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on Labour Economics |
| By: | Herz, Benedikt (Universitat Pompeu Fabra); van Rens, Thijs (University of Warwick) |
| Abstract: | We investigate unemployment due to mismatch in the US over the past three decades. We propose an accounting framework that allows us to estimate the overall amount of mismatch unemployment as well as the contribution of the frictions that caused the mismatch. Mismatch is quantitatively important for unemployment and the cyclical behavior of mismatch unemployment is very similar to that of the overall unemployment rate. Geographic mismatch is driven primarily by wage frictions. Mismatch across industries is driven by wage frictions as well as barriers to job mobility. We find virtually no role for worker mobility frictions. |
| Keywords: | mismatch, structural unemployment, worker mobility, job mobility |
| JEL: | E24 J61 J62 |
| Date: | 2015–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp8884&r=lab |
| By: | Carluccio, Juan (Banque de France); Fougère, Denis (CREST); Gautier, Erwan (LEMNA - University of Nantes) |
| Abstract: | We estimate the impact of international trade on wages using data for French manufacturing firms. We instrument firm-level trade flows with firm-specific instrumental variables based on world demand and supply shocks. Both export and offshoring shocks have a positive effect on wages. Exports increase wages for all occupational categories while offshoring has heterogeneous effects. The impact of trade on wages varies across bargaining regimes. In firms with collective bargaining, the elasticity of wages with respect to exports and offshoring is higher than in firms with no collective bargaining. Wage gains associated with collective bargaining are similar across worker categories. Keywords: exports, offshoring, firm-level wages, collective bargaining. |
| Keywords: | exports, offshoring, firm-level wages, collective bargaining |
| JEL: | F16 J51 E24 |
| Date: | 2015–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp8894&r=lab |
| By: | Deidda, Manuela (University of Cagliari); Di Liberto, Adriana (University of Cagliari); Foddi, Marta (University of Cagliari); Sulis, Giovanni (University of Cagliari) |
| Abstract: | We analyze the effects of an ALMP for disadvantaged workers implemented in a depressed area of Italy. Using propensity-score matching, we find that a) the employment subsidy had a positive effect for participants on both the probability of finding a job and income, b) the outcome of the policy was more positive for women, and c) the program was more effective for older and less-educated female workers. Using data on previous contacts between workers and firms and on informal channels for job search activity, we ultimately explore the role of the program in promoting the transition from informal to salaried employment. |
| Keywords: | employment subsidies, female labor-force participation, evaluation, informal economy |
| JEL: | C14 C83 J64 J16 |
| Date: | 2015–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp8886&r=lab |
| By: | Bloemen, Hans (VU University Amsterdam); Hochguertel, Stefan (VU University Amsterdam); Zweerink, Jochem (VU University Amsterdam) |
| Abstract: | We estimate and explain the impact of early retirement of husbands on their wives’ probability to retire within one year, using administrative micro panel data that cover the whole Dutch population. We employ an instrumental variable approach in which the retirement choice of husbands is instrumented with eligibility rules for generous early retirement benefits that were temporarily and unexpectedly available to them. We find that early retirement opportunities of husbands increased the wives' probability to retire by 24.6 percentage points. This is a strong, and robust effect. Partly, wives respond to husbands' choices at ages when they are themselves likely eligible for early retirement programs. |
| Keywords: | instruments, retirement, couples |
| JEL: | C26 J26 J12 J14 |
| Date: | 2015–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp8861&r=lab |
| By: | Karlsson, Tobias (Department of Economy and Society, School of Business, Economics and Law) |
| Abstract: | Along with rapid growth and improved standards of living, the first decades of the twentieth century saw the introduction of new technology and new ways to organize production. There are contrasting views on what impact these developments, often summarized as the Second Industrial Revolution, had on the situation of old men in the labour market. Some contemporary observers and modern-day historians have described how old men were crowded out of the labour force and pushed into an ‘industrial scrap heap’. Other researchers have maintained a more optimistic view on the opportunities of old men and argued that labour force withdrawal often was made possible by rising real earnings and savings. Since most of the research in the field has been based on cross-sectional data, the debate has relied on anecdotes, indirect evidence and assumptions.This paper uses data from a longitudinal panel of men living in the city of Gothenburg during the period 1923-1943. In contrast to most previous studies, this one takes up actual transitions into retirement and how such transitions were associated with access to resources. The main result is that a lack of resources was associated with a higher risk of retirement. This association appears even clearer when the sample is restricted to workingclass men and to the latter half of the period of investigation, when unemployment was lower and pension benefits higher. Thus, it would appear that transitions into retirement were most frequent when push and pull mechanisms were combined.<p> |
