|
on Labour Economics |
| By: | Yamauchi, Futoshi; Liu, Yanyan |
| Abstract: | This paper examines the long-term impacts of improved school quality at the elementary school stage on subsequent schooling investments and labor market outcomes using unique data from a recent survey that tracked students in the Philippines. The empirical results, which are based on a comparison of students who graduated from schools located in adjacent treatment and control areas before and after a school intervention, show significant differences in subsequent schooling investments, migration, and labor market earnings between females and males. That is, females study more (relative to males) and tend to migrate and earn more if they receive high-quality educational investments at an early stage. The above results are consistent with females'greater incentives to study, driven by their higher returns to schooling, especially after high school completion, observed in the labor market. |
| Keywords: | Tertiary Education,Education For All,Secondary Education,Primary Education,Access to Finance |
| Date: | 2012–10–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:6247&r=lab |
| By: | Sofía Galán (Banco de España); Sergio Puente (Banco de España) |
| Abstract: | We estimate the effects of a significant increase in the minimum wage in Spain between 2004 and 2010 on the individual probability of losing employment, using a large panel of social security records. Our main finding is that older people experienced the largest increase in the probability of losing their job, when compared with other age groups, including young people. The intuition is simple: among the affected (low-productivity) workers, young people are expected to increase their productivity more than older ones, who are in the flat part of their life-cycle productivity curve. Consequently, an employer facing a uniform increase in the minimum wage may find it profitable to retain young employees and to fire older ones |
| Keywords: | Minimum wage, labour demand, firing |
| JEL: | J23 J38 J63 |
| Date: | 2012–10 |
| URL: | http://d.repec.org/n?u=RePEc:bde:wpaper:1237&r=lab |
| By: | Yamauchi, Futoshi; Liu, Yanyan |
| Abstract: | This paper examines the impact of a large supply-side education intervention in the Philippines, the Third Elementary Education Project, on students'national achievement test scores. It finds that the program significantly increased student test scores at grades 4 to 6. The estimation indicates that two-year exposure to the program increases test scores by about 4.5 to 5 score points. Interestingly, the mathematics score is more responsive to the education reform than are other subjects. The analysis also finds that textbooks, instructional training of teachers, and new classroom construction particularly contributed to these outcomes. The empirical results imply that early-stage investment improves student performance at later stages in the elementary school cycle, which suggests that social returns to such an investment are greater than what the current study demonstrates. |
| Keywords: | Education For All,Tertiary Education,Primary Education,Teaching and Learning,Secondary Education |
| Date: | 2012–10–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:6246&r=lab |
| By: | Beatriz Muriel (Institute for Advanced Development Studies); Carlos Gustavo Machicado (Institute for Advanced Development Studies) |
| Abstract: | This paper analyzes employment in Bolivian registered manufacturing firms during 1988 to 2007, establishing its relationship with labor regulation. Estimating job flows, we find that firms with high temporary worker rates (less labor regulation costs) are those with both higher job reallocation rates and higher net employment growth, and only they contributed to employment growth during the country economic downturn, 1998-1999. In addition, estimating demand functions, we find the following effects of recent changes in labor norms: i) the compulsory basic salary rise in 2006-2009 entailed costs in terms of job losses, 5.6 percent for production workers and 4.8 percent for non-production workers; iii) the major labor costs derived from the new pension law, enacted in 2010, decreased employment demand around 1 percent; and, iv) labor protection policies decreased production workers demand. |
| Keywords: | job flows, labor demand, labor regulation, translog function, unbalanced panel |
| JEL: | D24 J01 J23 K31 |
| Date: | 2012–07 |
| URL: | http://d.repec.org/n?u=RePEc:adv:wpaper:201207&r=lab |
| By: | Rosa Sanchis-Guarner |
| Abstract: | This paper estimates the effects of road construction on individual labour market outcomes using micro-data from Great Britain between 2002 and 2008. To capture these effects, I use a measure of accessibility to employment through the road network at a very detailed geographical level. I test the effect of accessibility changes on weekly wages and hours worked. In order to tackle potential sources of bias, I use an instrumental variable which exploits the variation in employment accessibility stemming only from changes in minimum travel times between locations. I argue that, conditional on controls, small scale spatial variation in the accessibility impact of road construction can be considered to be exogenous because road schemes are aimed to improve connectivity and reduce congestion for wider and more distant areas. I further use home and work location specific individual fixed-effects to control for endogenous sorting of workers and I also restrict the sample to workers who are located very close to the projects. I find a positive impact of accessibility from work location on weekly wages and total hours worked but no effect of accessibility from home neither on wages nor hours, conditional on commuting time. These effects are not due to selection into employment as a result of road construction. I also find evidence of accessibility from home reducing commuting travel time. Increased spatial competition or agglomeration externalities are potential explanations for the findings. |
