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on Labour Economics |
| By: | Furtado, Delia (University of Connecticut); Papps, Kerry L. (University of Bath); Theodoropoulos, Nikolaos (University of Cyprus) |
| Abstract: | Social Security Disability Insurance (SSDI) take-up tends to increase during recessions. We exploit variation across immigrant groups in the non-pecuniary costs of participating in SSDI to examine the role that costs play in applicant decisions across the business cycle. We show that immigrants from country-of-origin groups that have lower participation costs are more sensitive to economic conditions than immigrants from high cost groups. These results do not seem to be driven by variation across groups in sensitivity to business cycles or eligibility for SSDI. Instead, they appear to be primarily driven by differences in work norms across origin countries. |
| Keywords: | disability insurance, immigrants, unemployment rates, ethnic networks |
| JEL: | E32 J61 H55 I18 |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12097&r=all |
| By: | Clemens, Michael A. (Center for Global Development) |
| Abstract: | 'Guest workers' earn higher wages overseas on temporary low-skill employment visas. This wage effect can quantify global inefficiencies in the pure spatial allocation of labor between poorer and richer countries. But rigorous estimates are rare, complicated by migrant self-selection. This paper tests the effects of guest work on Indian applicants to a construction job in the United Arab Emirates, where a crisis exogenously influenced job placement. Guest work raised the return to labor by a factor of four, implying large spatial inefficiency. Short-term effects on households were modest. Effects on information, debt, and later migration were incompatible with systematic fraud. |
| Keywords: | income, human capital, migration, labor, mobility, guest work, India, gulf, construction, worker, selection, migrant, temporary, visa, wage, education, crisis, low-skill, unskilled, credit, exploited, naive, regret, slavery, trafficking, debt, coerced, cheated |
| JEL: | F22 J6 O12 O16 O19 |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12095&r=all |
| By: | Bindler, Anna; Ketel, Nadine |
| Abstract: | Little is known about the costs of crime to victims and their families. In this paper, we use unique and detailed register data on victimisations and labour market outcomes from the Netherlands to overcome data restrictions previously met in the literature and estimate event-study designs to assess the short- and long-term effects of criminal victimisation. Our results show significant decreases in earnings (6.6-9.3%) and increases in the days of benefit receipt (10.4-14.7%) which are lasting up to eight years after victimisation. We find shorter-lived responses in health expenditure. Additional analyses suggest that the victimisation can be interpreted as an escalation point, potentially triggering subsequent adverse life-events which contribute to its persistent impact. Heterogeneity analyses show that the effects are slightly larger for males regarding earnings and significantly larger for females regarding benefits. These differences appear to be largely (but not completely) driven by different offence characteristics. Lastly, we investigate spill-over effects on non-victimised partners and find evidence for a spill-over effect of violent threat on the partner's earnings. |
| Keywords: | crime; event-study design; labour market outcomes; victimisation |
| JEL: | I1 J01 J12 K4 |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:13431&r=all |
| By: | Jäger, Simon; Schoefer, Benjamin; Zweimüller, Josef |
| Abstract: | We present a sharp test for the efficiency of job separations. First, we document a dramatic increase in the separation rate - 11.2ppt (28%) over five years - in response to a quasi-experimental extension of UI benefit duration for older workers. Second, after the abolition of the policy, the "job survivors" in the formerly treated group exhibit exactly the same separation behavior as the control group. Juxtaposed, these facts reject the "Coasean" prediction of efficient separations, whereby the UI extensions should have extracted marginal (low-surplus) jobs and thereby rendered the remaining (high-surplus) jobs more resilient after its abolition. Third, we show that a formal model of predicted efficient separations implies a piece-wise linear function of the actual control group separations beyond the missing mass of marginal matches. A structural estimation reveals point estimates of the share of efficient separations below 4%, with confidence intervals rejecting shares above 13%. Fourth, to characterize the marginal jobs in the data, we extend complier analysis to difference-in-difference settings such as ours. The UI-indiced separators stemmed from declining firms, blue-collar jobs, with a high share of sick older workers, and firms more likely to have works councils - while their wages were similar to program survivors. The evidence is consistent with a "non-Coasean" framework building on wage frictions preventing efficient bargaining, and with formal or informal institutional constraints on selective separations. |
