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on Labour Economics |
| By: | Margolis, David Naum (World Bank); Navarro, Lucas (Universidad Alberto Hurtado); Robalino, David A. (World Bank) |
| Abstract: | This paper analyses the potential impacts of introducing unemployment insurance (UI) in middle income countries using the case of Malaysia, which today does not have such a system. The analysis is based on a job search model with unemployment and three employment sectors: formal and informal wage employment, and self employment. The parameters of the model are estimated to replicate the structure of the labor market in Malaysia in 2009 and the distribution of earnings for informal, formal and self employed workers. The results suggest that unemployment insurance would have only a modest negative effect on unemployment if benefits are not overly generous. The main effect would be a reallocation of labor from wage into self employment while increasing average wages in the formal and informal sectors. |
| Keywords: | unemployment insurance, informal sector, self employment, job search |
| JEL: | J64 J65 O17 J23 J31 J21 J62 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6660&r=lab |
| By: | Tim Barmby; Alex Bryson; Barbara Eberth |
| Abstract: | Using a model of wage determination developed by Stevens (2003) we offer an explanation of why tenure has a negative effect when entered in job satisfaction equations. If job satisfaction measures match quality, then the explanation follows from a model of the labour market in which workers accumulate specific human capital at the firm they work and the way in which this accumulation affects the way workers react to outside job opportunities. |
| Keywords: | Job satisfaction, job match quality, human capital, job tenure |
| JEL: | J24 J28 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1151&r=lab |
| By: | Johnston, David W. (Monash University); Schurer, Stefanie (Victoria University of Wellington); Shields, Michael A. (University of Melbourne) |
| Abstract: | Using data from the 1970 British Cohort Study, we investigate the role of maternal gender role attitudes in explaining the differential educational expectations mothers have for their daughters and sons, and consequently their children's later educational outcomes and labour supply. We find that mothers' and children's gender role attitudes, measured some 25 years apart, are significantly correlated, equally so for sons and daughters. Moreover, daughters are significantly more likely to continue school beyond the minimum school-leaving age, participate in the labour force, and work more hours, if their mothers held non-traditional (pro-gender-equality) beliefs, even if they were not working themselves. Consistent with the hypothesis that maternal gender role attitudes affect daughters' economic opportunities only, we find no effect on sons' education outcomes and labour supply. However, we find that mothers' attitudes are significantly correlated with sons' partners' (daughter-in-law) labour supply. All these results suggest that the intergenerational transmission of non-traditional attitudes from mothers to their children explain a substantive part of gender inequalities in economic opportunities, and that attitudes and outcomes persevere across generations through assortative mating. |
| Keywords: | maternal gender role attitudes, intergenerational transmission, labour supply, human capital investment, expectations, cohort data |
| JEL: | J62 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6656&r=lab |
| By: | Seltzer, Andrew (Royal Holloway, University of London) |
| Abstract: | The late 19th and early 20th century British labour market experienced an influx of female clerical workers. Employers argued that female employment increased opportunities for men to advance; however, most male clerks regarded this expansion of the labour supply as a threat to their pay and status. This paper examines the effects of female employment on male clerks using data from Williams Deacon's Bank covering a period 25 years prior and 25 years subsequent to the initial employment of women. It is shown that within position women were substitutes for men, although the degree of substitutability was less for older men than for juniors. In addition, the employment of women in routine positions allowed the Bank to expand its branch network, creating new higher-level positions, which were almost always filled by men. |
| Keywords: | clerical labour markets, female employment, spill over effects, internal labour markets |
| JEL: | N3 J3 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6663&r=lab |
| By: | Traag Tanja; Lubbers Miranda Jessica; Velden Rolf van der (ROA rm) |
| Abstract: | In this paper we investigate if peer relations affect a student’s risk of early schoolleaving.We use the sociometric data collection from the Dutch “Secondary EducationPupil Cohort 1999” to identify peer relations in a sample of almost 20,000 students inthe first grade of secondary education (mean age 13). This information is matched todata on educational attainment from 1999 to 2010 for these students, to measure laterearly school-leaving by both the focal students as well as their peers. Our results showthat both being friends with future early school-leavers as well as popularity amongfuture early school-leavers increases the risk of students to be early school-leaverslater in their educational career while other characteristics of the peer group such asgender composition, ethnic composition, average (non)cognitive skills and averagesocioeconomic background have no effects on the risk of early school-leaving. And whilecharacteristics like gender, ethnicity and socio-economic background play an importantrole in peer selection, the future dropout status does not have a major impact on peerselection. |
