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on Labour Economics |
| By: | NAGORE GARCIA Amparo |
| Abstract: | Using administrative data from Spanish Social Security for the period 2002-2013, we explore differences between unemployed men and women in their probabilities to find a job, their initial wages if they find a new job, and the likelihood to fall back into unemployment. We estimate bivariate proportional hazard models for unemployment duration and for the consecutive job duration for men and women separately, and decompose the gender gap using a non-linear Oaxaca decomposition. Gender differentials in labour market outcomes are procyclical, probably due to the procyclical nature of typically male occupations. While a higher level of education protects women in particular from unemployment, having children hampers women?s employment and initial wages after unemployment. There are lower gender gaps in the public sector and in high technology- firms. Decompositions show that the gender gaps are not explained by differences in sample composition. Indeed, if women had similar characteristics to men, the gender gap would be even wider. |
| Keywords: | unemployment duration; job duration; decomposition; labour market outcomes |
| JEL: | C14 E32 J62 J64 |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:irs:cepswp:2017-06&r=lab |
| By: | Camilo Morales-Jimenez |
| Abstract: | I propose a new mechanism for sluggish wages based on workers' noisy information about the state of the economy. Wages do not respond immediately to a positive aggregate shock because workers do not (yet) have enough information to demand higher wages. This increases firms' incentives to post more vacancies, which makes unemployment volatile and sensitive to aggregate shocks. The model is robust to two major criticisms of existing theories of sluggish wages and volatile unemployment: flexibility of wages for new hires and pro-cyclicality of the opportunity cost of employment. Calibrated to U.S. data, the model explains 70% of unemployment volatility. |
| Keywords: | Information Frictions ; Unemployment ; Wages and compensation |
| JEL: | E24 E32 J31 J63 |
| Date: | 2017–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2017-47&r=lab |
| By: | Borjas, George J. (Harvard University) |
| Abstract: | Over 11 million undocumented persons reside in the United States, and there has been a heated debate over the impact of legislative or executive efforts to regularize the status of this population. This paper examines the determinants of earnings for undocumented workers. Using newly developed methods that impute undocumented status for foreign-born persons sampled in microdata surveys, the study documents a number of findings. First, the age-earnings profile of undocumented workers lies far below that of legal immigrants and of native workers, and is almost perfectly flat during the prime working years. Second, the unadjusted gap in the log hourly wage between undocumented workers and natives is very large (around 40 percent), but half of this gap disappears once the calculation adjusts for differences in observable socioeconomic characteristics, particularly educational attainment. Finally, the adjusted wage of undocumented workers rose rapidly in the past decade. As a result, there was a large decline in the wage penalty associated with undocumented status. The relatively small magnitude of the current wage penalty suggests that a regularization program may only have a modest impact on the wage of undocumented workers. |
| JEL: | J31 J61 J68 |
| Date: | 2017–03 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:rwp17-013&r=lab |
| By: | Ebru Kongar; Mark Price |
| Abstract: | Using data from the 2003-14 American Time Use Survey (ATUS), this paper examines the relationship between the state unemployment rate and the time that opposite-sex couples with children spend on childcare activities, and how this varies by the socioeconomic status (SES), race, and ethnicity of the mothers and fathers. The time that mothers and fathers spend providing primary and secondary child caregiving, solo time with children, and any time spent as a family are considered. To explore the impact of macroeconomic conditions on the amount of time parents spend with children, the time-use data are combined with the state unemployment rate data from the US Bureau of Labor Statistics. The analysis finds that the time parents spend on child-caregiving activities or with their children varies with the unemployment rate in low-SES households, African-American households, and Hispanic households. Given that job losses were disproportionately high for workers with no college degree, African-Americans, and Hispanics during the Great Recession, the results suggest that the burden of household adjustment during the crisis fell disproportionately on the households most affected by the recession. |
| Keywords: | Economics of Gender; Time Use; Economic Crises; Unpaid Labor |
| JEL: | D13 J16 J64 |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:lev:wrkpap:wp_888&r=lab |