| Keywords: | complier analysis; Efficient separations; job surplus; Unemployment insurance; wage bargaining |
| JEL: | C52 J30 J63 J65 |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:13473&r=all |
| By: | van der Klaauw, Bas; Ziegler, Lennart |
| Abstract: | We conduct a field experiment to evaluate the effectiveness of labor market speeddates where unemployed workers meet temporary employment agencies. Our analysis shows that participation in such events increases immediate job finding by 6-7 percentage points. In the subsequent months, employment effects diminish again, suggesting that vacancies mediated through temporary employment agencies have no long-lasting effect on employment prospects. While the intervention is cost effective for the UI administration, higher labor earnings of treated job seekers do not fully compensate for the decline in benefit payments. Additional survey evidence shows that speeddate participation increases job search motivation and reduces reservation wages. |
| Keywords: | active labor market policies; job search behavior; Matching events; randomized experiment; temporary work |
| JEL: | C21 C93 J64 J65 |
| Date: | 2019–02 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:13516&r=all |
| By: | Lisette Swart (CPB Netherlands Bureau for Economic Policy Analysis); Wiljan van den Berge (CPB Netherlands Bureau for Economic Policy Analysis); Karen van der Wiel (CPB Netherlands Bureau for Economic Policy Analysis) |
| Abstract: | When children start school, parents save time and/or money. In this paper, we empirically examine the impact of these changes to the family's budget constraint on parents' working hours. Labor supply is theoretically expected to increase for parents who used to spend time taking care of their children, but to decrease for fulltime working parents because of an income effect: child care expenses drop. We show that the effect of additional time dominates the income effect in the Netherlands, where children start school (kindergarten) for approximately 20 hours a week in the month that they turn 4. Using detailed administrative data on all parents, we fi nd that the average mother's hours worked increases by 3% when her youngest child starts going to school. For their partners, who experience a much smaller shock in terms of time, the increase in hours worked is also much smaller at 0.4%. |
| JEL: | J13 J22 |
| Date: | 2019–02 |
| URL: | http://d.repec.org/n?u=RePEc:cpb:discus:392&r=all |
| By: | Di Paolo, Antonio; Tansel, Aysit |
| Abstract: | In this paper, we investigate the effect of the level of English skills on the labour market outcomes of Turkish women, using data from the Adult Education Survey of 2007. By adopting a bivariate equation framework, we jointly model the effect of English skills on labour market status and, conditional on being a wage earner, on monthly earnings and occupational status. The multinomial equation that explains labour market status allows for a different effect of language knowledge on the probability of being employed, unemployed but actively looking for a job, an unpaid family worker or involved in household tasks. The results indicate that being proficient in English is conditionally associated with a higher probability of being employed as a wage earner and, to a lesser extent, unemployed but looking for a job, whereas it decreases the likelihood of being involved in household tasks. Moreover, there is a significant conditional correlation between having a high level of skills in English and earnings, which is only modestly reduced when job-related variables and (especially) occupation dummies are included as additional controls. Indeed, being proficient in English barely affects occupational status when selection into employment status is controlled for. Therefore, the knowledge of foreign languages (in this case English) seems to stimulate labour market participation and earnings capacity, but does not substantially affect the occupational position of women in the Turkish labour market. |
| Keywords: | English skills,females,labour market status,earnings,occupation |
| JEL: | J16 J24 J31 O15 Z13 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:319&r=all |
| By: | J. David Brown; John S. Earle; Mee Jung Kim; Kyung Min Lee |