| Keywords: | labour market entry and occupational careers; |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:umaror:2012006&r=lab |
| By: | Nirav Mehta (University of Western Ontario) |
| Abstract: | I develop a model of competition between charter schools and traditional public schools and estimate the model using administrative data from North Carolina. I use the model to quantify how existing charter schools have affected test scores for both charter and public school students and simulate charter school entry and student test scores were binding caps on charters lifted. I find that i) the mean effect of charter schools on attendant students (direct effect) is 25% of a standard deviation, ii) there is substantial heterogeneity in the mean direct effect by market, iii) the mean spillover effect on public school students is marginal, and iv) lifting caps on charter schools would more than double entry and cause increases in mean test scores similar to those under the capped scenario. |
| Keywords: | School Choice; Charter Schools; Education; Structural Estimation; General Equilibrium; Public Economics |
| JEL: | D58 I20 I28 H41 H72 L30 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:uwo:hcuwoc:20123&r=lab |
| By: | D'Amuri Francesco; Giovanni Peri (Department of Economics, University of California Davis) |
| Abstract: | n this paper we analyze the impact of immigrants on the type and quantity of native jobs. We use data on fifteen Western European countries during the 1996-2010 period. We find that immigrants, by taking manual-routine type of occupations pushed natives towards more "complex" (abstract and communication) jobs. Such positive reallocation occurred while the total number of jobs held by natives was unaffected. This job upgrade was associated in the short run to a 0.6% increase in native wages for a doubling of the immigrants' share. These results are robust to the use of two alternative IV strategies based on past settlement of immigrants across European countries measured alternatively with Census or Labor Force data. The job upgrade slowed, but did not come to a halt, during the Great Recession. We also document the labor market flows behind it: the complexity of jobs offered to new native hires was higher relative to the complexity of lost jobs. Finally, we find evidence that such reallocation was significantly larger in countries with more flexible labor laws and that his tendency was particularly strong for less educated workers. |
| Keywords: | Immigration, Jobs, Task specialization, Employment Protection Laws, Europe |
| JEL: | J24 J31 J61 |
| Date: | 2012–06–19 |
| URL: | http://d.repec.org/n?u=RePEc:cda:wpaper:12-15&r=lab |
| By: | Andrews, Martyn J. (University of Manchester); Gill, Leonard (University of Manchester); Schank, Thorsten (University of Mainz); Upward, Richard (University of Nottingham) |
| Abstract: | Positive assortative matching implies that high productivity workers and firms match together. However, there is almost no evidence of a positive correlation between the worker and firm contributions in two-way fixed-effects wage equations. This could be the result of a bias caused by standard estimation error. Using German social security records we show that the effect of this bias is substantial in samples with limited inter-firm movement. The correlation between worker and firm contributions to wage equations is unambiguously positive. |
| Keywords: | linked employer-employee panel data, fixed effects, limited mobility bias |
| JEL: | J20 J30 C23 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6662&r=lab |
| By: | Lo, Simon M.S. (Lingnan University); Stephan, Gesine (Institute for Employment Research (IAB), Nuremberg); Wilke, Ralf (University of York) |
| Abstract: | We estimate the effect of a shortening of unemployment benefit entitlements on unemployment duration. Previous studies on the same or related problems have not taken into account that the competing risks duration model is not identified and we shed first light on the question whether the non identification problem may preclude informative results. It turns out that the identification bounds for the parameters of interest are very wide in the absence of strong assumptions. We suggest an assumption on the dependence structure between risks which is milder than what conventional duration models assume. Under this assumption, the identification bounds are tighter and become informative for the direction of the treatment effect. We find evidence that the unemployed with higher pre-unemployment earnings are more likely to enter full-time employment and, in particular, subsidized self-employment. |
| Keywords: | dependent censoring, partial identification, difference-in-differences, unemployment duration, unemployment benefits |
| JEL: | C34 C41 J64 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6650&r=lab |
| By: | Ghazala Azmat; José Garcia Montalvo |