| By: | Armona, Luis (Stanford University); Chakrabarti, Rajashri (Federal Reserve Bank of New York); Lovenheim, Michael (Cornell University, NBER, CESifo) |
| Abstract: | For-profit providers are becoming an increasingly important fixture of U.S. higher education markets. Students who attend for-profit institutions take on more educational debt, have worse labor market outcomes, and are more likely to default than students attending similarly selective public schools. Because for-profit schools tend to serve students from more disadvantaged backgrounds, it is important to isolate the causal effect of for-profit enrollment on educational and labor market outcomes. We approach this problem using a novel instrument combined with more comprehensive data on student outcomes than have been employed in prior research. Our instrument leverages the interaction between increases in the demand for college when labor demand declines and the local supply of for-profit schools. We compare enrollment and postsecondary outcome changes across areas that experience similar labor demand shocks but that have different latent supply of for-profit institutions. The first-stage estimates show that students are much more likely to enroll in a for-profit institution for a given labor demand change when there is a higher supply of such schools in the base period. Second-stage estimates vary somewhat across two-year and four-year schools. Among four-year students, for-profit enrollment leads to more loans, higher loan amounts, an increased likelihood of borrowing, an increased risk of default, and worse labor market outcomes. Two-year for-profit students also take out more loans and have higher default rates and lower earnings. But they are more likely to graduate and to earn over $25,000 per year (the median earnings of high school graduates). Finally, we show that negative local labor demand shocks induce for-profit entry and that this effect is larger in areas that have a higher latent supply of for-profit institutions. Our results point to low returns to forprofit enrollment—a finding that has important implications for public investments in higher education as well as how students make postsecondary education choices. |
| Keywords: | postsecondary education; for-profit schools; student loans; default; returns to education |
| JEL: | H4 I2 J1 |
| Date: | 2017–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fednsr:811&r=lab |
| By: | Buchheim, Lukas (University of Munich); Watzinger, Martin (University of Munich) |
| Abstract: | We estimate the causal impact of a sizable German infrastructure investment program on employment at the county level. The program focused on improving the energy efficiency of school buildings, making it possible to use the number of schools as an instrument for investments. We find that the program was effective, creating one job for one year for each €25\'000 of investments. The employment gains reached their peak after nine months and dropped to zero quickly after the program\'s completion. The reductions in unemployment amounted to two-thirds of the job creation, and employment grew predominately in the construction and non-tradable industries. |
| Keywords: | infrastructure investments; job creation; employment dynamics; countercyclical fiscal policy; |
| JEL: | E24 E62 H72 |
| Date: | 2017–03–25 |
| URL: | http://d.repec.org/n?u=RePEc:rco:dpaper:20&r=lab |
| By: | Macours, Karen; Molina Millan, Teresa |
| Abstract: | This paper starts from a review of RCT studies in development economics, and documents many studies largely ignore attrition once attrition rates are found balanced between treatment arms. The paper analyzes the implications of attrition for the internal and external validity of the results of a randomized experiment with balanced attrition rates, and proposes a new method to correct for attrition bias. We rely on a 10-years longitudinal data set with a final attrition rate of 10 percent, obtained after intensive tracking of migrants, and document the sensitivity of ITT estimates for schooling gains and labour market outcomes for a social program in Nicaragua. We find that not including those found during the intensive tracking leads to an overestimate of the ITT effects for the target population by more than 35 percent, and that selection into attrition is driven by observable baseline characteristics. We propose to correct for attrition using inverse probability weighting with estimates of weights that exploit the similarities between missing individuals and those found during an intensive tracking phase. We compare these estimates with alternative strategies using regression adjustment, standard weights, bounds or proxy information. |
| Keywords: | attrition; long-term evaluation; randomized control trials |
| JEL: | C31 C81 C93 O12 |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:11962&r=lab |
| By: | Gehrke, Britta (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Lechthaler, Wolfgang; Merkl, Christian |
