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on Labour Economics |
| By: | Hani Mansour; Pamela Medina; Andrea Velásquez |
| Abstract: | We study gender differences in the labor market reallocation of Peruvian workers in response to trade liberalization. The empirical strategy relies on variation in import competition across local labor markets based on their industrial composition before China entered the global market in 2001. In contrast to much of the existing literature, we find that import competition did not have persistent negative employment effects on men or led them to sort into the non-tradable or informal sectors. The adverse effects on the employment of low-educated women in the tradable sector, however, persist over time leading them to sort into the non-tradable sector or out of the labor force. The results are consistent with a mechanism in which gender occupational and industrial segregation leads to a widening of the gender gap in employment. |
| Keywords: | import competition, female employment, gender discrimination |
| JEL: | E24 F14 J16 J71 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9639&r= |
| By: | Qendrai, Pamela (IZA) |
| Abstract: | This paper studies how the introduction of a novel residence permit for working purposes – the so-called Blue Card introduced in August 2012 – has affected entry-level wages of non-EU migrants in Germany. The Blue Card was targeted at non-EU university graduates with degrees received or recognized in Germany. It provided immediate residence to students with a working contract that pays above clearly-announced and regularly-updated wage thresholds. We leverage a difference-in-difference approach and unique data on national and international graduates in Germany between 2011-2014. We find that the introduction of the Blue Card increases entry-level wages of non-EU graduates relative to the control group by approximately 2 percent of the pre-treatment entry-level wages. We provide suggestive evidence that these results are not driven by more or better-quality non-EU graduates staying in Germany, but rather because the Blue Card wage threshold acts as a reference point. |
| Keywords: | work permit, foreign students, highly-educated migrants, wages |
| JEL: | J60 J61 J63 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15191&r= |
| By: | Deiana, Claudio (University of Essex); Giua, Ludovica (European Commission, DG Joint Research Centre); Nistico, Roberto (University of Naples Federico II) |
| Abstract: | This paper establishes a new fact about immigration policies: legalization has long-term effects on formal employment of undocumented immigrants and their assimilation. We exploit the broad amnesty enacted in Italy in 2002 together with rich survey data collected in 2011 on a representative sample of immigrant households to estimate the effect of regularization in the long run. Immigrants who were not eligible for the amnesty have a 14% lower probability of working in the formal sector a decade later, are subject to more severe ethnic segregation on the job and display less linguistic assimilation than their regularized counterparts. |
| Keywords: | undocumented immigrants, amnesty program, formal employment, discrimination, segregation |
| JEL: | J15 J61 K37 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15189&r= |
| By: | Yuki Uemura (Graduate School of Economics, Kyoto University) |
| Abstract: | This paper examines the job search behavior of unemployed workers over the business cycle. The paper first constructs a standard search and matching model with endogenous search efforts, wage rigidity, and a generalized matching function. Contrary to the existing literature, the proposed model generates both procyclical and countercyclical search intensity, depending on the degree of wage rigidity and the elasticity parameter of the matching function. The paper then calibrates the model to the U.S. economy and provides various impulse response analyses. The numerical exercises show that the model successfully and simultaneously reproduces countercyclical search efforts and sizable labor market fluctuations. |
| Keywords: | search intensity; business cycles; wage rigidity; unemployment fluctuations |
| JEL: | E24 E32 J64 |
| Date: | 2022–04 |
| URL: | http://d.repec.org/n?u=RePEc:kyo:wpaper:1078&r= |
| By: | Wilson, Riley (Brigham Young University) |
| Abstract: | I document a new empirical pattern of internal mobility in the United States. Namely, county-to-county migration and commuting drop off discretely at state borders. People are three times as likely to move to a county 15 miles away, but in the same state, than to move to an equally distant county in a different state. These gaps remain even among neighboring counties or counties in the same commuting zone. Standard economic explanations, which emphasize differences in utility or moving costs, have little explanatory power. Cross-border differences in observables, amenities, state occupational licensing, taxes, or transfer program generosity do not explain this border effect. However, county-to-county social connectedness (as measured by the number of Facebook linkages) follows a similar pattern, and there is suggestive evidence that this is driven by a so-called "home state bias," rather than alternative explanations such as information frictions or network ties. I show that this reluctance to cross state lines has real economic costs, resulting in local labor markets that are less dynamic after negative economic shocks. |
| Keywords: | internal migration, commuting, social networks, border discontinuities |
| JEL: | J6 R1 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15193&r= |
| By: | Salamone, Alberto (London School of Economics); Lordan, Grace (London School of Economics) |
