|
on Labour Economics |
| By: | Chiswick, Barry R. (George Washington University); Rebhun, Uzi (Hebrew University, Jerusalem); Beider, Nadia (Hebrew University, Jerusalem) |
| Abstract: | This paper analyzes the Hebrew language proficiency, probability of employment, and labor market earnings of immigrants in Israel. It uses the 2010/11 Immigrant Absorption Survey conducted by the Israeli Central Bureau of Statistics. Unique features of the analysis include the study of long-duration immigrants (3 to 20 years), and analyses for: males and females, primary reasons for immigration, the subsidized intensive Hebrew language training program (ulpan), Ethiopian Jews, and Jewish and non-Jewish immigrants from the Former Soviet Union (FSU), in addition to standard immigration, demographic, and human capital variables. Results from multivariate analyses largely accord with the "standard theoretical model" of language proficiency regarding the mechanisms of "exposure", "efficiency", and "economic incentives". Acquaintance with the local language, on its part, increases the likelihood of being employed, and it has positive earnings outcomes. We discuss implications of the findings for public policy which can improve the adjustment of these new immigrants into their new society hence also moderate inter-group tensions. |
| Keywords: | immigrants, Israel, language proficiency, employment, earnings, motive for immigration, ulpan |
| JEL: | F22 J15 J24 J61 |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10214&r=lab |
| By: | Grace Lordan; Jörn-Steffen Pischke |
| Abstract: | Occupational segregation and pay gaps by gender remain large while many of the constraints traditionally believed to be responsible for these gaps have weakened over time. Here, we explore the possibility that women and men have different tastes for the content of the work they do. We run regressions of job satisfaction on the share of males in an occupation. Overall, there is a strong negative relationship between female satisfaction and the share of males. This relationship is fairly stable across different specifications and contexts, and the magnitude of the association is not attenuated by personal characteristics or other occupation averages. Notably, the effect is muted for women but largely unchanged for men when we include three measures that proxy the content and context of the work in an occupation, which we label ‘people,’ ‘brains,’ and ‘brawn.’ These results suggest that women may care more about job content, and this is a possible factor preventing them from entering some male dominated professions. We continue to find a strong negative relationship between female satisfaction and the occupation level share of males in a separate analysis that includes share of males in the firm. This suggests that we are not just picking up differences in the work environment, although these seem to play an independent and important role as well. |
| Keywords: | occupational choice; job content; gender; preferences |
| JEL: | J16 J4 |
| Date: | 2016–08 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:67682&r=lab |
| By: | Povilas Lastauskas (Bank of Lithuania); Julius Stakenas (Bank of Lithuania) |
| Abstract: | This paper builds a theoretical model that introduces frictional unemployment in a multisectoral heterogeneous firms model. We allow for multi-worker firms and dynamic matching process. In doing so, we have a rich environment that combines product, labour, and international markets. The focus is on unemployment benefits and employment contingent subsidies. We establish a mechanism, which is different from the standard search and matching model. A change in labour market policies due to the feedback from labour market tightness to wages transforms the share of exporters and affects average productivity. Partial equilibrium effects are overturned for subsidies in general equilibrium due to sectoral arbitrage condition. We address the following questions in the quantitative exercise: How does trade along intensive and extensive margins evolve with changes in labour market policies? How do firms’ profitabilities and thus reallocations across exporters/non-exporters react to labour market institu-tions? What are the differences between a domestic and a trade-bloc wide shock? In addition to the theory contribution, we find that unemployment benefits bear differ-ent policy implications with regards to international coordination than employment subsidies. |
| Keywords: | labour market institutions, heterogeneous multi-worker firms, dynamic matching, openness |
| JEL: | E24 F12 F16 |
| Date: | 2016–09–09 |
| URL: | http://d.repec.org/n?u=RePEc:lie:wpaper:33&r=lab |
| By: | Marco Di Maggio; Amir Kermani |