| Abstract: | This paper analyzes Germany's unusual labor market experience during the Great Recession. We estimate a general equilibrium model with a detailed labor market block for postunification Germany. This allows us to disentangle the role of institutions (short-time work, government spending rules) and shocks (aggregate, labor market, and policy shocks) and to perform counterfactual exercises. We identify positive labor market performance shocks (likely caused by labor market reforms) as the key driver for the "German labor market miracle" during the Great Recession. |
| JEL: | E24 E32 E62 J08 J63 |
| Date: | 2017–04–14 |
| URL: | http://d.repec.org/n?u=RePEc:iab:iabdpa:201714&r=lab |
| By: | Asali, Muhammad; Pignatti, Norberto; Skhirtladze, Sophiko |
| Abstract: | We provide experimental evidence about ethnic discrimination in the labor market in Georgia. We randomly assign Georgian and non-Georgian, male and female, names to similar resumes and apply for jobs as advertised in help-wanted web sites in Georgia. We find that gender has no effect on the probability of callback, but a job applicant who is ethnic Georgian is twice more likely to be called for a job interview than an equally skilled ethnic non-Georgian (Azeri or Armenian). The almost 100% gap in callbacks is statistically significant and cannot be abridged by having more experience or education. Both taste-based discrimination and statistical discrimination models are consistent with the evidence provided in this study. Labor market discrimination tends to aggravate in economic busts. |
| Keywords: | Field Experiment; Discrimination; Employment; Recession; Ethnicity |
| JEL: | C93 J15 J71 P23 |
| Date: | 2017–04–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:78230&r=lab |
| By: | David Deming; Lisa B. Kahn |
| Abstract: | We study variation in skill demands across firms and labor markets using job vacancy postings. We categorize a wide range of keywords found in job ads into ten general skills. We find a positive correlation between average wages and cognitive skill and social skill requirements that remains even after controlling for occupation, industry, and MSA fixed effects. We also find a positive correlation between these skill requirements and indicators of firm performance such as revenue per worker and whether the firm is publicly traded. These returns are concentrated among ads that specify both a cognitive and social skill requirement. Job skills have explanatory power for pay and firm performance, beyond what is available in widely-used labor market data. |
| JEL: | F1 F16 |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:23328&r=lab |
| By: | van Veldhuizen, Roel (WZB Berlin Social Science Center) |
| Abstract: | A large number of recent experimental studies show that women are less likely to sort into competitive environments. While part of this effect may be explained by gender differences in risk attitudes and overconfidence, previous studies have attributed the majority of the gender gap to gender differences in a separate \\\'competitiveness\\\' trait. We re-examine this result using a novel experimental technique that allows us to separate competitiveness from alternative explanations by experimental design. In contrast to the literature, our results imply that the whole gender gap is driven by risk attitudes and overconfidence, which has important implications for future research. |
| Keywords: | gender; competitiveness; lab experiment; experimental design; |
| JEL: | C90 J16 D03 |
| Date: | 2017–03–25 |
| URL: | http://d.repec.org/n?u=RePEc:rco:dpaper:14&r=lab |
| By: | Ager, Philipp (Department of Business and Economics); Brueckner, Markus (Australian National University); Herz, Benedikt (European Commission) |
| Abstract: | This paper provides new insights on the link between structural change and the fertility transition. In the early 1890s agricultural production in the American South was severely impaired by the spread of an agricultural pest, the boll weevil. We use this plausibly exogenous variation in agricultural production to establish a causal link between changes in earnings opportunities in agriculture and fertility. Our estimates show that lower earnings opportunities in agriculture lead to fewer children. We identify two channels: households staying in agriculture reduced fertility because children are a normal good, and households switching to manufacturing faced higher opportunity costs of raising children. The rather bleak outlook for unskilled agricultural workers also increased the demand for human capital, which reinforced the fertility decline that occurred in the American South during the late 19th and early 20th centuries. |
| Keywords: | Fertility transition; structural change; industrialization; agricultural income |
| JEL: | J13 N31 O15 |
| Date: | 2017–04–24 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sdueko:2017_006&r=lab |
| By: | Ricardo Reis |
