one of the most important thematic programmes of the EU-FP5. We use the funding available to the firms as an instrumental variable to account for self-selection and estimate the Local Average Treatment Effect (LATE) of participation by considering labor productivity and profit margin as performance measures. Our results show a large and positive impact of participation on the labor productivity of the firms, whereas the effect on profit margin is weaker. When taking into account the size of the RJV, we find that the positive impact on labor productivity comes mainly from participation in large projects and that participation in smaller RJVs has a negative effect on the profit margin. |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:hal-00622969&r=lab |
| By: | Ronald Jean Degen (International School of Management Paris) |
| Abstract: | This paper identifies the ways in which the ideas of Fordism and Taylorism have been responsible for the success of the U.S. motor vehicle companies until 1955, and for their subsequent decline. On three occasions, the motor vehicle industry has changed the fundamental ideas on the process of manufacturing, and, perhaps more significantly, on how humans work together to create value. Under Fordism and Taylorism, the conditions of employment at the assembly lines became less and less bearable for the workers, and this resulted in an ongoing confrontation between management and the workforce, led by United Auto Workers (UAW). This confrontation resulted in escalating labor costs for the U.S. motor vehicle companies, and undermined their capacity to compete with the Japanese motor vehicle companies, who had developed a lean production system and a more humanistic management style. |
| Keywords: | Fordism, Taylorism, decline of the U.S. motor vehicle companies, mass production system, lean production system, reflective production system, confrontational management-labor-relations |
| JEL: | M0 M1 |
| Date: | 2011–09–12 |
| URL: | http://d.repec.org/n?u=RePEc:pil:wpaper:81&r=lab |
| By: | Alfred A. Haug & Ian P. King |
| Abstract: | We examine the relationship between inflation and unemployment in the long run,using quarterly US data from 1952 to 2010. Using a band-pass filter approach, we find strong evidence that a positive relationship exists, where inflation leads unemployment by some 3 to 3.5 years, in cycles that last from 8 to 25 or 50 years. Our statistical approach is atheoretical in nature, but provides evidence in accordance with the predictions of Friedman (1977) and the recent New Monetarist model of Berentsen, Menzio, and Wright (2011): the relationship between inflation and unemployment is positive in the long run. |
| Keywords: | Inflation; Unemployment; Long-Run Phillips Curve |
| JEL: | E24 E31 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:mlb:wpaper:1128&r=lab |
| By: | Conrads, Julian (University of Cologne); Irlenbusch, Bernd (University of Cologne); Rilke, Rainer Michael (University of Cologne); Walkowitz, Gari (University of Cologne) |
| Abstract: | We investigate the influence of two widespread compensation schemes, individual piece-rates and team incentives, on participants' inclination to lie, by adapting the experimental setup of Fischbacher and Heusi (2008). Lying turns out to be more pronounced under team incentives than under individual piece-rates, which highlights a so far fairly neglected feature of these compensation schemes. |
| Keywords: | compensation schemes, lying, team, experiment |
| JEL: | C91 C92 M52 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5968&r=lab |
| By: | Bhattacharya, Dhritiman (EQUIFAX); Guner, Nezih (MOVE, Barcelona); Ventura, Gustavo (Arizona State University) |
| Abstract: | We develop a span-of-control model where managerial skills are endogenous and the outcome of investments over the life cycle of managers. We calibrate this model to U.S plant-size data to quantify the effects of distortions that are correlated with the size of production units. These distortions lead to sharp reductions in plant productivity and the fraction of employment in large plants, with a quantitatively important role for managerial investments. We find that the model can account quite well for properties of Japanese size-distribution data, with a model-implied TFP of about 83% of the U.S. Distortions are critical in accounting for the differences in size distribution between the U.S. and Japan. |
| Keywords: | distortions, size, skill investments, productivity differences |
| JEL: | O40 E23 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5963&r=lab |
| By: | Black, Dan A. (Harris School, University of Chicago); Kolesnikova, Natalia (Federal Reserve Bank of St. Louis); Sanders, Seth G. (Duke University); Taylor, Lowell J. (Carnegie Mellon University) |
| Abstract: | We examine Becker's (1960) contention that children are "normal." For the cross section of non-Hispanic white married couples in the U.S., we show that when we restrict comparisons to similarly-educated women living in similarly-expensive locations, completed fertility is positively correlated with the husband's income. The empirical evidence is consistent with children being "normal." In an effort to show causal effects, we analyze the localized impact on fertility of the mid-1970s increase in world energy prices – an exogenous shock that substantially increased men's incomes in the Appalachian coal-mining region. Empirical evidence for that population indicates that fertility increases in men's income. |
| Keywords: | economics of fertility, location choice, Appalachian fertility |
