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on Labour Economics |
| By: | Merkl, Christian; Sauerbier, Timo |
| Abstract: | Our paper aims at improving the understanding for the role of public employment agencies in job matching. We analyze the effects of the restructuring of the Federal Employment Agency in Germany (Hartz III labor market reform) for aggregate matching and unemployment. Based on two microeconomic datasets, we show that the market share of the Federal Employment Agency as job intermediary declined after the Hartzreforms. We propose a macroeconomic model of the labor market with a private and a public search channel and fit the model to various dimensions of the data. We show that direct intermediation activities of the Federal Employment Agency did not contribute to the decline of unemployment in Germany. By contrast, improved activation of unemployed workers reduced unemployed by 0.7 percentage points. |
| Keywords: | Hartz reforms,search and matching,reform of employment agency |
| JEL: | E24 E00 E60 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:iwqwdp:012022&r= |
| By: | Ning Jia; Raven S. Molloy; Christopher L. Smith; Abigail Wozniak |
| Abstract: | We review developments in research on within-country migration, focusing on internal migration in the U.S. We begin by describing approaches to modelling individuals' migration decisions and equilibrium outcomes across local areas. Next, we summarize evidence regarding the impact of migration on individuals' outcomes, implications of migration for local labor market adjustment, and interactions between migration and housing markets. Finally, we discuss evidence on the efficacy of policies aimed at encouraging migration and conclude by highlighting important unanswered questions that are critical for informing migration-related policy. |
| Keywords: | Internal migration; Migration; Mobility |
| JEL: | J60 J61 J68 R10 |
| Date: | 2022–02–02 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2022-03&r= |
| By: | Remi Jedwab (George Washington University); Roberto Samaniego (George Washington University); Paul Romer (NYU Stern); Asif Islam (World Bank) |
| Abstract: | Pandemic shocks disrupt human capital accumulation through schooling and work experience. This study quantifies the long-term economic impact of these disruptions in the case of COVID-19, focusing on countries at different levels of development and using returns to education and experience by college status that are globally estimated using 1,084 household surveys across 145 countries. The results show that both lost schooling and experience contribute to significant losses in global learning and output. Developed countries incur greater losses than developing countries, because they have more schooling to start with and higher returns to experience. The returns to education and experience are also separately estimated for men and women, to explore the differential effects by gender of the COVID-19 pandemic. Surprisingly, while we uncover gender differences in returns to education and schooling, gender differences in the impact of COVID-19 are small and short-lived, with a loss in female relative income of only 2.5 percent or less mainly due to the greater severity of the employment shock on impact. These findings might challenge some of the ongoing narratives in policy circles. The methodology employed in this study is easily implementable for future pandemics. |
| Keywords: | Pandemics; Human Capital; Returns to Education; Returns to Experience; Gender; Female Relative Income; Labor Markets; Development Accounting; COVID-19 |
| JEL: | O11 O12 O15 E24 J11 J16 J17 J31 |
| Date: | 2022–02 |
| URL: | http://d.repec.org/n?u=RePEc:gwi:wpaper:2022-02&r= |
| By: | Mühlbauer, Sabrina (Institute for Employment Research (IAB), Nuremberg, Germany); Weber, Enzo (Institute for Employment Research (IAB), Nuremberg, Germany) |
| Abstract: | "This paper develops a large-scale application to improve the labour market matching process with model- and algorithm-based statistical methods. We use comprehensive administrative data on employment biographies covering individual and job-related information of workers in Germany. We estimate the probability that a job seeker gets employed in a certain occupational field. For this purpose, we make predictions with common statistical methods and machine learning (ML) methods. The findings suggest that ML performs better than the other methods regarding the out-of-sample classification error. In terms of the unemployment rate, the advantage of ML would stand for a difference of 2.9 - 3.6 percentage points." (Author's abstract, IAB-Doku) ((en)) |
| Keywords: | IAB-Open-Access-Publikation |
| JEL: | C14 C45 J64 C55 |
| Date: | 2022–02–02 |
| URL: | http://d.repec.org/n?u=RePEc:iab:iabdpa:202203&r= |
| By: | Alexander Hijzen; Andrea Salvatori |
| Abstract: | This paper analyses the impact of the COVID-19 crisis across socio-economic groups in Switzerland and the role played by its short-time work scheme during the first year of the crisis until the end of 2020. To this end, it compares changes in hours worked for different socio-groups in Switzerland and other OECD countries, and then documents differences across groups in the use of short time work and in the risk of job loss. Finally, the paper investigates differences between groups of short-time work participants in terms of the reduction in working time, job search behavior and the risk of subsequent job loss. The evidence so far suggests that the Swiss short time work scheme as it operated during the first year of the COVID-19 crisis was fit for purpose. |
