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on Labour Economics |
| By: | Alicia De Quinto; Libertad González |
| Abstract: | Countries often encourage part-time work among new parents as part of their family policies, aiming to foster mothers' attachment to the labor force. However, this well-intentioned approach may inadvertently impede women's long-term prospects in the labor market. We examine the impact of a 1999 Spanish reform allowing new parents to reduce working hours by up to a half while their youngest child is under age 6, along with job protection measures. Leveraging eligibility rules, we employ a regression kink design, comparing ineligible women to mothers with varying eligibility durations, and track women's subsequent work trajectories. We find that longer eligibility resulted in a modest increase in maternal part-time work during her child's early years. Mothers worked part time, on average, about one additional day for each extra month of eligibility. This rise in part-time work came at the expense of fewer days of unemployment, rather than fewer days of full-time work, and thus correlated with higher earnings. In the long term, we document slightly higher employment and earnings for those with extended eligibility after aging out of the program. The long-term effects remain modest. In conclusion, we find that the policy had minimal impact on the labor supply and earnings of women with children, both in the short and longer term. |
| Keywords: | worktime reduction, maternity, childcare policies |
| JEL: | J08 J13 J16 J18 |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:bge:wpaper:1434&r=lab |
| By: | Chiplunkar, Gaurav (University of Virginia); Kelley, Erin (World Bank); Lane, Gregory (University of Chicago) |
| Abstract: | We study how job-seekers share information about jobs within their social network, and its implications for firms. We randomly increase the amount of competition for a job and find that job-seekers are less likely to share information about the job with their high ability peers. This lowers the quality of applicants, hires, and performance on the job - suggesting that firms who disseminate job information through social networks may see lower quality applicants than expected for their most competitive positions. While randomly offering higher wages attracts better talent, it is not able to fully overcome these strategic disincentives in information sharing. |
| Keywords: | job information, social networks, labor markets |
| JEL: | L14 M51 O12 |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16840&r=lab |
| By: | Enrico Moretti; Moises Yi |
| Abstract: | Economists have long hypothesized that large and thick labor markets facilitate the matching between workers and firms. We use administrative data from the LEHD to compare the job search outcomes of workers originally in large and small markets who lost their jobs due to a firm closure. We define a labor market as the Commuting Zone×industry pair in the quarter before the closure. To account for the possible sorting of high-quality workers into larger markets, the effect of market size is identified by comparing workers in large and small markets within the same CZ, conditional on workers fixed effects. In the six quarters before their firm’s closure, workers in small and large markets have a similar probability of employment and quarterly earnings. Following the closure, workers in larger markets experience significantly shorter non-employment spells and smaller earning losses than workers in smaller markets, indicating that larger markets partially insure workers against idiosyncratic employment shocks. A 1 percent increase in market size results in a 0.014 and 0.023 percentage points increase in the 1-year re-employment probability of high school and college graduates, respectively. Displaced workers in larger markets also experience a significantly lower need for relocation to a different CZ. Conditional on finding a new job, the quality of the new worker-firm match is higher in larger markets, as proxied by a higher probability that the new match lasts more than one year; the new industry is the same as the old one; and the new industry is a “good fit” for the worker’s college major. Consistent with the notion that market size should be particularly consequential for more specialized workers, we find that the effects are larger in industries where human capital is more specialized and less portable. Our findings may help explain the geographical agglomeration of industries—especially those that make intensive use of highly specialized workers—and validate one of the mechanisms that urban economists have proposed for the existence of agglomeration economies. |
| JEL: | H0 J0 R0 |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:32250&r=lab |
