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on Labour Economics |
| By: | Doepke, Matthias (Northwestern University); Kindermann, Fabian (University of Bonn) |
| Abstract: | It takes a woman and a man to make a baby. This fact suggests that for a birth to take place, the parents should first agree on wanting a child. Using newly available data on fertility preferences and outcomes, we show that indeed, babies are likely to arrive only if both parents desire one, and there are many couples who disagree on having babies. We then build a bargaining model of fertility choice and match the model to data from a set of European countries with very low fertility rates. The distribution of the burden of child care between mothers and fathers turns out to be a key determinant of fertility. A policy that lowers the child care burden specifically on mothers can be more than twice as effective at increasing the fertility rate compared to a general child subsidy. |
| Keywords: | fertility, bargaining, child care |
| JEL: | J13 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9803&r=lab |
| By: | George J. Borjas |
| Abstract: | The Department of Homeland Security estimates that 11.4 million undocumented persons reside in the United States. Congress and President Obama are considering a number of proposals to regularize the status of the undocumented population and provide a “path to citizenship.” Any future change in the immigration status of this group is bound to have significant effects on the labor market, on the number of persons that qualify for various government-provided benefits, on the timing of retirement, on the size of the population receiving Social Security benefits, and on the funding of almost all of these government programs. This paper provides a comprehensive empirical study of the labor supply behavior of undocumented immigrants in the United States. Using newly developed methods that attempt to identify undocumented status for foreign-born persons sampled in the Current Population Surveys, the empirical analysis documents a number of findings, including the fact that the work propensity of undocumented men is much larger than that of other groups in the population; that this gap has grown over the past two decades; and that the labor supply elasticity of undocumented men is very close to zero, suggesting that their labor supply is almost perfectly inelastic. |
| JEL: | J22 J6 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22102&r=lab |
| By: | Kohlbrecher, Britta (University of Erlangen-Nuremberg); Merkl, Christian (University of Erlangen-Nuremberg) |
| Abstract: | This paper shows that the matching function and the Beveridge curve in the United States exhibit strong nonlinearities over the business cycle. These patterns can be replicated by enhancing a search and matching model with idiosyncratic productivity shocks for new contacts. Large negative aggregate shocks move the hiring cutoff point into a part of the idiosyncratic density function with higher density and thereby generate large, asymmetric job-finding rate and unemployment reactions. Our proposed mechanism is of high relevance as it leads to time varying effects of certain policy interventions. |
| Keywords: | business cycle asymmetries, matching function, Beverdige curve, job-finding rate, unemployment, effectiveness of policy |
| JEL: | E24 E32 J63 J64 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9816&r=lab |
| By: | Clemens, Michael A. (Center for Global Development); Montenegro, Claudio (University of Chile); Pritchett, Lant (Harvard Kennedy School) |
| Abstract: | Large international differences in the price of labor can be sustained by differences between workers, or by natural and policy barriers to worker mobility. We use migrant selection theory and evidence to place lower bounds on the ad valorem equivalent of labor mobility barriers to the United States, with unique nationally-representative microdata on both U.S. immigrant workers and workers in their 42 home countries. The average price equivalent of migration barriers in this setting, for low-skill males, is greater than $13,700 per worker per year. Natural and policy barriers may each create annual global losses of trillions of dollars. |
| Keywords: | migration, growth, impact, GDP, tariff, quota, deadweight, cost, visa, barrier, price, wedge |
| JEL: | F22 J61 J71 O15 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9789&r=lab |
| By: | Anna Zhu (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne) |
| Abstract: | Mothers caring for an infant or toddler continue to face barriers in returning to work after child birth. Mothers caring for an infant or toddler with a disability, however, may face even greater barriers. This paper contributes to the literature by exploring the employment costs for this group of mothers using a novel Australian administrative data set. The employment patterns of mothers with and without a disabled infant or toddler are compared both before and after child birth. The data follow 7,600 mothers on a bi-weekly basis for the entire period 12 months before and the 24 months after child birth and contain information on the disability status of the child, measures of employment and the intensity of employment. I find that mothers of disabled toddlers and infants suffer employment disadvantages relative to mothers of non-disabled children. The employment gaps grow from approximately six percentage points shortly after their children are born to 14-17 percentage points when their children are 12 to 24 months old. The employment gaps exist for full-time employment as well as for short part-time employment. Classification-I12, J13, J22 |