| Abstract: | We estimate differences in innovation behavior between foreign versus U.S.-born entrepreneurs in high-tech industries. Our data come from the Annual Survey of Entrepreneurs, a random sample of firms with detailed information on owner characteristics and innovation activities. We find uniformly higher rates of innovation in immigrant-owned firms for 15 of 16 different innovation measures; the only exception is for copyright/trademark. The immigrant advantage holds for older firms as well as for recent start-ups and for every level of the entrepreneur’s education. The size of the estimated immigrant-native differences in product and process innovation activities rises with detailed controls for demographic and human capital characteristics but falls for R&D and patenting. Controlling for finance, motivations, and industry reduces all coefficients, but for most measures and specifications immigrants are estimated to have a sizable advantage in innovation. |
| JEL: | F22 J15 J6 L26 O3 O31 |
| Date: | 2019–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25565&r=all |
| By: | Green, David A. (University of British Columbia, Vancouver); Riddell, W. Craig (University of British Columbia, Vancouver) |
| Abstract: | Numerous studies conclude that ethnic/cultural/racial diversity has negative impacts on interpersonal trust and support for redistributive social programs. Although some Canadian public opinion data is consistent with this view, whether these impacts on public opinion are important enough to influence policy is unclear. Many scholars argue that Canada is an exception to experience elsewhere. This paper examines this question for the case of Canadian social assistance (welfare) policies - a central component of the social safety net. We exploit two salient features of recent Canadian experience. One is dramatic growth in the ethnic and cultural diversity of Canada's immigrant inflows in recent decades, but the extent of this growth has varied substantially across regions. The second is that welfare policies vary across provinces, and the ability of the provinces to employ different approaches to welfare programs has increased since the mid-1990s. We thus examine whether provinces that became more diverse reduced the generosity of their welfare programs, relative to provinces that experienced little change in the heterogeneity of their populations. We examine impacts of immigration on welfare benefit rates of four family types: single employables, single disabled, lone parents and couples with children. Our main finding is that there is limited evidence of increased immigration on any of these types other than families with children. Even in this case the estimated effects are small. Our study thus supports the view that Canada's experience stands as an example in which greater diversity has not reduced support for redistributive social programs. |
| Keywords: | redistribution, social assistance, welfare, immigration, multiculturalism, ethnic diversity, interpersonal trust |
| JEL: | H0 I3 J6 |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12098&r=all |
| By: | Kamil Galuscak; Jan Solc; Pawel Strzelecki |
| Abstract: | We investigate the cyclical properties of labour market flows in the Czech Republic and Poland. We find that the role of flows from and into inactivity in explaining the cyclical properties of unemployment and employment rates is smaller than that of flows between employment and unemployment, but is not negligible. The participation rate is weakly countercyclical in both countries, driven by the countercyclical net flow from inactivity to unemployment. This could be explained by fewer employment opportunities in recessions, so that more inactive individuals go to unemployment than directly to employment. Our results are very similar for the two countries, the only noticeable difference being that flows between employment and inactivity have a bigger impact on the participation and employment rates in Poland than those in the Czech Republic. |
| Keywords: | Employment, labour market flows, participation, unemployment, vector autoregression |
| JEL: | E17 E24 E32 J21 J64 |
| Date: | 2018–12 |
| URL: | http://d.repec.org/n?u=RePEc:cnb:wpaper:2018/17&r=all |
| By: | Hochmuth, Brigitte; Kohlbrecher, Britta; Merkl, Christian; Gartner, Hermann |
| Abstract: | This paper proposes a new approach to evaluate the macroeconomic effects of the Hartz IV reform in Germany, which reduced the generosity of long-term unemployment benefits. We use a model with different unemployment durations, where the reform initiates both a partial effect and an equilibrium effect. The relative importance of these two effects and the size of the partial effect are estimated based on the IAB Job Vacancy Survey. Our novel methodology provides a solution for the existing disagreement in the macroeconomic literature on the unemployment effects of Hartz IV. We find that Hartz IV was a major driver for the decline of Germany's unemployment and that partial and equilibrium effect where of equal importance. We thereby contribute to the literature on partial and equilibrium effects of unemployment benefit changes. In addition, we are the first to provide direct empirical evidence on labour selection, which can be interpreted as one dimension of recruiting intensity. |