| By: | Gustafsson, Johan (Department of Economics, Umeå University); Sjögren, Tomas (Department of Economics, Umeå University) |
| Abstract: | This paper concerns the timing of taxation in an economy with trade unions. By using insights from the industrial organization literature, we show within the framework of an overlapping generations model where agents work in the first period of life and are retired in the second that trade unions can obtain an advantageous bargaining outcome vis-à-vis firms by delegating authority to a negotiator who (i) discounts the future at a higher rate than the union members, and (ii) treats the workers´ labor supply and saving decisions as given. In this context, the timing of taxation of first period labor income matters for wage formation and we show that the welfare can be improved by implementing an income-based pension for retired workers (i.e. a negative delayed income tax) when there is unemployment in equilibrium. We also outline when the welfare can be improved by implementing a positive delayed income tax. Finally, we show that if the trade union delegates authority to a negotiator who recognizes the workers´ labor supply and saving responses, the welfare cannot be improved by implementing a second period tax/pension. |
| Keywords: | Timing of taxation; labor market distortion; pensions |
| JEL: | H21 H55 J51 |
| Date: | 2024–03–26 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:umnees:1024&r=lab |
| By: | David R. Agrawal; Elke J. Jahn; Eckhard Janeba |
| Abstract: | An unappreciated potential benefit of commuting subsidies is that they can expand the choice set of feasible job opportunities in a way that facilitates a better job match quality. Variations in wages and initial commuting distances, combined with major reforms of the commuting subsidy formula in Germany, generate worker-specific variation in commuting subsidy changes. We study the effect of changes in these subsidies on a worker’s position in the wage distribution. Increases in the generosity of commuting subsidies induce workers to switch to higher-paying jobs with longer commutes. Although increases in commuting subsidies generally induce workers to switch to employers that pay higher wages, commuting subsidies also enhance positive assortativity in the labor market by better matching high-ability workers to higher-productivity plants. Greater assortativity induced by commuting subsidies corresponds to greater earnings inequality. |
| Keywords: | commuting, commuting subsidies, taxes, wage distribution, local labor markets, AKM, assortativity |
| JEL: | H20 H31 J20 J61 R23 R48 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_10981&r=lab |
| By: | Bütikofer, Aline (Norwegian School of Economics); Coy, Deirdre (Irish Government Economic and Evaluation Service); Doyle, Orla (University College Dublin); Ginja, Rita (University of Bergen) |
| Abstract: | Pregnancy loss is often a traumatic event which may impact both parents and subsequent children. Using Norwegian registry data, we exploit the random nature of single, early miscarriages to examine the impact of pregnancy loss on parental investment and family outcomes. We find that pregnancy loss improves maternal health investments in the subsequent pregnancy regarding supplement use, smoking, preventative healthcare, and physician choice. While a miscarriage negatively affects labor market attachment, it has limited effects on children born after the loss. This suggests that investment in the next pregnancy may offset the negative consequences of stress associated with pregnancy loss. |
| Keywords: | miscarriage, parental investment, healthcare use, household labor supply |
| JEL: | I12 J13 |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16858&r=lab |
| By: | Bastani, Spencer (IFAU - Institute for Evaluation of Labour Market and Education Policy); Dickmanns, Lisa (Department of Economics, University of Cologne); Giebe, Thomas (Department of Economics and Statistics); Gürtler, Oliver (Department of Economics, University of Cologne) |
| Abstract: | We study how the presence of promotion competition in the labor market affects household specialization patterns. By embedding a promotion tournament model in a household setting, we show that specialization can emerge as a consequence of competitive work incentives. This specialization outcome, in which only one spouse invests heavily in his or her career, can be welfare superior to a situation in which both spouses invest equally in their careers. The reason is that household specialization reduces the intensity of competition and provides households with consumption smoothing. The specialization result is obtained in a setting where spouses are equally competitive in the labor market and there is no household production. It is also robust to several modifications of the model, such as varying the number of households, two spouses competing for promotion in the same workplace, and the inclusion of household production. |