| Abstract: | This paper studies the determinants of school choice, focusing on the role of information. We consider how parents' search efforts and their capacity to process information (i.e., to correctly assess schools) affect the quality of the schools they choose for their children. Using a novel dataset, we are able to identify parents' awareness of schools in their neighborhood and measure their capacity to rank the quality of the school with respect to the official rankings. We find that parents’ education and wealth are important factors in determining their level of school awareness and information gathering. Moreover, these search efforts have important consequences in terms of the quality of school choice. |
| Keywords: | school choice, education in developing country, information gathering, household behavior |
| JEL: | I21 O12 D1 |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:upf:upfgen:1324&r=lab |
| By: | Thomas Sampson |
| Abstract: | This paper analyzes the impact of trade integration on wage inequality when there is heterogeneity across both workers and firms. By incorporating labor assignment into the heterogeneous firms literature I develop a model in which positive assortative matching between worker skill and firm technology explains the employer size-wage premium and the exporter wage premium. Under trade, fixed export costs cause the selection of high productivity, high skill firms into exporting and an upwards shift in the firm technology distribution. Consequently, the demand for skill and wage inequality increase in all countries, both on aggregate and within the export sector. This result holds both when firms' technologies are determined by a random draw and when technology is endogenous to firm level R&D. With endogenous technology, the increased demand for skill caused by trade liberalization results from technology upgrading by new exporters. |
| Keywords: | Wage inequality, matching, technology, skills, trade |
| JEL: | F16 J31 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1152&r=lab |
| By: | Andrews, Martyn J. (University of Manchester); Gerner, Hans-Dieter (Institute for Employment Research (IAB), Nuremberg); Schank, Thorsten (University of Mainz); Upward, Richard (University of Nottingham) |
| Abstract: | Increases in standard hours have been a contentious policy issue in Germany. Whilst this might directly lead to a substitution of workers by hours, there may also be a positive employment effect due to reduced costs. Moreover, the response of firms differs between firms which offer overtime and those which do not. For a panel of German plants (2001-2006), we analyse the effect of increased standard hours on employment. Using difference-in-difference methods we find that, consistent with theory, overtime plants showed a significant positive employment response, whilst for standard-time plants there is no difference at all between plants which increased standard hours and those which did not. |
| Keywords: | working time, employment, plant-level data, difference-in-differences |
| JEL: | C23 J23 J81 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6652&r=lab |
| By: | Büchner Charlotte; Cörvers Frank; Traag Tanja; Velden Rolf van der (ROA rm) |
| Abstract: | This study analyzes four different transmission mechanisms, through which father’searnings affect son’s earnings: the educational attainment, cognitive skills, the culturalcapital of the family and the social capital in the neighborhood. Using a unique dataset that combines panel data from a birth cohort with earnings data from a largenationwide income survey and national tax files, our findings show that cognitive skillsand schooling of the son account for 50% of the father-son earnings elasticity. Educationby far accounts for the largest part, while cognitive skills mainly work indirectly througheducational attainment. Social capital of the neighborhood and cultural capital of theparents account for an additional 6% of the intergeneration income persistence. Fromthese two additional mechanisms, social capital appears to play a stronger role than thecultural capital of the parents. This means that 44% of the intergenerational persistenceis due to other unobserved characteristics for example personality traits or spillovereffects of family assets. |
| Keywords: | labour economics ; |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:umaror:2012007&r=lab |
| By: | Zsolt Darvas |
| Abstract: | Sectoral shifts, such as shrinkage of low labour productivity and the low-wage construction sector, can lead to apparent increased aggregate average labour productivity and average wages, especially when capital intensity differs across sectors. For 11 main sectors and 13 manufacturing sub-sectors, we quantify the compositional effects on productivity, wages and unit labour costs (ULCs) based and real effective exchange rates (REER), for 24 EU countries. Compositional effects are greatest in Ireland, where the pharmaceutical sector drives the growth of output and productivity, but other sectors have suffered greatly and have not yet recovered. Our new ULC-REER measurements, which are free from compositional effects, correlate well with export performance. Among the countries facing the most severe external adjustment challenges, Lithuania, Portugal and Ireland have been the most successful based on five indicators, and Latvia, Estonia and Greece the least successful. There is evidence of downward wage flexibility in some countries, but wage cuts have corrected just a small fraction of pre-crisis wage rises and came with massive reductions in employment even in the business sector excluding construction and real estate, highlighting the difficulty of adjusting wages downward. |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:bre:polcon:730&r=lab |