| JEL: | J01 J08 J30 |
| Date: | 2022–01–20 |
| URL: | http://d.repec.org/n?u=RePEc:oec:elsaab:268-en&r= |
| By: | David Lagakos; Mushfiq Mobarak; Michael E. Waugh |
| Abstract: | This paper studies the welfare effects of encouraging rural-urban migration in the developing world. To do so, we build and analyze a dynamic general-equilibrium model of migration that features a rich set of migration motives. We estimate the model to replicate the results of a field experiment that subsidized seasonal migration in rural Bangladesh, leading to significant increases in migration and consumption. We show that the welfare gains from migration subsidies come from providing better insurance for vulnerable rural households rather than correcting spatial misallocation by relaxing credit constraints for those with high productivity in urban areas that are stuck in rural areas. |
| Keywords: | Risk; Insurance; Rural-urban gaps; Field experiment; Rural-urban migration; Spatial misallocation |
| JEL: | J61 R23 O11 O15 |
| Date: | 2022–01–04 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedmsr:93606&r= |
| By: | Rauh, C.; Santos, M. R. |
| Abstract: | This paper studies the impact of existing and universal transfer programs on vacancy creation, wages, and welfare using a search-and-matching model with heterogeneous agents and on-the-job human capital accumulation. We calibrate the general equilibrium model to match key moments concerning unemployment, wage and wealth distributions, as well as the distribution of EITC and transfers. In addition, unemployment insurance benefits are related to pre-unemployment earnings and subject to exhaustion, after which agents can only rely on transfers and savings. First, we show that existing transfers hamper economic activity but provide sizeable welfare gains. Next, we show that a universal basic income of nearly $12,500 to each household per year, which replaces all existing transfer programs and unemployment benefits, can lead to small aggregate welfare gains. These welfare gains mostly accrue to less skilled individuals despite their sizable fall in wages, and the overall rise in skill premia and wage inequality. Albeit the extra burden of higher taxes to finance UBI, we show that the increased action in hiring is a key channel though which outcomes for low education groups improve with the reform. However, if we keep the UI benefits in place, the positive effects on job creation vanish and UBI does not improve upon the current system. |
| Keywords: | Transfer programs, EITC, Means-tested transfers, Welfare programs, Labor supply, On-the-job human capital accumulation, Life cycle, Inequality, Universal basic income, UBI, Unemployment, General equilibrium |
| Date: | 2022–01–31 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:2208&r= |
| By: | Molly Paterson (Monash University); Jaai Parasnis (Department of Economics, Monash University); Michelle Rendall (Department of Economics, Monash University) |
| Abstract: | The performance of students in numeracy tests reveals gaps based on students’ gender and household income. In this paper, using longitudinal data on Australian children, we show the interrelationship between (i) socioeconomic gaps based on early-life household income, and (ii) the gender gap in numeracy. We find that between Grades 3 to 9, boys have a distinct advantage in numeracy scores over girls, which widens over time. We also find that, by Grade 9, poorer female students are doubly disadvantaged. This disadvantage does not arise because of differences in socioeconomic status between boys and girls but because the effect of a lower socioeconomic background on test scores is significant only for girls. We find that mother’s education and labor force status play an important role in the emergence of gender gaps, at both ends (top and bottom) of the income distribution. We confirm that early life circumstances continue to impact student’s achievement well into adolescence and these exacerbate gender gaps, thus demonstrating the importance of targeted early interventions to address gaps in key skills acquisition for the modern economy. |
| Keywords: | Australia, parental education, household income, numeracy, gender |
| JEL: | I20 I24 J16 |
| Date: | 2022–02 |
| URL: | http://d.repec.org/n?u=RePEc:mos:moswps:2022-02&r= |
| By: | Doruka, Ömer Tuğsal; Pastore, Francesco |
| Abstract: | In this study, for the first time, to our knowledge, we use the propensity score matching algorithm to estimate the probability to remain 'stuck in the status-quo ante' across generations in Egypt. We use repeated cross-sectional data relative to a 20-year period from 1998 to 2018 to build transition matrices of intergenerational occupational mobility. The findings of the econometric analysis hint at a low degree of occupational mobility, with children of fathers in the agricultural sector or holding a blue- or white-collar job remaining linked to the profession of their fathers in most cases and experiencing only rarely upward mobility from agricultural to blue- and white-collar jobs. |
| Keywords: | Intergenerational occupational mobility,Status quo bias,Propensity score matching,Egypt |
| JEL: | C35 D64 J24 J62 L16 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:1018&r= |