| Abstract: | We assess the extent to which unemployment insurance (UI) serves as an automatic stabilizer to mitigate the economy's sensitivity to shocks. Using a local labor market design based on heterogeneity in local benefit generosity, we estimate that a one standard deviation increase in generosity attenuates the effect of adverse shocks on employment growth by 7% and on earnings growth by 6%. Consistent with a local demand channel, we find that consumption is less responsive to local labor demand shocks in counties with more generous benefits. Our analysis finds that the local fiscal multiplier of unemployment insurance expenditure is approximately 1.9. |
| JEL: | E24 E62 H53 J65 |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22625&r=lab |
| By: | Gordon Hanson; Craig McIntosh |
| Abstract: | How will worldwide changes in population affect pressures for international migration in the future? We contrast the past three decades, during which population pressures contributed to substantial labor flows from neighboring countries into the United States and Europe, with the coming three decades, which will see sharp reductions in labor-supply growth in Latin America but not in Africa or much of the Middle East. Using a gravity-style empirical model, we examine the contribution of changes in relative labor-supply to bilateral migration in the 2000s and then apply this model to project future bilateral flows based on long-run UN forecasts of working-age populations in sending and receiving countries. Because the Americas are entering an era of uniformly low population growth, labor flows across the Rio Grande are projected to slow markedly. Europe, in contrast, will face substantial demographically driven migration pressures from across the Mediterranean for decades to come. Although these projected inflows would triple the first-generation immigrant stocks of larger European countries, they would still absorb only a small fraction of the 800-million-person increase in the working-age population of Sub-Saharan Africa that is projected to occur over the coming 40 years. |
| JEL: | F22 J61 |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22622&r=lab |
| By: | Marcotte, Dave E. (American University) |
| Abstract: | Community colleges have long been recognized for their potential in providing access to post-secondary education for students of limited means. Indeed, the recent #FreeTuition movement is built on community colleges as a cornerstone. Previous research on the value of community colleges in shaping earnings and career outcomes suggests that encouraging access to community college is a good investment. But, the evidence base on this issue is limited. The main limitations stem from the fact that what we know comes from data collected from cohorts of students who studied in community colleges more than twenty years ago. In the meantime, the market for higher education has changed drastically, and the Great Recession and economy of the early 21st Century have reshaped how young Americans are educated and begin their careers. For these reasons, I update the evidence on the employment and earnings effects of community college education. I study the experiences of the Educational Longitudinal Survey (ELS) cohort, which graduated from high school and began studying in community colleges at the start of the Great Recession, and who began their working careers in the years after. The experiences of this cohort are important in their own right, since they provide insight into the experiences of American workers during and after one of the largest economic downturns in modern history. Moreover, this paper will provide insight into the role post-secondary education plays in shaping economic security more generally. |
| Keywords: | education, community college |
| JEL: | I21 I23 I26 |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10202&r=lab |
| By: | Christoph Schottmüller (Department of Economics, University of Copenhagen) |
| Abstract: | A decision maker repeatedly asks an adviser for advice. The adviser is either competent or incompetent and his preferences are not perfectly aligned with the decision maker's preferences. Over time the decision maker learns about the adviser's type and fires him if he is likely to be incompetent. If the adviser's reputation for being competent improves, it is more attractive for him to push his own agenda because he is less likely to be fired for incompetence. Consequently, competent advisers are also fired with positive probability. Firing is least likely if the decision maker is unsure about the adviser's type. |
| Keywords: | advice, cheap talk, reputation |
| JEL: | C73 D83 G24 |
| Date: | 2016–09–12 |
| URL: | http://d.repec.org/n?u=RePEc:kud:kuiedp:1610&r=lab |
| By: | Gordon H. Hanson; Matthew J. Slaughter |