| Keywords: | contest theory; gender equality; family; household; competition |
| JEL: | C72 D13 J16 J71 M51 M52 |
| Date: | 2024–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:vxesta:2024_005&r=lab |
| By: | Huebener, Mathias (Bundesinstitut für Bevölkerungsforschung (BiB)); Jessen, Jonas (IZA); Kühnle, Daniel (University of Duisburg-Essen); Oberfichtner, Michael (Institute for Employment Research (IAB), Nuremberg) |
| Abstract: | Motherhood and parental leave are frequent causes of worker absences and employment interruptions, yet we know little about their effects on firms. Based on linked employer-employee data from Germany, we examine how parental leave absences affect small- and medium-sized firms. We show that they anticipate the absence with replacement hirings in the six months before childbirth. A 2007 parental leave reform extending leave absences reduces firm-level employment and total wages in the first year after childbirth, driven by firms with few internal substitutes for the absent mother. However, we do not find longer-term effects on firms' employment, wage-bill, or likelihood to shut down. We find that the reform increases replacement hirings, but firms directly affected do not respond to longer expected absences of mothers by subsequently hiring fewer young women. Overall, our findings show that extended parental leave does not have a lasting impact on firms when these can anticipate the absences. |
| Keywords: | parental leave, worker absences, worker substitutability |
| JEL: | J16 J18 J24 |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16843&r=lab |
| By: | Braxton, John Carter (University of Wisconsin-Madison); Chikhale, Nisha (University of Wisconsin-Madison); Herkenhoff, Kyle (University of Minnesota); Phillips, Gordon (Dartmouth College) |
| Abstract: | We combine the Decennial Census, credit reports, and administrative earnings to create the first panel dataset linking parent's credit access to the labor market outcomes of children in the U.S.We find that a 10% increase in parent's unused revolving credit during their children's adolescence (13 to 18 years old) is associated with 0.28% to 0.37% greater labor earnings of their children during early adulthood (25 to 30 years old). Using these empirical elasticities, we estimate a dynastic, defaultable debt model to examine how the democratization of credit since the 1970s – modeled as both greater credit limits and more lenient bankruptcy – affected intergenerational mobility. Surprisingly, we find that the democratization of credit led to less intergenerational mobility and greater inequality. Two offsetting forces underlie this result: (1) greater credit limits raise mobility by facilitating borrowing and investment among low-income households; (2) however, more lenient bankruptcy policy lowers mobility since low-income households dissave, hit their constraints more often, and reduce investments in their children. Quantitatively, the democratization of credit is dominated by more lenient bankruptcy policy and so mobility declines between the 1970s and 2000s. |
| Keywords: | credit limits, bankruptcy, intergenerational mobility |
| JEL: | D14 E21 E24 G51 J62 |
| Date: | 2024–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16826&r=lab |
| By: | Stefano Arnolfo (Max Planck Institute for Demographic Research, Rostock, Germany); Nicole Hiekel (Max Planck Institute for Demographic Research, Rostock, Germany) |
| Abstract: | This study investigates the heterogeneity of multipartnered fertility (MPF) trajectories in the Northern European context, where transformations in family formation patterns and in the partnership context of childbearing, together with high social acceptance for new family behaviours, result in a large degree of family life course differentiation. Applying sequence and cluster analyses to high-quality partnership and fertility histories of men and women who experience MPF from the Swedish, Norwegian, Danish, Estonian, and Finnish Generations and Gender Survey Round II collected between 2020 and 2022, we provide a timely description of how MPF trajectories unfold, and identify a typology of these family life courses. Our findings reveal that in the five countries, various trajectories of MPF co-exist that differ substantially in terms of the order and timing of union formation and dissolution, and the partnership context of births. Furthermore, we investigate gender and socioeconomic inequalities, and reflect on the potential vulnerabilities nested within MPF life courses and the additional layer of disadvantage that childbearing can represent for mothers vis-à-vis fathers in the context of family complexity. |
