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on Labour Economics |
| By: | Hederos, Karin (Swedish Institute for Social Research, Stockholm University); Stenberg, Anders (Swedish Institute for Social Research, Stockholm University) |
| Abstract: | Bertrand et al. (2015) show that in the U.S.,the distribution of the wife’s share of household income drops sharply at the point where the wife starts to earn more than her husband. They attribute the drop to a gender identity norm prescribing that a wife’s income should not exceed her husband’s income. We document a similar sharp drop in Swedish administrative register data. However, we also show that there is a large spike in the distribution of the wife’s share of household income at the point where spouses earn exactly the same. The wives in the equal-earning couples do not have higher earnings potential than their husbands, suggesting that the spike is not generated by couples seeking to avoid that the wife earns more than her husband. Excluding the equal-earning couples, the drop is small and mostly statistically insignificant. We conclude that, if anything, we find only weak evidence that Swedish couples comply with a norm against wives earning more than their husbands. |
| Keywords: | Gender roles; gender norms; marriage market; gender gap; gender identity |
| JEL: | D10 J12 J16 |
| Date: | 2019–06–28 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sofiwp:2019_003&r=all |
| By: | Mueller, Andreas I.; Spinnewijn, Johannes; Topa, Giorgio |
| Abstract: | This paper analyses job seekers' perceptions and their relationship to unemployment outcomes to study heterogeneity and duration-dependence in both perceived and actual job finding. Using longitudinal data from two comprehensive surveys, we document (1) that reported beliefs have strong predictive power of actual job finding, (2) that job seekers are over-optimistic in their beliefs, particularly the long-term unemployed, and (3) that job seekers do not revise their beliefs downward when remaining unemployed. We then develop a reduced-form statistical framework where we exploit the joint observation of beliefs and ex-post realizations, to disentangle heterogeneity and duration-dependence in true job finding rates while allowing for elicitation errors and systematic biases in beliefs. We find a substantial amount of heterogeneity in true job finding rates, accounting for almost all of the observed decline in job finding rates over the spell of unemployment. Moreover, job seekers' beliefs are systematically biased and under-respond to these differences in job finding rates. Finally, we show theoretically and quantify in a calibrated model of job search how biased beliefs contribute to the slow exit out of unemployment. The biases can explain more than 10 percent of the incidence of long-term unemployment. |
| Keywords: | beliefs; Biases; Duration Dependence; unemployment |
| JEL: | E24 J64 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:13774&r=all |
| By: | Mountford, Andrew (Royal Holloway, University of London); Wadsworth, Jonathan (Royal Holloway, University of London) |
| Abstract: | While skilled immigration ceteris paribus provides an immediate boost to GDP per capita by adding to the human capital stock of the receiving economy, might it also reduce the number of 'good jobs', i.e. those with training, available to indigenous workers? We analyse this issue theoretically and empirically. The theoretical model shows how skilled immigration can affect the sectoral allocation of labor and how it may have a positive or negative effect on the training and social mobility of native born workers. The empirical analysis uses UK data from 2001 to 2018 to show that training rates of UK born workers have declined in a period where immigration has been rising strongly, and have declined significantly more in high wage non-traded sectors. At a more disaggregated level however this link is much less strong, though there is evidence of different training effects of skilled immigration across traded and non-traded sectors. Hiring of UK born workers in high wage non-traded sectors has also been negatively affected by skilled immigration, although this effect is not large. Taken together the theoretical and empirical analyses suggest that skilled immigration may have some role in allocating native born workers away from 'good jobs' sectors but it is unlikely to be a major driver of social mobility. |
| Keywords: | immigration, training, income distribution |
| JEL: | J6 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12409&r=all |
| By: | O'Higgins, Niall (ILO International Labour Organization); Pica, Giovanni (USI Università della Svizzera Italiana) |
| Abstract: | We analyse theoretically and empirically the effects on young people's labour market outcomes of two specific labour market institutions and their interaction: employment protection legislation andactive labour market policy. The paper examines recent policy reforms in Italy focusing on the impact of the 2012 Fornero reforms of employment protection legislation as well as the initial impact of the EU-wide Youth Guarantee scheme introduced in Italy in March 2014. The paper then examines how these two policy reforms interacted. The analysis first confirms the finding that the Fornero reform increased permanent hires particularly amongst the very youngest workers; it then goes on to find that the YG was indeed successful in increasing the hires of young people, although this operated through a statistically significant increase in female hires on temporary contracts. Third, it finds some evidence of dampening effect of the YG on EPL reforms as predicted by theory. |
