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on Labour Economics |
| By: | Acton, Riley (Miami University); Khafaji-King, Jo Al (New York University); Smith, Austin C. (Bates College) |
| Abstract: | We examine the impact of local labor market shocks and state unemployment insurance (UI) policies on student discipline in U.S. public schools. Analyzing school-level discipline data and firm-level layoffs in 23 states, we find that layoffs have little effect on discipline rates overall. However, effects differ across the UI benefit distribution. At the lowest benefit level ($265/week), a mass layoff increases out-of-school suspensions by 4.5%, with effects dissipating as UI benefits increase. Effects are consistently largest for Black students - especially in predominantly White schools - resulting in increased racial disproportionality in school discipline following layoffs in low-UI states. |
| Keywords: | school discipline, layoffs, unemployment insurance |
| JEL: | I24 J63 J65 |
| Date: | 2023–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16423&r=lab |
| By: | Bhalotra, Sonia (Department of Economics, University of Warwick, CEPR, IEA, IZA, CAGE, IFS); Clarke, Damian (bDepartment of Economics, University of Chile and IZA); Mühlrad, Hanna (IFAU - Institute for Evaluation of Labour Market and Education Policy); Palme, Mårten (Stockholm University) |
| Abstract: | In vitro fertilization (IVF) has allowed women to delay birth and pursue a career, but it massively increases the risk of twin birth. We investigate the extent to which having twins hampers women’s careers after birth. To do this, we leverage a single embryo transfer (SET) mandate for IVF procedures implemented in Sweden in 2003, following which the share of twin births showed a precipitous drop of 70%. Linking birth registers to hospitalization and earnings registers, we identify substantial improvements in women’s earnings following IVF birth, alongside improvements in maternal and child health and an increase in subsequent fertility. We provide the first comprehensive evaluation of SET. This is relevant given the secular rise in IVF births and the broader rise in the risk of twin birth. |
| Keywords: | twins; IVF; single embryo transfer; career costs of children; gender wage gap; fertility; maternal health; neonatal health; gender |
| JEL: | I11 I12 I38 J13 J24 |
| Date: | 2023–08–10 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2023_019&r=lab |
| By: | Alexander Ahammer; Ulrich Glogowsky; Martin Halla; Timo Hener |
| Abstract: | Using Austrian and Danish administrative data, we examine the impacts of parenthood on mental health. Parenthood imposes a greater mental health burden on mothers than on fathers. It creates a long-run gender gap in antidepressant prescriptions of about 93.2% (Austria) and 64.8% (Denmark). These parenthood penalties in mental health are unlikely to reflect differential help-seeking behavior across the sexes or postpartum depression. Instead, they are related to mothers’ higher investments in childcare: Mothers who take extended maternity leave in quasi-experimental settings are more likely to face mental health problems. |
| Keywords: | Gender equality, fertility, parenthood, motherhood, mental health, parental leave |
| JEL: | D63 J13 I10 J16 J22 |
| Date: | 2023–09 |
| URL: | http://d.repec.org/n?u=RePEc:jku:econwp:2023-12&r=lab |
| By: | Jessen, Jonas (IZA); Schmitz, Sophia (Federal Institute for Population Research); Weinhardt, Felix (European University Viadrina, Frankfurt / Oder) |
| Abstract: | We study the local evolution of female labour supply and cultural norms in West Germany in reaction to the sudden presence of East Germans who migrated to the West after reunication. These migrants grew up with high rates of maternal employment, whereas West German families mostly followed the traditional breadwinner-housewife model. We find that West German women increase their labour supply and that this holds within households. We provide additional evidence on stated gender norms, West-East friendships, intermarriage, and child care infrastructure. The dynamic evolution of the effects on labour supply is best explained by local cultural learning. |
| Keywords: | cultural norms, local learning, gender, immigration |
| JEL: | J16 J21 D1 |
| Date: | 2023–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16428&r=lab |
| By: | Ufuk Akcigit; Harun Alp; André Diegmann; Nicolas Serrano-Velarde |
| Abstract: | This paper investigates a unique policy designed to maintain employment during the privatization of East German firms after the fall of the Iron Curtain. The policy required new owners of the firms to commit to employment targets, with penalties for non-compliance. Using a dynamic model, we highlight three channels through which employment targets impact firms: distorted employment decisions, increased productivity, and higher exit rates. Our empirical analysis, using a novel dataset and instrumental variable approach, confirms these findings. We estimate a 22% points higher annual employment growth rate, a 14% points higher annual productivity growth, and a 3.6% points higher probability of exit for firms with binding employment targets. Our calibrated model further demonstrates that without these targets, aggregate employment would have been 15% lower after 10 years. Additionally, an alternative policy of productivity investment subsidies proved costly and less effective in the short term. |