| JEL: | J1 Z0 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:dem:wpaper:wp-2024-005&r=lab |
| By: | Coskun, Sena (FAU Erlangen Nuremberg); Dauth, Wolfgang (Institut für Arbeitsmarkt- und Berufsforschung); Gartner, Hermann (Institute for Employment Research (IAB), Nuremberg); Stops, Michael (Institute for Employment Research (IAB), Nuremberg); Weber, Enzo (Institute for Employment Research (IAB), Nuremberg) |
| Abstract: | This paper examines how the shift towards working from home during and after the Covid-19 pandemic shapes the way how labor market and locality choices interact. For our analysis, we combine large administrative data on employment biographies in Germany and a new working from home potential indicator based on comprehensive data on working conditions across occupations. We find that in the wake of the Covid-19 pandemic, the distance between workplace and residence has increased more strongly for workers in occupations that can be done from home: The association of working from home potential and work-home distance increased significantly since 2021 as compared to a stable pattern before. The effect is much larger for new jobs, suggesting that people match to jobs with high working from home potential that are further away than before the pandemic. Most of this effect stems from jobs in big cities, which indicates that working from home alleviates constraints by tight housing markets. We find no significant evidence that commuting patterns changed more strongly for women than for men. |
| Keywords: | working from home, commuting, urban labor markets |
| JEL: | J61 R23 |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16855&r=lab |
| By: | IWASAKI, Ichiro; MA, Xinxin; MIZOBATA, Satoshi |
| Abstract: | This paper reports on an empirical analysis of 42, 094 public/private companies in China and 21 Eastern European countries to grasp the actual state and determinants of board gender diversity in emerging market firms. We confirmed that firms in these countries are comparable to those in advanced nations in terms of the prevalence of firms recruiting female board members and the female share of board directorships. Furthermore, in emerging market countries, internal promotions are used as often as, or even more often than, external ones to recruit women to director positions. The results revealed that board composition and ownership structure are important determinants of the gender diversity of the corporate board in emerging market firms. We also found that the effects of these factors vary significantly depending on the country/region and the listing status of firms and that two qualitatively different decision-making stages related to the appointment of women to board positions (i.e., a decision as to whether to appoint any women to the board and a decision as to how many board positions should be reserved for women) have a substantial impact on the empirical results. |
| Keywords: | board gender diversity, board composition, ownership structure, emerging markets, China, Eastern Europe |
| JEL: | D22 G32 J16 K22 L22 P31 |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:hit:hitcei:2023-09&r=lab |
| By: | Aleksandra Kolasa (University of Warsaw, Faculty of Economic Sciences) |
| Abstract: | Universal child benefits are an important component of the social protection systems in many developed economies, particularly in Europe. When evaluating their impact, most studies tend to focus primarily on the empirical evidence and short-term effects. However, given their large-scale implementation, such programs can have sizable general equilibrium effects. The aim of this paper is to study the long-run implications of universal child benefits within a theoretical framework that can capture the complexities of household decisions regarding consumption, labor participation, and the timing of children. To this end, I develop an overlapping generations model with idiosyncratic earnings risk, infertility shocks, and endogenous temporal fertility. According to the model simulations, universal child benefits lead to a reduction in the spacing between children and, on average, lower maternal age at childbirth for all births. This, in turn, alleviates some of the negative aggregate effects typically associated with redistributive policies, but has a detrimental impact on the average quality of children. Finally, universal child benefits increase ex-ante welfare by 0.42% of lifetime adult consumption, significantly outperforming broad-based transfer policies not tied to the number of children. |
| Keywords: | universal child benefits, infertility risk, temporal fertility, social welfare, general equilibrium models |
| JEL: | I38 H53 H31 E61 D52 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:war:wpaper:2024-04&r=lab |
