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on Labour Economics |
| By: | Isabelle Sin (Motu Economic and Public Policy Research); Kabir Dasgupta (Auckland University of Technology); Gail Pacheco (Auckland University of Technology) |
| Abstract: | This paper is an initial exploration of what we can learn regarding the drivers of the gender pay gap in New Zealand from combining administrative wage data, birth records, and survey data on hours worked and earnings. Our particular focus is the role of parenthood penalties in this pay gap. In NZ, as internationally, the gender pay gap is larger among parents than non-parents, though the mechanisms driving this relationship are not entirely clear. We use administrative wage data to describe the distribution of how long women are out of paid employment after having their first child and how this differs with pre-parenthood income. We then look at employment rates and wage earnings among employed women each month in the five years before and ten years after birth of their first child. We also compare women who spend different lengths of time out of employment both overall and within each pre-parenthood earnings quartile. Although this does not strictly isolate the causal effect of length of time out of employment on subsequent monthly earnings, it does show how, within earnings quartiles, women who return quickly to work increase their earnings lead over those who return more slowly. |
| Keywords: | gender wage gap, parenthood, labour market |
| JEL: | E24 J12 J16 J17 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:mtu:wpaper:18_08&r=lab |
| By: | Juliana Mesén Vargas; Bruno Van der Linden |
| Abstract: | This article analyzes the behavioral effects of unemployment benefits (UB) and it characterizes their optimal level when jobless people, who can carry out a subsistence activity, only survive if they have access to a minimum consumption level. Our model shows that if the level of UB is low enough, increasing its level or providing liquidity to the agent can decrease the duration in unemployment. Extensive numerical simulations indicate that the relationship between the level of the benefits and the probability of finding a formal job is frequently inverse U-shaped. We show that rewriting the insurance gain of the Baily-Chetty formula in terms of sufficient statistics requires specific modeling assumptions. The optimal replacement rate is generally higher than when subsistence is ignored. |
| Keywords: | liquidity effect, scarcity, monetary costs, optimal insurance |
| JEL: | D91 H21 J64 J65 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7044&r=lab |
| By: | Anukriti, S (Boston College); Kwon, Sungoh (University of Connecticut); Prakash, Nishith (University of Connecticut) |
| Abstract: | This paper examines how traditional marriage market institutions affect households' financial decisions. We study how bride-to-groom marriage payments, i.e., dowries, influence saving behavior in rural India. Exploiting variation in firstborn gender and heterogeneity in dowry amounts across marriage markets, we find that the prospect of paying higher dowry increases household savings, which are primarily financed through increased paternal labor supply. This is the first paper that highlights this alternative motive for savings in dowry-paying societies. However, we find no impacts of dowry expectations on son-preferring fertility behaviors and investments in girls. |
| Keywords: | household savings, dowry, marriage payments, India, labor supply, fertility, sex ratio, child investments |
| JEL: | J1 D14 O15 |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11464&r=lab |
| By: | Olney, William W. (Williams College); Pozzoli, Dario (Copenhagen Business School) |
| Abstract: | This paper studies the relationship between immigration and offshoring by examining whether an influx of foreign workers reduces the need for firms to relocate jobs abroad. We exploit a Danish quasi-natural experiment in which immigrants were randomly allocated to municipalities using a refugee dispersal policy and we use the Danish employer-employee matched data set covering the universe of workers and firms over the period 1995-2011. Our findings show that an exogenous influx of immigrants into a municipality reduces firm-level offshoring at both the extensive and intensive margins. The fact that immigration and offshoring are substitutes has important policy implications, since restrictions on one may encourage the other. While the multilateral relationship is negative, a subsequent bilateral analysis shows that immigrants have connections in their country of origin that increase the likelihood that firms offshore to that particular foreign country. |
| Keywords: | immigration, offshoring |
| JEL: | F22 F16 J61 F23 |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11480&r=lab |
| By: | Carlana, Michela (Bocconi University); Tabellini, Marco (Massachusetts Institute of Technology) |