| JEL: | J13 J40 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5959&r=lab |
| By: | OKUMURA Tsunao; USUI Emiko |
| Abstract: | Using the Japanese Study of Aging and Retirement (JSTAR), a Japanese panel survey of people age 50 or older, we find that many Japanese in their early 50s—compared to those in their late 50s and early 60s—expect their level of public pension benefits to decline. We find that recent pension reform (which raised the pensionable age) affected people by increasing the age when they expect to claim their benefits by almost the exact amount for all. Nevertheless, the effect of reform on their expectations for future benefits remained insignificant. We also find evidence that anxiety about the public pension program's future induces people to save more. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:11065&r=lab |
| By: | Haug, Alfred A.; King, Ian P. |
| Abstract: | We examine the relationship between inflation and unemployment in the long run, using quarterly US data from 1952 to 2010. Using a band-pass filter approach, we find strong evidence that a positive relationship exists, where inflation leads unemployment by some 3 to 3 1/2 years, in cycles that last from 8 to 25 or 50 years. Our statistical approach is atheoretical in nature, but provides evidence in accordance with the predictions of Friedman (1977) and the recent New Monetarist model of Berentsen, Menzio, and Wright (2011): the relationship between inflation and unemployment is positive in the long run. |
| Keywords: | Inflation; Unemployment; Long-Run Phillips Curve |
| JEL: | E24 E31 |
| Date: | 2011–08–25 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:33409&r=lab |
| By: | Ana Poças (Polytechnic Institute of Guarda and UDI); Elias Soukiazis (Faculdade de Economia/GEMF, Universidade de Coimbra) |
| Abstract: | The aim of this study is to analyze the impact of health factors on economic growth and convergence across the Portuguese regions at the district level. Like education, health factors could be important for explaining the growth performance of regions through the increase in labour productivity. Therefore, human capital can be seen in a broader perspective encompassing not only educational qualifications but also health conditions. Although this is not a new idea, empirical evidence at a regional level is not robust supporting this issue, with few exceptions. With this study we try to fill this gap and bring additional evidence of the relevance of health on regional growth considering the Portuguese districts. We employ a panel data approach for the period 1996-2006 taking into account specific regional differences. We also analyze whether there are differences between the littoral (coastal) and the interior (in-land) districts in what concerns health conditions and how they affect their convergence process. |
| Keywords: | : Regional growth, health and human capital, panel data. |
| JEL: | R11 O18 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:gmf:wpaper:2011-14&r=lab |
| By: | Tine De Moor; Jaco Zuijderduijn |
| Abstract: | In this paper we contribute to literature on human capital formation by investigating age references on early-modern portraits from the Low Countries. We use the very popular aetatis formulae to estimate to what degree sitters to portraits were able to give their age in an accurate way. This approach allows us to estimate the numeracy of single men and women, as well as couples who commissioned pair portraits to commemorate marriage. The paper suggests a methodology to be used for this type of research and also uses some specific characteristics of portraits to contribute to recent discussions in the field of numeracy studies, particularly with respect to gender differences in numeracy. |
| Keywords: | Portraits, human capital, numeracy, Holland, early modern period, gender |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:ucg:wpaper:0016&r=lab |
| By: | Isabelle Agier; Isabelle Guérin; Ariane Szafarz |
| Abstract: | The unequal treatment of children is not gender neutral from the parent side. Our results show that women try to compensate through debt for the unbalanced situation faced by their daughters compared to their sons. However, the lack of symmetry between mothers' and fathers' financial situations leads to the perpetuation of gender inequality through generations. |
| Keywords: | Gender; discrimination; borrowing,; debt; children; mother; father |
| JEL: | O16 D13 J12 O15 O17 G21 I32 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:sol:wpaper:2013/97214&r=lab |
| By: | Bonleu, A.; Cette, G.; Horny, G. |
| Abstract: | This empirical analysis aims at assessing the effect of the economic climate and the intensity of capital utilisation on companies’ capital retirement behaviour. It is conducted using individual company data, as well as original data on the degree of utilisation of production factors. The sample includes 6,998 observations over the period 1996-2008. This database is, to our knowledge, unique for the empirical analysis of the intensity of capital utilisation on firms’ capital retirement behaviour. We adjust for endogeneity biases by means of instrumental variables. The main results obtained from the estimation of capital retirement models may be summarised as follows: i) The retirement rate decreases with the variations in cyclical pressures measured by the changes in output and the workweek of capital; this relation corresponds to a countercyclical decelerator effect on capital retirement; ii) The capital retirement rate increases with the structural intensity of capital utilisation; this effect, which corresponds to a wear and tear one, is nevertheless small compared to the decelerator one; iii) The profit rate does not have a significant impact on the retirement rate. Compared with the existing literature, here mainly Mairesse and Dormont (1985), the contribution of these results is to show, through the use of unique survey data, that the effect of the intensity of capital utilisation on capital retirement is structurally positive, via a wear and tear effect, and cyclically negative, via a decelerator effect which completes that already taken into account via the effect of changes in value added. |