| By: | Evan Borkum; Fang He; Leigh L. Linden |
| Abstract: | We conduct a randomized evaluation of a school library program on children’s language skills. We find that the program had little impact on students’ scores on a language test administered 16 months after implementation. The estimates are sufficiently precise to rule out effects larger than 0.13 and 0.11 standard deviations based on the 95 and 90 percent confidence intervals. The finding of zero effects is robust to different modes of implementation, individual tested language competencies and various subsets of the student population. We also find no impact on test scores in other subjects or on school attendance rates. |
| JEL: | I21 I28 O15 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:18183&r=lab |
| By: | Naito, Katsuyuki; Nishida, Keigo |
| Abstract: | This paper provides a simple theory to study how the allocation of public funds between primary and higher education affects human capital accumulation. The allocation is endogenously determined through majority voting. Public funding for higher education is not supported when a majority is poor. In some cases, higher education starts to be realized as a majority of individuals accumulate enough human capital through primary education. Although the emergence of higher education can accelerate aggregate human capital accumulation, it widens income inequality because the very poor are excluded from higher education and the declined budget share for primary education decreases its quality. |
| Keywords: | Public Education; Economic Development; Income Inequality; Majority Voting |
| JEL: | O11 O15 D72 O40 |
| Date: | 2012–06–22 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:39603&r=lab |
| By: | Sofia N. Andreou and Panos Pashardes |
| Abstract: | This paper investigates the willingness of households to pay for level (mean score) and egalitarian (deprivation compensating) components of the Contextual Value Added (CVA) indicator of school quality, which is used in England. Semi-parametric and parametric analysis shows that consumers are willing to pay for houses in the catchment area of primary and secondary schools with high academic achievement as measures by mean score; whereas, the component of the CVA indicating egalitarian education attainment is found to have zero and negative valuation at primary and secondary education levels, respectively. The implications of our findings for recently proposed changes in school funding policy to combat education inequalities are discussed. |
| Keywords: | Consumer Valuation, Egalitarian Education, School Quality, Hedonic Analysis, Contextual Value Added |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:ucy:cypeua:10-2012&r=lab |
| By: | Moen, Espen R. (Norwegian Business School (BI)); Yashiv, Eran (Tel Aviv University) |
| Abstract: | This paper studies the value of firms and their hiring and firing decisions in an environment where the productivity of the workers depends on how well they match with their co-workers and the firm acts as a coordinating device. Match quality derives from a production technology whereby workers are randomly located on the Salop circle, and depends negatively on the distance between the workers. It is shown that a worker's contribution in a given firm changes over time in a nontrivial way as co-workers are replaced with new workers. The paper derives optimal hiring and replacement policies, including an optimal stopping rule, and characterizes the resulting equilibrium in terms of employment, wages and distribution of firm values. The paper stresses the role of horizontal differences in worker productivity, as opposed to vertical, assortative matching issues. Simulations of the model show the dynamics of worker replacement policy, the resulting firm value and age distributions, and the connections between them. |
| Keywords: | firm value, complementarity, worker value, Salop circle, hiring, firing, match quality, optimal stopping |
| JEL: | E23 J62 J63 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6657&r=lab |
| By: | Ambrosini, J. William (Amazon); Mayr, Karin (University of Vienna); Peri, Giovanni (University of California, Davis); Radu, Dragos (University College London) |
| Abstract: | This paper uses census and survey data to identify the wage earning ability and the selection of recent Romanian migrants and returnees. We construct measures of selection across skill groups and estimate the average and the skill-specific premium for migration and return for three typical destinations of Romanian migrants after 1990. Once we account for migration costs, we find evidence that the selection and sorting of migrants by skills is driven by different returns in countries of destination. We also find that the return premium increases with migrants' skills and this drives the positive selection of returnees relative to non-migrants. As these findings are consistent with a model of rational choice in the migration decisions, we simulate a rational-agent model of education, migration and return. Our results suggest that for a source country like Romania relatively high rates of temporary migration might have positive long-run effects on average skills and wages. |
