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on Labour Economics |
| By: | Selwaness, Irene |
| Abstract: | This paper aims to study the evolution in the age composition of males' employment in the aftermath of the public sector downsizing in the 1990s -during the Economic Reform and Structural Adjustment Policies - and the new labor law in 2003. This answers the question of whether young (15-29) and older (50-59) male workers were the most likely to bear the brunt of the 1990s reforms and the new labor law in 2003. Employment, formality and hours-of-work are simultaneously estimated by maximum likelihood to control for the self-selection, using three repeated cross sectional samples from Egyptian Datasets conducted in 1988, 1998 and 2006. Results show that men aged (15-29) and those aged (50-59) were less likely, as compared to their peers in middle age (30-49), to be employed in 1998 than in 1988 (before the first reform). While informality has affected all age groups, the 30 to 49 years old were the category that experienced the most rapid increase in informality as compared to the other two age groups. Findings also show evidence of negative correlation between the probability of employment and the probability of having a formal job, indicating that those who have more incidence to work in formal jobs are more likely to remain unemployed or inactive. |
| Keywords: | Structural Adjustment Programs,Labor Supply,Informality,Simultaneous Equations,Middle-East,Egypt |
| JEL: | J08 J21 N35 C3 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:455&r=all |
| By: | Kuhelika De; Ryan A. Compton; Daniel C. Giedeman; Gary A. Hoover |
| Abstract: | Using 136 United States macroeconomic indicators from 1973 to 2017, and a factor augmented vector autoregression (FAVAR) framework with sign restrictions, we investigate the effects of three structural macroeconomic shocks - monetary, demand, and supply – on the labour market outcomes of black and white Americans. Our results indicate that adverse macroeconomic shocks have differential effects on labour market outcomes for blacks and whites, hurting blacks disproportionately relative to whites. Black Americans appear to be significantly more sensitive to macroeconomic shocks than white Americans. Evidence from our FAVAR model, which uses information on contractionary initiatives by the Federal Reserve, indicates that the employment-population ratio among black Americans falls close to twice as much as that among white Americans, primarily due to an increase in their unemployment rate and not a decline in labour force participation rate. Policymakers should take account of these heterogeneous effects across racial groups when implementing disinflationary guiding policy. |
| Keywords: | macroeconomic shocks, monetary policy, business cycles, labour market, unemployment, racial inequality, FAVAR, sign restrictions |
| JEL: | C32 E24 E32 E52 J10 J15 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_8004&r=all |
| By: | Hannes Schwandt; Till M. von Wachter |
| Abstract: | This paper uses several large cross-sectional data sources and a new approach to estimate midlife effects of entering the labor market in a recession on mortality by cause and various measures of socioeconomic status. We find that cohorts coming of age during the deep recession of the early 1980s suffer increases in mortality that appear in their late 30s and further strengthen through age 50. We show these mortality impacts are driven by disease-related causes such as heart disease, lung cancer, and liver disease, as well as drug overdoses. At the same time, unlucky middle-aged labor market entrants earn less and work more while receiving less welfare support. They are also less likely to be married, more likely to be divorced, and experience higher rates of childlessness. Our findings demonstrate that tempo- rary disadvantages in the labor market during young adulthood can have substantial impacts on lifetime outcomes, can affect life and death in middle age, and go beyond the transitory initial career effects typically studied. |
| JEL: | E32 I10 J10 |
| Date: | 2020–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:26638&r=all |
| By: | Khoury, Laura (Dept. of Economics, Norwegian School of Economics and Business Administration); Briole, Simon (Paris School of Economics and JPAL Europe); Brébion , Clément (CEET-CNAM and Paris School of Economics) |
| Abstract: | Entitlement conditions are a little explored dimension of unemployment insurance (UI) schemes. In this paper, we provide a comprehensive evaluation of a reform that softened the minimum employment record condition to qualify for UI benefits in France after 2009. Using administrative panel data matching employment and unemployment spells, we first provide clear evidence that the reform induced a separation response at the eligibility threshold. It appears both at the micro level– through a jump in transitions from employment to unemployment – and at the macro level – through the scheduling of shorter contracts, in line with the new eligibility requirements. Exploiting the reform as well as relevant sample restrictions, we then estimate the effects of receiving UI benefits on subsequent labour market outcomes using a regression discontinuity design. Our findings point to a large negative impact of UI benefits receipt on employment probability up to 21 months after meeting the eligibility criterion, which is not counterbalanced by an increase in job quality. |