| Keywords: | labour markets; ageing; retirement; Sweden; inter-war period ISSN: 1653- |
| JEL: | J14 J26 N34 N94 |
| Date: | 2015–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunhis:0019&r=lab |
| By: | Meyer, Brent (Federal Reserve Bank of Atlanta); Tasci, Murat (Federal Reserve Bank of Cleveland) |
| Abstract: | This paper evaluates the ability of autoregressive models, professional forecasters, and models that incorporate unemployment flows to forecast the unemployment rate. We pay particular attention to flows-based approaches–the more reduced-form approach of Barnichon and Nekarda (2012) and the more structural method in Tasci (2012)–to generalize whether data on unemployment flows are useful in forecasting the unemployment rate. We find that any approach that considers unemployment inflow and outflow rates performs well in the near term. Over longer forecast horizons, Tasci (2012) appears to be a useful framework even though it was designed to be mainly a tool to uncover long-run labor market dynamics such as the "natural" rate. Its usefulness is amplified at specific points in the business cycle when the unemployment rate is away from the longer-run natural rate. Judgmental forecasts from professional economists tend to be the single best predictor of future unemployment rates. However, combining those guesses with flows-based approaches yields significant gains in forecasting accuracy. |
| Keywords: | unemployment forecasting; natural rate; unemployment flows; labor market search |
| JEL: | C53 E24 E32 J64 |
| Date: | 2015–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedawp:2015-01&r=lab |
| By: | Doreen Triebe |
| Abstract: | This paper examines the added worker effect (AWE), which refers to the increase of labor supply of individuals in response to a sudden financial shock in family income, that is, unemployment of their partner. While previous empirical studies focus on married women's response to those shocks, I explicitly analyze the spillover effects of unemployment on both women and men and I also differentiate according to their partnership status (marriage vs. cohabitation). My aim is to evaluate whether intra-household adaptation mechanisms differ by gender and by partnership status. The underlying method is a difference-in-differences setting in combination with an entropy balancing matching procedure. The paper considers plant closures and employer terminations as exogenous forms of unemployment. Using longitudinal data from the German Socio-Economic Panel (SOEP) study from 1991 through 2013, the empirical investigation finds evidence of the existence of an AWE. The effect is largest when a woman enters unemployment and is mainly driven by changes on the intensive margin (increase of hours). |
| Keywords: | Added worker effect, plant closure, unemployment, entropy balancing,intra-household adaptation |
| JEL: | D13 J12 J22 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp740&r=lab |
| By: | Hospido, Laura (Bank of Spain); Moreno-Galbis, Eva (Université d'Angers) |
| Abstract: | While Spain had traditionally under-performed its European counterparts in terms of labor productivity, the trend is reversed after 2007. The evolution of aggregate productivity in Spain during the Great Recession largely responds to the adverse conditions in the labor market, but not only. Using a longitudinal sample of Spanish manufacturing and services companies between 1995 and 2012, we show that the recent increase in Spanish aggregate productivity also responds to the evolution of the total factor productivity (TFP) and to composition effects. By combining the information at the firm level on balance sheet items, collective agreements and imports-exports, we are able to establish that commitment to a collective agreement at the firm level and access to external markets are positively related to TFP performance during the whole period. In addition, we estimate that firm TFP was negatively correlated with the share of temporary workers during the expansion period, 1995-2007, whereas the sign of that correlation reversed completely during the crisis, 2008-2012. Finally, we relate this sign reversal with the changing composition of temporary workers in the labor market. |
| Keywords: | labor productivity, TFP, temporary workers, collective agreements, exporting firms |
| JEL: | J24 J21 J52 |
| Date: | 2015–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp8891&r=lab |
| By: | Sin, Isabelle (Motu Economic and Public Policy Research Trust); Stillman, Steven (University of Otago) |