| Keywords: | Job accessibility, labour markets, roads, spatial sorting |
| JEL: | J31 R12 |
| Date: | 2012–10 |
| URL: | http://d.repec.org/n?u=RePEc:cep:sercdp:0120&r=lab |
| By: | Arias-Vazquez , Francisco Javier; Lee, Jean N.; Newhouse, David |
| Abstract: | This paper investigates the relationship between sectoral growth patterns and employment outcomes. A broad cross-country analysis reveals that in middle-income countries, employment responds more to growth in less productive and more labor-intensive sectors. Employment in middle-income countries is susceptible to a resource curse, and grows rapidly in response to manufacturing and export manufacturing growth. Within Brazil, Indonesia, and Mexico, the effects of different sectoral growth patterns are context dependent, but differences in sectoral growth effects on employment and wages are substantially reduced in states or provinces with higher measured labor mobility. Consistent with this, aggregate employment and wage effects of growth by sector are close to uniform when examined over longer time horizons, after labor has an opportunity to adjust across sectors. The results reinforce the importance of growth in more labor-intensive sectors, and suggest that job mobility may be an important mechanism to diffuse the benefits of capital-intensive growth. |
| Keywords: | Labor Policies,Labor Markets,Economic Theory&Research,Achieving Shared Growth,Banks&Banking Reform |
| Date: | 2012–10–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:6250&r=lab |
| By: | Ana Damas de Matos |
| Abstract: | I use a unique linked employer employee panel covering all wage earners in the private sector in Portugal to shed new light on the careers of immigrants. During the first ten years in the country immigrants close one third of the initial immigrant-native wage gap. I show that one third of this wage catch-up is accounted for by firm heterogeneity: Immigrants remain in the same occupations but get jobs with better paying _rms. Over time immigrants move to larger, more productive firms and with a higher share of native workers. These patterns are similar for all the recent immigrants irrespective of their origin and in particular of whether their mother tongue is the host country's language. Motivated by these new stylized facts, I suggest an economic assimilation mechanism which highlights imperfect information about immigrant productivity. I build an employer learning model with firm heterogeneity and complementarities between worker and firm type. The initial uncertainty over immigrants' productivity prevents them from getting access to the best jobs. Over time, productivity is revealed and immigrants obtain better firm matches. I derive predictions on the immigrant wage distributions over time, on their mobility patterns and on the productivity distribution of firms they are matched with. The predictions of the model are in line with the data and are not trivially derived from competing explanations. |
| Keywords: | Wage differentials, wage convergence, job mobility, immigration, linked employer-employee panel data |
| JEL: | J31 J61 J63 |
| Date: | 2012–10 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1171&r=lab |
| By: | Chi, Wei; Li, Bo |
| Abstract: | In contrast to the United States and European countries, China has witnessed a widening gender pay gap in the past two decades. Nevertheless, the size of the gender pay gap could still be underestimated as a result of not accounting for the low-wage women who have dropped out of the labor force. As shown by a large and representative set of household survey data in China, since the 1980s the female employment rate has been falling and the gap between male and female employment rates has been increasing. We estimate the bounds of the raw gender pay gap in China, taking into consideration the different male and female employment rates. To tighten the bounds, we use an instrumental variable, having a child aged less than 6 years. The results support the view that the raw gender pay gap, as large as it has been, is still underestimated. |
| Keywords: | Gender pay gap; gender employment gap; bounds; instrumental variable |
| JEL: | J3 |
| Date: | 2012–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:42132&r=lab |
| By: | Rothstein, Jesse |
| Abstract: | Recent proposals would strengthen the dependence of teacher pay and retention on performance, in order to attract those who will be effective teachers and repel those who will not. I model the teacher labor market, incorporating dynamic self-selection, noisy performance measurement, and Bayesian learning. Simulations indicate that labor market interactions are important to the evaluation of alternative teacher contracts. Typical bonus policies have very small effects on selection. Firing policies can have larger effects, if accompanied by substantial salary increases. However, misalignment between productivity and measured performance nearly eliminates the benefits while preserving most of the costs.  |