| Keywords: | Unemployment; Employment duration; Behavioural response; Entitlement conditions; Job quality |
| JEL: | H31 J08 J65 J68 |
| Date: | 2020–01–13 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:nhheco:2020_001&r=all |
| By: | Blien, Uwe (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Dauth, Wolfgang (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Roth, Duncan (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]) |
| Abstract: | "This paper analyses how differences in the degree of occupational routine-intensity affect the costs of job loss. We use worker-level data on mass layoffs in Germany between 1980 and 2010 and provide causal evidence that workers who used to be employed in more routine-intensive occupa-tions suffer larger and more persistent earnings losses after the mass layoff. Furthermore, we are able to show that, at least initially, earnings losses are primarily due to a reduction in the number of days in employment, suggesting that routine-intensive workers face considerable frictions in the adjustment to job loss. Conditional on finding a new job, routine-intensive workers are more likely to change their occupations but end up systematically in the lower end of their new occupa-tion's wage distribution." (Author's abstract, IAB-Doku) ((en)) |
| JEL: | J24 J63 O33 |
| URL: | http://d.repec.org/n?u=RePEc:iab:iabdpa:201925&r=all |
| By: | Joshua Angrist; Brigham Frandsen |
| Abstract: | Machine learning (ML) is mostly a predictive enterprise, while the questions of interest to labor economists are mostly causal. In pursuit of causal effects, however, ML may be useful for automated selection of ordinary least squares (OLS) control variables. We illustrate the utility of ML for regression-based causal inference by using lasso to select control variables for estimates of effects of college characteristics on wages. ML also seems relevant for an instrumental variables (IV) first stage, since the bias of two-stage least squares can be said to be due to over-fitting. Our investigation shows, however, that while ML-based instrument selection can improve on conventional 2SLS estimates, split-sample IV and LIML estimators do better. In some scenarios, the performance of ML-augmented IV estimators is degraded by pretest bias. In others, nonlinear ML for covariate control creates artificial exclusion restrictions that generate spurious findings. ML does better at choosing control variables for models identified by conditional independence assumptions than at choosing instrumental variables for models identified by exclusion restrictions. |
| JEL: | C21 C26 C52 C55 J01 J08 |
| Date: | 2019–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:26584&r=all |
| By: | Choi, Sekyu; Figueroa, Nincen; Villena-Roldán, Benjamin |
| Abstract: | In this paper we analyze cyclicality of wages at the job level, using posted wage data from an online job board in an emerging economy. Our data contains a significant fraction of online job advertisements in the Chilean economy for the period 2009 to 2018 and is representative of the overall wage distribution of newly hired workers. One major advantage of our dataset is the availability of wage information along information on requirements for each job. We find significant levels of posted wage procyclicality, safely ignoring any cyclical mismatch. We show how omitted variable bias, by ignoring countercyclical changes in hiring standards, reduces the amount of cyclicality found in previous studies. |
| Keywords: | Wage cyclicality; online job boards; composition bias; hiring standards |
| JEL: | E24 J4 J6 |
| Date: | 2020–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:98240&r=all |
| By: | Oscar Claveria (AQR-IREA, University of Barcelona, 08034 Barcelona, Spain.); Ivana Lolic (University of Zagreb, Faculty of Economics and Business); Enric Monte (Department of Signal Theory and Communications, Polytechnic University of Catalunya.); Petar Soric (University of Zagreb, Faculty of Economics and Business) |