| Keywords: | migration premium, selection of migrants, returnees |
| JEL: | F22 J61 O15 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6664&r=lab |
| By: | Emin Dinlersoz; Jeremy Greenwood |
| Abstract: | Union membership displayed an inverted U-shaped pattern over the 20th century, while the distribution of income sketched a U. A model of unions is developed to analyze these phenomena. There is a distribution of firms in the economy. Firms hire capital, plus skilled and unskilled labor. Unionization is a costly process. A union decides how many firms to organize and its members’ wage rate. Simulation of the developed model establishes that skilled-biased technological change, which affects the productivity of skilled labor relative to unskilled labor, can potentially explain the above facts. Statistical analysis suggests that skill-biased technological change is an important factor in de-unionization. |
| Keywords: | CES,economic,research,micro,data,microdata, Computers, Distribution of Income, Flexible Manufacturing, Mass Production, Numerically Controlled Machines, Panel-Data Regression Analysis, Relative Price of New Equipment, Skill-Biased Technological Change, Simulation Analysis, Union Coverage, Union Membership, Deunionization |
| JEL: | J51 J24 L23 L11 L16 O14 O33 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:12-12&r=lab |
| By: | Addison, John T. (University of South Carolina); Teixeira, Paulino (University of Coimbra); Evers, Katalin (Institute for Employment Research (IAB), Nuremberg); Bellmann, Lutz (Institute for Employment Research (IAB), Nuremberg) |
| Abstract: | It is sometimes claimed that the coverage of collective bargaining in Germany is considerably understated because of orientation, a process whereby uncovered firms profess to shadow the wages set under sectoral bargaining. Yet importantly, at a time when collective bargaining proper has been in retreat, little is known of corresponding trends in the frequency of indirect coverage, still less of the degree to which wages are aligned in practice. Using nationally representative data for 2000-2010, this paper charts the extent of orientation in the uncovered sector, and tracks average wages across bargaining regimes as well as changes in wages from switches in regime. It is reported that orientation is growing with the decline in sectoral bargaining and that orienting firms do pay higher wages than their counterparts in the collective bargaining free zone. Yet in neither case – frequency nor remuneration – is the degree of 'compensation' recorded other than partial. |
| Keywords: | orientation, erosion of collective bargaining, uncovered sector, sectoral bargaining, wages, regime shifts |
| JEL: | J31 J5 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6658&r=lab |
| By: | Guillem López-Casasnovas; Catia Nicodemo |
| Abstract: | In this paper we study the disability transition probabilities (as well as the mortality probabilities) due to concurrent factors to age such as income, gender and education. Although it is well known that aging and socioeconomic status influence the probability of causing functional disorders, surprisingly little attention has been paid to the combined effect of those factors along the individuals' life and how this affects the transition from one degree of disability to another. The assumption that tomorrow's disability state is only a function of the today's state is very strong, since disability is a complex variable that depends on several other elements than time. This paper contributes into the field in two ways: (1) by attending the distinction between the initial disability level and the process that leads to his course (2) by addressing whether and how education, age and income differentially affect the disability transitions. Using a Markov chain discrete model and a survival analysis, we estimate the probability by year and individual characteristics that changes the state of disability and the duration that it takes its progression in each case. We find that people with an initial state of disability have a higher propensity to change and take less time to transit from different stages. Men do that more frequently than women. Education and income have negative effects on transition. Moreover, we consider the disability benefits associated to those changes along different stages of disability and therefore we o er some clues on the potential savings of preventive actions that may delay or avoid those transitions. On pure cost considerations, preventive programs for improvement show higher benefits than those for preventing deterioration, and in general terms, those focusing individuals below 65 should go first. Finally the trend of disability in Spain seems not to change among years and regional differences are not found. |
| Keywords: | Markov transition, disability states, cost of disability, Spain, survival analysis |
| JEL: | J11 I18 H55 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:bge:wpaper:643&r=lab |
| By: | Gabriel Burdin |
