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on Labour Economics |
| By: | Nancy Kong (The Centre for the Business of Economics of Health, The University of Queensland); Lars Osberg (Department of Economics, Dalhousie University); Weina Zhou (Department of Economics, Dalhousie University) |
| Abstract: | Reform of the Chinese state-owned enterprise (SOE) sector in the late 1990s produced massive layoffs (34 million employees) and marked the end of the “iron rice bowl†guarantee of employment security. An expanding international literature has documented the adverse health impacts of economic insecurity on adults but has usually neglected children. This paper uses the natural experiment of SOE reform in China to explore the causal relationship between increased parental economic insecurity and children’s BMI Z-score. Using provincial and year-level layoff rates and income loss from the layoffs, we estimate a generalized differences-in-differences model with individual fixed effects and year fixed effects. For a medium-built 10-year-old boy, a 10%-point increase in expected parental economic loss from layoff (largest treatment effect) implies a gain of 4 kg. The counterfactual analysis suggests a 4.5%-point increase in overweight rate due to the reform. The weight gain persists for boys whose parents kept their jobs, indicating the importance of anxiety about potential losses, as well as the experience of actual loss. Quantile regressions suggest that boys who were relatively overweight were more severely affected by parental economic insecurity. Girls are not significantly affected. Accounting for intergenerational effects therefore increases the estimated public health costs of greater economic insecurity. |
| Keywords: | Economic Insecurity, Health, Intergenerational Effects, BMI |
| JEL: | J13 J63 |
| URL: | http://d.repec.org/n?u=RePEc:qld:uq2004:595&r=lab |
| By: | Elizabeth U. Cascio; Ethan G. Lewis |
| Abstract: | We explore how permanent residency affects the income tax using variation from the Immigration Reform and Control Act of 1986 (IRCA), which authorized the largest U.S. amnesty to date. We exploit the timing and geographic unevenness of IRCA’s legalization programs alongside newly digitized data on the income tax in California, home to the majority of applicants. Green Cards induced the previously unauthorized to file state income tax returns at rates comparable to other California residents. While the new returns generated little additional revenue through the end of the 1990s, they did raise the earnings of families with children through new claims of the federal Earned Income Tax Credit. |
| JEL: | H24 H53 H71 J61 |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24872&r=lab |
| By: | Schmidpeter, Bernhard (Institute for Social and Economic Research, University of Essex); Winter-Ebmer, Rudolf (Christian Doppler Laboratory Aging, Health and the Labor Market, JKU Linz and IHS, Institut for Advanced Studies, Vienna and IZA, Bonn and CEPR, London and CReAM, London) |
| Abstract: | We analyze the effect of automation and offshorability on unemployment duration and post-unemployment outcomes such as wages and employment stability. Our rich administrative data allow us to evaluate the importance of providing unemployment training in this context. Employing a multivariate mixed proportional hazard model to deal with selectivity, we find that both the routine content in tasks as well as the probability of off-shoring negatively affects the re-employment possibilities. Labor market training is helping workers to ameliorate these negative effects and is remarkably on the spot. For workers who find re-employment, our results show that offshorability (but not automation) affects future job duration and wages positively. Our analysis reveals interesting differences by gender. |
| Keywords: | Unemployment duration, routinisation, offshorability |
| JEL: | J64 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:ihs:ihsesp:343&r=lab |
| By: | Anne Ardila Brenøe |
| Abstract: | I examine how one central aspect of the childhood family environment—sibling gender composition—affects women's gender conformity, measured through their choice of occupation and partner. Using Danish administrative data, I causally estimate the effect of having a second-born brother relative to a sister for first-born women. The results show that women with a brother acquire more traditional gender norms with negative consequences for their labor earnings. I provide evidence of increased gender-specialized parenting in families with mixed-sex children, suggesting a stronger transmission of traditional gender norms. Finally, I find indications of persistent effects to the next generation of girls. |
| Keywords: | Gender identity, sibling gender, occupational choice, family formation |