| Keywords: | youth employment, job search, ALMPs, EPL |
| JEL: | J13 J63 J68 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12424&r=all |
| By: | Jia Barwick, Panle; Liu, Yanyan; Patacchini, Eleonora; Wu, Qi |
| Abstract: | Information is a crucial ingredient in economic decision making. Yet measuring the extent of information exchange among individuals and its effect on economic outcomes is a difficult task. We use the universe of de-identified cellphone usage records from more than one million users in a Chinese city over twelve months to quantify information exchange among individuals and examine the role of referrals -- human carriers of information -- in urban labor markets. We present the first evidence that information flow (measured by call volume) correlates strongly with worker flows, a pattern that persists at different levels of geographic aggregation. Condition on information flow, socioeconomic diversity in information sources (social contacts), especially that associated with the working population, is crucial and helps to predict worker flows. We supplement our phone records with auxiliary data sets on residential housing prices, job postings, and firm attributes from administrative data. Information passed on through referrals is valuable: referred jobs are associated with higher monetary gains, a higher likelihood to transition from part-time to full-time, reduced commuting time, and a higher probability of entering desirable jobs. Referral information is more valuable for young workers, people switching jobs from suburbs to the inner city, and those changing their industrial sector. Firms receiving referrals are more likely to have successful recruits and experience faster growth. |
| Keywords: | Entrop; Information; Mobile Communication; Social Networks; Urban Labor Market |
| JEL: | J60 L15 R23 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:13786&r=all |
| By: | Nicholas Broten; Michael Dworsky; David Powell |
| Abstract: | Alternative work arrangements, including temporary and contract work, have become more widespread. There is interest in understanding the effects of these types of arrangements on employment and earnings risk for workers and the potential for existing social insurance programs to address this risk. We study employment and earnings risk in the context of workplace injuries among temporary and contract workers. We link administrative workers' compensation claims to earnings records to measure the employment and earnings risk posed by workplace injuries, comparing labor market outcomes after injury between temporary and contract workers and direct-hire workers injured doing the same job. We use a triple-difference identification strategy to isolate the effect of alternative work arrangements. We find that temporary workers have significantly lower probabilities of employment post-injury relative to similar direct-hire workers; temporary workers also have more severe earnings losses, which persist for at least three years after injury. This difference in income risk cannot be explained by differences in employment dynamics between temporary and direct-hire workers. We find evidence that the additional earnings losses suffered by temporary workers are offset by workers' compensation benefits, suggesting that the program provides insurance for the incremental risk faced by temporary workers. |
| JEL: | J28 J81 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25989&r=all |
| By: | Fatih Karahan; Benjamin Pugsley; Aysegül Sahin |
| Abstract: | We propose a simple explanation for the long-run decline in the startup rate. It was caused by a slowdown in labor supply growth since the late 1970s, largely pre-determined by demographics. This channel explains roughly two-thirds of the decline and why incumbent firm survival and average growth over the lifecycle have been little changed. We show these results in a standard model of firm dynamics and test the mechanism using shocks to labor supply growth across states. Finally, we show that a longer startup rate series imputed using historical establishment tabulations rises over the 1960-70s period of accelerating labor force growth. |
| Keywords: | Firm dynamics, Demographics, Business Dynamism, Macroeconomics |
| JEL: | J11 E24 D22 |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:19-21&r=all |
| By: | Nikhil Datta |
| Abstract: | This paper investigates the extent to which labour supply preferences are responsible for the marked rise in atypical work arrangements in the UK and US. By employing vignettes in a discrete job choice experiment in a representative survey, I estimate the distribution for preferences and willingness-to-pay over various job attributes. The list of attributes includes key distinguishing factors of typical and atypical work arrangements, such as security, work-related benefits, flexibility, autonomy and taxation implications. The results are indicative that the majority of the population prefer characteristics associated with traditional employee-employer relationships, and this preference holds even when analysing just the sub-sample of those in atypical work arrangements. Additionally, preferences across the UK and US are very similar, despite differences in labour market regulations. Rather than suggesting that labour supply preferences have contributed to the increase in atypical work arrangements, I find that the changing nature of work is likely to have significant negative welfare implications for many workers. |
| Keywords: | atypical work, self-employment, willingness-to-pay, experiment, labour supply preferences |
| JEL: | J22 J24 J32 J81 |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1632&r=all |