| Abstract: | Between 1984 and 2003, New Zealand undertook comprehensive market-oriented economic reforms. In this paper, we use Census data to examine how the internal mobility of Māori compares to that of Europeans in New Zealand in the period after these reforms. It is often suggested that Māori are less mobile than other ethnic groups because of attachment to particular geographical locations. If this were the case, Māori may have been disadvantaged in the post-reform period because they were more likely to be living in adversely affected areas and less likely to move to pursue better employment opportunities. In contrast to the anecdotal evidence, we find that Māori are more mobile on average than similar Europeans. However, Māori who live in areas with strong networks of their iwi are slightly less mobile than Europeans. The difference between Māori who live locally to their iwi and those who do not is even more pronounced when we consider responsiveness to local labour market shocks. Non-local Māori are considerably more responsive to changes in economic opportunities than are Europeans, whereas local Māori are almost entirely unresponsive. |
| Keywords: | mobility, migration, New Zealand, Māori, labour market areas |
| JEL: | J61 J15 R23 |
| Date: | 2015–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp8883&r=lab |
| By: | Beata Javorcik; Esther Ann Boler; Karen Helene Ulltveit-Moe |
| Abstract: | While the impact of globalization on income inequality has received a lot of attention, little is known about its effect on the gender wage gap (GWG). This study argues that there is a systematic difference in the GWG between exporting firms and non-exporters. By the virtue of being exposed to higher competition, exporters require greater commitment and flexibility from their employees. If commitment is not easily observable and women are perceived as less committed workers than men, exporters will statistically discriminate against female employees and will exhibit a higher GWG than non-exporters. We test this hypothesis using matched employer-employee data from the Norwegian manufacturing sector from 1996 to 2010. Our identification strategy relies on an exogenous shock, namely, the legislative changes that increased the length of the parental leave that is available only to fathers. We argue that these changes have narrowed the perceived commitment gap between the genders and show that the initially higher GWG observed in exporting firms relative to non-exporters has gone down after the changes took place. |
| Keywords: | Exporters, Globalization, Gender Wage Gap |
| JEL: | F10 F14 F16 J16 |
| Date: | 2015–03–10 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:743&r=lab |
| By: | Dusan Paredes (Departamento de Economía, Universidad Católica del Norte); Juan Soto (Departamento de Economía, Universidad Católica del Norte) |
| Abstract: | This paper suggests that long distance commuters in Chile obtain a wage compen- sation of 8.7% on average when they commute among functional areas using data for 2009, while previous work identies an average compensation of 19% using counties. Also, we estimated a higher compensation per hour. This estimated wage-gradient is 6.1% per commuted hour and it is robust in several econometric specications, a signicantly higher number than the 0.06% previously reported in Jamett and Paredes (2013). Long distance commuters receive dierent wage compensation along the education distribution. Workers with a high education earn a higher wage compensation. This research suggests that the labor market alone does not seem to present evidence, which foreshadows a reduction in LDC ows. Moreover, this paper displays how the labor market oers workers higher incentives in order to maintain the ow of long distance commuting. |
| Keywords: | Long Distance Commuting, Wage Compensation, Functional Areas |
| JEL: | J61 R23 |
| Date: | 2015–02 |
| URL: | http://d.repec.org/n?u=RePEc:cat:dtecon:dt201502&r=lab |
| By: | Koç, E. (Tilburg University, Center For Economic Research) |
| Abstract: | According to the permanent income / life-cycle hypothesis (PILCH), under standard preferences anticipated changes in employment status should not affect the changes in consumption. In this paper, we investigate the consumption behaviour of individuals who lose their jobs and those who find a job. For a representative sample of American households anticipated changes between employment and unemployment states are identified using monthly transition expectations. Firstly, it is shown that expectations have significant predictive power conditional on individual characteristics and a set of time-varying controls. This allows us to use a two-stage estimation strategy, where expectations are used to explain anticipated changes in employment status<br/>in the first stage and changes in consumption are regressed on anticipated changes in employment status in the second stage. Secondly, by estimating a first-order approximation of the Euler equation, it is shown that consumption expenditures are not sensitive to either anticipated transition into unemployment or anticipated transition into employment which is in line with the PILCH. |
| Keywords: | life-cycle model; labour market; expectations |
| JEL: | E2 J1 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:tiu:tiucen:257b35a1-8c5c-4662-88db-a364b7b1542c&r=lab |