| By: | Sugata Bag (Department of Economics, Delhi School of Economics); Anirban Kar (Department of Economics, Delhi School of Economics) |
| Abstract: | Female labour force participation in India has stagnated despite gains in other aspects. Do Indian women prefer to stay out of labour market voluntarily or do social norms prevent their participation? We identify parental involvement in partner choice during marriage as an important bottleneck. We first find that women who had some degree of involvement in partner choice enjoy significantly more autonomy in post-marriage labour market choices than those whose marriages were arranged solely by parents. We use a marriage tradition instrument to estimate causal effects. Since autonomy and participation affect each other, next, we estimate simultaneous equations for autonomy and participation for only rural women. We use parental involvement in marriage and district-level share of drought-affected villages as two exogenous variables - the former for autonomy and the latter for participation. We find that autonomy significantly increases participation. We further explain the mechanism through a theoretical model. To distinguish between autonomy and participation; we introduce a new household delegation game. The main message of the theoretical model is that parental involvement in partner choice reduces women’s ability to screen partners leading to relatively more mismatches, i.e., women who are inclined to work mismatched with men who prefer otherwise. Key Words: Parental involvement, Partner selection, Female autonomy, Female labour market participation, Delegation game JEL Codes: J12, J16, D82 |
| Date: | 2022–01 |
| URL: | http://d.repec.org/n?u=RePEc:cde:cdewps:317&r= |
| By: | Philippe Sterkens; Stijn Baert; Eline Moens; Eva Derous; Joey Wuyts (-) |
| Abstract: | The existing burnout literature has predominantly focussed on the determinants of burnout, whereas its consequences for individual careers have received little attention. In this study, we investigate whether recently burned-out individuals and persons with a very high risk of clinical burnout differ in job preferences from non-burned-out workers. Moreover, we link these differences in preferences with (1) diverging perceptions of job demands and resources in a job, as well as (2) distinct weighting of such perceptions. To this end, a highquality sample of 582 employees varying in their history and current risk of burnout judged fictitious job offers with experimentally manipulated characteristics in terms of their willingness to apply as well as perceived job demands and resources. We find that recently burned-out employees appreciate possibilities to telework and fixed feedback relatively more, while being relatively less attracted to opportunities for learning on the job. Moreover, employees with a very high risk of burnout are more attracted to part-time jobs. These findings can be partially explained by differences in the perceived resources offered by jobs. |
| Keywords: | burnout, labour market, job search, job preference, factorial survey experiment |
| JEL: | J62 I12 C91 C83 |
| Date: | 2022–01 |
| URL: | http://d.repec.org/n?u=RePEc:rug:rugwps:22/1038&r= |
| By: | Yann Bramoullé (Aix-Marseille Univ, CNRS, AMSE, Marseille, France.); Rachel E Kranton (Duke University, Durham, US) |
| Abstract: | What patterns of economic relations arise when people are altruistic rather than strategically self-interested? This paper introduces an altruism network into a simple model of choice among partners for economic activity. With concave utility, agents effectively become inequality averse towards friends and family. Rich agents preferentially choose to work with poor friends despite productivity losses. Hence, network inequality-the divergence in incomes within sets of friends and family-is key to how altruism shapes economic relations and output. Skill homophily also plays a role; preferential contracts and productivity losses decline when rich agents have poor friends with requisite skills. |
| Date: | 2022–02 |
| URL: | http://d.repec.org/n?u=RePEc:aim:wpaimx:2202&r= |
| By: | Ndubuisi, Gideon (UNU-MERIT, Maastricht University, and German Development Institute (DIE)); Owusu, Solomon (UNU-MERIT, Maastricht University, and German Development Institute (DIE)) |
| Abstract: | We examine how participation and positioning in global value chains (GVC) affect wages. We also examine whether this relationship is conditioned by a country's development level and labour market regulation. The results show that participation and upstream specialisation in GVCs are associated with higher wages but only in developed countries. In developing countries, while GVC participation is associated with higher wages, upstream specialisation exerts downward pressure on wages. For analysis focusing on the role of labour market regulation, we find that GVC participation only exerts a positive effect on wages under stringent labour market regulation. Under flexible labour market conditions, it exerts downward pressure on wages but allows for the effective reallocation of GVC workers into knowledge-intensive and high value added upstream activities in the value chain that are more productive and wage rewarding. Additional analysis on the effects of GVCs along the wage distribution show that participation and upstream specialisation in GVCs are associated with higher wages across all wage segments in the developed countries. In developing countries, GVC participation only benefits higher wage earners and make low-wage earners worse-off. Even when upstream specialisation is associated with lower wages across all wage segments, low wage earners are disproportionately affected. |