| By: | Debela, Bethelhem Legesse; Gehrke, Esther; Qaim, Matin |
| Abstract: | Child undernutrition remains a widespread problem in many developing countries. The empowerment of women, and mothers in particular, was shown to improve child nutrition in various geographical contexts. One important avenue to empower women is fostering female employment. However, maternal employment can influence child nutrition through different mechanisms; it is not clear under what conditions the overall effect will be positive. We develop a theoretical model to show that maternal employment can affect child nutrition through changes in (i) income, (ii) intra-household bargaining power, and (iii) time available for childcare. The links are empirically analyzed using panel data from rural Tanzania and regression models with maternal fixed effects. Maternal employment has non-linear effects on child height-for-age z-scores (HAZ), the standard indicator of longterm child nutritional status. Off-farm employment reduces child HAZ at low levels of labor supply. The effect turns positive at higher levels of off-farm labor supply and negative again at very high levels. The child nutrition effects of maternal time allocation to agricultural work on the own family farm are weaker than those of off-farm employment and statistically insignificant. These findings can help to better design development interventions that foster synergies and avoid potential tradeoffs between female empowerment and child nutrition goals. |
| Keywords: | Community/Rural/Urban Development, Food Consumption/Nutrition/Food Safety, Food Security and Poverty, Health Economics and Policy, International Development, Labor and Human Capital |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:ags:gagfdp:291358&r=all |
| By: | Persson, Petra; Rossin-Slater, Maya |
| Abstract: | While workplace flexibility is perceived to be a key determinant of maternal labor supply, less is known about fathers' demand for flexibility or about intra-household spillover effects of flexibility initiatives. This paper examines these issues in the context of a critical period in family life-the months immediately following childbirth-and identifies the impacts of paternal access to workplace flexibility on maternal postpartum health. We model household demand for paternal presence at home as a function of domestic stochastic shocks, and use variation from a Swedish reform that granted new fathers more flexibility to take intermittent parental leave during the postpartum period in a regression discontinuity difference-in-differences (RD-DD) design. We find that increasing the father's temporal flexibility reduces the risk of the mother experiencing physical postpartum health complications and improves her mental health. Our results suggest that mothers bear the burden from a lack of workplace flexibility-not only directly through greater career costs of family formation, as previously documented-but also indirectly, as fathers' inability to respond to domestic shocks exacerbates the maternal health costs of childbearing. |
| Keywords: | intra-household spillovers; maternal postpartum health; paternity leave; workplace flexibility |
| JEL: | I12 I18 I31 J12 J13 J38 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:13780&r=all |
| By: | Lori L. Taylor; Kalena E. Cortes; Travis C. Hearn |
| Abstract: | This paper presents on three new styled facts: first, schools of public affairs hire many economists; second, those economists are disproportionately female; and third, salaries in schools of public affairs are, on average, lower than salaries in mainline departments of economics. We seek to understand the linkage, if any, among these facts. We assembled a unique database of over 2,150 faculty salary profiles from the top 50 Schools of Public Affairs in the United States as well as the corresponding Economics and Political Science departments. For each faculty member we obtained salary data to analyze the relationship between scholarly discipline, department placement, gender, and annual salary compensation. We found substantial pay differences based on departmental affiliation, significant differences in citation records between male and female faculty in schools of public affairs, and no evidence that the public affairs discount could be explained by compositional differences with respect to gender, experience or scholarly citations. |
| JEL: | J01 J16 J30 J31 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:26022&r=all |
| By: | Richard K. Crump; Stefano Eusepi; Marc Giannoni; Ayşegül Şahin |
| Abstract: | This paper bridges the gap between two popular approaches to estimating the natural rate of unemployment, u*. The first approach uses detailed labor market indicators such as labor market flows, cross-sectional data on unemployment and vacancies, or various measures of demographic changes. The second approach which comprises reduced form models and DSGE models relies on aggregate price and wage Phillips curve relationships. We combine the key features of these two approaches to estimate the natural rate of unemployment in the United States using both data on labor market flows and a forward-looking Phillips curve linking inflation to current and expected deviations of unemployment from its unobserved natural rate. We estimate that the natural rate of unemployment is around 4.0% toward the end of 2018 and that the unemployment gap is roughly closed. Identification of a secular downward trend in the unemployment rate, driven solely by the inflow rate, facilitates the estimation of u*. We identify the increase in labor force attachment of women, decline in job destruction and reallocation intensity, and dual aging of workers and firms as the main drivers of the secular downward trend in the inflow rate. |