| Keywords: | Teacher Education and Professional Development, Specific Levels and Methods, Economics, General, Teachers, Education, Teacher quality, Evaluation |
| Date: | 2012–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:indrel:qt81q0f4bc&r=lab |
| By: | Bockerman, Petri; Vainiomäki, Jari |
| Abstract: | We use twin data matched to register-based individual information on earnings and employment to examine the effect of height on life-time labor market outcomes. The use of twin data allows us to remove otherwise unobserved ability and other differences. The twin pair difference estimates from instrumental variables estimation for genetically identical twins reveal a significant height-wage premium for women but not for men. This result implies that cognitive ability explains the effect of height on life-time earnings for men. Additional findings using capital income as the outcome variable suggest that discrimination against short persons may play a role for women. |
| Keywords: | Height; Weight; BMI; Height premium; Earnings; Employment |
| JEL: | J31 J23 I10 |
| Date: | 2012–10–25 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:42220&r=lab |
| By: | Falco, Paolo; Maloney, William F.; Rijkers, Bob; Sarrias, Mauricio |
| Abstract: | Using an extraordinarily rich panel dataset from Ghana, this paper explores the nature of self-employment and informality in developing countries through the analysis of self-reported happiness with work and life. Subjective job satisfaction measures allow assessment of the relative desirability of different jobs in ways that, conditional wage comparisons cannot. By exploiting recent advances in mixed (random parameter) ordered probit models, the distribution of subjective well-being across sectors of employment is quantified. There is little evidence for the overall inferiority of the small firm informal sector: there is not a robust average satisfaction premium for formal work vs. self-employment or informal salaried work, and owners of informal firms that employ others are on average significantly happier than workers in the formal private sector. Moreover, the estimated distribution of parameters predicting satisfaction reveal substantial heterogeneity in subjective well-being within sectors that conventional fixed parameter models, such as standard ordered probit models, cannot detect: Whatever the average satisfaction premium in a sector, all job categories contain both relatively happy and disgruntled workers. Specifically, roughly 67, 50, 40 and 59 percent prefer being a small-firm employer, sole proprietor, informal salaried, civic worker respectively, than formal work. Hence, there is a high degree of overlap in the distribution of satisfaction across sectors. The results are robust to the inclusion of fixed effects and alternate measures of satisfaction. Job characteristics, self-perceived autonomy and experimentally elicited measures of attitudes toward risk do not appear to explain these distributional patterns. |
| Keywords: | Labor Markets,Labor Policies,Labor Management and Relations,Work&Working Conditions,Educational Policy and Planning |
| Date: | 2012–10–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:6244&r=lab |
| By: | Albert, Jose Ramon G.; David, Clarissa |
| Abstract: | To improve the country`s standing on achieving the Millennium Development Goals on Education and Education for All targets, it is important to examine various economic and sociocultural demand-side factors that hinder children from attending and completing primary school, as well as maximizing their learning when they are in school. In this report, we look into two major issues regarding universal primary education, viz., late school entry and dropping out before completion of elementary, which are tied to a variety of factors related to demand for education. This paper focuses on a select few that appear to have substantial consequences on school attendance: perceptions about school readiness of children, economic factors (poverty and costs of education), differences in expectations between boys and girls, and education of mothers. Supply barriers also exacerbate these problems, particularly in a system that suffers continuous shortages of various education inputs. The examination in this paper includes reports using available national survey data and primary observations made during field visits and interviews in various areas of the country. This paper identifies and discusses the most pertinent factors related to why preprimary-aged children not in school are viewed as being too young for schooling, why primary-aged children not in school reportedly lack interest in schooling, and what puts some primary-aged students more at risk of dropping out than others. |
| Keywords: | poverty, Philippines, out-of-school children,dropouts, primary education, school readiness, gender disparities, input deficits |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:phd:dpaper:dp_2012-07&r=lab |
| By: | T. BUYSE; F. HEYLEN; R. VAN DE KERCKHOVE |
