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on Labour Economics |
| By: | L Rachel Ngai (Centre for Macroeconomics (CFM); London School of Economics (LSE)); Christopher A Pissarides (Centre for Macroeconomics (CFM); London School of Economics (LSE); Hong Kong University of Science and Technology); Jin Wang (Hong Kong University of Science and Technology) |
| Abstract: | China's hukou system imposes two main barriers to population movements. Agricultural workers get land to cultivate but are unable to trade it in a frictionless market. Social transfers (education, health, etc.) are conditional on holding a local hukou. We show that the land policy leads to over-employment in agriculture and it is the more important barrier to industrialization. Effective land tenure guarantees and a perfect competitive rental market would correct this inefficiency. The local restrictions on social transfers favour rural enterprises over urban employment with a relatively smaller impact on industrialization. |
| Keywords: | Chinese immigration, Chinese land policy, Imperfect rent, Hukou registration, Social transfers |
| JEL: | J61 O18 R23 |
| Date: | 2018–03 |
| URL: | http://d.repec.org/n?u=RePEc:cfm:wpaper:1811&r=lab |
| By: | Brian Duncan; Stephen J. Trejo |
| Abstract: | In this chapter, we document generational patterns of educational attainment and earnings for contemporary immigrant groups. We also discuss some potentially serious measurement issues that arise when attempting to track the socioeconomic progress of the later-generation descendants of U.S. immigrants, and we summarize what recent research has to say about these measurement issues and how they might bias our assessment of the long-term integration of particular groups. Most national origin groups arrive with relatively high educational attainment and/or experience enough improvement between the first and second generations such that they quickly meet or exceed, on average, the schooling level of the typical American. Several large and important Hispanic groups (including Mexicans and Puerto Ricans) are exceptions to this pattern, however, and their prospects for future upward mobility are subject to much debate. Because of measurement issues and data limitations, Mexican Americans in particular and Hispanic Americans in general probably have experienced significantly more socioeconomic progress beyond the second generation than available data indicate. Even so, it may take longer for their descendants to integrate fully into the American mainstream than it did for the descendants of the European immigrants who arrived near the turn of the twentieth century. |
| JEL: | J61 J62 |
| Date: | 2018–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24394&r=lab |
| By: | Balazs Egert |
| Abstract: | This paper estimates and quantifies the impact of structural reforms on per capita income for a large set of OECD and non-OECD countries. The findings suggest that the quality of institutions matters to a large extent for economic outcomes. More competition-friendly regulations, as measured by the OECDs’ Product Market Regulation (PMR) indicator improve economic outcomes. Lower barriers to foreign trade and investment help MFP. Lower barriers to entry and less pervasive state control of businesses boost the capital stock and the employment rate. No robust link between labour market regulation and MFP and capital deepening could be established. But looser labour market regulation is found to go hand in hand with higher employment rates. The paper shows that countries at different level of economic development face different policy impacts. Furthermore, PMR effects depend on the level of labour market regulations. |
| Keywords: | structural reforms, product markets, labour markets, regulation, institutions, simulation, multi-factor productivity, investment, employment, per capital impact, OECD, emerging market economies, developing countries |
| JEL: | D24 E17 E22 E24 J08 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6921&r=lab |
| By: | Jahn, Elke J. (University of Bayreuth); Rosholm, Michael (Aarhus University) |
| Abstract: | This paper investigates whether the stepping-stone effect of temporary agency employment varies over the business cycle. Using German administrative data for the period 1985-2012 and an estimation framework based on the timing-of-events model, we estimate in-treatment and post-treatment effects and their relationship to the aggregate unemployment rate. We find evidence of a strong lock-in effect of agency employment, particularly in tight labor markets. This suggests that firms do not use agency employment as a screening device when unemployment is low. Moreover, the positive post-treatment effect is noticeably larger in periods of high unemployment, indicating that workers might be activating networks they established while in treatment. We further document that the matching quality in terms of earnings improves for those leaving unemployment directly from agency employment. This gain is higher when unemployment is low. |
| Keywords: | temporary agency employment, stepping-stone effects, cyclicality, Germany |
| JEL: | C41 J40 J64 |
| Date: | 2018–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11377&r=lab |
