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on Labour Economics |
| By: | Addison, John T. (University of South Carolina); Chen, Liwen (University of South Carolina); Ozturk, Orgul Demet (University of South Carolina) |
| Abstract: | Job mobility, especially early in a career, is an important source of wage growth. This effect is typically attributed to heterogeneity in the quality of employee-employer matches, with individuals learning of their abilities and discovering the tasks at which they are most productive through job search. That is, job mobility enables better matches, and individuals move to better their labor market prospects and settle once they find a satisfactory match. In this paper, we show that there are gender differences in match quality and changes in match quality over the course of careers. In particular, we find that females are mismatched more than males. This is true even for females with the best early-career matches. However, the direction of the gender effect differs significantly by education. Only females among the college educated are more mismatched and are more likely to be over-qualified then their male counterparts. These results are seemingly driven by life events, such as child birth. For their part, college-educated males of the younger cohort are worse off in terms of match quality compared to the older cohort, while the new generation of women is doing better on average. |
| Keywords: | multidimensional skills, occupational mismatch, match quality, wages, gender wage gap, fertility, fertility timing |
| JEL: | J3 J16 J22 J24 J31 J33 N3 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11114&r=lab |
| By: | Ginja, Rita (University of Bergen); Jans, Jenny (Uppsala University); Karimi, Arizo (IFAU) |
| Abstract: | How do parental resources early in life affect children's health and schooling outcomes? We address this question by exploiting the so-called speed premium (SP) in the Swedish parental leave (PL) system. The SP grants mothers higher PL benefits for the subsequent child without the need to re-quality for benefits through pre-birth market work, if the two births occur within a pre-specified interval. The eligibility birth interval for this automatic renewal of PL benefits was set to 24 months in 1980–1985, and to 30 months since 1986. This allow us to use a Regression Discontinuity framework to study how additional parental time and monetary resources impacts both the existing and new child's educational and health outcomes. We find that maternal eligibility to the SP increases the 9th grade GPA, and the likelihood of college attendance of the first-born child, but it does not affect the secondborn. These impacts can be generalized for higher-order parities. The effects are prevalent primarily among children to high-income mothers. Impacts are driven by a combination of a persistent positive income shock, and substitution away from informal care to maternal time. |
| Keywords: | parental leave, earnings, time investments, child outcomes |
| JEL: | J13 J22 J18 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11106&r=lab |
| By: | Michèle Müller-Itten (Department of Economics, University of Notre Dame); Aniko Ory (Cowles Foundation, Yale University) |
| Abstract: | We study the evolution of labor force composition when mentoring is more effective within members of the same socio-demographic type. Typically, multiple steady states exist. Some completely exclude juniors of one type. Even a mixed steady state tends to over-represent the type that is dominant in the population. In contrast, the efficient labor force balances talent recruitment against mentoring frictions. It may even underrepresent the dominant type and typically calls for persistent government intervention. This contrasts with the public discourse around temporary affirmative action. We consider specific policy instruments and show that hiring quotas can induce equilibrium employment insecurity. |
| Keywords: | Affirmative action, Continuous time overlapping generations, Human capital, Labor participation, Employment insecurity, Mentoring, Talent |
| JEL: | D62 E24 I2 J15 J16 J24 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:cwl:cwldpp:3012&r=lab |
| By: | Hijzen, Alexander (OECD); Martins, Pedro S. (Queen Mary, University of London); Parlevliet, Jante (De Nederlandsche Bank) |
| Abstract: | This paper contributes to a deeper understanding of sector-level bargaining systems and their role for labour market performance. We compare two countries with seemingly similar collective bargaining systems, the Netherlands and Portugal, and document a number of features that may affect labour market outcomes, including: i) the scope for flexibility at the firm or worker level within sector-level agreements; ii) the emphasis on representativeness as a criterion for extensions; iii) the effectiveness of coordination across bargaining units; and iv) pro-active government policies to enhance trust and cooperation between the social partners. |
| Keywords: | industrial relations, social dialogue, employment |
| JEL: | J5 P52 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11113&r=lab |
| By: | Bauer, Thomas K. (RWI); Giesecke, Matthias (RWI); Janisch, Laura (RWI) |
