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on Labour Economics |
| By: | Alan Piper; David G. Blanchflower; Alex Bryson |
| Abstract: | The cross-sectional association between pain and unemployment is well-established. But the absence of panel data containing data on pain and labor market status has meant less is known about the direction of any causal linkage. Those longitudinal studies that do examine the link between pain and subsequent labor market transitions suggest results are sensitive to the measurement of pain and model specification. We contribute to this literature using large-scale panel data from the German Socio-Economic Panel (GSOEP) for the period 2002 to 2018. We show that pain leads to job loss. Workers suffering pain are more likely than others to leave their job for unemployment or economic inactivity. This probability rises with the frequency of the pain suffered in the previous month. The effect persists having accounted for fixed unobserved differences across workers, is apparent among those who otherwise report good general health and is robust to the inclusion of controls for mental health, life satisfaction and the employee’s occupation. |
| JEL: | J0 J64 |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28863&r= |
| By: | Hélène Benghalem (Université de Lausanne (UNIL)); Pierre Cahuc (Département d'économie); Pierre Villedieu (Département d'économie) |
| Abstract: | We ran a large randomized controlled experiment among about 150,000 recipients of unemployment benefits insurance in France in order to evaluate the impact of part-time unemployment benefits. We took advantage of the lack of knowledge of job seekers regarding this program and sent emails presenting the program. The information provision had a significant positive impact on the propensity to work while on claim, but reduced the unemployment exit rate, showing important lock-in effects into unemployment associated with part-time unemployment benefits. The importance of these lock-in effects implies that increasing the marginal tax rate on earnings from work while on claim in the neighborhood of its current level would not decrease labor supply and would decrease the expenditure net of taxes of the unemployment insurance agency. |
| Keywords: | Unemployment insurance; Part-time unemployment benefits; Lock-in effects; Unemployment duration |
| JEL: | H5 J64 J65 |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpecon:info:hdl:2441/3eqvfrusqi97g9fr9cuc7t5gkd&r= |
| By: | Simon Jäger; Shakked Noy; Benjamin Schoefer |
| Abstract: | We provide a comprehensive overview of codetermination, i.e., worker representation in firms’ governance and management. We cover the institution’s history, implementation, and the best available evidence on its economic impacts. We argue that existing quasiexperimental estimates suggest that codetermination has zero or very small positive effects on worker and firm outcomes at the partial-equilibrium firm level. In addition, we test for general-equilibrium effects of codetermination laws using novel cross-country event studies exploiting a series of codetermination reforms between the 1960s and 2010s, and find no evidence that codetermination laws shift aggregate economic outcomes or the quality of industrial relations. We offer three potential explanations of the institution’s limited impact. First, existing codetermination laws convey relatively little authority to workers. Second, countries with codetermination laws have high baseline levels of informal worker involvement in decision-making, independently of formal codetermination. Third, codetermination laws may interact with other labor market institutions, such as union representation and collective bargaining. We close by discussing implications of these facts for recent codetermination proposals in the United States. |
| JEL: | J08 K31 M1 M5 |
| Date: | 2021–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28921&r= |
| By: | Chiswick, Barry R. (George Washington University); Robinson, RaeAnn Halenda (George Washington University) |
| Abstract: | Estimated labor force participation rates among free women in the pre-Civil War period were exceedingly low. This is due, in part, to cultural or societal expectations of the role of women and the lack of thorough enumeration by Census takers. This paper develops an augmented labor force participation rate for free women in 1860 and compares it with the augmented rate for 1920 and today. Our methodology identifies women who are likely providing informal and unenumerated labor for market production in support of a family business, that is, unreported family workers. These individuals are not coded in the original data as formally working, but are likely to be engaged in the labor force on the basis of the self- employment of other relatives in their household. Unreported family workers are classified into four categories: farm, merchant, craft, and boardinghouse keepers. Using microdata, the inclusion of these workers more than triples the free female labor force participation rate in the 1860 Census from 16 percent to 57 percent, more than doubles the participation rate in the 1920 Census from 24 percent to 50 percent, and has a trivial effect on the currently measured rate of 56 percent (2015-2019 American Community Survey). This suggests that rather than a steep rise from a very low level in the female labor force participation rate since 1860, it has in fact always been high and fairly stable over time. In contrast, the effect of including unreported family workers in the male augmented labor force participation rate is relatively small. |