| JEL: | I2 J1 J3 |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:zur:econwp:294&r=lab |
| By: | Carlo Pizzinelli (University of Oxford); Konstantinos Theodoridis (Cardiff Business School); Francesco Zanetti (Centre for Macroeconomics (CFM); University of Oxford) |
| Abstract: | This paper documents state dependence in labor market fluctuations. Using a Threshold Vector-Autoregression model, we establish that the unemployment rate, the job separation rate and the job finding rate exhibit a larger response to productivity shocks during periods with low aggregate productivity. A Diamond-Mortensen-Pissarides model with endogenous job separation and on-the-job search replicates these empirical regularities well. The transition rates into and out of employment embed state dependence through the interaction of reservation productivity levels and the distribution of match-specific idiosyncratic productivity. State dependence implies that the effect of labor market reforms is different across phases of the business cycle. A permanent removal of layoff taxes is welfare enhancing in the long run, but it involves distinct short-run costs depending on the initial state of the economy. The welfare gain of a tax removal implemented in a low-productivity state is 4.9 percent larger than the same reform enacted in a state with high aggregate productivity. |
| Keywords: | Search and matching models, State dependence in business cycles, Threshold vector autoregression |
| JEL: | E24 E32 J64 C11 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:cfm:wpaper:1822&r=lab |
| By: | Cody Cook; Rebecca Diamond; Jonathan Hall; John A. List; Paul Oyer |
| Abstract: | The growth of the “gig” economy generates worker flexibility that, some have speculated, will favor women. We explore this by examining labor supply choices and earnings among more than a million rideshare drivers on Uber in the U.S. We document a roughly 7% gender earnings gap amongst drivers. We completely explain this gap and show that it can be entirely attributed to three factors: experience on the platform (learning-by-doing), preferences over where to work (driven largely by where drivers live and, to a lesser extent, safety), and preferences for driving speed. We do not find that men and women are differentially affected by a taste for specific hours, a return to within-week work intensity, or customer discrimination. Our results suggest that there is no reason to expect the “gig” economy to close gender differences. Even in the absence of discrimination and in flexible labor markets, women’s relatively high opportunity cost of non-paid-work time and gender-based differences in preferences and constraints can sustain a gender pay gap. |
| JEL: | J16 J31 |
| Date: | 2018–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24732&r=lab |
| By: | Edward P. Lazear; Kristin McCue |
| Abstract: | Most turnover reflects churn, where hires replace departures. Churn varies substantially by employer, industry and worker characteristics. In the LEHD (QWI) data, permanent employer differences account for 36% of the variation in churn. For example, leisure and hospitality turnover is more than double that of manufacturing. The cost of churn is proxied by the mean wage and the benefit by the variance in wages. QWI and JOLTS data confirm predictions. High mean wage occupations and industries experience less churn and high wage-variance ones experience more churn. Additionally, less educated, younger and male workers have higher separation and churn rates. |
| JEL: | E24 J0 J6 J63 M50 M51 |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24873&r=lab |
| By: | Genz, Sabrina (Institute for Employment Research (IAB), Nuremberg); Bellmann, Lutz (Institute for Employment Research (IAB), Nuremberg); Matthes, Britta (Institute for Employment Research (IAB), Nuremberg) |
| Abstract: | As works councils' information, consultation and co-determination rights affect the decision process of the management, works councils play a key role in the implementation of digital technologies in establishments. However, previous research focuses on the potential of digital technologies to sub-stitute for labor and its impact on labor market outcomes of workers. This paper adds the role of industrial relations to existing literature by analyzing the impact of works councils on the implementation of digital technologies. Theoretically, the role of works councils in the digital transformation is ambiguous. Using establishment data from the IAB Establishment Survey of 2016 combined with individual employee data from the Federal Employment Agency and occupational level data about the physical job exposure, empirical evidence indicates an ambivalent position of works councils to-wards digital technologies. The sole existence of works councils leads to statistically significant lower equipment levels with digital technologies. However, works councils foster the equipment with digital technologies in those establishments, which employ a high share of workers who are conducting physical demanding job activities. Thus, this study highlights the importance of establishment-level workforce representation for the digital adoption process within Germany. |