| Keywords: | Unemployment benefits reform,search and matching,Hartz reforms |
| JEL: | E24 E00 E60 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:iwqwdp:012019&r=all |
| By: | Astrid Kunze; Xingfei Liu |
| Abstract: | In this paper, we investigate whether the expansion of childcare leads to an increase in the female labour supply. We measure female labour supply at both the extensive and intensive margin. For identification, we exploit a nationwide reform that expanded childcare for 1–2- year-olds in Norway. Our results reveal a significant increase in the overall employment of mothers in the target group, but only weak evidence of an increase in contracted hours of work. However, both adjustments are only short term following the reform. When we consider sub-groups of mothers more closely, we find substantial heterogeneity in the affected outcomes and the timing of these effects. In particular, when we exclude mothers on job-protected maternity leave and with currently zero hours of work from the target group, we estimate even larger effects on employment and now significant effects on actual hours of work. For mothers with more than one child, we find significant long-term effects of the reform on both employment and hours of work. |
| Keywords: | childcare, female labour supply, contracted hours, actual hours, causal effects |
| JEL: | J08 J13 J22 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7509&r=all |
| By: | Courtney Coile; Mark Duggan |
| Abstract: | The economic progress of U.S. men has stagnated in recent decades, with declining labor force participation and weak growth in real earnings, particularly for less educated and non-white men. In this paper, we illuminate the broader context in which prime-age men are experiencing economic stagnation. We explore changes for prime-age men over time in education, mortality, morbidity, disability program receipt, family structure, and incarceration rates, indicators that may be affected by men’s sluggish economic progress or play a role in explaining it, or both. While establishing causality for such a wide range of health and other outcomes is inherently difficult, we discuss clues provided by recent research. |
| JEL: | I10 I20 J12 J22 K42 |
| Date: | 2019–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25569&r=all |
| By: | Jedwab, Remi; Johnson, Noel; Koyama, Mark |
| Abstract: | The Black Death killed 40% of Europe's population between 1347-1352, making it one of the largest shocks in history. Despite its importance, little is known about its spatial effects and the effects of pandemics more generally. Using a novel dataset that provides information on spatial variation in Plague mortality at the city level, as well as various identification strategies, we explore the short-run and long-run impacts of the Black Death on city growth. On average, cities recovered their pre-Plague populations within two centuries. In addition, aggregate convergence masked heterogeneity in urban recovery. We show that both of these facts are consistent with a Malthusian model in which population returns to high-mortality locations endowed with more rural and urban fixed factors of production. Land suitability and natural and historical trade networks played a vital role in urban recovery. Our study highlights the role played by pandemics in determining both the sizes and placements of populations. |
| Keywords: | Black Death; cities; growth; Malthusian Theory. Migration; path dependence; Urbanization |
| JEL: | J11 N00 N13 O11 O47 R11 R12 |
| Date: | 2019–02 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:13523&r=all |
| By: | Chigavazira, Abraham (University of Melbourne); Fisher, Hayley (University of Sydney); Robinson, Tim (Life Course Centre); Zhu, Anna (University of Melbourne) |
| Abstract: | This paper analyses the effect of extending equitable property division divorce laws to unmarried cohabiting couples in Australia. Using a triple-difference fixed effects approach we show that existing couples are more likely to make relationshipspecific investments after being exposed to laws enabling the equitable redistribution of property in the event of relationship breakdown. In affected couples we find that men increase their employment and women increase time spent on housework. Couples have more children and are more likely to become home owners. These results demonstrate the causal effect of property division laws on relationship-specific investments and inform the ongoing international debate about the appropriate legal treatment of unmarried cohabiting couples. |
| Keywords: | cohabitation, divorce, property, division, household behavior |
| JEL: | J12 K36 |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12102&r=all |