| Keywords: | Capital, Capital measure, Capital retirement, Capital utilisation. |
| JEL: | E22 D24 O16 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:bfr:banfra:343&r=lab |
| By: | Timothy Perri |
| Abstract: | Following Rosen [1981], superstar effects (earnings convex in quality and a few firms reaping a large share of market earnings) occur with imperfect substitution between sellers, low (and possibly declining) marginal cost of output, and marginal cost falling as quality increases. However, markets without such characteristics have superstar effects, and the main result from the superstar model---small quality differences result in large earnings differences---may not hold. A competitive model can yield superstar effects when a few firms have quality significantly higher than others and cost increases in output, provided cost does not increase too rapidly in quality. Key Words: superstars & competition |
| JEL: | D21 D41 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:apl:wpaper:11-11&r=lab |
| By: | Mitra, Aniruddha (Middlebury College); Bang, James T. (St. Ambrose University); Wunnava, Phanindra V. (Middlebury College) |
| Abstract: | This paper explores the impact of financial liberalization on the migration of high skilled labor from 46 countries to the OECD, taken at five year intervals over the period 1985-2000. Using an exploratory factor analysis, we are able to distinguish between two dimensions of financial liberalization, namely the robustness of the markets and their freedom from direct government control. We find that a standard deviation improvement in the robustness of the source country financial sector magnifies the extent of brain drain by a factor of about four percentage points on the average. However, a corresponding increase in the freedom of the source country financial sector from government control has a modest negative impact on the emigration of high skilled labor and the effect is not statistically significant. Further, the impact of improved financial sector robustness on selection is more pronounced for non-OECD economies than for OECD nations, which experience virtually no impact on skilled emigration. |
| Keywords: | immigration, financial liberalization, brain drain, institutions |
| JEL: | F22 O15 P48 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5953&r=lab |
| By: | Paulo Júlio (Gabinete de Estratégia e Estudos, Portuguese Ministry of Economy and Employment, and NOVA School of Business and Economics); Ricardo Pinheiro-Alves (Gabinete de Estratégia e Estudos, Portuguese Ministry of Economy and Employment and Instituto de Artes Visuais, Design e Marketing); José Tavares (NOVA School of Business and Economics and Center for Economic Policy Research) |
| Abstract: | This article analyses the effects of several geographic, economic and institutional factors on bilateral inward FDI in Europe. Moreover, it assesses the required reform effort, and the expected benefits, for Portugal to converge with the EU in the institutional variables that are relevant to attract investment. We conclude that good institutions favouring economic freedom and the ease of doing business, and geography, market size and labor costs, affect bilateral inward FDI. Political risk does not lead to significant differences in FDI across the EU. The results are robust to different methods – principal component analysis, factor-based scores and by considering several institutional indicators successively. We also find that most promising reforms arise in the financial system, corruption, property rights, and in some business regulations associated with starting a business. Increasing labor market flexibility to the EU level has also a large impact on inward FDI, but this reform comes at a comparatively higher effort. |
| Keywords: | FDI, Institutional reform, Institutions, Portugal, EU |
| JEL: | F30 H00 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:mde:wpaper:0040&r=lab |
| By: | Andrea Doneschi (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Rossana Patron (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República) |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:1511&r=lab |
| By: | Norovsambuu Tumennasan (School of Economics and Management, Aarhus University, Denmark) |
| Abstract: | We revisit the question of whether price matching is anti-competitive in a capacity constrained duopoly setting. We show that the effect of price matching depends on capacity. Specifically, price matching has no effect when capacity is relatively low, but it benefits the firms when capacity is relatively high. Interestingly, when capacity is in an intermediate range, price matching benefits only the small firm but does not affect the large firm in any way. Therefore, one has to consider capacity seriously when evaluating if price matching is anti-competitive. If the firms choose their capacities simultaneously before pricing decisions, then the effect of price matching is either pro-competitive or ambiguous. We show that if the cost of capacity is high, then price matching can only (weakly) decrease the market price. On the other hand, if the cost of capacity is low, then the effect of price matching on the market price is ambiguous due to the multiplicity of equilibria. Therefore, this paper challenges the widely accepted belief that price matching is an anti-competititive practice if the firms choose their capacities simultaneously before pricing decisions. |