| Keywords: | co-determination, digital technologies, works councils, industrial relations, entropy balancing |
| JEL: | J50 J53 |
| Date: | 2018–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11616&r=lab |
| By: | Toshihiko Mukoyama (Department of Economics, Georgetown University) |
| Abstract: | This paper analyzes a simple search and matching model with heterogeneous jobs. First, I derive an explicit formula that ensures the social efficiency of the equilibrium outcome. This formula generalizes the well-known Hosios condition and clarifies the role of externalities across labor markets for different types of jobs. Second, business cycle fluctuations with heterogeneous jobs are analyzed. Heterogeneity in productivity and job stability plays an important role in generating strong labor-market responses to the aggregate labor market to productivity shocks. |
| Keywords: | Search and matching; Unemployment; Heterogeneous jobs; Efficiency; Business cycles |
| JEL: | D61 E24 E32 J63 J64 |
| Date: | 2018–08–12 |
| URL: | http://d.repec.org/n?u=RePEc:geo:guwopa:gueconwpa~18-18-01&r=lab |
| By: | Forth, John (National Institute of Economic and Social Research (NIESR)); Bryson, Alex (University College London) |
| Abstract: | The literature on the union wage premium is among the most extensive in labour economics but unions' effects on other aspects of the wage-effort bargain have received much less attention. We contribute to the literature through a study of the union premium in paid holiday entitlements, using large-scale survey data for the UK. We find that the union premium on paid holidays is substantially larger than the union premium on wages. However, the premium fell with the introduction of a statutory minimum entitlement to paid leave. This is indicative of the difficulties that unions have faced in protecting the most vulnerable employees, and symptomatic of their decreasing regulatory role in the UK labour market. |
| Keywords: | trade unions, holidays, vacation, working time |
| JEL: | J51 J32 K31 |
| Date: | 2018–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11615&r=lab |
| By: | Gould, Eric D. (Hebrew University, Jerusalem) |
| Abstract: | This paper examines the impact of manufacturing employment decline on the socio-economic outcomes within and between black and white Americans from 1960 to 2010. Exploiting variation across cities and over time, the analysis shows that manufacturing decline negatively impacted blacks (men, women, and children) in terms of their wages, employment, marriage rates, house values, poverty rates, death rates, single parenthood, teen motherhood, child poverty, and child mortality. In addition, the decline in manufacturing increased inequality within the black community in terms of overall wages and the gaps between education groups in wages, employment, and marriage rates. Many of the same patterns are found for whites, but to a lesser degree – leading to larger gaps between whites and blacks in wages, marriage patterns, poverty, single-parenthood, and death rates. The results are robust to the inclusion or exclusion of several control variables, and the use of a "shift-share" instrument for the local manufacturing employment share. Overall, the decline in manufacturing is reducing socio-economic conditions in general while increasing inequality within and between racial groups – which is consistent with a stronger general equilibrium effect of the loss of highly-paid, lower-skilled jobs on the less-educated segments of the population. |
| Keywords: | racial gaps, manufacturing decline |
| JEL: | J10 |
| Date: | 2018–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11614&r=lab |
| By: | Isabelle Bouchard (HEC Montreal); Lydia Cheung (School of Economics, Auckland University of Technology); Gail Pacheco (New Zealand Work Research Institute, Faculty of Business, Economics and Law, Auckland University of Technology) |
| Abstract: | New Zealand introduced a substantial childcare subsidy just over a decade ago, providing 20 hours free early childhood education (ECE) to all three and four year olds. We evaluate the impact of this policy shift on mothers’ labour market participation. Using a triple difference strategy and population wide administrative data, we follow mothers’ monthly wages from pre-pregnancy to six years post-childbirth. The estimated impact of the ECE reform is a drop in earnings for eligible women, by four to ten percent post-childbirth. Furthermore, most of the reduction occurs prior to the children reaching the age of eligibility. This suggests that the policy may have partially displaced private spending on ECE and that eligible mothers substituted this saving intertemporally. |