| Abstract: | While there is much that is wrong with macroeconomics today, most critiques of the state of macroeconomics are off target. Current macroeconomic research is not mindless DSGE modeling filled with ridiculous assumptions and oblivious of data. Rather, young macroeconomists are doing vibrant, varied, and exciting work, getting jobs, and being published. Macroeconomics informs economic policy only moderately and not more nor all that differently than other fields in economics. Monetary policy has benefitted significantly from this advice in keeping inflation under control and preventing a new Great Depression. Macroeconomic forecasts perform poorly in absolute terms and given the size of the challenge probably always will. But relative to the level of aggregation, the time horizon, and the amount of funding, they are not so obviously worst than those in other fields. What is most wrong with macroeconomics today is perhaps that there is too little discussion of which models to teach and too little investment in graduate-level textbooks. |
| JEL: | J1 |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:74332&r=lab |
| By: | Alan J. Auerbach; Kerwin K. Charles; Courtney C. Coile; William Gale; Dana Goldman; Ronald Lee; Charles M. Lucas; Peter R. Orszag; Louise M. Sheiner; Bryan Tysinger; David N. Weil; Justin Wolfers; Rebeca Wong |
| Abstract: | Older Americans have experienced dramatic gains in life expectancy in recent decades, but an emerging literature reveals that these gains are accumulating mostly to those at the top of the income distribution. We explore how growing inequality in life expectancy affects lifetime benefits from Social Security, Medicare, and other programs and how this phenomenon interacts with possible program reforms. We first project that life expectancy at age 50 for males in the two highest income quintiles will rise by 7 to 8 years between the 1930 and 1960 birth cohorts, but that the two lowest income quintiles will experience little to no increase over that time period. This divergence in life expectancy will cause the gap between average lifetime program benefits received by men in the highest and lowest quintiles to widen by $130,000 (in $2009) over this period. Finally we simulate the effect of Social Security reforms such as raising the normal retirement age and changing the benefit formula to see whether they mitigate or enhance the reduced progressivity resulting from the widening gap in life expectancy. |
| JEL: | H50 J10 |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:23329&r=lab |
| By: | Norma Burow; Miriam Beblo; Denis Beninger; Melanie Schröder |
| Abstract: | This paper addresses the behavioral puzzle of women’s preference for competition when competitors are also women. Using a framed field experiment with 883 non-standard subjects, we show that none of the determinants of competitive behavior in general, including ability, self-confidence and risk aversion, provide a satisfying explanation for women’s substantive gender-related selection into competition. Nonetheless, women who are overconfident, i.e. over-estimate own abilities in performing a task, enter competition regardless of the gender-mix. Hence, the gender-pairing phenomenon is driven by women who correctly estimate or under-estimate own ability. We concluded that this is due to stereotypes about women’s underperformance compared to men. |
| Keywords: | Preferences for competition, gender, group composition, self-confidence |
| JEL: | C99 D83 J16 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1662&r=lab |
| By: | Ariel Burstein; Gordon Hanson; Lin Tian; Jonathan Vogel |
| Abstract: | In this paper, we show that labor-market adjustment to immigration differs across tradable and nontradable occupations. Theoretically, we derive a simple condition under which the arrival of foreign-born labor crowds native-born workers out of (or into) immigrant-intensive jobs, thus lowering (or raising) relative wages in these occupations, and explain why this process differs within tradable versus within nontradable activities. Using data for U.S. commuting zones over the period 1980 to 2012, we find that consistent with our theory a local influx of immigrants crowds out employment of native-born workers in more relative to less immigrant-intensive nontradable jobs, but has no such effect within tradable occupations. Further analysis of occupation wage bills is consistent with adjustment to immigration within tradables occurring more through changes in output (versus changes in prices) when compared to adjustment within nontradables, thus confirming the theoretical mechanism behind differential crowding out between the two sets of jobs. We then build on these insights to construct a quantitative framework to evaluate the consequences of counterfactual changes in U.S. immigration. Reducing inflows from Latin America, which tends to send low-skilled immigrants to specific U.S. regions, raises local wages for native-born workers in more relative to less-exposed nontradable occupations by much more than for similarly differentially exposed tradable jobs. By contrast, increasing the inflow of high-skilled immigrants, who are not so concentrated geographically, causes tradables and nontradables to adjust in a more similar fashion. For the nontradable-tradable distinction in labor-market adjustment to be manifest, as we find to be the case in our empirical analysis, regional economies must vary in their exposure to an immigration shock. |
| JEL: | F0 J0 |
| Date: | 2017–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:23330&r=lab |