| Abstract: | In this study we construct quarterly consumer confidence indicators of unemployment for the euro area using as input the consumer expectations for sixteen socio-demographic groups elicited from the Joint Harmonised EU Consumer Survey. First, we use symbolic regressions to link unemployment rates to qualitative expectations about a wide range of economic variables. By means of genetic programming we obtain the combination of expectations that best tracks the evolution of unemployment for each group of consumers. Second, we test the out-of-sample forecasting performance of the evolved expressions. Third, we use a state-space model with time-varying parameters to identify the main macroeconomic drivers of unemployment confidence and to evaluate whether the strength of the interplay between variables varies across the economic cycle. We analyse the differences across groups, obtaining better forecasts for respondents comprised in the first quartile with regards to the income of the household and respondents with at least secondary education. We also find that the questions regarding expected major purchases over the next 12 months and savings at present are by far, the variables that most frequently appear in the evolved expressions, hinting at their predictive potential to track the evolution of unemployment. For the economically deprived consumers, the confidence indicator seems to evolve independently of the macroeconomy. This finding is rather consistent throughout the economic cycle, with the exception of stock market returns, which governed unemployment confidence in the pre-crisis period. |
| Keywords: | Unemployment, Expectations, Consumer behaviour, Forecasting, Genetic programming, State-space models yield. JEL classification: C51, C53, C55, D12, E24, E27, J10 |
| Date: | 2020–01 |
| URL: | http://d.repec.org/n?u=RePEc:ira:wpaper:202001&r=all |
| By: | Giovanni Dosi; Richard B. Freeman; Marcelo C. Pereira; Andrea Roventini; Maria Enrica Virgillito |
| Abstract: | This paper presents an Agent-Based Model (ABM) that seeks to explain the concordance of sluggish growth of productivity and of real wages found in macro-economic statistics, and the increased dispersion of firm productivity and worker earnings found in micro level statistics in advanced economies at the turn of the 21st century. It shows that a single market process unleashed by the decline of unionization can account for both the macro and micro economic phenomena, and that deunionization can be modeled as an endogenous outcome of competition between high wage firms seeking to raise productive capacity and low productivity firms seeking to cut wages. The model highlights the antipodal competitive dynamics between a “winner-takes-all economy” in which corporate strategies focused on cost reductions lead to divergence in productivity and wages and a “social market economy” in which competition rewards the accumulation of firm-level capabilities and worker skills with a more egalitarian wage structure. |
| JEL: | C63 E02 E24 J51 |
| Date: | 2020–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:26634&r=all |
| By: | Stjepan Srhoj (University of Dubrovnik); Ivan Zilic (The Institute of Economics, Zagreb) |
| Abstract: | This paper evaluates the effect of a self-employment grant scheme for unemployed individuals-designed to ease the first 12 months of business operation-on firm growth, survival, and labor market re-integration in Croatia in the 2010-2017 period. Grants offered a moderate amount of finances (up to 50% of average annual gross salary) and absorbed only 5% of funds allocated to active labor market policies, but accounted for 10% of new firms opened throughout the years. We use the universe of unemployment episodes and the universe of unlimited and limited liability firms to document the effect of self-employment grants both causally and descriptively. Exploiting longitudinal structure of unemployment episodes dataset, we find that individuals who finish their spell with a grant have a significantly lower probability of returning to unemployment. Also, we find that limited liability firms opened via a grant have lower growth potential and worse survival profile, while unlimited liability firms-even though a sizable portion of them closes after a required 12-month grant period-have a more favorable survival profile. While these results are in line with the rest of the empirical literature on the self-employment grants, we also find that the effectiveness of these grants has increased throughout the years, indicating towards the direction of institutional learning. |
| Keywords: | self-employment grant, evaluation, unemployment, firm performance |
| JEL: | J68 M13 H25 H43 |
| Date: | 2020–01 |
| URL: | http://d.repec.org/n?u=RePEc:iez:wpaper:2001&r=all |
| By: | Michael Lokshin; Martin Ravallion |
| Abstract: | It will be politically difficult to liberalize international migration without protecting host-country workers. The paper explores the scope for efficiently managing migration using a competitive market for work permits. Host-county workers would have the option of renting out their citizenship work permit for a period of their choice, while foreigners purchase time-bound work permits. Aggregate labor supply need not rise in the host country. However, total output would rise and workers would see enhanced social protection. Simulations for the US and Mexico suggest that the new market would attract many skilled migrants, boosting GDP and reducing poverty in the US. |
| JEL: | F22 J61 |
| Date: | 2019–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:26590&r=all |