| JEL: | D84 E24 E31 E32 J11 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25930&r=all |
| By: | Mumford, Karen A. (University of York); Sechel, Cristina (University of Sheffield) |
| Abstract: | This article presents and explores a rich new data source to analyse the determinants of pay and job rank amongst academic Economists in the UK. Characteristics associated with individual productivity and workplace features are found to be important determinants of the relative wage and promotion structure in this sector. However, there is also a substantial unexplained gender pay gap. Men are considerably more likely to work in higher paid job ranks where there are also substantial within-rank gender pay gaps. We show that the nature of the gender pay gap has changed over the last two decades; but its size has not, suggesting a role for suitable policy intervention. |
| Keywords: | economist, academia, pay-gap, gender |
| JEL: | A1 A11 A2 I3 J01 J31 J7 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12397&r=all |
| By: | Khorunzhina, Natalia (Department of Economics, Copenhagen Business School); Miller, Robert A. (Tepper School of Business) |
| Abstract: | This paper develops and estimates a dynamic model of discrete choice for labor supply, fertility and transition from tenant to home-owner,to investigate the secular decline in home ownership over the past several decades,wholly attributable to households postponing the purchase of their first home. House prices only partly explain the decline; higher base level wages led to lower fertility also contributing to the decline,because households with children are more likely to own a home than those without.Somewhat surprisingly we find higher levels of female education ameliorated this trend,highly educated women placing greater value on homeownership. |
| Keywords: | Housing Demand; Fertility; Labor Supply |
| JEL: | D14 D91 J13 J22 R21 |
| Date: | 2019–07–03 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:cbsnow:2019_007&r=all |
| By: | Delaney, Judith (Economic and Social Research Institute, Dublin) |
| Abstract: | This paper looks at the joint impact of labour market risk and selection in to the labour market on returns to education. Accounting for non-employment risk leads to substantial changes in returns while wage risk has little impact. The risk- adjusted returns to both high school and college for males are larger than unadjusted returns. For females, risk leads to an increase in returns to high school but to a decrease in the returns to college while correcting for selection in to employment has large effects for females. The results suggest that failure to account for risk and selection in to employment when calculating returns to education leads to biased estimates. |
| Keywords: | employment, risk, education |
| JEL: | J1 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12394&r=all |
| By: | Björn Fischer; Kai-Uwe Müller |
| Abstract: | This paper analyzes the impact of a reduction in women's labor supply through retirement on their informal care provision. Using SOEP data from the years 2001- 2016 the analysis addresses fundamental endogeneity problems by applying a fuzzy regression discontinuity design. We exploit early retirement thresholds for women in the German pension system as instruments for their retirement decision. We find significant positive effects on informal care provided by women retiring from employment at the intensive and extensive margin that are robust to various sensitivity checks. Women retiring from full-time employment, highly educated women and women providing care within the household react slightly stronger. Findings are consistent with previous evidence and underlying behavioral mechanisms. They point to a time-conflict between labor supply and informal care before retirement. Policy implications are far-reaching in light of population aging. Prevalent pension reforms that aim to increase life-cycle labor supply threaten to reduce informal care provision by women and to aggravate the existing excess demand for informal care. |
| Keywords: | retirement; informal care; regression discontinuity; age threshold |
| JEL: | J22 J13 H43 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1809&r=all |
| By: | Baumgarten, Daniel (LMU); Lehwald, Sybille (Federal Ministry for Economic Affairs and Energy) |
| Abstract: | We analyze the effect of the increase in trade exposure induced by the rise of China and the transformation of Eastern Europe on collective bargaining coverage of German plants in the period 1996-2008. We exploit cross-industry variation in trade exposure and use trade flows of other high-income countries as instruments for German trade exposure. We find that increased import exposure has led to an increase in the probability of German plants leaving industry-wide bargaining agreements, accounting for about one fifth of the overall decline in the German manufacturing sector. The effect is most pronounced for small and medium-sized plants. |
| Keywords: | international trade; import competition; collective bargaining; |
| JEL: | F16 J51 |
| Date: | 2019–07–11 |
| URL: | http://d.repec.org/n?u=RePEc:rco:dpaper:165&r=all |
| By: | Kimberly A. Berg; Chadwick C. Curtis; Steven Lugauer; Nelson C. Mark |