| Abstract: | Abstract In this paper, we document the importance of high-skilled immigration for U.S. employment in STEM fields. To begin, we review patterns of U.S. employment in STEM occupations among workers with at least a college degree. These patterns mirror the cycle of boom and bust in the U.S. technology industry. Among younger workers, the share of hours worked in STEM jobs peaked around the year 2000, at the height of the dot-com bubble. STEM employment shares are just now approaching these previous highs. Next, we consider the importance of immigrant labor to STEM employment. Immigrants account for a disproportionate share of jobs in STEM occupations, in particular among younger workers and among workers with a master's degree or PhD. Foreign-born presence is most pronounced in computer-related occupations, such as software programming. The majority of foreign-born workers in STEM jobs arrived in the U.S. at age 21 or older. Although we do not know the visa history of these individuals, their age at arrival is consistent with the H-1B visa being an important mode of entry for highly trained STEM workers into the U.S. Finally, we examine wage differences between native and foreign-born labor. Whereas foreign-born workers earn substantially less than native-born workers in non-STEM occupations, the native-foreign born earnings difference in STEM jobs is much smaller. Further, foreign-born workers in STEM fields reach earnings parity with native workers much more quickly than they do in non-STEM fields. In non-STEM jobs, foreign-born workers require 20 years or more in the U.S. to reach earnings parity with natives; in STEM fields, they achieve parity in less than a decade. |
| JEL: | F22 J61 |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22623&r=lab |
| By: | Annamaria Lusardi; Olivia S. Mitchell |
| Abstract: | The goal of this paper is to ascertain whether older women’s current and anticipated future labor force patterns have changed over time, and if so, to evaluate the factors associated with longer work lives and plans to continue work at older ages. Using data from both the Health and Retirement Study (HRS) and the National Financial Capability Study (NFCS), we show that older women’s current and intended future labor force attachment patterns are changing over time. Specifically, compared to our 1992 HRS baseline, more recent cohorts of women in their 50’s and 60s’s are more likely to plan to work longer. When we explore the reasons for delayed retirement among older women, factors include education, more marital disruption, and fewer children than prior cohorts. But household finances also play a key role, in that older women today have more debt than previously and are more financially fragile than in the past. The NFCS data show that factors associated with retirement planning include having more education and greater financial literacy. Those who report excessive amounts of debt and are financially fragile are the least financially literate, had more dependent children, and experienced income shocks. Thus shocks do play a role in older women’s debt status, but it is not enough to have resources: people also need the capacity to manage those resources if they are to stay out of debt as they head into retirement. |
| JEL: | D91 J14 |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22606&r=lab |
| By: | Patrick Kehoe; Elena Pastorino; Virgiliu Midrigan |
| Abstract: | During the Great Recession, regions of the United States that experienced the largest declines in household debt also experienced the largest drops in consumption, employment, and wages. Employment declines were larger in the nontradable sector and for firms that were facing the worst credit conditions. Motivated by these findings, we develop a search and matching model with credit frictions that affect both consumers and firms. In the model, tighter debt constraints raise the cost of investing in new job vacancies and thus reduce worker job finding rates and employment. Two key features of our model, on-the-job human capital accumulation and consumer-side credit frictions, are critical to generating sizable drops in employment. On-the-job human capital accumulation makes the flows of benefits from posting vacancies long-lived and so greatly amplifies the sensitivity of such investments to credit frictions. Consumer-side credit frictions further magnify these effects by leading wages to fall only modestly. We show that the model reproduces well the salient cross-regional features of the U.S. data during the Great Recession. |
| JEL: | E21 E24 E32 J21 J64 |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22614&r=lab |
| By: | Elena Cottini; Paolo Ghinetti (Università Cattolica del Sacro Cuore; Dipartimento di Economia e Finanza, Università Cattolica del Sacro Cuore) |