| Keywords: | Disability, infants or toddlers, mothers’ employment |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:iae:iaewps:wp2016n6&r=lab |
| By: | Schoiswohl Florian (Department of Economics, Vienna University of Economics and Business); Wüger Michael (Department of Economics, Vienna University of Economics and Business) |
| Abstract: | While worker flow analysis has grown in importance in many countries, Austria still lacks a specific longitudinal dataset as a prerequisite to perform similar analyses. For this reason, this article provides a coherent procedure to construct a longitudinal dataset based on the rotational panel structure of the Austrian quarterly LFS from 2004 to 2014. The procedure, which is available for researcher, is grounded on the discussion of several related and important issues inherent in constructing this sort of longitudinal data: First, it deals with the construction of the quarterly-matched dataset and the quality-of-measurement of several labour market variables. Second, the paper analyses non-response as a sample selection process, and shows that the selected (quarterly-matched) dataset causes biased estimates of worker flows. Third, the article proposes an iterative raking procedure to obtain survey weights as a bias-correcting device for any future analysis. Based on these adjustments, we present unbiased time-series of worker flows and transition rates, and conclude that the employment-unemployment margin is highly sensitive to economic shocks and that the Austrian labour market is additionally shaped by large movements within the participation margin. |
| Keywords: | Matched cross-sections, Sample selection, Worker flows, Unemployment dynamics, Austrian labour market |
| JEL: | C81 J21 J63 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwwuw:wuwp223&r=lab |
| By: | Hélène Perivier (OFCE Sciences Po); |
| Abstract: | The GDP collapse phase of the economic crisis has less affected female employment than male employment, whereas the austerity phase was particularly harsh for women. This gendered impact of the different stages of the crisis is described in the literature as follows: from she-cession to sh(e)austerity . This article aims to analyse the gendered trends in labour market for eight European countries. The quarterly evolution of the participation of women and men and the employment at the sectorial level are decomposed. The she-cession to sh(e)austerity scenario does not apply to all the selected countries. The other channels through which austerity policies can jeopardize gender equality and women’s rights are identified by referring to a typology of these policies. |
| Keywords: | gender,Recession,Austerity,Segregation, Economic policies, Employment |
| JEL: | J16 J21 J22 |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:fce:doctra:1605&r=lab |
| By: | Allison Shertzer; Randall P. Walsh |
| Abstract: | Residential segregation by race grew sharply in the United States as black migrants from the South arrived in northern cities during the early twentieth century. The existing literature emphasizes discriminatory institutions as the driving force behind this rapid rise in segregation. Using newly assembled neighborhood-level data, we instead focus on the role of “flight” by whites, providing the first systematic evidence of the role that prewar population dynamics played in the emergence of the American ghetto. Leveraging exogenous changes in neighborhood racial composition, we show that white departures in response to black arrivals were quantitatively large and accelerated between 1900 and 1930. Our preferred estimates suggest that white flight was responsible for 34 percent of the increase in segregation over the 1910s and 50 percent over the 1920s. Our analysis suggests that segregation would likely have arisen in American cities even without the presence of discriminatory institutions as a direct consequence of the widespread and decentralized relocation decisions of white urban residents. |
| JEL: | J15 N32 R23 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22077&r=lab |
| By: | Daysal, N. Meltem (University of Southern Denmark); Trandafir, Mircea (University of Southern Denmark); van Ewijk, Reyn (University of Mainz) |
| Abstract: | We investigate the impact of early-life medical interventions on low-risk newborn health. A policy rule in The Netherlands creates large discontinuities in medical treatments at gestational week 37. Using a regression discontinuity design, we find no health benefits from additional treatments for average newborns. However, there is substantial heterogeneity in returns to treatments with significant health benefits for newborns in the lowest income quartile and no benefits in higher income quartiles. This seems due to increased maternal stress from referral to an obstetrician among higher-income mothers, heterogeneous effects of home births, and potential difficulties in risk screening among low-income women. |