| Abstract: | Worker-managed firms (WMFs) represent a marginal proportion of total firms and aggregate employment in most countries. The bulk of firms in real economies is ultimately controlled by capital suppliers. Different theoretical explanations suggest that workermanaged firms (WMFs) are prone to failure in competitive environments. Using a panel of Uruguayan firms based on social security records and including the entire population of WMFs over the period January 1997-July 2009, I present new evidence on worker managed firms´ survival. I find that the hazard of exit is 24%-38% lower for WMFs than for conventional firms. This result is robust to alternative estimation strategies based on semiparametric and parametric frailty duration models that impose different distributional assumptions about the shape of the baseline hazard and allow to consider firm-level unobserved heterogeneity. The evidence suggests that the marginal presence of WMFs in market economies can hardly be explained by the fact that these organizations exhibit lower survival chances than conventional firms. This paper adds to the literature on labormanaged firms, shared capitalism and to the Industrial Organization literature on firm survival. |
| Keywords: | labor-managed firms, capitalist firms, survival analysis |
| JEL: | P13 P51 C41 |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:usi:wpaper:641&r=lab |
| By: | Buckles, Kasey (University of Notre Dame); Malamud, Ofer (University of Chicago); Morrill, Melinda Sandler (North Carolina State University); Wozniak, Abigail (University of Notre Dame) |
| Abstract: | We exploit exogenous variation in college completion induced by draft-avoidance behavior during the Vietnam War to examine the impact of college completion on adult mortality. Our preferred estimates imply that increasing college completion rates from the level of the state with the lowest induced rate to the highest would decrease cumulative mortality by 28 percent relative to the mean. Most of the reduction in mortality is from deaths due to cancer and heart disease. We also explore potential mechanisms, including differential earnings, health insurance, and health behaviors, using data from the Census, ACS, and NHIS. |
| Keywords: | health, college education |
| JEL: | I12 I23 J24 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6659&r=lab |
| By: | Blázquez Cuesta, Maite (Universidad Autónoma de Madrid); Budría, Santiago (University of Madeira) |
| Abstract: | Using a random effects dynamic panel data model and the 2000-2008 waves of the German SOEP this paper shows that non-cognitive skills have a predictive power on unemployment transitions. |
| Keywords: | non-cognitive skills, dynamic random effects model, unemployment persistence |
| JEL: | C33 J64 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6654&r=lab |
| By: | David Autor; Mark Duggan; Jonathan Gruber |
| Abstract: | We provide a detailed analysis of the incidence, duration and determinants of claims made on private Long Term Disability (LTD) policies using a database of approximately 10,000 policies and 1 million workers from a major LTD insurer. We document that LTD claims rates are much lower than claims rates on the public analogue to LTD, the Social Security Disability Insurance program, yet LTD policies have a much higher return-to-work rate among initial claimants. Nevertheless, our analysis indicates that the impact of moral hazard on LTD claims is substantial. Using within firm, over time variation in plan parameters, we find that a higher replacement rate and a shorter waiting time to benefits receipt—also known as the Elimination Period or EP—significantly increase the likelihood that workers claim LTD. About sixty percent of the effect of a longer EP is due to censoring of shorter claims, while the remainder is due to deterrence: workers facing a longer EP are less likely to claim benefits for impairments that would lead to a only a brief period of LTD receipt. This deterrence effect is equally large among high and low-income workers, suggesting that moral hazard rather than liquidity underlies the behavioral response. Consistent with this interpretation, the response of LTD claims to plan parameters is driven primarily by the behavior of the healthiest disabled, those who would return to work after receiving LTD. |
| JEL: | H55 J32 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:18172&r=lab |
| By: | Bram Timmermans; Ron Boschma |
| Abstract: | This paper investigates the impact of labour mobility on plant performance in Denmark. Our study shows that the effect of labour mobility can only be assessed when one accounts for the type of skills that flow into the plant, and the degree to which these match the existing skills at the plant level. As expected, we found that the inflow of skills that are related to skills in the plant impacts positively on plant productivity growth, while inflows of skills that are similar to the plant skills have a negative effect. We used a sophisticated indicator of revealed relatedness that measures the degree of skill relatedness between sectors on the basis of the intensity of labour flows between sectors. Intra-regional mobility of skilled labour had a negative effect on plant performance, but the impacts of intra- and inter-regional mobility depended on the type of skills that flow into the plant. |
| Keywords: | labour mobility, revealed relatedness, plant performance, geographical proximity, related labour flows, Denmark |