| By: | Gazeley, Ian (University of Sussex); Holmes, Rose (University of Sussex); Newell, Andrew T. (University of Sussex); Reynolds, Kevin (University of Sussex); Gutierrez Rufrancos, Hector (University of Sussex) |
| Abstract: | In this article we map, for the first time, the time-path of the size distribution of income among working class households in Western Europe, 1890-1960. To do this we exploit data extracted from a large number of newly digitised household expenditure surveys. Many are not representative of the population, or even of their target-subpopulation, as methods of social investigation were initially primitive, though rapidly evolving over this period. We overcome the consequent problem of comparability by exploiting our knowledge of the methods used by early social investigators to estimate of the scale of known biases. For some we have the original household data, but in most cases we have tables by income group. One by-product of this work is an evaluation of the range of estimation methods for distributional statistics from these historical tables of grouped data. Our central finding is that inequality among working households does not follow the general downward trend in inequality for the early part of the century found in labour share and top income studies. Contrary to Kuznets' prediction, our evidence suggests that on average income inequality among European working households remained stable for three generations from the late nineteenth century onwards. |
| Keywords: | inequality, working households, Europe, 20th century |
| JEL: | N33 N34 O15 |
| Date: | 2018–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11355&r=lab |
| By: | Stepanok, Ignat (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]) |
| Abstract: | "North-South foreign direct investment (FDI) is frequently viewed as a process in which jobs relocate from the North to the South. I build a growth model with two asymmetric trading economies, the North where firms innovate and the South where Northern firms invest to take advantage of lower wages. Contrary to expectation, I find that lower FDI costs increase unemployment both in the North and in the South. There are two effects of FDI on unemployment, a direct positive one which contributes to the turnover of firms parallel to innovation. The indirect effect appears through innovation and growth: more FDI means higher innovation, this intensifies firm turnover and increases the unemployment rates in both countries even further. I solve the model analytically without trade costs and imitation of products in the South. For the version with trade costs and imitation I offer a numerical solution in which I also look at the effect of FDI on welfare and find a positive relation. In addition to FDI, I explore how intellectual property (IP) rights protection affects unemployment and welfare. Both are higher in a steady state with stricter IP protection." (Author's abstract, IAB-Doku) ((en)) |
| JEL: | F12 F16 F23 F43 O31 O34 |
| Date: | 2018–03–28 |
| URL: | http://d.repec.org/n?u=RePEc:iab:iabdpa:201811&r=lab |
| By: | Ross Levine; Chen Lin; Zigan Wang |
| Abstract: | We study the impact of toxic emissions on the migration of corporate executives. We link data on the opening of industrial plants emitting toxic air pollutants with information on the career paths of executives at all S&P 1500 firms over the 1996-2014 period. We find that (1) the opening of toxic emitting plants increases the rate at which executives leave geographically close firms and move to firms in less polluted areas, (2) stock returns fall when these “treated” executives announce their departures, and (3) the replacement executives have less experience than the departing executives. |
| JEL: | G3 J61 J63 Q5 R32 |
| Date: | 2018–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24389&r=lab |
| By: | Drusilla Brown; Rajeev Dehejia; Raymond Robertson |
| Abstract: | The impact of Better Work (ILO/OFC) is assessed on costs, profits, productivity and business terms for firms in Vietnam, Indonesia and Jordan. Participation in Better Work has a positive productivity effect on Vietnamese and Indonesian firms. Productivity gains are captured by workers in the form of higher pay. Unit costs rise due to increased compliance with payment requirements such as the minimum wage, paying as promised and mandated promotions. Despite the increase in wages, profits for firms in Better Work Vietnam and Indonesia increase due to improved business terms such as larger orders and possibly an increase in price. The impact of Better Work Jordan suggests that exposure to the program for individual firms may have temporarily increased costs and lowered profits. However, the Jordanian apparel industry becomes more profitable over time, suggesting a positive country reputation effect. Participation in Better Work and firm performance are not jointly determined by manager quality. Early entrants into Better Work are, on average, high cost-low profit firms. |
| Keywords: | high road, working conditions, supply chains, social compliance, International Labor Organization, supply chains. |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:tuf:tuftec:0823&r=lab |
| By: | Aoki, Yu (University of Aberdeen); Santiago, Lualhati (Office for National Statistics, UK) |