| Abstract: | We examine the long-run effects of forced migration from Eastern Europe into post-war Germany. Existing evidence suggests that displaced individuals are worse off economically, facing a considerably lower income and a higher unemployment risk than comparable natives even twenty years after being expelled. We extend this literature by investigating the relative performance of forced migrants across the entire life cycle. Using social security records that document the exact date of death and a proxy for pre-retirement lifetime earnings, we estimate a significantly and considerably higher mortality risk among forced migrants compared to native West-Germans. The adverse displacement effect persists throughout the earnings distribution except for the top quintile. Although forced migrants are generally worse off regarding mortality outcomes, those with successful labor market histories seem to overcome the long-lasting negative consequences of flight and expulsion. |
| Keywords: | forced migration, differential mortality, lifetime earnings, economic history |
| JEL: | I12 J61 O15 R23 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11116&r=lab |
| By: | Garcia-Lorenzo, Lucia; Donnelly, Paul; Sell-Trujillo, Lucia; Imas, J. Miguel |
| Abstract: | This paper contributes to creative entrepreneurship studies through exploring ‘liminal entrepreneuring’, i.e., the organization-creation entrepreneurial practices and narratives of individuals living in precarious conditions. Drawing on a processual approach to entrepreneurship and Turner’s liminality concept, we study the transition from un(der)employment to entrepreneurship of 50 nascent necessity entrepreneurs (NNEs) in Spain, the United Kingdom, and Ireland. The paper asks how these agents develop creative entrepreneuring practices in their efforts to overcome their condition of ‘necessity’. The analysis shows how, in their everyday liminal entrepreneuring, NNEs disassemble their identities and social positions, experiment with new relationships and alternative visions of themselves, and (re)connect with entrepreneuring ideas and practices in a new way, using imagination and organization-creation practices to reconstruct both self and context in the process. The results question and expand the notion of entrepreneuring in times of socioeconomic stress |
| Keywords: | creative entrepreneuring; economic crisis; liminality; narratives; nascent necessity entrepreneurs; organization-creation |
| JEL: | R14 J01 J50 |
| Date: | 2017–10–24 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:85141&r=lab |
| By: | Barth, Erling (Institute for Social Research, Oslo); Bryson, Alex (University College London); Dale-Olsen, Harald (Institute for Social Research, Oslo) |
| Abstract: | We exploit tax-induced exogenous variance in the price of union membership to identify the effects of changes in firm union density on firm productivity and wages in the population of Norwegian firms over the period 2001 to 2012. Increases in union density lead to substantial increases in firm productivity and wages having accounted for the potential endogeneity of unionization. The wage effect is larger in more productive firms, consistent with rent-sharing models. |
| Keywords: | trade unions, union density, productivity, wages |
| JEL: | J01 J08 J50 J51 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11111&r=lab |
| By: | Dickson, Lisa (University of Maryland, Baltimore County); Gindling, T. H. (University of Maryland, Baltimore County); Kitchin, James (University of Maryland) |
| Abstract: | Many undocumented immigrants come to the U.S. as children. Undocumented immigrant children have a legal right to attend free public primary and secondary schools. However, in most states undocumented immigrants are treated as out-of-state students in public colleges and universities, and are therefore required to pay substantially higher tuition than other state residents. Since 2001, 21 of 50 U.S. states have implemented policies that allow undocumented immigrants to qualify for in-state resident tuition (ISRT) at public colleges and universities. In 12 of these states undocumented immigrants are also eligible for financial aid. In this study we present strong evidence that both ISRT policies and access to financial aid significantly increase the college enrollment and graduation rates of undocumented immigrants but have no impact on the college enrollment or graduation rates of U.S.-born youth. Another important change in immigration policy that affects many undocumented immigrant children is the 2012 Deferred Action for Childhood Arrivals (DACA). DACA allows undocumented individuals who came to the U.S. as children to obtain legal employment. The potential of being able to work legally in the United States could represent a significant increase in earnings as well as a substantial increase in the perceived benefits of higher education. Our findings present evidence that DACA led to an increase in youth employment and a decrease in college enrollment rates. Further, we find no evidence that the introduction of DACA reduced or increased the positive impact of ISRT and financial aid policies. |