| Abstract: | In this paper, we study the effects of immigration on natives' marriage, fertility, and family formation across US cities between 1910 and 1930. Instrumenting immigrants' location decision by interacting pre-existing ethnic settlements with aggregate migration flows, we find that immigration raised marriage rates, the probability of having children, and the propensity to leave the parental house for young native men and women. We show that these effects were driven by the large and positive impact of immigration on native men's employment and occupational standing, which increased the supply of "marriageable men". We also explore alternative mechanisms − changes in sex ratios, natives' cultural responses, and displacement effects of immigrants on female employment − and provide evidence that none of them can account for a quantitatively relevant fraction of our results. |
| Keywords: | immigration, marriage, fertility, employment |
| JEL: | J12 J13 J61 N32 |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11467&r=lab |
| By: | Eleonora Guarnieri; Helmut Rainer |
| Abstract: | Do policies and institutions that promote women’s economic empowerment have a long-term impact on intimate partner violence? We address this question by exploiting a natural experiment of history in Cameroon. From the end of WWI until 1961, the western territories of today’s Cameroon were arbitrarily divided between France and the United Kingdom, whose colonial regimes opened up divergent economic opportunities for women in an otherwise cul- turally and geographically homogeneous setting. Women in British territories benefited from a universal education system and gained opportunities for paid employment. The French colonial practice in these domains centered around educating a small administrative elite and investing in the male employment-dominated infrastructure sector. Using a geographical regression discontinuity design, we show that women in former British territories are 30% more likely to be victims of domestic violence than those in former French territories. Among a broad set of possible channels of persistence, only one turns out statistically significant and quantitatively important: women in former British territories are 30% more likely to be in paid employment than their counterparts in former French areas. These results are incompatible with household bargaining models that incorporate domestic violence but they are accommodated by theories of male backlash. |
| Keywords: | colonization, female economic empowerment, intimate partner violence |
| JEL: | J12 J16 N37 Z13 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7009&r=lab |
| By: | Jeremy Edwards; Sheilagh Ogilvie |
| Abstract: | Voigtländer and Voth argue that the Black Death shifted England towards pastoral agriculture, increasing wages for unmarried women, thereby delaying female marriage, lowering fertility, and unleashing economic growth. We show that this argument does not hold. Its crucial assumption is inconsistent with the evidence: women wanting to do pastoral work after the Black Death did not have to remain unmarried, so improved pastoral opportunities did not necessitate later marriage. There is no consensus that late female marriage emerged after the Black Death. Furthermore, the relationship between pastoralism and female marriage age in England provides no support for this argument. |
| Keywords: | European marriage pattern, black death, land-labour ratio, arable and pastoral agriculture |
| JEL: | E02 J12 J13 N13 N33 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7016&r=lab |
| By: | Sara Rellstab (Erasmus University Rotterdam); Pieter Bakx (Erasmus University Rotterdam); Pilar (P.) Garcia-Gomez (Erasmus University Rotterdam); Eddy (E.K.A.) van Doorslaer (Erasmus University Rotterdam) |
| Abstract: | Unexpected negative health shocks may have serious consequences for labour force participation, not only for those who incur the shock but also for their family members. In particular, adult children may spend substantial time providing informal care and may incur stress-induced mental health problems following a parental health shock, which may in turn lead to reductions in labour supply. We link administrative data on labour market outcomes, hospitalisations and family relations for the full Dutch population for the years 1999-2008 to evaluate the effect of an unexpected parental hospitalisation on the probability of employment and on conditional earnings for the working age population. Using a difference-in-differences model combined with coarsened exact matching and individual fixed effects, we find no effect of an unexpected parental hospitalisation on either the probability of employment or conditional earnings for Dutch men and women, and neither for the full population nor for subpopulations most likely to become a caregiver. These findings suggest that the extensive public coverage of formal long-term care in the Netherlands provides sufficient opportunities to deal with adverse health events of family members without having to compromise one’s labour supply. |
| Keywords: | Labour supply; parental health shocks; informal care |
| JEL: | J22 J14 J10 I10 |
| Date: | 2018–05–18 |
| URL: | http://d.repec.org/n?u=RePEc:tin:wpaper:20180049&r=lab |
| By: | Dolado, Juan J. (European University Institute); Motyovszki, Gergö (European University Institute); Pappa, Evi (European University Institute) |