| JEL: | D22 D24 J08 O4 |
| Date: | 2023–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:31645&r=lab |
| By: | Job Boerma; Aleh Tsyvinski; Ruodu Wang; Zhenyuan Zhang |
| Abstract: | We propose a new sorting framework: composite sorting. Composite sorting comprises of (1) distinct worker types assigned to the same occupation, and (2) a given worker type simultaneously being part of both positive and negative sorting. Composite sorting arises when fixed investments mitigate variable costs of mismatch. We completely characterize optimal sorting and additionally show it is more positive when mismatch costs are less concave. We then characterize equilibrium wages. Wages have a regional hierarchical structure − relative wages depend solely on sorting within skill groups. Quantitatively, composite sorting can generate a sizable portion of within-occupations wage dispersion in the US. |
| JEL: | C78 D31 E0 J01 |
| Date: | 2023–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:31656&r=lab |
| By: | Jonas Fluchtmann; Violetta van Veen; Willem Adema |
| Abstract: | This paper analyses the association of labour market outcomes and family policies with fertility trends between 2002 and 2019 in 26 OECD countries. While the average age of mothers at birth of their children continued to increase over the entire period, these years have been marked by an initial catching-up of total fertility rates after marked declines in previous decades. Furthermore, after peaking in 2008, total fertility rates declined substantially, fueling concerns about demographic, economic and fiscal implications. Using panel data models and building on prior work, this paper links these changes in fertility outcomes to changes in the labour market position of men and women as well as with changes in family policies, such as parental leaves and early childhood education and care. This paper provides insights into the complex dynamics between family policies, employment and fertility, shedding light on the factors influencing overall population dynamics in OECD countries. |
| Keywords: | Birth rates, Employment, Family Policy, Fertility |
| JEL: | J13 J18 J21 C33 |
| Date: | 2023–09–21 |
| URL: | http://d.repec.org/n?u=RePEc:oec:elsaab:299-en&r=lab |
| By: | Bacic, Ryan (McMaster University); Zheng, Angela (McMaster University) |
| Abstract: | A large literature documents a positive correlation between parental income and child test scores. In this paper, we study whether this relationship, the dependence of the cognitive skills of children on the socioeconomic resources of their parents, varies across race. Using education data linked to tax records, we find that the income-achievement gap is small for East Asian children while significantly larger for Indigenous children. School-level factors explains a large portion of the variation in the gap across race. Our results suggest that the large income-achievement gap for Indigenous students may be rooted in inequality in special needs status. |
| Keywords: | test scores, income-achievement gaps, race |
| JEL: | I20 I24 J15 |
| Date: | 2023–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16419&r=lab |
| By: | Eric Chyn; Kareem Haggag; Bryan Stuart |
| Abstract: | This paper provides new evidence on the causal impacts of citywide racial segregation on intergenerational mobility. We use an instrumental variable approach that relies on plausibly exogenous variation in segregation due to the arrangement of railroad tracks in the 19th century. Our analysis finds that higher segregation reduces upward mobility for Black children from households across the income distribution and White children from low-income households. Moreover, segregation lowers academic achievement while increasing incarceration and teenage birth rates. An analysis of mechanisms shows that segregation reduces government spending, weakens support for antipoverty policies, and increases racially conservative attitudes among White residents. |
| Keywords: | Race; Inequality; Intergenerational Mobility; Segregation; Discrimination |
| JEL: | J15 J62 J71 R31 |
| Date: | 2023–09–05 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedpwp:96678&r=lab |
| By: | Saerom (Ronnie) Lee; Britta Glennon |
| Abstract: | To spur entrepreneurship and economic growth, an increasing number of countries have introduced immigration policies that provide visas to skilled entrepreneurs. This paper investigates whether these policies influence the founding location choice of immigrant founders, by leveraging the introduction of Canada's Start-up Visa Program in 2013. We demonstrate that this immigration policy increased the likelihood that U.S.-based immigrants have a start-up in Canada by 69%. Our results show that Asian immigrants (who have a higher representation in Canada than in the U.S.) are disproportionately more likely to migrate to Canada to start their businesses, whereas Hispanic immigrants (who have a smaller representation in Canada than in the U.S.) are less inclined to do so. We also find that this propensity varies with the size of co-ethnic immigrant communities in the origin location. Overall, our study unveils the importance of immigration policies in determining founding location choice and has important implications for countries competing for global talent. |
| JEL: | F20 F22 J60 M13 |
| Date: | 2023–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:31634&r=lab |