| Keywords: | higher education, undocumented immigrants, tuition policies at public universities |
| JEL: | I23 J61 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11109&r=lab |
| By: | Andreas Menzel |
| Abstract: | Productivity spill-overs within firms have commonly been used as a proxy measure for organizational learning. Using novel data from more than 200 production lines in three garment factories in Bangladesh, this paper extends the evidence on such productivity spill-over in two directions. First, I find that spatial distance within firms matters greatly for the strengths of productivity spill-overs, while product complexity matters little. This has important implications for firms in rapidly developing countries such as Bangladesh, as spill-over strength seems less affected when firms upgrade to more complex products, but seems more affected if firms grow larger. Second, I provide evidence from a randomized communication intervention in the three factories to determine the extent to which productivity spill-overs are indeed a measure of knowledge exchange within firms, and not of other types of peer effects, such as competition. In the intervention, randomly selected line supervisors were instructed by their superiors to share production knowledge when their lines were allocated the same garment for production. The intervention increased the strength of the productivity spill-overs between the targeted production lines. It thus supports the view that productivity spill-overs can be used as a measure of knowledge exchange within firms. |
| Keywords: | learning; productivity; firms |
| JEL: | D2 L2 M5 O3 |
| Date: | 2017–11 |
| URL: | http://d.repec.org/n?u=RePEc:cer:papers:wp607&r=lab |
| By: | Murillo Huertas, Inés P. (Universidad de Extremadura); Ramos, Raul (University of Barcelona); Simón, Hipólito (Universidad de Alicante) |
| Abstract: | This study examines wage differences across Spain's regions along the entire wage distribution based on matched employer-employee microdata from 2006 to 2014. Unlike previous studies, we control for differences in regional purchasing power parities, which are very large in practice. Although many of the raw wage differences observed are explained by differences between regional productive structures and, to a lesser extent, in labour forces, noteworthy regional differences net of composition effects remain after controlling for a broad set of individual and firm characteristics. Unexplained wage differences are generally very similar throughout the wage distribution and are strongly persistent over time, despite significant changes in both economic cycle and labour regulations that occurred in Spain during the examined period. This evidence suggests the presence of common mechanisms in the generation of regional wage differentials that affect the whole labour force and that are strongly persistent over time, which is consistent with a key role of collective bargaining |
| Keywords: | interregional wage differentials, decomposition methods, matched employer-employee data, wage setting institutions |
| JEL: | J31 J52 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11122&r=lab |
| By: | El-Sahli, Zouheir (Leiden University, Department of Economics); Gullstrand, Joakim (Department of Economics, Lund University); Olofsdotter, Karin (Department of Economics, Lund University) |
| Abstract: | In this paper, we investigate the effects of offshoring on workers' job security using matched employer-employee data from Sweden. For our observed period (1997-2011), while the share of firms engaged in offshoring fell during the period from around 25% to 22%, offshoring per worker within offshoring firms almost doubled. We make use of this variation to contribute to the literature on several fronts by examining both the internal (i.e., firms' own offshoring activities) and the external (i.e., neighboring firms’ offshoring activities) effects of offshoring on workers' employment spells. To deal with potential endogeneity, we use instruments based on world supply shocks for both the internal and external measures of offshoring. Our results suggest that external offshoring has a greater impact on job security than internal offshoring. In addition, having a university degree, being young, and being new to the job all reduce the risk of a job exit due to increased external offshoring. This result is indicative of a Schumpeterian job restructuring effect of offshoring, where old jobs are replaced by newer ones. Finally, the increased risk of a job exit from external offshoring is limited to workers in small firms that do not offshore themselves, suggesting a higher vulnerability of these firms to local shocks. |
| Keywords: | offshoring; heterogeneous firms; job security; globalization |
| JEL: | F16 J64 |
| Date: | 2017–11–13 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:lunewp:2017_014&r=lab |
| By: | Müller, Steffen; Stegmaier, Jens |