| Keywords: | Wages, Global Value Chain, GVC Participation, Upstream Specialisation |
| JEL: | F14 F16 J16 O14 O15 P51 |
| Date: | 2021–11–11 |
| URL: | http://d.repec.org/n?u=RePEc:unm:unumer:2021042&r= |
| By: | Chen, Jie; Kanjilal-Bhaduri, Sanghamitra; Pastore, Francesco |
| Abstract: | In this paper, we report returns to education in India using unit level data from the nationwide Periodic Labour Force Survey for 2018-19. OLS estimates from the classical Mincerian equation are presented. Various econometric techniques (e.g., conventional IV and heteroskedasticity-based IV models) are used to address endogeneity and sample selection issue. For regular workers, compared to those with no formal education, an additional year of literacy education increases yearly return by 2.3%, primary education by 3.4%, middle school education by 3.7%, secondary school education by 4.5%, higher secondary education by 5.8%, graduate and diploma by 9.8%, and postgraduate and above level of education by 8.2%. We also find a widening of the wage distribution, with striking differences across social groups, sectors, locations. First, returns to middle-school and above level of education are higher for women than for men; second, returns to graduate and above level of education are higher for urban than for rural workers; third, returns to workers in the public sector are higher than returns in the private or third sectors; fourth, returns to the scheduled tribe are the highest across all the castes. Over the last decade, returns to education have reduced. We provide evidence showing that this may be because more people hold higher levels of education qualifications, while the demand for skills remains quite stable. Overall, our policy suggestion is that in India, as in other lowmiddle- income countries, especially in rural areas, it is important to increase primary and secondary level of education in rural areas, and the tertiary level in urban areas and to equalize the life chances of some social groups. |
| Keywords: | returns to education,endogeneity,sample selection,India |
| JEL: | I26 J15 J16 J30 C20 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:1016&r= |
| By: | Lucie Martin (University College Dublin School of Economics and Geary Institute for Public Policy); Liam Delaney (London School of Economics Department of Psychological and Behavioural Science); Orla Doyle (University College Dublin School of Economics and Geary Institute for Public Policy) |
| Abstract: | Administrative burdens may deepen inequality by creating costly experiences for vulnerable groups. Research to date typically focuses on how burdens affect decisions in specific policy contexts, thus little is known about everyday experiences of burdens and their distribution in society. This is the first study to document everyday administrative experiences, accounting for time and emotional costs across ten domains: tax, retirement, government benefits, bills, goods and services, savings, debt, health, childcare, and adult care. Results from 2,243 UK adults show that administrative tasks are a significant part of life (one hour per day). Time and emotional costs vary by domain; government benefits emerge as particularly costly. There is evidence that administrative burdens are regressive, not only through their effects on decisions, but through their unequal distribution in society. Those in poor health and financial insecurity focus on tasks salient to them (e.g. benefits, health, debt), but are less likely to engage in beneficial longer-term tasks (e.g. savings, retirement), and suffer higher emotional costs from engaging in tasks relevant to their disadvantage, compared to non-disadvantaged groups. A choice experiment shows that (hypothetical) burdens discourage beneficial action in general, but even more so for some disadvantaged groups. |
| Keywords: | administrative burden; inequality; time-use; subjective well-being; experiment |
| JEL: | D91 I30 J10 |
| Date: | 2022–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:ucd:wpaper:202202&r= |
| By: | Konstantins Benkovskis (Latvijas Banka, Stockholm School of Economics in Riga); Ludmila Fadejeva (Latvijas Banka) |
| Abstract: | We develop a novel way to evaluate the size of unreported wage payments at employee level. It is only the reported employer-employee income data combined with firm-level financial statements and survey information on various person-level indicators that are required for this purpose. We estimate the Mincer earning regression by the Stochastic Frontier Analysis approach, proxying the unreported wage payments by the non-negative inefficiency term. Our methodology is tested on the Latvian data: we find that small and young firms engage in illegal wage payments more than other firms. Unofficial payments to employees with small reported wages are more frequent and sizeable, revealing lower wage income inequality in Latvia when the unreported wage is taken into account. |
| Keywords: | unreported wage, tax evasion, Mincer earning regression, income distribution |
| JEL: | E26 H26 J08 J31 |
| Date: | 2022–02–09 |
| URL: | http://d.repec.org/n?u=RePEc:ltv:wpaper:202201&r= |