| Abstract: | We conducted a field experiment in a small electronics manufacturing firm in the US with the specific aim to improve minutes worked, punctuality, tardiness and safety checks. Our intervention was to put posters on the production floor on a random day, which made salient to the blue-collar employees the meaning and importance of their job, which comprised of routine repetitive tasks, in a before and after design. Overall, the intervention was a success with positive and significant effects consistently found for the outcomes both immediately after the experiment finished (+3 days) and also more than two weeks after (+15 days). Our study highlights it is possible to motivate blue collar manual workers intrinsically by drawing attention to the meaning of their work. |
| Keywords: | meaning, motivation, blue collar, manufacturing, field experiment |
| JEL: | J10 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15183&r= |
| By: | Adda, Jérôme (Bocconi University); Dustmann, Christian (University College London) |
| Abstract: | This paper investigates the sources of wage growth over the life cycle, where individuals have the possibility to acquire vocational training at the start of their career. Wage growth is determined by sectoral and firm mobility, unobserved ability and the accumulation of human capital. Workers may move between two occupational sectors that require cognitive-abstract (CA) and routine-manual (RM) skills, and job mobility is induced by non-pecuniary job attributes and persistent firm-worker productivity matches. Estimating this model using longitudinal administrative data over three decades, we show that RM skills are a key driver of early wage growth while CA skills become important later on. Moreover, job amenities are an important determinant of mobility decisions. Vocational training has long term effects on career outcomes, affecting the type and quality of matches, with substantial internal rates of return both to the individual as well as society. |
| Keywords: | wage determination, learning by doing, job mobility, apprenticeship training |
| JEL: | J2 J3 J6 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15154&r= |
| By: | Edoardo Di Porto (CSEF, INPS DCSR, Università di Napoli Federico II, and UCFS University of Uppsala.); Cristina Tealdi (Heriot-Watt University and IZA Institute of Labor) |
| Abstract: | We investigate how the flexibility of temporary contracts affects the probability of young workers to be upgraded into permanent employment. Theoretically, we explore the workers’ career development in response to the change in flexibility within a search and matching model; empirically, we exploit an Italian labour market reform which increased flexibility in a difference in differences framework. We find that new entrants in the labour market who have been affected by the reform experienced a decrease in the conversion rate of approximately 12.5 percentage points in the first months after the reform, and of 5.1 percentage points over a year, compared to unaffected peers. This effect is particularly strong among women and low-educated workers employed in low productive firms in the Center/South of Italy. Worryingly, the lower conversion rate leads to a 25% wage penalty even two years down the workers’ career paths. |
| Keywords: | temporary contracts, young workers, flexibility, institutional reforms, employment protection legislation. |
| JEL: | J41 J63 J64 |
| Date: | 2022–04–27 |
| URL: | http://d.repec.org/n?u=RePEc:sef:csefwp:644&r= |
| By: | Kawaguchi, Daiji (University of Tokyo); Toriyabe, Takahiro (University of Tokyo) |
| Abstract: | We develop new indices of skill and skill use, drawing on the alley of skill and skill-use questions in the Programme for the International Assessment of Adult Competencies (PIAAC). We demonstrate that the proposed skill and skill use indices explain the wage gap between males and females, as well as the gap between immigrants and natives. We also show that the skill use index captures the side effect of parental- leave policies on females that conventional labor-market outcomes fail to capture. We discuss how the newly developed indices can be merged to conventional survey data. |
| Keywords: | measurement, skill use, gender gap, parental leave |
| JEL: | D12 H24 J16 J12 J13 J16 J24 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15177&r= |
| By: | Dahl, Espen S. (University of Oslo); Hernaes, Øystein (Ragnar Frisch Centre for Economic Research) |
| Abstract: | Activation policies to promote self-sufficiency among recipients of welfare and other types of benefits are becoming more common in many welfare states. We evaluate a law change in Norway making welfare receipt conditional on participation in an activation program for all welfare recipients below the age of 30. Analyzing the program's staggered implementation across municipalities with several modern event study estimators, we estimate that the law change had quite precise 0-effects on benefit receipt, work and education. We also do not find any effects on the probability of being out of work or of being in employment, education or labor market programs. Qualitative evidence suggests that the zero effect may be due to the law change only impacting the participation of recipients with low expected gain from activation. |
| Keywords: | social assistance, activation, conditionality, welfare reform, labor |
| JEL: | H55 I38 J18 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15170&r= |
| By: | Josten, Cecily (London School of Economics); Lordan, Grace (London School of Economics) |