| Abstract: | In order to improve our understanding of the channels through which monetary policy has distributional consequences, we build a New Keynesian model with incomplete asset markets, asymmetric search and matching (SAM) frictions across skilled and unskilled workers and, foremost, capital-skill complementarity (CSC) in the production function. Our main finding is that an unexpected monetary easing increases labor income inequality between high and low-skilled workers, and that the interaction between CSC and SAM asymmetry is crucial in delivering this result. The increase in labor demand driven by such a monetary shock leads to larger wage increases for high-skilled workers than for low-skilled workers, due to the smaller matching frictions of the former (SAM-asymmetry channel). Moreover, the increase in capital demand amplifies this wage divergence due to skilled workers being more complementary to capital than substitutable unskilled workers are (CSC channel). Strict inflation targeting is often the most successful rule in stabilizing measures of earnings inequality even in the presence of shocks which introduce a trade-off between stabilizing inflation and aggregate demand. |
| Keywords: | monetary policy, search and matching, capital-skill complementarity, inequality |
| JEL: | E24 E25 E52 J64 |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11494&r=lab |
| By: | Jarl, Johan (Department of Clinical Sciences, Lund University); Linder, Anna (Department of Clinical Sciences, Lund University); Busch, Hillevi (The Public Health Agency of Sweden); Nyberg , Anja (Department of Healthcare Management, Region Skåne); Gerdtham, Ulf-G. (Department of Economics, Lund University) |
| Abstract: | The burden of mental disorders continues to grow and is now a leading cause of disability worldwide. The prevalence of mental disorders is unequal between population subgroups, and these disorders are associated with unfavourable consequences in social and economic conditions, health and survival. However, how the negative effects of mental disorders are distributed among population subgroups is less studied. Our aim is to investigate how labour market consequences of Common Mental Disorders (CMD) differ over gender, age, education, and country of birth. We use a population sample from southern Sweden of patients diagnosed with CMD 2009-2012 and a matched general population control group with linked register information on employment, long-term sick leave, and disability pension. Logistic regression with interaction effects between CMD and sociodemographic indicators are used to estimate labour market consequences of CMD in the different population subgroups. CMD have a negative impact on all labour market outcomes studied, reducing employment while increasing the risk of long term sick leave and disability pension. However, the associated effect is found to be stronger for men than women, except for disability pension where consequences are similar. Surprisingly, high educated individuals suffer worse labour market consequences than low educated. Consequences of CMD in labour market outcomes are not consistent across different age-groups and country of birth. Inequalities in the labour market consequences of common mental disorders sometimes contributes to, and sometimes mitigates, societal inequalities in employment, long term sick leave and disability pension. When developing new strategies to tackle mental ill health in the population, it may therefore be motivated to consider not only inequalities in the prevalence of mental disorders, but also inequalities in the consequences of these disorders. |
| Keywords: | Mental health; Inequality; Employment; Labour market |
| JEL: | I10 I14 J01 |
| Date: | 2018–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:lunewp:2018_015&r=lab |
| By: | Sanghamitra Bandyopadhyay (Queen Mary, University of London); Elliott Green (London School of Economics) |
| Abstract: | Inter-cultural marriages have long been of great interest to social scientists who wish to examine how ethnic, religious, racial and other identities form and change over time. However, the vast majority of this research has been concentrated in developed countries. As such we undertake the first major examination into the causes and correlates of inter-ethnic and inter-religious marriage in contemporary Sub-Saharan Africa. We use Demographic and Health Survey (DHS) couples data in a series of multi-level logit models from up to 36 countries to document a number of findings. First, we show that inter-ethnic marriage rates are high, at 22.3% on average, and rising across Africa over the past 30 years, with rates approaching 50% for recent marriages in Gabon and Zambia and rising rates over time for all countries in our dataset. In contrast, however, we show that inter-religious marriage rates are much lower, at only 5%, and stagnant, with no country average higher than 15% and declining over time in a number of countries. Second, as expected from the literature on inter-cultural marriages in other contexts, we show that modernization variables such as urbanization, literacy/education, wealth and declines in polygamy and agricultural employment are significantly correlated with rising levels of inter-ethnic marriage; in contrast, the relationship between modernization and inter-religious marriage is much more ambiguous. Third, we show that inter-ethnic marriage is significantly correlated with higher age at marriage, being previously married and migration before marriage. Finally, we find no evidence that inter-married couples have fewer children, in contrast to findings elsewhere. |