| Keywords: | medical interventions, birth, heterogeneity, mortality |
| JEL: | I11 I12 I18 J13 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9810&r=lab |
| By: | Braakmann, Nils; Brandl, Bernd |
| Abstract: | Individual and company bargaining has increasingly supplanted sector and country collective bargaining leading to increasingly perforated and multi-layered national collective bargaining systems. In this paper, we develop a comprehensive categorization of bargaining and argue that both the bargaining level and the degree of integrative interaction between bargaining units matters for efficacy. This idea is tested using representative company level data for the European Union. We find that the efficacy of coordinated sector and multi-level systems is higher than for all other forms of bargaining. Policy implications are discussed as these results challenge current attempts to reform collective bargaining in Europe. |
| Keywords: | collective bargaining; efficacy; hybrid bargaining systems; company performance |
| JEL: | J31 J32 J52 |
| Date: | 2016–02–08 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:70025&r=lab |
| By: | Thomas Buser (University of Amsterdam, the Netherlands) |
| Abstract: | I study how gender differences in willingness to compete evolve over time in response to experience. Participants in a lab experiment perform the same real-effort task over several rounds. In each round, they have to choose between piece-rate remuneration and a winner-takes-all competition. At the end of each round, those who compete get feedback on the competition outcome. The main result is that women are much more likely than men to stop competing after a loss, which leads to the appearance of a significant gender gap in competitiveness even among those who are initially willing to compete. This gender effect is also present for high performers. In an additional experiment, I show that giving feedback to non-competers might further increase the gender gap in willingness to compete as men who initially choose not to compete react more strongly to positive feedback compared to women. |
| Keywords: | competitiveness; gender; feedback; career decisions; laboratory experiment |
| JEL: | C91 D03 J01 J16 |
| Date: | 2016–03–14 |
| URL: | http://d.repec.org/n?u=RePEc:tin:wpaper:20160017&r=lab |
| By: | Deborah A. Cobb-Clark (School of Economics, The University of Sydney; ARC Centre of Excellence for Children and Families over the Life Course; Institute for the Study of Labor (IZA)); Nicolas Salamanca (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne; ARC Centre of Excellence for Children and Families over the Life Course); Anna Zhu (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne; ARC Centre of Excellence for Children and Families over the Life Course) |
| Abstract: | We propose a household production function approach to human development that explicitly considers the role of parenting style in child rearing. Specifically, we model parenting style as an investment in human development that depends not only on inputs of time and market goods, but also on attention, i.e. cognitive effort. The model links socioeconomic disadvantage to parenting style and human development through the constraints that disadvantage places on cognitive capacity. We find empirical support for our model. We demonstrate that parenting style is a construct that is distinct from standard goods- and timeintensive parental investments and that effective parenting styles are negatively correlated with socioeconomic disadvantage. Moreover, parenting style is an important determinant of young adults’ human capital net of other parental investments. Classification-D13, I31, J13 |
| Keywords: | Parenting style, cognitive load, locus of control, socioeconomic disadvantage, parental investments, human development |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:iae:iaewps:wp2016n3&r=lab |
| By: | Stefan Bender; Nicholas Bloom; David Card; John Van Reenen; Stefanie Wolter |
| Abstract: | Recent research suggests that much of the cross-firm variation in measured productivity is due to differences in use of advanced management practices. Many of these practices – including monitoring, goal setting, and the use of incentives – are mediated through employee decision-making and effort. To the extent that these practices are complementary with workers’ skills, better-managed firms will tend to recruit higher-ability workers and adopt pay practices to retain these employees. We use a unique data set that combines detailed survey data on the management practices of German manufacturing firms with longitudinal earnings records for their employees to study the relationship between productivity, management, worker ability, and pay. As documented by Bloom and Van Reenen (2007) there is a strong partial correlation between management practice scores and firm-level productivity in Germany. In our preferred TFP estimates only a small fraction of this correlation is explained by the higher human capital of the average employee at better-managed firms. A larger share (about 13%) is attributable to the human capital of the highest-paid workers, a group we interpret as representing the managers of the firm. And a similar amount is mediated through the pay premiums offered by better-managed firms. Looking at employee inflows and outflows, we confirm that better-managed firms systematically recruit and retain workers with higher average human capital. Overall, we conclude that workforce selection and positive pay premiums explain just under 30% of the measured impact of management practices on productivity in German manufacturing. |