| Keywords: | Price matching, capacity constraint, quantity precommitment |
| JEL: | L00 |
| Date: | 2011–09–12 |
| URL: | http://d.repec.org/n?u=RePEc:aah:aarhec:2011-13&r=lab |
| By: | Guy David; Evan Rawley; Daniel Polsky |
| Abstract: | We develop a formal model to show how integration solves task allocation problems between organizations and test the predictions of the model, using a large and rich patient-level dataset on hospital discharges to nursing homes and home health care. As predicted by the theory, we find that vertical integration allows hospitals to shift patient recovery tasks downstream to lower cost delivery systems by discharging patients earlier and in poorer health, and integration leads to greater post-hospitalization service intensity. While integration facilitates a shift in the allocation of tasks, health outcomes are no worse when patients receive care from an integrated provider. The evidence suggests that by improving the allocation of tasks, integration solves coordination problems that arise in market exchange. |
| JEL: | I12 L23 |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:17419&r=lab |
| By: | Timothy Perri |
| Abstract: | We consider the possibility a draft increases the likelihood individuals will invest in human capital in the military. This possibility exists because those drafted have less time to reap the return from human capital investment. A draft is more likely to increase human capital investment in the military the larger the civilian return to human capital investment, the shorter the additional time one must spend in the military if one invests while enlisted, and the larger the cost to an individual of obtaining a deferment. Key Words: Conscription, volunteer military, and human capital |
| JEL: | H56 J24 J45 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:apl:wpaper:11-15&r=lab |
| By: | Craigwell, Roland; Mathouraparsad, Sebastien; Maurin, Alain |
| Abstract: | In the Caribbean Basin, as in many other parts of the world, unemployment, with rates between 15 and 30 percent, has become one of the major problems affecting these societies. This article highlights the specific characteristics of Caribbean unemployment, contrasting them with those observed in the industrialized and developed nations. Secondly, it summarizes the main ideas that have been proposed to explain the problem of unemployment hysteresis and discusses their appropriateness in the case of the countries under consideration. Finally, it uses the framework of threshold models and processes with nonlinearities in the mean to empirically examine the hypothesis of hysteresis. The results supported these non- linear specifications: for Barbados, an LSTAR model is preferred while in the case of Trinidad and Tobago, an ESTAR specification is selected. |
| Keywords: | Unemployment persistence; Unit root tests; Non-linear models |
| JEL: | E24 J64 C2 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:33440&r=lab |
| By: | Leila Maron; Danièle Meulders; Sile Padraigin O'Dorchai; Robert Plasman; Natalie Julie Simeu Keumoe |
| Abstract: | Dans le cadre de la Présidence belge de l’Union européenne au deuxième semestre 2010, l’Institut pour l’égalité des femmes et des hommes a demandé au Département d’économie appliquée de l’Université Libre de Bruxelles (DULBEA) de préparer un rapport européen qui présente les indicateurs quantitatifs et qualitatifs relatifs à l’écart salarial approuvés par le Conseil de l’Union européenne en 2001. Ce rapport incorpore un certain nombre de développements récents qui tiennent compte des conclusions de la Task Force spéciale d’Eurostat qui avait pour objectif d’étudier et d’améliorer le calcul de l’indicateur relatif à l’écart salarial. Le rapport comporte deux parties :la première partie est relative aux indicateurs quantitatifs (Ratio des salaires des femmes et des hommes pour tous les salariés ;Ratio pour la masse salariale ;Ratio pour le temps partiel ;Ratio par âge et par niveau d'éducation ;Désavantage salarial dans les professions où les femmes sont concentrées ;Décomposition de l’écart salarial horaire entre hommes et femmes par la technique d’Oaxaca) et la seconde est relative aux indicateurs qualitatifs (Indicateur sur les lois, réglementations et dispositifs de lutte contre les discriminations et les inégalités professionnelles ;Indicateur sur l’influence des autorités publiques en matière de négociation salariale ;Indicateur concernant le temps partiel et les suspensions temporaires de la carrière professionnelle), ces deux types d’indicateurs permettant d’analyser les inégalités salariales entre les pays européens dans des optiques différentes. Le but de ce rapport vise à donner un aperçu de la situation de l’écart salarial dans l’Union européenne, sur la base des neuf indicateurs approuvés par le Conseil des Ministres de l’Union européenne en 2001 et de formuler une proposition d’actualisation de ces indicateurs, tenant compte des développements statistiques et de l'évolution législative intervenus depuis lors. |
| Keywords: | écart salarial de genre |
| JEL: | J31 |
| Date: | 2011–02–17 |
| URL: | http://d.repec.org/n?u=RePEc:dul:wpaper:2013/97157&r=lab |