| Abstract: | We use register data for Denmark (IDA) merged with the Danish Work Environment Cohort Survey (1995-2000-2005) to estimate the effect of employment insecurity on health for a sample of Danish employees. We consider two health measures from the SF-36 Health Survey Instrument: a vitality scale for general wellbeing and a mental health scale. We use three dimensions of perceived employment insecurity: the fear of job loss (job tenure insecurity), of being transferred against will (job status insecurity) and of not finding another job if the current one is lost (employability insecurity). The nature of the dataset enables us to account for both individual and firm fixed. Results show that, overall, employment insecurity matters for both health measures. All the three insecurity dimensions increase psychological distress of workers, while general wellbeing is negatively affected mostly by employability prospects. We also exploit within country variability in employment protection rules by tenure and between blue and white collars to analyse differences in the health effect of our insecurity measures over these dimensions. We find substantial heterogeneity by tenure (attenuated effects by increasing tenure especially for job tenure insecurity) and occupation (white collars are worse off in their health gradient compared to blue collars). |
| Keywords: | job insecurity, employability, mental health, vitality, individual plus firm fixed effects. |
| JEL: | I12 J81 J65 |
| Date: | 2016–07 |
| URL: | http://d.repec.org/n?u=RePEc:ctc:serie1:def045&r=lab |
| By: | Torun, Huzeyfe (Central Bank of Turkey); Tumen, Semih (Central Bank of Turkey) |
| Abstract: | Although the season of birth variable is often used as an instrumental variable to estimate the rate of returns to schooling in the labor economics literature, there is an emerging consensus that the season of birth is systematically associated with later outcomes in life such as the educational and labor market success; thus, it is highly likely non-random. Using a large micro-level data set from Turkey, we argue that the degree of this non-randomness can be even larger in a developing-country context. Specifically, we show that around 20 percent of all individuals in Turkey have January as their month of birth due to a combination of geographical, seasonal, institutional, and idiosyncratic factors that lead to misreporting. We further document that being January-born strongly predicts worse socio-economic outcomes in later life. We show that this can be a serious problem in evaluating policies that define eligibility based on the month of birth – such as compulsory schooling and compulsory military service laws that set the eligibility birth date cutoff as the January 1st. We confirm the validity of this concern based on a series of regression discontinuity design exercises. We conclude that, in a developing-country context, additional caution should be exercised when using the season-of-birth variable as a statistical tool. |
| Keywords: | season-of-birth effects, IV, education, earnings, family background, misreporting |
| JEL: | C26 I26 J13 |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10203&r=lab |
| By: | Fali Huang; Ginger Zhe Jin; Lixin Colin Xu |
| Abstract: | While parental matchmaking has been widespread throughout history and across countries, we know little about the relationship between parental matchmaking and marriage outcomes. Does parental involvement in matchmaking help ensure their needs are better taken care of by married children? This paper finds supportive evidence using a survey of Chinese couples. In particular, parental involvement in matchmaking is associated with having a more submissive wife, a greater number of children, a higher likelihood of having any male children, and a stronger belief of the husband in providing old age support to his parents. These benefits, however, are achieved at the cost of less marital harmony within the couple and lower market income of the wife. The results render support to and extend the findings of Becker, Murphy and Spenkuch (2015) where parents meddle with children's preferences to ensure their commitment to providing parental goods such as old age support. |
| JEL: | D82 D83 J12 |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22586&r=lab |
| By: | Thierry Mayer; Marc J. Melitz; Gianmarco I. P. Ottaviano |
| Abstract: | We document how demand shocks in export markets lead French multi-product exporters to re-allocate the mix of products sold in those destinations. In response to positive demand shocks, those French firms skew their export sales towards their best performing products; and also extend the range of products sold to that market. We develop a theoretical model of multi-product firms and derive the specific demand and cost conditions needed to generate these product-mix reallocations. Our theoretical model highlights how the increased competition from demand shocks in export markets .and the induced product mix reallocations - induce productivity changes within the firm. We then empirically test for this connection between the demand shocks and the productivity of multi-product firms exporting to those destinations. We find that the effect of those demand shocks on productivity are substantial .and explain an important share of aggregate productivity fluctuations for French manufacturing. |
| Keywords: | productivity; trade; competition |
| JEL: | R14 J01 |
| Date: | 2016–07 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:67678&r=lab |