| Keywords: | Ethnicity, Religion, Marriage, Sub-Saharan Africa, DHS data, Modernization |
| JEL: | J12 N37 O10 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:cgs:wpaper:90&r=lab |
| By: | Costanza Biavaschi (Norwegian University of Science and Technology (NTNU) and IZA); Michal Burzynski (University of Luxembourg); Benjamin Elsner (University College Dublin, IZA and CReAM); Joël Machado (Luxembourg Institute for Socio-Economic Research (LISER)) |
| Abstract: | Global migration is heavily skill-biased, with tertiary-educated workers being four times more likely to migrate than workers with a lower education. In this paper, we quantify the global impact of this skill bias in migration. Based on a quantitative multi-country model with trade, we compare the current world to a counterfactual with the same number of migrants, where all migrants are neutrally selected from their countries of origin. We find that most receiving countries benefit from the skill bias in migration, while a small number of sending countries is significantly worse off. The negative effect in many sending countries is completely eliminated — and often reversed — once we account for remittances and additional migration-related externalities. In a model with all our extensions, the average welfare effect of skill-biased migration in both OECD and non-OECD countries is positive. |
| Keywords: | migration, skill selection, global welfare |
| JEL: | F22 O15 J61 |
| Date: | 2018–05–22 |
| URL: | http://d.repec.org/n?u=RePEc:ucd:wpaper:201810&r=lab |
| By: | Jeffrey A. Flory; Andreas Leibbrandt; Christina Rott; Olga Stoddard |
| Abstract: | The persistent lack of workplace diversity in management and leadership may lead to organizational vulnerabilities. White males occupy most high-profile positions in the largest U.S. corporations whereas African Americans, Hispanics, and women are clearly underrepresented in leadership roles. While many firms and other organizations have set ambitious goals to increase demographic diversity, there is a dearth of empirical evidence on effective ways to reach them. We use a natural field experiment to test several hypotheses on effective means to attract minority candidates for top professional careers. By randomly varying the content in recruiting materials of a major financial services corporation with over 10,000 employees, we test different types of signals regarding the extent and manner in which the employer values diversity among its workers. We find that signaling explicit interest in employee diversity can reverse the ethnicity gap in rates of interest and applications, and that it has a strong positive effect on interest in openings among racial minority candidates, the likelihood that they apply, and the probability that they are selected. These results uncover an effective method for disrupting monocultures in management through a minor intervention that influences sorting among job-seekers into high-profile careers. |
| Keywords: | diversity, experiment, field experiment, gender, race |
| JEL: | J15 J16 C93 D22 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7025&r=lab |
| By: | Ayuso, Mercedes (University of Barcelona); Bravo, Jorge Miguel (Universidade Nova de Lisboa); Holzmann, Robert (University of New South Wales) |
| Abstract: | In many policy areas it is essential to use the best estimates of life expectancy, but such estimates are vital to most areas of pension policy – from indexed access age and the calculation of initial benefits to the financial sustainability of pension schemes and the operation of their balancing mechanism. This paper presents the conceptual differences between static period and dynamic cohort mortality tables, estimates the differences in life expectancy between both tables using data from Portugal and Spain, and compares official estimates of both life expectancy estimates for Australia, the United Kingdom, and the United States for 1981, 2010 and 2060. This comparison reveals major differences between period and cohort life expectancy in and between countries and across years. Using measures of period instead of cohort life expectancy creates an implicit subsidy for individuals of 30 percent or more, with potentially stark consequences on the financial sustainability of pension schemes. These and other implications for pension policy are explored and next steps suggested. |
| Keywords: | cross-country comparison, Lee-Carter, life expectancy indexation, balancing mechanism |
| JEL: | D9 G22 H55 J13 J14 J16 |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11512&r=lab |
| By: | Gehrke, Britta (University of Erlangen-Nuremberg); Hochmuth, Brigitte (University of Erlangen-Nuremberg) |