| Keywords: | women, labor force participation, unreported family workers, occupational status, unpaid workers, self-employment, 1860 Census, 1920 Census, American Community Survey |
| JEL: | N31 J16 J21 J82 |
| Date: | 2021–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14449&r= |
| By: | Jason Furman; Melissa Schettini Kearney; Wilson Powell |
| Abstract: | We examine how much of the overall decline in employment between the beginning of 2020 and 2021 can be explained by excess job loss among parents of young children, and mothers specifically. Using data from the Current Population Survey (CPS), we confirm that, in general, mothers with young children have experienced a larger decline in employment, as compared (unconditionally) with other adults, including fathers. This excess job loss is driven by mothers without a four-year college (bachelor’s) degree. The main point of the paper is to build off this observation and examine how much of the aggregate employment deficit in early 2021 can be explained by parent-specific issues, such as childcare struggles. To examine this question, we construct counterfactual employment rates and labor force participation rates that assign to mothers of young children the percent change in employment and labor force participation rates experienced by comparable women without young children. We consider multiple definition, sample, and counterfactual specification alternatives. Our analysis yields robust evidence that differential job loss among mothers of young children accounts for a negligible share of the ongoing aggregate employment deficit. The result is even stronger (and flips signs) if we consider all parents, since fathers with young children experienced less job loss than other men. The practical implication of these findings is that nearly all of the aggregate ongoing employment deficit is explained by factors that affect workers more broadly, as opposed to challenges specific to working parents. |
| JEL: | J01 J18 J21 |
| Date: | 2021–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28934&r= |
| By: | Natalie Bau; Raquel Fernández |
| Abstract: | This handbook chapter focuses on important interactions between the family and culture. We discuss the wide range of global variation in family institutions, variation which is in part sustained by cultural differences, and important recent changes in family structures. The chapter discusses why different family institutions arise, when they persist, and what forces may lead them to change. Furthermore, it examines changes in key family outcomes, such as the rise of female labor force participation, the decline in marriage, and the increase in divorce. These changes have been accompanied by and interact with cultural change. Finally, we show how cultural institutions related to the family, such as son preference, co-residence traditions, polygyny, and marriage payments, affect decision-making within the family and interact with policy. We conclude that studying the family in a vacuum, without accounting for the role of culture, may lead to misleading conclusions regarding the effects of policies, macroeconomic shocks, or technological change. |
| JEL: | I0 J11 J12 J13 J14 J16 O11 O12 |
| Date: | 2021–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28918&r= |
| By: | Mark Hoekstra; Sandra Orozco-Aleman |
| Abstract: | Recent years have witnessed the emergence of increasingly provocative anti-immigrant politicians in both Europe and the United States. We examine whether the 2016 election of Donald Trump, who made illegal immigration and border enforcement a centerpiece of his campaign, reduced illegal immigration into the U.S. We exploit the fact the election result was widely unexpected and thus generated a large, overnight change in expected immigration policy and rhetoric. We compare migration flows before and after the election and find that while it reduced immigration among deported Mexicans and at least temporarily among Central Americans, it had no effect on the overall inflow of unauthorized Mexican workers. |
| JEL: | J15 J6 J61 |
| Date: | 2021–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28909&r= |
| By: | Anderberg, Dan (Royal Holloway, University of London); Mantovan, Noemi (Bangor University); Sauer, Robert M. (Royal Holloway, University of London) |