| By: | Yamamura, Eiji; Tsutsui, Yoshiro |
| Abstract: | This study investigates how spousal age gaps influence the allocation of housework between husbands and wives. Further, we consider the identity formed as a result of respondents’ family backgrounds by specifically exploring the effects of the age gaps between the respondents’ parents. We initially collect an individual-level panel dataset covering the periods before and after marriage, by monthly surveys of unmarried persons in the initial period prior to marriage, then the three-year period that follows. After controlling for individual- and time period-fixed effects, the key findings are as follows: (1) after marriage, women older than their husbands tend to become burdened with a larger amount of housework, and the spousal gap effect increases as the marriage duration increases; (2) women with mothers older than their fathers tend to assume a larger allocation of the housework as the marriage duration increases; and (3) the age gap hardly affects the men’s allocation of housework, although men with a full-time working mother at age 15 assume a larger allocation of housework as the marriage duration increases. |
| Keywords: | Spousal age gaps; housework allocation; intra-household bargaining |
| JEL: | D13 J12 J16 |
| Date: | 2019–02–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:92059&r=all |
| By: | Cai, Zhengyu; Stephens, Heather M.; Winters, John V. |
| Abstract: | Women face unique challenges in starting and running their own businesses and may have differing motives to men for pursuing self-employment. Previous research suggests that married women with families value the flexibility that self-employment can offer, allowing them to balance their family responsibilities with their career aspirations. This may be especially true for college graduates, who tend to have more successful businesses. Access to childcare may also affect their labor force decisions. Using American Community Survey microdata, we examine how birth-place residence, a proxy for access to extended family and child care, relates to self-employment and hours worked for college-graduate married mothers. Our results suggest that flexibility is a major factor pulling out-migrant college-educated mothers into self-employment. Additionally, it appears that, in response to fewer childcare options, self-employed mothers away from their birth-place work fewer hours, while self-employed mothers residing in their birth place are able to work more hours per week. |
| Keywords: | motherhood,migration,self-employment,childcare,hours worked |
| JEL: | J13 J22 L26 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:317&r=all |
| By: | Noemi Oggero (Department of Economics and Statistics (Dipartimento di Scienze Economico-Sociali e Matematico-Statistiche), University of Torino, Italy); Maria Cristina Rossi (Department of Management, University of Torino, Italy); Elisa Ughetto (Department of Management and Production Engineering, Politecnico di Torino, Italy) |
| Abstract: | We investigate the attitudes to entrepreneurship of Italian households, focusing on the importance of digital skills and financial literacy as potentially relevant factors shaping entrepreneurial entry. We put the gender focus to our analysis to detect whether, and to what extent, women and men differ in their propensity to run a business. We carry out our research by using a sample of the Bank of Italy SHIW dataset for the year 2008 and 2010. Our findings suggest a strong heterogeneity, between men and women, of the importance of digital skills and financial literacy as entrepreneurial drivers. Results show that the impact of financial literacy on the probability of being an entrepreneur is significant, but only for men. Digital skills increase the probability of being entrepreneur with a bigger effect for men than for women. |
| Keywords: | entrepreneurship, financial literacy, digital, gender economics. |
| JEL: | L26 J16 D14 |
| Date: | 2019–02 |
| URL: | http://d.repec.org/n?u=RePEc:tur:wpapnw:059&r=all |
| By: | Lechner, Michael |
| Abstract: | Uncovering the heterogeneity of causal effects of policies and business decisions at various levels of granularity provides substantial value to decision makers. This paper develops new estimation and inference procedures for multiple treatment models in a selection-on-observables framework by modifying the Causal Forest approach suggested by Wager and Athey (2018). The new esti-mators have desirable theoretical and computational properties for various aggregation levels of the causal effects. An Empirical Monte Carlo study shows that they may outperform previously suggested estimators. Inference tends to be accurate for effects relating to larger groups and conservative for effects relating to fine levels of granularity. An application to the evaluation of an active labour mar-ket programme shows the value of the new methods for applied research. |