| JEL: | J01 L2 M2 O32 O33 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22101&r=lab |
| By: | Neidhöfer, Guido |
| Abstract: | Countries with high income inequality also show a strong association between parents´ and children´s economic well-being; i.e. low intergenerational mobility. This study is the first to test this relationship in a between and within country setup, using harmonized micro data from 18 Latin American countries spanning multiple cohorts. It is shown that experiencing higher inequality in childhood has a negative effect on intergenerational mobility as adults. Furthermore, the influence of economic growth and public education is evaluated: both have a positive, significant, and substantial effect on intergenerational mobility. |
| Keywords: | inequality,intergenerational mobility,equality of opportunity,human capital,growth,development,public education,Great Gatsby Curve,Latin America |
| JEL: | D63 I24 J62 O15 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:fubsbe:20163&r=lab |
| By: | César Alonso-Borrego (Department of Economics, Universidad Carlos III de Madrid); Raquel Carrasco (Department of Economics, Universidad Carlos III de Madrid) |
| Abstract: | This paper studies the effect on the risk of female victimization of the employment statuses of both partners, conditional on income and a set of sociodemographic characteristics. Using cross-sectional data from the Violence Against Women (VAW) surveys for Spain in 1999, 2002, and 2006, we address the potential endogeneity of employment and income variables using a multivariate probit model. We exploit geographical-level information on employment and unemployment rates by gender and age, and on household income, to identify the parameters of the model. Our estimation results, for which proper account of the endogeneity problem proves critical, show that male partner employment plays a major role in the risk of physical violence, while female employment only lowers the risk of violence when her partner is employed too. The lowest risk of physical abuse appears for more egalitarian couples in which both partners are employed. |
| Keywords: | intimate-partner violence, employment, discrete choice, multivariate probit, endogeneity. |
| JEL: | J12 D19 J16 C25 C26 |
| Date: | 2016–03–15 |
| URL: | http://d.repec.org/n?u=RePEc:ucd:wpaper:201607&r=lab |
| By: | Han Lin Shang; Rob J Hyndman |
| Abstract: | Age-specific mortality rates are often disaggregated by different attributes, such as sex, state and ethnicity. Forecasting age-specific mortality rates at the national and sub-national levels plays an important role in developing social policy. However, independent forecasts of age-specific mortality rates at the sub-national levels may not add up to the forecasts at the national level. To address this issue, we consider the problem of reconciling age-specific mortality rate forecasts from the viewpoint of grouped univariate time series forecasting methods (Hyndman, Ahmed, et al., 2011), and extend these methods to functional time series forecasting, where age is considered as a continuum. The grouped functional time series methods are used to produce point forecasts of mortality rates that are aggregated appropriately across different disaggregation factors. For evaluating forecast uncertainty, we propose a bootstrap method for reconciling interval forecasts. Using the regional age-specific mortality rates in Japan, obtained from the Japanese Mortality Database, we investigate the one- to ten-step-ahead point and interval forecast accuracies between the independent and grouped functional time series forecasting methods. The proposed methods are shown to be useful for reconciling forecasts of age-specific mortality rates at the national and sub-national levels, and they also enjoy improved forecast accuracy averaged over different disaggregation factors. |
| Keywords: | Forecast reconciliation, hierarchical time series forecasting, bottom-up, optimal combination, Japanese Mortality Database |
| JEL: | C14 C32 J11 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:msh:ebswps:2016-4&r=lab |
| By: | Arnaud Lefranc (University of Cergy-Pontoise, THEMA and IZA, France); Alain Trannoy (Aix-Marseille University, AMSE, CNRS and EHESS, France) |
| Abstract: | Equality of opportunity is usually defined as a situation where the effect of circumstances on outcome is nullified (compensation principle) and the effort is acknowledged (reward principle). We propose a new version of the reward principle and we show that luck can be introduced in two ways in the definition of these principles, depending on whether the correlation between luck and circumstances should be nullified and whether the correlation between luck and effort should be rewarded. This leads to two distinct formulations (before-luck and after-luck) of the compensation and reward principles. Each combination of principles correspond to a particular view about how luck affects the opportunities of success. We also pay attention to the correlation between effort and circumstances which is dear to Roemer in a context of uncertainty. |