| Abstract: | This paper studies the causal effect of English proficiency on residential location outcomes and the socioeconomic class of immigrants in England and Wales, exploiting a natural experiment. Based on the phenomenon that young children learn a new language more easily than older children, we construct an instrument for English proficiency using age at arrival in the United Kingdom. Taking advantage of a unique dataset, we measure the extent of residential segregation along different dimensions, and find that poor English skills lead immigrants to live in areas with a high concentration of people who speak their same native language, but not necessarily in areas with a high concentration of people of their same ethnicity or country of birth. This finding could suggest that, for immigrants with poor English proficiency, what matters for their residential location decision is language spoken by residents, as opposed to ethnicity or country of birth. We also find that language skills have an impact on the occupation-based socioeconomic class of immigrants: Poor English skills reduce the likelihood of being in the occupation-based class 'higher managerial and professional' and increase that of being in the class 'self-employment'. |
| Keywords: | language skills, deprivation, residential segregation, socioeconomic class |
| JEL: | J15 J61 R23 Z13 |
| Date: | 2018–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11368&r=lab |
| By: | Ramos-Toro, Diego |
| Abstract: | This paper establishes the detrimental effect of historical conflict on contemporary gender disparities. Such effects appear to be absent when focusing on female labor participation, revealing that long-run determinants of women’s positioning do not opperate solely through labor outcomes. Further, a historical compilation of Mexican conflicts was digitized and geo-referenced to establish the persistence of such results at a subnational level. Causal estimates are achieved at this level by exploiting exogenous changes introduced by the Columbian exchange and by long-run reductions in precipitation. Finally, the document examines gender views of US respondents and of second-generation migrants in Europe to show that culture constiutes a mechanism through which gender biases emerge and consolidate. |
| Keywords: | Historical conflict, Gender Disparities, Female Labor Force Participation |
| JEL: | J16 N30 Z10 |
| Date: | 2018–03 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:85045&r=lab |
| By: | Philipp Herkenhoff; Sebastian Krautheim |
| Abstract: | Over the last decades, the internationalization of the value chain has allowed firms to exploit cross-country differences in environmental and labor regulation (and enforcement) in ways that have led to a large number of NGO campaigns and consumer boycotts criticizing ‘unethical’ practices. How do potential ‘unethical’ cost savings on the one hand and the threat to reputation and sales on the other interact with the international organization of production? In this paper we introduce North-South differences in regulation, a cost-saving ‘unethical’ technology and consumer boycotts into a standard property rights model of international production. Contracts are incomplete, so that a firm has limited control over both investments and (un)ethical technology choices of both foreign affiliates and suppliers along the value chain. We show that international outsourcing and ‘unethical’ production are linked through a novel unethical outsourcing incentive, for which we also provide empirical support: a high cost advantage of ‘unethical’ production in an industry and a low regulatory stringency in the supplier's country favor international outsourcing (as opposed to vertical FDI). We also provide a microfounded model of investment and pricing under incomplete contracts when the production technology is a credence characteristic of the final good and an NGO investigates firms and may initiate a consumer boycott. |
| Keywords: | multinational firms, international outsourcing, property rights theory of the firm, ethical production, labor standards, pollution, consumer boycotts, credence goods, NGOs |
| JEL: | D21 D23 F12 F23 J81 L22 L23 L31 L50 Q53 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6922&r=lab |
| By: | Besart Avdiu |
| Abstract: | I investigate the effect of attitudes toward migrants on the average skill composition of immigrants in destination countries. A model is presented showing that negative attitudes toward migrants can reduce the average skill composition. The intuition for the result is that the highly skilled are more mobile and hence more sensitive to negative attitudes. To test the hypothesis, I use survey data on attitudes toward migrants as well as data on migrant stocks by education level and origin country. The empirical analysis is based on two classes of theoretical models and I find consistent evidence for the hypothesis that more positive attitudes increase the skill composition of immigrants. The results imply that general attitudes toward migrants can be relevant for policies seeking to attract highly skilled migrants. |
| Keywords: | international migration, high-skilled immigration, immigration attitudes |
| JEL: | F22 J15 J61 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6919&r=lab |