| Abstract: | We present a dynamic lifecycle model of women's choices with respect to partnership status, labour supply and fertility when they cannot directly observe whether a given male partner is of a violent type or not. The model is estimated by the method of simulated moments using longitudinal data from the Avon Longitudinal Study of Parents and Children. The results indicate that uncertainty about a partner's abusive type creates incentives for women to delay fertility, reduce fertility overall, divorce more often and increase labour supply. We also study the impact of higher female wages, income support to single mothers, and subsidized childcare when the mother is working. While higher wages reduce women's overall exposure to abuse, both income support and subsidized childcare fail to do so because they encourage early fertility. Income support also leads to less accumulated labour market experience and hence higher abuse rates. |
| Keywords: | domestic violence, learning, fertility, ALSPAC |
| JEL: | J12 J13 |
| Date: | 2021–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14442&r= |
| By: | Goller, Daniel; Harrer, Tamara; Lechner, Michael; Wolff, Joachim |
| Abstract: | We investigate the effectiveness of three different job-search and training programmes for German long-term unemployed persons. On the basis of an extensive administrative data set, we evaluated the effects of those programmes on various levels of aggregation using Causal Machine Learning. We found participants to benefit from the investigated programmes with placement services to be most effective. Effects are realised quickly and are long-lasting for any programme. While the effects are rather homogenous for men, we found differential effects for women in various characteristics. Women benefit in particular when local labour market conditions improve. Regarding the allocation mechanism of the unemployed to the different programmes, we found the observed allocation to be as effective as a random allocation. Therefore, we propose data-driven rules for the allocation of the unemployed to the respective labour market programmes that would improve the status-quo. |
| Keywords: | Policy evaluation, Modified Causal Forest (MCF), active labour market programmes, conditional average treatment effect (CATE) |
| JEL: | J08 J68 |
| Date: | 2021–06 |
| URL: | http://d.repec.org/n?u=RePEc:usg:econwp:2021:08&r= |
| By: | Matthew Freedman; Shantanu Khanna; David Neumark |
| Abstract: | We evaluate the effects of one of a new generation of economic development programs, the California Competes Tax Credit (CCTC), on local job creation. Incorporating perceived best practices from previous initiatives, the CCTC combines explicit eligibility thresholds with some discretion on the part of program officials to select tax credit recipients. The structure and implementation of the program facilitates rigorous evaluation. We exploit detailed data on accepted and rejected applicants to the CCTC, including information on scoring of applicants with regard to program goals and funding decisions, together with restricted access American Community Survey (ACS) data on local economic conditions. Using a difference-in-differences approach, we find that each CCTC-incentivized job in a census tract increases the number of individuals working in that tract by over two – a significant local multiplier. We also explore the program’s distributional implications and impacts by industry. We find that CCTC awards increase employment among workers residing in both high income and low income communities, and that the local multipliers are larger for non-manufacturing awards than for manufacturing awards. |
| Keywords: | Economic Development, Business Incentives, Tax Credits, Hiring Incentives, Place- Based Policies |
| JEL: | H25 H71 J68 R11 R23 R58 |
| Date: | 2021–06 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:21-13&r= |
| By: | Pierre Cahuc (Département d'économie); Francis Kramarz (ENSAE ParisTech (ENSAE)); Sandra Nevoux (Banque de France) |
| Abstract: | To understand which firms take-up short-time work and which workers they enroll in this program, we provide a model which shows that short-time work may save jobs in firms hit by strong negative revenue shocks, but not in less severely-hit firms, where hours worked are reduced, without saving jobs. Using detailed data on the administration of the program covering the universe of French establishments in the 2008-2009 Great Recession, we find that short-time work did indeed save jobs and increase hours of work in firms faced with large negative shocks. These firms have been able to recover rapidly in the aftermath of the Recession thanks to short-time work. We also provide evidence of large windfall effects which significantly increased the cost of the policy per job saved; yet we also find that short-time work remains more cost-efficient at saving jobs than wage subsidies. |
| Keywords: | Short-time Work; Unemployement; Hours of work |
| JEL: | E24 J22 J65 |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpecon:info:hdl:2441/2ju03cb3kc9a3986bsibii70hd&r= |
| By: | Bagger, Jesper (Royal Holloway, University of London); Fontaine, Francois (Paris School of Economics); Galenianos, Manolis (University of London); Trapeznikova, Ija (Royal Holloway, University of London) |