| JEL: | J61 R11 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:egu:wpaper:1213&r=lab |
| By: | Silke J. Forbes; Nora E. Gordon |
| Abstract: | We investigate decision-making and the potential for social learning among school administrators in the market for school reform consulting services. Specifically, we estimate whether public schools are more likely to choose given Comprehensive School Reform service providers if their “peer” schools—defined by common governance or geography—have performed unusually well with those providers in the past. We find strong evidence that schools tend to contract with providers used by other schools in their own districts in the past, regardless of past performance. In addition, our point estimates are consistent with school administrators using information from peers to choose the plans they perceive to have performed best in the past. Despite choosing a market with an unusually comprehensive data source on contracts between public schools and private firms, our statistical power is sufficiently weak that we cannot reject the absence of social learning. |
| JEL: | H52 I2 L14 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:18185&r=lab |
| By: | Pallares-Miralles, Montserrat; Romero, Carolina; Whitehouse, Edward |
| Abstract: | This paper presents and explains cross country data for mandatory publicly and privately managed pension systems around the world. This report is organized into three parts corresponding to three broad types of indicators. These indicators relate to: (i) the relevant contextual factors referred to here asenvironment; (ii) pension system design parameters; and (iii) indicators of performance. Part one of the report provides some information on the environment in which the system operates, focusing on demographic and labor market conditions. Understanding the current and future path of demographic patterns, especially aging, will place the later section on performance into a clearer perspective. Part two on pension system design uses a standardized taxonomy to describe differences across countries. The data on system design are presented in two groups of indicators: (i) overall architecture of the system: pillars, schemes including civil servants and other special schemes, and (ii) operating parameters of the system, which includes two sub-groups: a) qualifying conditions: pension eligibility ages, and contribution history, and b) contribution rates, defined benefit (DB), and defined contribution (DC) schemes, and indexation. It should be noted that while many countries have more than one program providing retirement income benefits, unless otherwise indicated, most of the data refer only to the national scheme. Part three presents a set of performance indicators. The indicators included are core pension indicators that illustrate six key criteria of any pension scheme, namely: (i) coverage, (ii) adequacy, (iii) financial sustainability, (iv) economic efficiency (i.e., minimizing the distortions of the retirement?income system on individuals'behavior, such as labor supply and savings outside of pension plans), (v) administrative efficiency, and (vi)) security of benefits in the face of different risks and uncertainties. |
| Keywords: | Pensions&Retirement Systems,Population Policies,Emerging Markets,Labor Markets,Debt Markets |
| Date: | 2012–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:hdnspu:70319&r=lab |
| By: | , Thanyaporn |
| Abstract: | This paper attempts to contribute to the understanding of the impacts of secure rural agricultural land rights on labour structural transformation from agriculture to non-agriculture as well as on urbanization, with a specific focus on Thailand. Using pro |
| Keywords: | land right security, labour structural transformation, urbanization |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp2012-41&r=lab |
| By: | Zhang, Jian (Central University of Finance and Economics); Giles, John T. (World Bank); Rozelle, Scott (Stanford University) |
| Abstract: | Recruiting and retaining leaders and public servants at the grass-roots level in developing countries creates a potential tension between providing sufficient returns to attract talent and limiting the scope for excessive rent-seeking behavior. In China, researchers have frequently argued that village cadres, who are the lowest level of administrators in rural areas, exploit personal political status for economic gain. Much existing research, however, compares the earnings of cadre and non-cadre households in rural China without controlling for unobserved dimensions of ability that are also correlated with success as entrepreneurs or in non-agricultural activities. The findings of this paper suggest a measurable return to cadre status, but the magnitudes are not large and provide only a modest incentive to participate in village-level government. The paper does not find evidence that households of village cadres earn significant rents from having a family member who is a cadre. Given the increasing returns to non-agricultural employment since China‘s economic reforms began, it is not surprising that the returns to working as a village cadre have also increased over time. Returns to cadre-status are derived both from direct compensation and subsidies for cadres and indirectly through returns earned in off-farm employment from businesses and economic activities managed by villages. |