| Keywords: | Early childhood education, triple differences, mothers' wages and salaries, intertemporal substitution, administrative data |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:aut:wpaper:201805&r=lab |
| By: | Kai-Uwe Müller; Katharina Wrohlich |
| Abstract: | Expanding public or publicly subsidized childcare has been a top social policy priority in many industrialized countries. It is supposed to increase fertility, promote children's development and enhance mothers' labor market attachment. In this paper, we analyze the causal effect of one of the largest expansions of subsidized childcare for children up to three years among industrialized countries on the employment of mothers in Germany. Identification is based on spatial and temporal variation in the expansion of publicly subsidized childcare triggered by two comprehensive childcare policy reforms. The empirical analysis is based on the German Microcensus that is matched to county level data on childcare availability. Based on our preferred specification which includes time and county fixed effects we find that an increase in childcare slots by one percentage point increases mothers' labor market participation rate by 0.2 percentage points. The overall increase in employment is explained by the rise in part-time employment with relatively long hours (20-35 hours per week). We do not find a change in full-time employment or lower part-time employment that is causally related to the childcare expansion. The effect is almost entirely driven by mothers with medium-level qualifications. Mothers with low education levels do not profit from this reform calling for a stronger policy focus on particularly disadvantaged groups in coming years. |
| Keywords: | childcare provision; mother's labor supply; generalized difference-in-difference |
| JEL: | J22 J13 H43 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1747&r=lab |
| By: | Sansone, Dario |
| Abstract: | This paper analyzes how the legalization of same-sex marriage in the U.S. affected gay and lesbian couples in the labor market. Results from a difference-in-difference model show that both partners in same-sex couples were more likely to be employed, to have a full-time contract, and to work longer hours in states that legalized same-sex marriage. In line with a theoretical search model of discrimination, suggestive empirical evidence supports the hypothesis that marriage equality led to an improvement in employment outcomes among gays and lesbians and lower occupational segregation thanks to a decrease in discrimination towards sexual minorities. |
| Keywords: | same-sex marriage; discrimination; employment; LGBT; gay; lesbian |
| JEL: | D10 J12 J15 J22 J71 |
| Date: | 2018–07–17 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:87998&r=lab |
| By: | Maczulskij, Terhi (Labour Institute for Economic Research); Böckerman, Petri (Labour Institute for Economic Research); Kosonen, Tuomas (Labour Institute for Economic Research) |
| Abstract: | We examine the effect of job displacement on regional mobility using linked employer-employee panel data for the 1995-2014 period. We also study whether displaced movers obtain earnings and employment gains compared to displaced stayers. The results show that job displacement increases the migration probability by ~70%. However, social capital in a region and housing characteristics decrease the propensity to move, indicating that people do not make the migration decisions solely based on short-term economic incentives. Migration has an immediate negative relationship with earnings, but the link diminishes as time passes and eventually turns positive for men. The link between migration and employment is nevertheless positive and persistent for both genders. |
| Keywords: | unemployment, job displacement, migration, earnings, employment |
| JEL: | J61 J63 |
| Date: | 2018–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11635&r=lab |
| By: | Regina T. Riphahn; Salwan Saif |
| Abstract: | Naturalization may be a relevant policy instrument affecting immigrant integration in host-country labor markets. We study the effect of naturalization on labor market outcomes of immigrants in Germany. We apply recent survey data and exploit a reform of naturalization rules in an instrumental variable estimation. In our sample of recent immigrants, linear regression yields positive correlations between naturalization and beneficial labor market outcomes. Once we account for the endogeneity of naturalization most coefficients decline in magnitude and lose statistical significance: male immigrants' labor market outcomes do not benefit significantly from naturalization. Naturalization reduces the risks of unemployment and welfare dependence for female immigrants. For males and females, the propensity to hold a permanent contract increase as a consequence of naturalization. The results are robust to modifications of samples and the instrument. |