| Abstract: | We use comprehensive data from Denmark that combine online job advertisements with a matched employer-employee dataset and a firm-level dataset with information on revenues and value added to study the relationship between vacancy-posting and various firm outcomes. Posting a vacancy is associated with a 4.5 percentage point increase in a firm's hiring rate and two-thirds of the additional hiring occurs within two months. The response of hiring from employment is twice as large as the response of hiring from non-employment. Firms that are smaller, low-wage and fast-growing are associated with larger hiring responses and that response materializes faster at larger firms, low-wage firms and fast-growing firms. We also find that separations are associated with subsequent vacancy posting and this effect is stronger for separations to employment, consistent with replacement hiring and the presence of vacancy chains. Growth in revenue and value added strongly predict vacancy-posting, with negative shocks having a stronger effect than positive shocks and larger shocks having less-than-proportional responses. |
| Keywords: | vacancies, hiring, separations, employment growth, firm growth, value added, revenue |
| JEL: | J23 J63 |
| Date: | 2021–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14436&r= |
| By: | Chakravorty, Bhaskar (Erasmus University Rotterdam); Arulampalam, Wiji (University of Warwick); Imbert, Clement (University of Warwick); Rathelot, Roland (University of Warwick) |
| Abstract: | Using a randomised experiment, we show that providing better information about prospective jobs to vocational trainees can improve their placement outcomes. The study setting is the vocational training programme DDU-GKY in India. We find that including in the training two information sessions about placement opportunities make trainees 17% more likely to stay in the jobs in which they are placed. We argue that this effect is likely driven by improved selection into training. As a result of the intervention, trainees that are over-optimistic about placement jobs are more likely to drop out before placement. |
| Keywords: | vocational training, on-the-job-training, dropout, rural development, skills, job placement |
| JEL: | J24 J61 M53 |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14427&r= |
| By: | Euiyoung Jung (PSE - Paris School of Economics - ENPC - École des Ponts ParisTech - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique - EHESS - École des hautes études en sciences sociales - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement) |
| Abstract: | This paper analyzes the optimal cyclical behavior of labor market policies in an economy with asset and labor market frictions. The policies of interest include unemployment insurance (UI) and employment protection (EP). In addition to their supply-side effects, labor market policies affect the aggregate demand via earning risk and redistribution channels. Under bilateral wage bargaining, I find that procyclical UI and countercyclical EP deliver superior welfare outcomes through stabilization via both supply and demand channels. |
| Keywords: | new keynesian,uncertainty,unemployment,incomplete markets,labor market policy New Keynesian,Uncertainty,Unemployment,Incomplete markets,Labor market policy JEL Classification: E12,E21,E24,E29,E32,E61,E69,J68,J65 |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-03243698&r= |
| By: | Simon Deakin |
| Abstract: | There is much at stake in the classification of work relations: on the one hand, the stability of the tax base and the capacity of the state to deliver public goods; on the other, the structure of enterprise and the rights of workers in the ‘gig’ economy and beyond. Classification decisions, however, are made using legal concepts which many view as artificial and manipulable, to the point where it is hard to discern the considerations which are actually guiding decisions. Decomposing the ‘employment’ concept reveals something of the implicit ‘weighting’ of tests and indicators which underlies judicial and administrative determinations. Viewed in this light, statutory reformulations such as the ‘ABC’ test can play a role in ‘reweighting’ the classification process, extending the protective coverage of labour laws and resisting fiscal erosion. |
| Keywords: | Labour law, tax law, employment status |
| JEL: | J83 K31 K34 |
| Date: | 2021–04 |
| URL: | http://d.repec.org/n?u=RePEc:cbr:cbrwps:wp525&r= |
| By: | Brian D. Bell; Nicholas Bloom; Jack Blundell |
| Abstract: | We use a UK employer-employee administrative earnings dataset to investigate the response of earnings and hours to business cycles. Exploiting our long panel of data from 1975 to 2020 we find wide heterogeneity in the exposure of different types of workers to aggregate shocks. Employees who are younger, male, lower-skilled, non-union, and working in smaller private sector firms show the largest earnings response to recessions. The qualitative patterns of earnings changes across workers observed in the COVID-19 recession are broadly as predicted using the previously estimated exposures and size of the GDP shock. This suggests the COVID-19 recession in terms of its impact responses was relatively similar to those that have gone before, but the GDP shock was far larger in absolute size. Compared to aggregate shocks, we find a relatively small role of firm-specific shocks, suggesting macro shocks play an outsized role in individual earnings dynamics. |