| Abstract: | We decompose the response of aggregate consumption to monetary policy shocks into contributions by households at different stages of the life cycle. This decomposition finds that older households have a higher consumption response than younger households. Amongst older households, the consumption response is also increasing in income. This, along with data on age-related net wealth, presents evidence for a wealth effect playing a role in driving the response patterns. This mechanism is studied further in a partial-equilibrium life-cycle model of consumption, saving, and labor-supply decisions. The model qualitatively explains the empirical patterns. Understanding the heterogeneity in consumption responses across age groups is important for understanding the transmission of monetary policy, especially as the U.S. population grows older. |
| JEL: | E0 E21 E52 J1 J11 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25970&r=all |
| By: | Bilal Nabeel Falah; Marcelo Bérgolo; Arwa Abu Hashhash; Mohammad Hattawy; Iman Saadeh |
| Abstract: | Two interesting facts emerge from the Palestinian labor market. Educational attainment for women swiftly expanded during the 1999-2011 period, but the labor force-participation rate (LFPR) for educated women stagnated—and disproportionately so for young educated women. We investigated whether changes in labor demand contributed to women’s sluggish labor-force participation (LFP). Our empirical analysis used quarterly labor-force data published by Palestine Census Bureau of Statistics (PCBS) between 2005 and 2011. To explore the causal effect of labor demand, we employed a fixed-effects model using the instrumental- variable approach. We provide evidence that changes in demand for educated women workers affect their LFP, indicating that the negative demand shocks that young educated women have encountered in recent years may have contributed to their sluggish LFP. Interestingly, the decrease in the demand for educated women is not driven by job competition with similarly situated men. This research has important implications for policy regarding the economic empowerment of educated women in Palestine and suggests that enhanced labor demand for educated women is vital to boost their labor-force participation. |
| Keywords: | Labor economics, labor demand, labor-force participation |
| JEL: | J21 J01 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:lvl:pmmacr:2019-08&r=all |
| By: | Goksu Aslan (United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) South and South-West Asia Office) |
| Abstract: | The youthful population of South Asia, having almost one-third of the population below the age of 15 years old, seems also to have a great share in the future alongside the risk of being NEET with a persisting gender gap. This makes important for South Asian countries to put a gender-responsive policy framework for the youth empowerment at the heart of their efforts towards the 2030 Agenda. Increasing youth’s financial inclusion at the individual level would also provide development benefits especially for developing and least developed countries. This paper, after constructing a multidimensional financial inclusion index, shows evidence on how to increase the formal financial inclusion among the South Asian youth considering also gendered effects and it provides policy recommendations accordingly. |
| Keywords: | Development, Financial Inclusion, Sustainable Development Goals (SDGs), Youth |
| JEL: | D14 G28 J16 N25 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:eap:sswadp:dp1902&r=all |
| By: | Jaschke, Philipp (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Keita, Sekou (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]) |
| Abstract: | "Immigration policy in most high-income countries is designed to promote qualified migration while maintaining high requirements on characteristics such as education and language skills. We rely on a standard self-selection model with heterogeneous migration costs to discuss the effect of access to language learning services in the country of origin on the skill composition of immigrants in Germany. Using individual-level survey data on immigrants from different cohorts over the period 2000 - 2014, combined with unique data on the presence of Goethe Institutes - a German association promoting German language and culture worldwide - in origin countries, the results of our empirical analysis show that the acquisition of the German language is fostered by the availability of language courses abroad. Moreover, we find that language services abroad induce a positive (self-)selection of migrants along several dimensions, such as education, experience, and the probability of holding a job offer at arrival. These characteristics are in turn highly relevant for long- term integration in Germany. To disentangle transmission channels, we perform a causal mediation analysis. We find that 25 % of the total effect of language services abroad on language skills at immigration trace back directly to migrants' participation in language courses, revealing important spillover effects." (Author's abstract, IAB-Doku) ((en)) |
| JEL: | F22 J18 J24 J61 Z13 |
| Date: | 2019–07–03 |
| URL: | http://d.repec.org/n?u=RePEc:iab:iabdpa:201914&r=all |
| By: | John R. Graham; Hyunseob Kim; Si Li; Jiaping Qiu |
| Abstract: | An employee’s annual earnings fall by 10% the year her firm files for bankruptcy and fall by a cumulative present value of 67% over seven years. This effect is more pronounced in thin labor markets and among small firms that are ultimately liquidated. Compensating wage differentials for this “bankruptcy risk” are approximately 2.3% of firm value for a firm whose credit rating falls from AA to BBB, about the same magnitude as debt tax benefits. Thus, wage premia for expected costs of bankruptcy are of sufficient magnitude to be an important consideration in corporate capital structure decisions. |
| JEL: | G32 G33 J21 J31 J61 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25922&r=all |