| Keywords: | citizenship, migration, naturalization, labor market outcomes, instrumental variables |
| JEL: | J61 J15 C26 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:bav:wpaper:181_riphahnsaif&r=lab |
| By: | Edoardo Ciscato (Paris School of Economics) |
| Abstract: | The American family underwent important transformations in the last decades. Mating patterns changed, college graduates and high earners marry with each other more and more frequently. On the other hand, those at the bottom of the wage and schooling distributions have become more and more likely to stay single, and, once married or cohabiting, more likely to break up. This increasing gap in family achievements has important implications for both income and consumption inequalities, as well as intergenerational mobility. In this paper, I aim to quantify the importance of the marriage market as a channel of inequality, both at household and individual level. I build on the matching literature and set up a model of marriage, divorce and remarriage along the life- cycle in order to reproduce the afore-mentioned aggregate trends and understand the underlying drivers. In the model, risk-averse agents get married in order to benefit from joint public good expenditure, but economic gains from marriage are volatile due to labor market shocks. I show that the underlying structure of preferences and of the meeting technology are identified with matched data on the distribution of couples’ and singles’ traits, jointly with data on newlyweds and divorcees. I propose an estimation method based on indirect inference and estimate the model with PSID data. Preliminary findings suggest that differences in the productivity of household public good expenditure appear as a key driving force behind differentials in the odds of staying single, mating patterns, and, ultimately, household income inequality. |
| Keywords: | marriage market, divorce, Inequality, life-cycle, wage uncertainty, search and matching |
| JEL: | D13 J11 J12 |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:hka:wpaper:2018-046&r=lab |
| By: | Rowlandy, Neil (Queen's University Belfast); McVicar, Duncan (Queen's University Belfast); Shuttleworth, Ian (Queen's University Belfast) |
| Abstract: | Ethnic and religious differentials in labour market outcomes within many countries have been remarkably persistent. Yet one very well-known differential – the Catholic/Protestant unemployment differential in Northern Ireland – has largely (although not completely) disappeared. This paper charts its decline since the mid-1980s and examines potential explanations using Census data from 1991, 2001 and 2011 together with annual survey data. These data span the ending of The Troubles, the signing of the Good Friday Agreement, the introduction of fair employment legislation, growth in hidden unemployment, and major structural changes in Northern Ireland. We assess the relative contributions of these changes. |
| Keywords: | unemployment, religion, economic inactivity, labour market inequality |
| JEL: | J64 Z12 |
| Date: | 2018–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp11633&r=lab |
| By: | Yusuf Sofiyandi1 (Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia) |
| Abstract: | I empirically investigated the influence of residential location and housing unit characteristics on the labor force participation of childbearing women by applying quasi-experimental methods and taking a developing country’s perspective – where the family size tends to grow faster. While the choices of residential location and housing unit characteristics are rarely exogenous, it is important to deal with the endogeneity problem. I use instrumental variable models, with twin births and gender composition as the exogenous sources of variation in the family size, and exploit an enormous micro dataset from the Indonesian Census Population 2010. Previous works of literature have examined the effect of twin birth on the female labor supply, but less attention given to the housing decision. This study provides new evidence of a forward-looking behavior about the residential location and housing consumption due to household size effects and shows that such behavior will most likely influence the female labor supply |
| Keywords: | residential location — housing — labor force — childbearing women — twin births |
| JEL: | J01 J21 J22 R21 O18 |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:lpe:wpaper:201822&r=lab |