| Abstract: | This study identifies the job attributes, and in particular skills and abilities, which predict the likelihood a job is recently automatable drawing on the Josten and Lordan (2020) classification of automatability, EU labour force survey data and a machine learning regression approach. We find that skills and abilities which relate to non-linear abstract thinking are those that are the safest from automation. We also find that jobs that require 'people' engagement interacted with 'brains' are also less likely to be automated. The skills that are required for these jobs include soft skills. Finally, we find that jobs that require physically making objects or physicality more generally are most likely to be automated unless they involve interaction with 'brains' and/or 'people'. |
| Keywords: | work, automatability, job skills, job abilities, EU Labour Force Survey |
| JEL: | J21 J00 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15180&r= |
| By: | Gustavo de Souza; Andre Luduvice |
| Abstract: | In the US, unemployed workers must satisfy two requirements to receive unemployment insurance (UI): a tenure requirement that stipulates the minimum qualifying work spell and a monetary requirement that determines a past minimum wage. This paper develops a heterogeneous agents model with history-dependent UI benefits in order to quantitatively obtain an optimal UI program design. We first conduct an empirical analysis using the discontinuity of UI rules at state borders and find that both the monetary and the tenure requirement reduce unemployment. The monetary requirement decreases the number of employers and the share of part-time workers, while the tenure requirement has the opposite effect. We then use a quantitative model to rationalize these results. When the tenure requirement is long, workers tend to accept more low paying jobs to become eligible for UI sooner and to protect themselves from risk, while the monetary requirement works conversely. We show that, because it mitigates moral hazard, the monetary requirement can generate higher welfare levels than an increase in the length of the tenure requirement. |
| Keywords: | Unemployment Insurance; UI Eligibility; Optimal UI |
| JEL: | E24 E61 J65 |
| Date: | 2022–04–19 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedcwq:94057&r= |
| By: | Costas-Fernández, Julián (University College London); Morando, Greta (University College London) |
| Abstract: | This paper offers new evidence of the role of immigration in shaping the educational and labour market outcomes of natives. We use administrative data on the entire English higher education system and exploit the idiosyncratic variation of foreign students within university-degree across four cohorts of undergraduate students. Foreign peers have zero to mild effects on natives' educational outcomes, such as graduation probability and degree classification. Large effects are found on displacement across universities and degree types after enrolment, although these outcomes are rare occurrences. In line with the mild effects on education outcomes, we also find little effect of foreign peers affecting early labour market outcomes of native graduates. |
| Keywords: | peer effects, higher education, immigration |
| JEL: | F22 I21 I23 I24 I26 J15 J24 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15187&r= |
| By: | Mukhopadhyay, Sankar (University of Nevada, Reno) |
| Abstract: | The COVID-19 pandemic led to an unprecedented level of job losses in the U.S., where a job loss is also associated with the loss of health insurance. This paper uses data from the 2020 Household Pulse Survey (HPS) and difference-in-difference (DD) regressions to estimate the effect of the Medicaid expansion on anxiety and depression associated with job loss. Estimates show that the respondents who live in expansion states are 96.6% (36.3%) more likely to have Medicaid coverage, and correspondingly, 14.2% (7.6%) less likely to have moderate to severe mental distress following their job loss (a family member's job loss) compared to those living in non-expansion states. Further explorations suggest that the economic security provided by Medicaid is as important (if not more) as the access or utilization to healthcare. The difference-in-difference-in-difference (DDD) estimates using just above and below the Medicare eligibility age (65) confirm these results. |
| Keywords: | job loss, depression, anxiety, mental health, COVID-19, Medicaid |
| JEL: | I12 I18 J6 |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15150&r= |
| By: | Matthias Doepke (Northwestern University); Anne Hannusch (University of Mannheim); Fabian Kindermann (University of Regensburg); Michèle Tertilt (Universität Mannheim) |
| Abstract: | In this survey, we argue that the economic analysis of fertility has entered a new era. First-generation models of fertility choice were designed to account for two empirical regularities that, in the past, held both across countries and across families in a given country: a negative relationship between income and fertility, and another negative relationship between women’s labor force participation and fertility. The economics of fertility has entered a new era because these stylized facts no longer universally hold. In high-income countries, the income-fertility relationship has flattened and in some cases reversed, and the cross-country relationship between women's labor force participation and fertility is now positive. We summarize these new facts and describe new models that are designed to address them. The common theme of these new theories is that they view factors that determine the compatibility of women’s career and family goals as key drivers of fertility. We highlight four factors that facilitate combining a career with a family: family policy, cooperative fathers, favorable social norms, and flexible labor markets. We also review other recent developments in the literature, and we point out promising new directions for future research on the economics of fertility. |
| Keywords: | cross-country analysis, women's careers, family policy |
| JEL: | J13 D31 J16 |
| Date: | 2022–04 |
| URL: | http://d.repec.org/n?u=RePEc:hka:wpaper:2022-012&r= |