| Abstract: | Recent empirical research generally finds evidence of positive economic effects of works councils, for example with regard to productivity and - with some limitations - to profits. This makes it necessary to explain why employers' associations have reservations against works councils. On the basis of an in-depth literature analysis, we show that beyond the generally positive findings, there are important heterogeneities in the impact of works councils. We argue that those groups of employers that tend to benefit little from employee participation in terms of productivity and profits may well be important enough to shape the agenda of their employers' organisation and even gained in importance within their organisations in recent years. We also discuss the role of deviations from profit-maximising behaviour like risk aversion, short-term profit maximisation, and other non-pecuniary motives, as possible reasons for employer resistance. |
| Keywords: | employers' association,plant level employee participation,works council |
| JEL: | J5 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:iwhdps:232017&r=lab |
| By: | Haan, Peter (DIW Berlin); Kemptner, Daniel (DIW Berlin); Lüthen, Holger (DIW Berlin) |
| Abstract: | This study uses German social security records to provide novel evidence about the heterogeneity in life expectancy by lifetime earnings and, additionally, documents the distributional implications of this earnings-related heterogeneity. We find a strong association between lifetime earnings and life expectancy at age 65 and show that the longevity gap is increasing across cohorts. For West German men born 1926–28, the longevity gap between top and bottom decile amounts to about 4 years (about 30%). This gap increases to 7 years (almost 50%) for cohorts 1947–49. We extend our analysis to the household context and show that lifetime earnings are also related to the life expectancy of the spouse. The heterogeneity in life expectancy has sizable and relevant distributional consequences for the pension system: when accounting for heterogeneous life expectancy, we find that the German pension system is regressive despite a strong contributory link. We show that the internal rate of return of the pension system increases with lifetime earnings. Finally, we document an increase of the regressive structure across cohorts, which is consistent with the increasing longevity gap. |
| Keywords: | mortality, lifetime inequality, pensions, redistribution |
| JEL: | H55 I14 J11 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11121&r=lab |
| By: | Delaney, Judith (Economic and Social Research Institute, Dublin); Devereux, Paul J. (University College Dublin) |
| Abstract: | Much evidence suggests that having more education leads to higher earnings in the labor market. However, there is little evidence about whether having more education causes employees to experience lower earnings volatility or shelters them from the adverse effects of recessions. We use a large British administrative panel data set to study the impact of the 1972 increase in compulsory schooling on earnings volatility over the life cycle. Our estimates suggest that men exposed to the law change subsequently had lower earnings variability and less pro-cyclical earnings. However, there is little evidence that education affects earnings volatility of older men. |
| Keywords: | return to education, earnings volatility |
| JEL: | J01 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11107&r=lab |
| By: | Dhingra, Swati; Machin, Stephen; Overman, Henry G. |
| Abstract: | This paper studies local economic impacts of the increases in trade barriers associated with Brexit. Predictions of the local impact of Brexit are presented under two different scenarios, soft and hard Brexit, which are developed from a structural trade model. Average effects are predicted to be negative under both scenarios, and to be more negative under hard Brexit. The spatial variation in negative shocks across areas is higher in the latter case as some local areas are particularly specialised in sectors that are predicted to be badly hit by hard Brexit. Areas in the South of England, and urban areas, are harder hit by Brexit under both scenarios. Again, this pattern is explained by sector specialisation. Finally, the areas that were most likely to vote remain are those that are predicted to be most negatively impacted by Brexit. |
| Keywords: | Brexit; EU and UK; local economic impacts; trade models |
| JEL: | J1 |
| Date: | 2017–10–31 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:85602&r=lab |
| By: | Stephen Smith (George Washington University); Uwe Jirjahn (University of Trier) |
| Abstract: | Theories of how nonunion employee representation impacts firm performance, affects market equilibria, and generates externalities on labor and society are synthesized. Mandated works councils in Germany provide a particularly strong form of nonunion employee representation. A systematic review of research on the German experience with mandated works councils finds generally positive effects, though these effects depend on a series of moderating factors and some impacts remain ambiguous. Finally, key questions for empirical research on nonunion employee representation, which have previously been little analyzed in the literature, are reviewed. |
| Keywords: | Nonunion representation, works councils, organizational failures, market failures, society |
| JEL: | J50 M50 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:gwi:wpaper:2017-22&r=lab |