| JEL: | J0 |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28871&r= |
| By: | Magne Mogstad; Gaute Torsvik |
| Abstract: | This paper reviews the literature on intergenerational mobility. While our review is centered around the large empirical literature on this topic, we also give a brief discussion of some of the relevant theory. We consider three strands of the empirical literature. First, we discuss how to measure intergenerational persistence in various socio-economic outcomes. We discuss both measurement challenges and some notable findings. We then turn to quantifying the importance of family environment and genetic factors for children's outcomes. We describe the pros and cons of various approaches as well as key findings. The third strand is concerned with drawing causal inferences about how children's outcomes are affected by specific features of their family environment. We discuss a wide range of environmental features, including the neighborhoods in which children grow up. We critically assess what conclusions one may and may not draw from certain celebrated studies of neighborhoods and intergenerational mobility. |
| JEL: | D1 J13 J24 J62 |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28874&r= |
| By: | Hai-Anh H. Dang (Analytics and Tools Unit, Development Data Group, World Bank); Long T. Giang (National Economics University, Vietnam); Minh N. N. Do (University of Economics and Business, Vietnam National University, Hanoi) |
| Abstract: | The COVID-19 pandemic has resulted in income and employment loss in many countries around the world. Yet, hardly any formal study exists on household finance and future economic expectations in poorer countries. To fill in this gap, we implemented and analyzed a new web-based rapid assessment survey immediately after the removal of lockdown measures in Vietnam—a poorer country that has received widespread recognition for its successful fight against the pandemic. We find that having a job is strongly and positively associated with better finance and more income and savings, as well as more optimism about the resilience of the economy. Further disaggregating employment into different types of jobs such as self-employment and jobs with permanent and short-term contracts, we find those with permanent job contracts to have fewer job worries and better assessments for the economy. Individuals with good health tend to have more positive evaluations for their current and future finance, but there is mixed evidence for those with higher educational levels. These findings are relevant for post-outbreak economic policies, especially regarding the labor market in a developing country context. |
| Keywords: | COVID-19, recession, labor market, wage work, household finance, Vietnam |
| JEL: | I1 I3 J01 J08 O1 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:dpc:wpaper:0121&r= |
| By: | Arjun Ramani; Nicholas Bloom |
| Abstract: | Using data from the US Postal Service and Zillow, we quantify the effect of Covid-19 on migration patterns and real estate markets within and across US cities. We find two key results. First, within large US cities, households, businesses, and real estate demand have moved from dense central business districts (CBDs) towards lower density suburban zip-codes. We label this the “Donut Effect” reflecting the movement of activity out of city centers to the suburban ring. Second, while this observed reallocation occurs within cities, we do not see major reallocation across cities. That is, there is less evidence for large-scale movement of activity from large US cities to smaller regional cities or towns. We rationalize these findings by noting that working patterns post pandemic will frequently be hybrid, with workers commuting to their business premises typically three days per week. This level of commuting is less than pre-pandemic, making suburbs relatively more popular, but too frequent to allow employees to leave the cities containing their employer. |
| JEL: | J0 |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28876&r= |
| By: | Lionel Fontagné (Banque de France, Université Paris 1 Panthéon-Sorbonne Centre d'Economie de la Sorbonne, PSE, CEPII); Michela Limardi (Centre d'Economie de la Sorbonne, RIME lab (Université de Lille)) |
| Abstract: | Can preferential market access help to enforce Labor Laws in beneficiary countries? The US Generalized System of Preferences (GSP) is accorded conditional on compliance with labor rights and leaves room for petitioning and revising the scheme upon request by interest groups. Using data from Indonesian Manufacturing firms, we show that GSP renegotiation combined with the activism of workers' rights groups helped increase firm-level average wages up to the minimum-wage level, not only inside but also outside the export sector. GSP leverage allowed labor NGOs to act more effectively by putting the violation of national Labor Laws under the international spotlight |
| Keywords: | GSP; labor standards; NGOs; wage determination |
| JEL: | J52 J80 |
| Date: | 2021–04 |
| URL: | http://d.repec.org/n?u=RePEc:mse:cesdoc:21014r&r= |