| By: | Favara, Marta (University of Oxford); Freund, Richard (University of Oxford); Perez-Alvarez, Marcello (University of Göttingen) |
| Abstract: | This paper examines the subjective treatment effects of a negative shock created by the COVID-19 pandemic on the labour market outcomes of young adults in India, Peru, and Vietnam. We leverage subjective counterfactual outcomes at the individual-level that were purposely collected from over 7, 000 individuals to this aim. Our findings suggest that the shock denied employment opportunities and reduced earnings. On average, the pandemic reduced monthly earnings by 19.4% and employment levels by 17.5% in our three-country-sample. Country-specific magnitudes are lowest for India and highest for Vietnam. However, these average effects belie that a substantial proportion of individuals, particularly those from disadvantaged backgrounds, are pushed into employment by the pandemic. This frequently comes at the expense of their education, hinting at youth labour acting as a buffer against transitory shocks. According to our findings, the perceived effects of the pandemic on labour market outcomes carry important implications for young people's well-being and behaviour. Individuals who are denied employment display significantly higher rates of anxiety, lower rates of COVID-19 vaccination, and lower desired fertility. |
| Keywords: | subjective treatment effects, labour market, COVID-19, youth, developing countries |
| JEL: | J21 J11 C21 C83 D84 |
| Date: | 2023–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16417&r=lab |
| By: | Mia Ellis; Cynthia Kinnan; Margaret S. McMillan; Sarah Shaukat |
| Abstract: | Not all firms have equal capacity to absorb productive credit. Identifying those with higher potential may have large consequences for productivity. We collect detailed survey data on small- and medium-sized Tanzanian firms who borrow from a large commercial bank, which in turn raises funds via international capital markets. Using machine learning methods to identify predictors of loan growth, we document, first, that we achieve high rates of predictive power. Second, “soft” information (entrepreneurs’ motivations for entrepreneurship and constraints faced) has predictive power over and above administrative data (sector, age, etc.). Third, there is a different and larger set of predictors for women than men, consistent with greater barriers to efficient capital allocation among female entrepreneurs. |
| JEL: | G14 J16 O16 |
| Date: | 2023–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:31620&r=lab |
| By: | Clément Imbert; Joan Monras; Marlon Seror; Yanos Zylberberg |
| Abstract: | This paper argues that migrants’ decision to bring their dependent family members shapes their consumption behavior, their choice of destination, and their sensitivity to migration barriers. We document that in China: (i) rural migrants disproportionately move to expensive cities; (ii) in these cities they live without their family and in poorer housing conditions; and (iii) they remit more, especially when living without their family. We then develop a quantitative general equilibrium spatial model in which migrant households choose whether, how (with or without their family), and where to migrate. We estimate the model using plausibly exogenous variation in wages, housing prices, and exposure to family migration costs. We use the model to estimate migration costs and relate them to migration policy. We find that hukou policies protect workers in large, expensive, and high income cities at the expense of rural households, who use remittances to overcome some of these costs. |
| Keywords: | migration; remittances; economic geography; spatial equilibrium |
| JEL: | R12 J61 O15 |
| Date: | 2023–08–30 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedfwp:96924&r=lab |
| By: | Otrachshenko, Vladimir (Justus Liebig University, Giessen); Popova, Olga (Leibniz Institute for East and Southeast European Studies (IOS)); Alimukhamedova, Nargiza (CERGE-EI) |
| Abstract: | Employing novel household survey data, this paper examines how rainfall variability and mean temperature affect individual labor supply in Uzbekistan, a highly traditional lower-middle-income country in Central Asia. The findings suggest that rainfall variability induces the reallocation of labor supply: (i) out of agriculture to unemployment, (ii) from unemployment to business activities and irregular remunerated activities, and (iii) from being out of labor force to unemployment. These effects differ in rural and urban areas and by gender. In addition, active women's involvement in the labor market and household decision-making mediates the impact of climate variability on employment choices, especially in rural areas. This implies that traditional gender roles may make households in developing countries more vulnerable to adverse consequences of climate change, while women's empowerment may smooth such consequences. |
| Keywords: | rainfall variability, labor market, agriculture, employment, women's empowerment, Uzbekistan, Central Asia |
| JEL: | J16 J21 J43 P28 Q54 |
| Date: | 2023–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16421&r=lab |
| By: | Athina Anastasiadou (Max Planck Institute for Demographic Research, Rostock, Germany); Jisu Kim (Max Planck Institute for Demographic Research, Rostock, Germany); Asli Ebru Şanlitürk (Max Planck Institute for Demographic Research, Rostock, Germany); Helga de Valk; Emilio Zagheni (Max Planck Institute for Demographic Research, Rostock, Germany) |