| Abstract: | We study the effects of pension reform in a four-period OLG model for an open economy where hours worked by three active generations, education of the young, the retirement decision of older workers, and aggregate growth, are all endogenous. Within each generation we distinguish individuals with high, medium or low ability to build human capital. This extension allows to investigate also the effects of pension reform on the income and welfare levels of different ability groups. Particular attention goes to the income at old-age and the welfare level of low-ability individuals. Our simulation results prefer an intelligent pay-as-you-go pension system above a fully-funded private system. When it comes to promoting employment, human capital, growth, and aggregate welfare, positive effects in a pay-as-you-go system are the strongest when it includes a tight link between individual labor income (and contributions) and the pension, and when it attaches a high weight to labor income earned as an older worker to compute the pension assessment base. Such a regime does, however, imply welfare losses for the current low-ability generations, and rising inequality in welfare. Complementing or replacing this ‘intelligent’ pay-as-you-go system by basic and/or minimum pension components is negative for aggregate welfare, employment and growth. Better is to maintain the tight link between individual labor income and the pension also for low-ability individuals, but to strongly raise their replacement rate. |
| Keywords: | employment by age; endogenous growth; retirement; pension reform; heterogeneous abilities; overlapping generations |
| JEL: | E62 H55 J22 J24 |
| Date: | 2012–08 |
| URL: | http://d.repec.org/n?u=RePEc:rug:rugwps:12/810&r=lab |
| By: | René Böheim (WIFO); Thomas Horvath (WIFO); Karin Mayr |
| Abstract: | We analyse the effect of workforce composition by birthplace in Austrian firms on workers' wages. In our model, each worker's productivity may depend on whether the co-workers are of the same or of a different birthplace and wages depend therefore both on the relative size of workers' groups as well as on the production structure of firms. We derive empirically testable hypotheses about the effect of co-worker birthplace on wages using a stylised model of intra-firm spill-overs across worker groups. We find evidence for complementarities between workers of different birthplace in line with our model that persist (but become smaller in size) after we control for observable productivity characteristics such as occupation and work experience. |
| Keywords: | Immigration, Labour force composition, Labour productivity |
| Date: | 2012–10–22 |
| URL: | http://d.repec.org/n?u=RePEc:wfo:wpaper:y:2012:i:438&r=lab |
| By: | Luciano Fanti |
| Abstract: | This paper discusses the dynamics of a standard (double Cobb-Douglas) labour market under the circumstance of changes in returns to labour. Despite the simplicity as well as the vast diffusion of this model, such an issue has so far escaped closer scrutiny by economic dynamics literature. This investigation shows: i) possible chaotic behaviours in a simple walrasian market, ii) the multiple roles that returns to labour play on the stability, and iii) the corresponding implications for stabilization policy. |
| Keywords: | chaos, walrasian labour market, returns to labor |
| JEL: | E3 J0 |
| Date: | 2012–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:pie:dsedps:2012/150&r=lab |
| By: | Ferdinand Geissler; Thomas Leopold; Sebastian Pink |
| Abstract: | This paper investigates gender differences in the spatial mobility of young adults when initially leaving their parental home. Using individual data from 11 waves (2000-2010) of the SOEP, we examine whether female home leavers in East Germany move across greater distances than males and whether these differences are explained by the gender gap in education. Our results reveal that female home leavers in East Germany are exceptionally mobile. This effect is attributable to their higher propensity of moving to West Germany. Education does not explain these gender differences. |
| JEL: | C23 J61 R23 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp493&r=lab |
| By: | Alessandro Turrini |
| Abstract: | This paper estimates the impact of fiscal consolidation on unemployment and job market flows across EU countries using a recent database of consolidation episodes built on the basis of a “narrative” approach (Devries et al., 2011). Results show that the impact of fiscal consolidation on cyclical unemployment, is temporary and significant mostly for expenditure measures. As expected, the impact of fiscal policy shocks on job separation rates is much stronger in low-EPL countries, while high-EPL countries suffer from a stronger reduction in the rate at which new jobs are created. Since a reduced job-finding rate corresponds to a longer average duration of unemployment spells, fiscal policy shocks also tend to raise the share of long-term unemployment if EPL is stricter. Results are broadly confirmed when using "top-down" fiscal consolidation measures based on adjusting budgetary data for the cycle. |
| Date: | 2012–07 |
| URL: | http://d.repec.org/n?u=RePEc:euf:ecopap:0462&r=lab |
| By: | Luciano Fanti; Nicola Meccheri |