| Keywords: | average treatment effects; causal forests; Causal machine learning; conditional aver-age treatment effects; multiple treatments; selection-on-observable; statistical learning |
| JEL: | C21 J68 |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:13430&r=all |
| By: | Chadi, Cornelia (University of Trier); Jirjahn, Uwe (University of Trier) |
| Abstract: | Previous international research has shown that women are more risk averse than men. This gives rise to the question whether the gender gap in risk attitudes is shaped by the social environment. We address this question by examining risk attitudes among East and West Germans. Originated from different family policies during Germany's separation, East Germans have more equal gender roles than West Germans. Thus, if the gender gap reflects socially constructed norms, it should be smaller among East Germans. Using data of the German Socio-Economic Panel (SOEP), our empirical analysis confirms this prediction. Specifically with respect to career and financial matters, the gender gap in risk tolerance is smaller among East Germans. We find no evidence that the East German gender gap has converged to the higher West German level after reunification. By contrast, the West German gap has narrowed over time. |
| Keywords: | risk preferences, gender roles, nurture, family policy |
| JEL: | D91 J16 P51 |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12100&r=all |
| By: | Del Boca, Daniela (University of Turin); Flinn, Christopher (New York University); Verriest, Ewout (New York University); Wiswall, Matthew (Arizona State University) |
| Abstract: | We construct and estimate a model of child development in which both the parents and children make investments in the child's skill development. In each period of the development process, partially altruistic parents act as the Stackelberg leader and the child the follower when setting her own study time. We then extend this non-cooperative form of interaction by allowing parents to offer incentives to the child to increase her study time, at some monitoring cost. We show that this incentive scheme, a kind of internal conditional cash transfer, produces efficient outcomes and, in general, increases the child's cognitive ability. In addition to heterogeneity in resources (wage offers and non-labor income), the model allows for heterogeneity in preferences both for parents and children, and in monitoring costs. Like their parents, children are forward looking, but we allow children and parents to have different preferences and for children to have age-varying discount rates, becoming more "patient" as they age. Using detailed time diary information on the allocation of parent and child time linked to measures of child cognitive ability, we estimate several versions of the model. Using model estimates, we explore the impact of various government income transfer policies on child development. As in Del Boca et al. (2016), we find that the most effective set of policies are (external) conditional cash transfers, in which the household receives an income transfer given that the child's cognitive ability exceeds a prespecified threshold. We find that the possibility of households using internal cash transfers greatly increases the cost effectiveness of external cash transfer policies. |
| Keywords: | time allocation, child development, household labor supply |
| JEL: | J13 D1 |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12103&r=all |
| By: | Sam Desiere; Kristine Langenbucher; Ludo Struyven |
| Abstract: | Profiling tools help to deliver employment services more efficiently. They can ensure that more costly, intensive services are targeted at jobseekers most at risk of becoming long term unemployed. Moreover, the detailed information on the employment barriers facing jobseekers obtained through the profiling process can be used to tailor services more closely to their individual needs. While other forms of profiling exist, the focus is on statistical profiling, which makes use of statistical models to predict jobseekers’ likelihood of becoming long-term unemployed. An overview on profiling tools currently used throughout the OECD is presented, considerations for the development of such tools, and some insights into the latest developments such as using “click data” on job searches and advanced machine learning techniques. Also discussed are the limitations of statistical profiling tools and options for policymakers on how to address those in the development and implementation of statistical profiling tools. |
| Keywords: | active labour market policy, caseworkers, employment barrier, jobseekers, selection, statistical profiling, targeting, unemployment |
| JEL: | J64 J68 |
| Date: | 2019–02–18 |
| URL: | http://d.repec.org/n?u=RePEc:oec:elsaab:224-en&r=all |