| Abstract: | Short-time work is a labor market policy that subsidizes working time reductions among firms in financial difficulty to prevent layoffs. Many OECD countries have used this policy in the Great Recession. This paper shows that the effects of short-time work are strongly time dependent and non-linear over the business cycle. It may save up to 0.8 jobs per short-time worker in deep economic crises. The policy becomes more efficient as the recession deepens. In expansions, the effects are smaller and may turn negative. We disentangle discretionary short-time work from automatic stabilization in German data using smooth transition VARs. |
| Keywords: | short-time work, fiscal policy, labor market, non-linearity, smooth transition VARs, business cycle |
| JEL: | C32 E24 E32 E62 |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11472&r=lab |
| By: | Berhe Mekonnen Beyene and (Consultant | Ethiopian Development Research Institute); Tsegay Gebrekidan Tekleselassie (Ethiopian Development Research Institute) |
| Abstract: | The study analyses the incidence of labour market mismatch, identifies the correlates of skills mismatch that shed light on the causes of the problem, and investigates its consequences on well-being. It is the first attempt to formally study skills mismatch in the urban labour market in Ethiopia. Using several indicators of qualification mismatch, we find that about a quarter of employees are mismatched with over-qualification being the more prevalent problem. In comport with findings for developed countries, our analysis reveals overqualified worker report lower job satisfaction compared to the well-matched. We also find that skill-mismatch, particularly over education lowers wages; while education is positively and significantly associated with wage, overeducated workers earn less than those well-matched for their level of education. This implies a wage penalty associated with over-qualification even in a developing country context. Our study highlights that labour market mismatch is not only a phenomenon of the developed world but also the developing countries. Hence, skills mismatch needs to be a key aspect of labour market policy making along with issues of decent and productive work. |
| Keywords: | Skills mismatch, education, labour market, Ethiopia, welfare |
| JEL: | I31 J31 J60 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:etd:wpaper:021&r=lab |
| By: | Borchert, Kathrin; Hirth, Matthias; Kummer, Michael E.; Laitenberger, Ulrich; Slivko, Olga; Viete, Steffen |
| Abstract: | Online labor markets experienced a rapid growth in recent years. They allow for long-distance transactions and offer workers access to a potentially 'global' pool of labor demand. As such, they bear the potential to act as a substitute for shrinking local income opportunities. Using detailed U.S. data from a large online labor platform for microtasks, we study how local unemployment affects participation and work intensity online. We find that, at the extensive margin, an increase in commuting zone level unemployment is associated with more individuals joining the platform and becoming active in fulfilling tasks. At the intensive margin, our results show that with higher unemployment rates, online labor supply becomes more elastic. These results are driven by a decrease of the reservation wage during standard working hours. Finally, the effects are transient and do not translate to a permanent increase in platform participation by incumbent users. Our findings highlight that many workers consider online labor markets as a substitute to offline work for generating income, especially in periods of low local labor demand. However, the evidence also suggests that, despite their potential to attract workers, online markets for microtasks are currently not viable as a long run alternative for most workers. |
| Keywords: | Unemployment,Crowdworking,Online platform |
| JEL: | D29 D80 H41 J60 L17 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:18023&r=lab |
| By: | Sabien DOBBELAERE; KIYOTA Kozo |
| Abstract: | This paper examines the links between a firm's internationalization status and the type and degree of market imperfections in product and labor markets. We develop a framework for modelling heterogeneity across firms in terms of (i) product market power (price-cost markups), (ii) labor market imperfections (workers' bargaining power during worker-firm negotiations or firm's degree of wage-setting power), and (iii) revenue productivity. We apply this framework to analyze whether the pricing behavior of firms in product and labor markets differs across firms that engage in different forms of internationalization using an unbalanced panel of 7,458 manufacturing firms over the period 1994-2012 in Japan. Engagement in international activities is found to matter for determining not only the type of imperfections in product and labor markets but also the degree of imperfections. Clear differences in behavior between firms that serve the foreign market through either exporting or foreign direct investment (FDI) are observed. Exporters are more likely to be characterized by imperfect competition in the product market whereas the opposite holds for multinationals. Exporters are more likely to share rents based on the bargaining power of workers whereas a firm's wage-setting power seems to generate wage dispersion across firms with foreign subsidiaries. |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:eti:dpaper:18033&r=lab |