| Keywords: | returns to political status, public sector labor markets, village political economy, rural China |
| JEL: | O16 O17 J45 P25 P26 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6653&r=lab |
| By: | Ortega, Francesc (Queens College, CUNY); Peri, Giovanni (University of California, Davis) |
| Abstract: | This paper makes two contributions to the literature on the determinants of international migration flows. First, we compile a new dataset on annual bilateral migration flows covering 15 OECD destination countries and 120 sending countries for the period 1980-2006. We also collect data on time-varying immigration policies that regulate the entry of immigrants for our destination countries over this period. Second, we extend the empirical model of migration choice across multiple destinations developed by Grogger and Hanson (2011) by allowing for unobserved individual heterogeneity between migrants and non-migrants. Our estimates show that international migration flows are highly responsive to income per capita at destination. This elasticity is twice as high for within-EU migration, reflecting the higher degree of labor mobility within the European Union. We also find that tightening of laws regulating immigrant entry reduce rapidly and significantly their flow. |
| Keywords: | international migration, labor movements, immigration policies |
| JEL: | F22 E25 J61 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6655&r=lab |
| By: | Francesc Ortega; Giovanni Peri (Department of Economics, University of California Davis) |
| Abstract: | This paper makes two contributions to the literature on the determinants of international migration flows. First, we compile a new dataset on annual bilateral migration flows covering 15 OECD destination countries and 120 sending countries for the period 1980-2006. We also collect data on time-varying immigration policies that regulate the entry of immigrants for our destination countries over this period. Second, we extend the empirical model of migration choice across multiple destinations developed by Grogger and Hanson (2011) by allowing for unobserved individual heterogeneity between migrants and non-migrants. Our estimates show that international migration flows are highly responsive to income per capita at destination. This elasticity is twice as high for within-EU migration, reflecting the higher degree of labor mobility within the European Union. We also find that tightening of laws regulating immigrant entry reduce rapidly and significantly their flow. |
| Keywords: | International Migration, Labor Movements, Immigration Policies. |
| JEL: | F22 E25 J61 |
| Date: | 2012–06–07 |
| URL: | http://d.repec.org/n?u=RePEc:cda:wpaper:12-14&r=lab |
| By: | Holger Schäfer |
| Abstract: | In principle, the SOEP is a highly adequate data source for analyzing the socio-economic background of temporary agency workers. In this paper, it's argued that on second glance, the SOEP's temp worker variable shows severe problems with data quality. An easy-to-use adjustment procedure is proposed that alleviates the problem, but is not an encompassing solution. Therefore, it is concluded that in the long term, the questionnaire needs to be improved. |
| Keywords: | Temporary agency work, panel surveys |
| JEL: | C83 J53 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp454&r=lab |
| By: | Alicia H. Munnell; Anthony Webb; Luke Delorme; Francesca Golub-Sass |
| Abstract: | The National Retirement Risk Index (NRRI) measures the share of American households “at risk” of being unable to maintain their pre-retirement standard of living in retirement. The NRRI is determined by comparing households’ projected replacement rates – retirement income as a percentage of pre-retirement income – with target rates that would allow them to maintain their living standards. A recent update shows that, in the wake of the financial crisis and the Great Recession, 51 percent of today’s working households are at risk.1 But a key assumption of the NRRI is that people retire at age 65. Clearly if people worked longer, the percentage at risk would decline. This brief adapts the NRRI calculations to address the question: At what age would the vast majority of households be ready to retire? The discussion proceeds as follows. The first section lays out the nuts and bolts of the NRRI and explains how it has been adapted for this analysis. Projected replacement rates are calculated not only for the generally assumed retirement age of 65, but also for every potential retirement age between 50 and 90. These replacement rates are then compared to a target rate to determine the percentage of house-holds “ready” for retirement at each age. The second section presents the results, showing the cumulative percentage of households ready for retirement at dif-ferent ages, with breakdowns by income and current age.2 The third section addresses how much longer households have to work beyond age 65 to be pre-pared for retirement. The final section concludes that over 85 percent of households would be prepared to retire by age 70. Thus, many individuals will need to work longer than their parents did, but they will still be able to enjoy a reasonable period of retirement, es-pecially as health and longevity continue to improve. |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:crr:issbrf:ib2012-12&r=lab |