| JEL: | J1 Z0 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:dem:wpaper:wp-2023-039&r=lab |
| By: | Kotschy, Rainer (Harvard School of Public Health); Bloom, David E. (Harvard School of Public Health) |
| Abstract: | This paper examines the extent to which changes in working-age shares associated with population aging might slow economic growth in upcoming years. We first analyze the economic effects of changing working-age shares in a standard empirical growth model using country panel data from 1950–2015. We then juxtapose the estimates with predicted shifts in population age structure to project economic growth in 2020–2050. Our results indicate that population aging will slow economic growth throughout much of the world. Expansions of labor supply due to improvements in functional capacity among older people can cushion much of this demographic drag. |
| Keywords: | population health, life expectancy, prospective aging, labor supply, economic development |
| JEL: | J11 O11 O47 |
| Date: | 2023–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16377&r=lab |
| By: | Michela Cella; Elena Manzoni; Francesco Scervini |
| Abstract: | In this paper we study, theoretically and empirically, how the belief that the gender of politicians affects their competence on a range of issues may influence electoral outcomes depending on the salience of these issues. We propose a model of issue-specific gender bias in elections which can describe both the presence of a real comparative advantage (‘kernel-of-truth’ case, or stereotype) and the case of pure prejudice. We show that the bias influences electoral results but it can be partially reversed by successful information transmission during the electoral campaign. We then empirically investigate the relation between issue salience and women’s performance, using US data on House and Senate elections. Estimates of issue salience are obtained using Google Trends data. Exploiting the longitudinal dimension of the dataset at district level and an IV strategy to rule out possible endogeneity, we show a positive correlation between the salience of feminine issues and women’s electoral outcomes. The average effect is sizable with respect to the share of votes for women candidates, even if not large enough, on average, to increase the probability that women candidates win elections. |
| Keywords: | gender bias, elections, female politicians. |
| JEL: | D72 J16 |
| Date: | 2023–09 |
| URL: | http://d.repec.org/n?u=RePEc:mib:wpaper:527&r=lab |
| By: | Yutaro Izumi; Hitoshi Shigeoka; Masayuki Yagasaki |
| Abstract: | While female CEOs are under-represented, the barriers they face in the business environment remain poorly understood. This study investigates the influence of gender bias in forming CEOs’ business networks. Using transaction data of 1 million Japanese firms, we find that CEOs of the same gender significantly trade more than those of the opposite gender, mostly driven by small- and medium-sized firms in which CEOs presumably have a strong involvement in transactions. As most CEOs are male, such same-gender bias reduces the trading opportunities for females relative to male CEOs. Regarding mechanisms, our survey reveals both the existence of barriers that impede male CEOs from becoming acquainted with female CEOs and the tendency for male CEOs to prefer interacting with male CEOs over female CEOs. |
| JEL: | D22 J16 |
| Date: | 2023–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:31616&r=lab |
| By: | Huet-Vaughn, Emiliano (Pomona College) |
| Abstract: | The positive political returns to providing cash transfers have been well documented. However, redistribution through the tax and transfer system, while direct, is not the only means by which governments seek to change the income distribution: regulation of private market transactions may have a similar, if indirect, effect, implicitly redistributing via so-called "pre-distribution" policies. Wage floors, in particular, are implemented with the explicit goal of redistributing pre-tax firm income to low-wage workers. In the United States, polls consistently indicate minimum wage increases are broadly popular, and, also clearly associated with the Democratic party. This paper provides the first test of whether large minimum wage increases actually yield electoral gains for Democrats. For both federal and state races, I find no evidence that this is generally true using an event-study design and sub-national variation in minimum wages from the early 1990s to recent years. A null result is further confirmed when using a beneficiary-level political sentiment measure and difference-in-difference design. Various explanations for the finding are explored and dispelled while newly collected survey evidence supports a salience, or inattention, mechanism. Specifically, voters are found to attend much less to a minimum wage increase than to an equivalently-valued direct cash transfer from the government. This suggests putting money in people's hands may not be enough to receive political credit and that the directness of a transfer may itself matter. |
| Keywords: | salience, minimum wage, voting |
| JEL: | J8 D72 |
| Date: | 2023–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16416&r=lab |