| By: | Ufuk Akcigit; Salomé Baslandze; Stefanie Stantcheva |
| Abstract: | This paper studies the effect of top tax rates on inventors' mobility since 1977. We put special emphasis on "superstar" inventors, those with the most and most valuable patents. We use panel data on inventors from the United States and European Patent Offices to track inventors' locations over time and combine it with international effective top tax rate data. We construct a detailed set of proxies for inventors' counterfactual incomes in each possible destination country including, among others, measures of patent quality and technological fit with each potential destination. We find that superstar top 1% inventors are significantly affected by top tax rates when deciding where to locate. The elasticity of the number of domestic inventors to the net-of-tax rate is relatively small, between 0.04 and 0.06, while the elasticity of the number of foreign inventors is much larger, around 1.3. The elasticities to top net-of-tax rates decline as one moves down the quality distribution of inventors. Inventors who work in multinational companies are more likely to take advantage of tax differentials. On the other hand, if the company of an inventor has a higher share of its research activity in a given country, the inventor is less sensitive to the tax rate in that country. |
| JEL: | F22 H21 H24 H31 J61 O33 O38 |
| Date: | 2015–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:21024&r=lab |
| By: | Chiara Falco |
| Abstract: | This study examines how the educational level attained by individuals affects their migration propensity. Using an original 2006 Ecuadorian survey, which gathered information on household members who were not in the country at the time of the survey (i.e., emigrants), we implement a Regression Discontinuity Design and control for potential endogeneity of the education explanatory variable based on the 1977 educational reform in Ecuador. Our results provide evidence of positive self-selection among migrants. Taking into account the 27{57 age sample, an individual with a lower secondary level of education increases the migration propensity by 31.30%; this propensity is even higher (34.47%) when the sample of migrants is restricted to the urban areas. Considering both country-specific characteristics and gender differentials, our results do not indicate a significant impact of an increase in human capital on the male migration propensity. However, there is a positive and significant effect on the female migration propensity, in particular, for women from larger cities. The results are consistent with theoretical models related to positive self-selection in response to labor market distortions, such as the disparities between genders. |
| Keywords: | International Migration, Education, Gender |
| JEL: | F22 J16 O15 I25 |
| Date: | 2015–03 |
| URL: | http://d.repec.org/n?u=RePEc:mib:wpaper:297&r=lab |
| By: | Jie Cai (University of New South Wales, School of Economics, Australian School of Business); Andrey Stoyanov (York University, Department of Economics, Faculty of Liberal Arts and Professional Studies) |
| Abstract: | In this paper we show that demographic di§erences between countries are a source of comparative advantage in international trade. Since many skills are age-dependent, population aging decreases the relative supply and increases the relative price of skills which depreciate with age. Thus, industries relying on skills in which younger workers are relatively more efficient will be more productive in countries with younger labor force and less productive in countries with older populations. Building upon the behavioral and economics literature, we construct industry-level measures of intensities in various age- dependent skills and show that population aging leads to specialization in industries which use age-appreciating skills intensively and erodes comparative advantage in industries for which age-depreciating skills are more important. |
| Keywords: | trade patterns; comparative advantage, population aging, cognitive skills |
| JEL: | F14 F16 J11 J24 |
| Date: | 2015–02–03 |
| URL: | http://d.repec.org/n?u=RePEc:yca:wpaper:2015_1&r=lab |
| By: | Ljungqvist, Lars; Sargent, Thomas J |
| Abstract: | To generate big responses of unemployment to productivity changes, researchers have reconfigured matching models in various ways: by elevating the utility of leisure, by making wages sticky, by assuming alternating-offer wage bargaining, by introducing costly acquisition of credit, or by positing government mandated unemployment compensation and layoff costs. All of these redesigned matching models increase responses of unemployment to movements in productivity by diminishing the fundamental surplus fraction, an upper bound on the fraction of a job's output that the invisible hand can allocate to vacancy creation. This single common channel unites analyses of business cycle and welfare state dynamics. |
| Keywords: | business cycle; fundamental surplus; market tightness; matching model; unemployment; volatility; welfare state |
| JEL: | E24 E32 J08 |
| Date: | 2015–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:10489&r=lab |