| By: | Knauth, Florian; Wrona, Jens |
| Abstract: | We present supportive empirical evidence and a new theoretical explanation for the negative selection into planned return migration between similar regions in Germany. In our model costly temporary and permanent migration are used as imperfect signals to indicate workers' high but otherwise unobservable skills. Production thereby takes place in teams with individual skills as strategic complements. Wages therefore are determined by team performance and not by individual skill, which is why migration inflicts a wage loss on all workers, who expect the quality of their co-workers to decline. In order to internalise this negative migration externality, which leads to sub-optimally high levels of temporary and permanent migration in a laissez-faire equilibrium, we propose a mix of two policy instruments, which reduce initial outmigration while at the same time inducing later return migration. |
| Keywords: | return migration,signalling,selection,strategic complementarity |
| JEL: | R23 J61 D82 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:dicedp:290&r=lab |
| By: | Ravaska Terhi (Faculty of Management, University of Tampere) |
| Abstract: | In this paper I study Finnish top incomes from a gender perspective using the Finnish register-based panel data over the period of 1995-2012. I find that that the under-representation of women at the top has been quite persistent in the overall top but the proportion of women in the top 1% has increased over 18 years. Women’s wage share at the top has increased while the self-employment income has decreased. The top income females more often have an entrepreneurial background and are more often sharing a household with a high-income spouse. The gender-specific income distributions show that female incomes are less dispersed. In this study I also test whether top incomes can be assumed sumed to be Pareto distributed. While the joint and men’s top income distributions can be approximated with Pareto distribution throughout the observation period, the Pareto assumption gets more support for women after the year 2000. The female top income receivers have caught up with top earning men over time but I also show that females are more likely to move downwards from the top than men. |
| Keywords: | income distribution, gender inequality, top incomes, income mobility |
| JEL: | D31 J16 D63 D30 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:tam:wpaper:1822&r=lab |
| By: | David R. Agrawal; Dirk Foremny |
| Abstract: | A recent Spanish tax reform granted regions the authority to set income tax rates, resulting in substantial tax differentials. We use individual-level information from Social Security records over a period of one decade. Conditional on moving, taxes have a significant effect on location choice. A one percent increase in the net of tax rate for a region relative to others increases the probability of moving to that region by 1.7 percentage points. Focusing on the stock of top-taxpayers, we estimate an elasticity of the number of top taxpayers with respect to net-of-tax rates of 0.85. Using this elasticity, a theoretical model implies that the mechanical increase in tax revenue due to higher tax rates is larger than the loss in tax revenue from the out-ow of migration. |
| Keywords: | migration, taxes, mobility, rich, fiscal decentralization |
| JEL: | H24 H31 H73 J61 R23 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7027&r=lab |
| By: | Grinza, Elena (University of Milan); Kampelmann, Stephan (Free University of Brussels); Rycx, Francois (Free University of Brussels) |
| Abstract: | Measuring the economic impact of coworkers from different countries of origin sparked intense scrutiny in labor economics, albeit with an uncomfortable methodological limitation. Most attempts involved metrics that eliminate most of the economically relevant distances among different countries of origin. The typical examples of such metrics are diversity indicators that divide the firm's workforce into blacks and whites, foreigners and natives, non-Europeans and Europeans, etc. We propose an entirely novel approach. It is based on the conversion of the qualitative information on individuals' countries of origin into an aggregate firm-level diversity indicator, built on the United Nations Development Programme's Human Development Index (HDI), a standard harmonized measure of cross-country variations that is available for virtually all the countries in the world. By resorting to rich matched employer-employee panel data for Belgium, we use this new aggregate measure to estimate state-of-the-art firm-level wage equations, which control for a wide range of observable and time-invariant unobservable factors, including variations in labor productivity between firms and within firms over time. Our results suggest that the majority of firms do not discriminate against foreigners. Yet, we find that firms with high diversity largely discriminate against them. The wage discrimination in high-diversity firms could be alleviated through a stronger presence of collective bargaining and/or efforts to de-cluster foreigners from low-HDI countries in these firms. |