| Abstract: | Can a merger from duopoly to monopoly be detrimental for profits? This paper deals with this issue by focusing on the interaction between decreasing returns to labour (which imply firms’ convex production costs) and centralised unionisation in a differentiated duopoly model. It is pointed out that the wage fixed by a monopoly central union in the post-merger case is higher than in the pre-merger/Cournot equilibrium, opening up the possibility that merger reduces profits. Indeed, it is shown that this “reversal result” actually applies when the central union is sufficiently little interested to wages with respect to employment. Moreover, the lower the degree of substitutability between firms’ products and the higher the workers’ reservation wage, the higher ceteris paribus the probability that profits decrease as a result of the merger. |
| Keywords: | merger profitability, unionised duopoly, convex costs. |
| JEL: | D43 L13 J50 |
| Date: | 2012–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:pie:dsedps:2012/134&r=lab |
| By: | Harry WU; Ximing YUE |
| Abstract: | Following the user cost theory on measuring labor input, after a careful scrutiny of available information, we construct employment and compensation matrices for China's industrial workforce over the period 1949-2009. Our measures are able to capture both individual and interactive effects of changes in gender, age, education, industry and ownership types of China's industrial workforce, and decompose the growth of labor input in Chinese industry into quantity and composition ("quality") effects. We find that the annual growth of the labor input in Chinese industry experienced a substantial decline from 6.9% per annum in the pre-reform period to 3.8% per annum in the post-reform period. Change of labor composition accounted for about 12% in the planning period (or 0.8% growth per annum), but it made little contribution during the reform period. We also find that the changes in industrial structure and age structure (reflecting the effects of seniority and experience) almost explained for the entire (positive) change in labor composition in the planning period. However, the change of education turned into negative after 1965 which made the average contribution of education negative in the planning period. Following the reform, education showed the most important contribution in the 1990s when the reform deepened, but the effect turned into negative again alongside China's entry into the World Trade Organization (WTO). |
| Date: | 2012–10 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:12065&r=lab |
| By: | Luciano Fanti |
| Abstract: | In this paper we study the effects of a boost of the mandatory retirement age, which is largely advocated in most countries facing with both the decline in the labour force participation of elderly workers and the increasing population ageing. It is shown, in the basic two-period overlapping generations model of growth (Diamond, 1965), that the postponement of the retirement age may be harmful for long run income and when the capital’s share is sufficiently high even PAYG pensions are reduced. In conclusion, since it is shown that the age of retirement might be reduced obtaining a higher income and even higher pension benefits, then our results suggest that the idea that a higher mandatory age of retirement is always beneficial in the long run for income and pension payments is theoretically controversial. |
| Keywords: | Retirement age; Pensions; OLG model |
| JEL: | J26 O41 |
| Date: | 2012–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:pie:dsedps:2012/149&r=lab |
| By: | Luciano Fanti |
| Abstract: | Motivated by the increasing literature on endogenous preferences, this paper investigates the implications of the introduction of habit and aspiration formation when labour supply is endogenous, in an OLG small open economy. In contrast with models with exogenous labour supply where aspirations always reduce economic performance, we show that in a model with endogenous labour supply greater aspirations lead to a higher long run savings and economic performance, through their impact on the labour/leisure choice. |
| Keywords: | Endogenous preferences; Fertility; OLG model. |
| JEL: | J22 O41 |
| Date: | 2012–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:pie:dsedps:2012/143&r=lab |
| By: | Robert L. Clark; Melinda S. Morrill; David Vanderweide |
| Abstract: | Studies examining pension distribution choices have found that the tendency of private-sector workers is to select lump sum distributions instead of life annuities. In the public sector, defined benefit pensions usually offer lump sum distributions equal to employee contributions, not the present value of the annuity. Using administrative data from the North Carolina state and local government retirement systems, we find that over two-thirds of public sector workers under age 50 separating prior to retirement from public plans in North Carolina left their accounts open and did not request a cash distribution from the pension system within one year of separation. Furthermore, the evidence suggests many separating workers, particularly those with short tenure, may be forgoing important benefits due to lack of knowledge, understanding, or accessibility of benefits. In contrast to prior research in the private sector, we find no evidence of a bias toward cash distributions for public employees in North Carolina. |
| JEL: | H75 J45 |
| Date: | 2012–10 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:18488&r=lab |