| Keywords: | Equality of Opportunity, luck, compensation principle, reward principle, moral hazard, first-order stochastic dominance, correlation, effort. |
| JEL: | D63 J62 C14 |
| Date: | 2016–02 |
| URL: | http://d.repec.org/n?u=RePEc:inq:inqwps:ecineq2016-394&r=lab |
| By: | Claudia Olivetti; M. Daniele Paserman; Laura Salisbury |
| Abstract: | This paper estimates intergenerational elasticities across three generations in the United States in the late 19th and early 20th centuries. We extend the methodology in Olivetti and Paserman (2015) to explore the role of maternal and paternal grandfathers for the transmission of economic status to grandsons and granddaughters. We document three main findings. First, grandfathers matter for income transmission, above and beyond their effect on fathers' income. Second, the socio-economic status of grandsons is influenced more strongly by paternal grandfathers than by maternal grandfathers. Third, maternal grandfathers are more important for granddaughters than for grandsons, while the opposite is true for paternal grandfathers. We present a model of multi-trait matching and inheritance that can rationalize these findings. |
| JEL: | J12 J62 N31 N32 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22094&r=lab |
| By: | Miller, Grant (Stanford University); Valente, Christine (University of Bristol) |
| Abstract: | There is longstanding debate in population policy about the relationship between modern contraception and abortion. Although theory predicts that they should be substitutes, the existing body of empirical evidence is difficult to interpret. What is required is a large‐scale intervention that alters the supply (or full price) of one or the other – and importantly, does so in isolation (reproductive health programs often bundle primary health care and family planning – and in some instances, abortion services). In this paper, we study Nepal's 2004 legalization of abortion provision and subsequent expansion of abortion services, an unusual and rapidly‐implemented policy meeting these requirements. Using four waves of rich individual‐level data representative of fertile‐age Nepalese women, we find robust evidence of substitution between modern contraception and abortion. This finding has important implications for public policy and foreign aid, suggesting that an effective strategy for reducing expensive and potentially unsafe abortions may be to expand the supply of modern contraceptives. |
| Keywords: | abortion, contraception, Nepal |
| JEL: | J13 N35 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9809&r=lab |
| By: | Thomas Url; Rob J Hyndman; Alexander Dokumentov |
| Abstract: | Many countries have implemented social programs providing long-term financial or in-kind entitlements. These programs often focus on specific age-groups and consequently their expenditure streams are subject to demographic change. Given the strains already existing on public budgets, long-term forecasts are an increasingly important instrument to monitor the budgetary consequences of social programs. The expected development of the labour force is a key input to these forecasts. We Produce forecasts of age-specific labour market participation rates, combining a functional data approach with information on education, marital status and other exogenous variables. |
| Keywords: | Forecast, labour supply, age-profile, smoothing. |
| JEL: | C14 C33 J11 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:msh:ebswps:2016-3&r=lab |
| By: | Keishi Fujiyama (Research Institute for Economics & Business Administration (RIEB), Kobe University, Japan) |
| Abstract: | It has been suggested in the literature that—given the long-term relationship between firms and employees—managers accelerate conservative accounting in prospect of employee negotiations to inform their employees of the firms' underlying economics. This study extends the existing literature by investigating whether a variation in employee influence in firms leads to different impairment accounting practices. Specifically, in the investigation of Japanese firms operating in a society where collective dismissals are difficult to implement, I find that firms with strong employee influence are less likely to downsize their employees, suggesting that such firms face stronger resistance from employees than those with weak employee influence. I also find that firms with strong employee influence that are contemplating downsizing recognize fixed asset impairment losses earlier than those with weak employee influence, suggesting that such an accounting practice by downsizing firms with strong employee influence elicits concessions from employees. In addition, the results indicate that shareholders and management also make concessions around downsizing implementation. Overall, the findings of this study suggest that accounting practices chosen by firms with strong employee influence are derived not from opportunistic purposes, but from informative motives. |
| Keywords: | Labor negotiation, Fixed asset impairment, Employee ownership, Downsizing |
| JEL: | G34 J54 M41 |
| Date: | 2016–03 |
| URL: | http://d.repec.org/n?u=RePEc:kob:dpaper:dp2016-10&r=lab |