| Keywords: | diversity, workers' origin, wages, discrimination, matched employer-employee panel data |
| JEL: | J15 J16 J24 J31 J7 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11520&r=lab |
| By: | Durazzi, Niccolo; Fleckenstein, Timo; Lee, Soohyun Christine |
| Abstract: | Political-economic analyses of trade unions in post-industrial societies have shifted away from traditional class-analytic approaches to embrace insider/outsider and producer coalition arguments based on the assumption that unions hold on to the defence of their core constituencies in the face of labour market deregulation and dualisation. Challenging this conventional wisdom, we provide an analysis of union strategies in Italy and South Korea, two most-different union movements perceived as unlikely cases for the pursuit of broader social solidarity, and we argue that in both countries unions have successively moved away from insider-focussed strategies. We show a movement towards “solidarity for all” in the industrial relations arena as well as in their social policy preferences. Furthermore, unions also explored new avenues of political agency, often in alliance with civil society organisations. We ascribe this convergent trend towards a social model of unionism to a response of unions to a “double crisis”; that is a socio-economic crisis, which takes the form of a growing periphery of the labour market associated with growing social exclusion, and a socio-political crisis, which takes the form of a increasing marginalisation of the unions from the political process pursued by right- and left-wing parties alike. |
| JEL: | J50 |
| Date: | 2018–03–26 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:87940&r=lab |
| By: | Reuben Ellul (Central Bank of Malta) |
| Abstract: | This study extends the flow approach to forecasting unemployment, as carried out by Barnichon and Nekarda (2013) and Barnichon and Garda (2016), to the Maltese labour market using a wider number of estimating techniques. The flow approach results in significant improvements in forecast accuracy over an autoregressive (AR) process. Particular improvements to forecasting accuracy are returned over shorter time horizons. When including flows, forecast improvements over both an AR process and non-flow forecasts are found when applying VECM methods. Bayesian and OLS VARs also show strong improvements over an AR, with or without the inclusion of flows. For Maltese data, the use of flows computed using aggregate data in these two latter methodologies does not bring about a significant improvement over the forecasts which exclude them. |
| JEL: | E24 E27 J64 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:mlt:wpaper:0318&r=lab |
| By: | Anthony Edo; Lionel Ragot; Hillel Rapoport; Sulin Sardoschau; Andreas Steinmayr |
| Abstract: | The rise in international migration over the past decades and particularly the recent influx of refugees to the European Union has given more audience to the economic and political consequences of immigration. A major concern in the public debate is that immigrants could take jobs from natives, reduce their wages and negatively contribute to public finances. At the same time, the rise of right-wing populist movements has brought to light that the skepticism towards immigrants and refugees may not only be based only on economic but also on cultural considerations. This report is devoted to investigating these considerations by carefully relying on the existing evidence. We thus study the vast literature on the effects of immigration on the labor market and welfare system in host societies, as well as the more recent literature on the attitudinal and political consequences of immigration. The literature on the labor market impact of immigration indicates that immigration has a negligible average impact on the wages and employment of native workers. However, because adjustments take time, particularly when immigration is unexpected, the initial and longer run impacts of immigration can differ. The average impact of immigration on public finance is also negligible, sometimes slightly positive or slightly negative. We also document that immigration can have distributional consequences. In particular, the age and educational structure of immigrants plays an important role in determining their impact on the labor market and public finances. The fact that immigration is sometimes perceived as a factor depressing economic outcomes in host countries tends to affect native attitudes and electoral outcomes. In this regard, the literature first suggests that cultural concerns is the main driving force behind the skepticism towards immigration and that fiscal or labor market concerns only play a secondary role. Second, immigration tends to reduce the support for redistribution among native workers. Third, the effect of local level exposure to immigrants and refugees on native attitudes towards immigrants and extreme voting has been found to vary by context and can be positive or negative. |
| Keywords: | Immigration;Labour Market;Public finance;Redistribution; Voting |
| JEL: | D72 E62 F22 H62 J15 |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:cii:cepipb:2018-22&r=lab |