| By: | Devos, Louise (Ghent University); Lippens, Louis (Ghent University); Lens, Dries (University of Antwerp); Rycx, François (Free University of Brussels); Volral, Mélanie (University of Mons); Baert, Stijn (Ghent University) |
| Abstract: | Labour markets struggle to be inclusive, while diversity is increasing. This literature review examines labour market challenges faced by first- and second-generation migrants in Belgium. We systematically review articles published between 2010 and 2023 in the Web of Science Core Collection to delineate underlying mechanisms, associated solutions, policy recommendations and literature gaps. The literature reveals that individuals with a migration background generally experience poorer labour market outcomes than natives. These outcomes vary based on specific origin and gender and persist from the first into the second generation. The mechanisms underlying these poorer outcomes are discrimination, individual preferences, and human and social capital differences. Recommendations for employers include implementing anti-discrimination policies, fostering awareness of discrimination, and taking affirmative action. On the employee side, investing in human capital, increasing labour market knowledge, and having competencies formally recognised can help to narrow employment gaps. Our review also advocates for policy refinement to combat biases and suggests that alternative pathways to attaining employment, such as self-employment and volunteering, are promising areas for future research. |
| Keywords: | Belgium, migration, labour market, systematic review |
| JEL: | J15 J18 |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16849&r=lab |
| By: | Cesarini, David (Department of Economics, New York University); Lindqvist, Erik (Swedish Institute for Social Research, Stockholm University); Östling, Robert (Department of Economics, Stockholm School of Economics); Terksaya, Anastasia (Department of Economics and IEB, Universidad de Barcelona) |
| Abstract: | We estimate the effects of large, positive wealth shocks on marriage and fertility in a sample of Swedish lottery players. For male winners, wealth increases marriage formation and reduces divorce risk, suggesting wealth increases men’s attractiveness as prospective and current partners. Wealth also increases male fertility. The only discernible effect on female winners is that wealth increases their short-run (but not long-run) divorce risk. Our results for divorce are consistent with a model where the wealthier spouse retains most of his/her wealth in divorce. In support of this assumption, we show divorce settlements in Sweden often favor the richer spouse. |
| Keywords: | Fertility; children; marriage; divorce |
| JEL: | D01 J12 J13 |
| Date: | 2024–04–08 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sofiwp:2023_004&r=lab |
| By: | Richard K. Crump; Stefano Eusepi; Marc Giannoni; Aysegul Sahin |
| Abstract: | Using a New Keynesian Phillips curve, we document the rapid and persistent increase in the natural rate of unemployment, ut*, in the aftermath of the pandemic and characterize its implications for inflation dynamics. While the bulk of the inflation surge is attributed to temporary supply factors, we also find an important role for current and expected negative unemployment gaps. Through the lens of the model, the 2022-23 disinflation was driven by the expectation that the unemployment gap will close through a progressive decline in ut* and a rise in the unemployment rate. This implies that convergence to long-run price stability depends critically on expectations about labor market tightness. Using a variety of cross-sectional data sources, we provide corroborating evidence of unusually tight labor market conditions, consistent with our estimated rise in ut*. |
| Keywords: | Phillips curve; unemployment; inflation; natural rate of unemployment; expectations |
| JEL: | D84 E24 E31 E32 J11 |
| Date: | 2024–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fednsr:97912&r=lab |
| By: | Pedro Romero Marques; Luiza Nassif Pires; Tainari Taioka; Jose Bergamin; Gilberto Tadeu Lima |
| Abstract: | Announced in June 2021, the never-implemented Green Recovery Plan for the Brazilian Legal Amazon Region (GRP) would be a green transition initiative to be carried out by the state governments of the region. The GRP represented the first large-scale proposal aiming at the transition to a low-carbon economy in Brazil and offered a preliminary framework to evaluate the opportunities and limitations of green development in Global South economies. The GRP's initial phase would provide an investment of 1.5 billion reais (around $315 million in September 2023) in four areas: control of illegal deforestation, sustainable development, green technology, and green infrastructure. This article presents a counterfactual analysis by assessing the impacts of green spending in Amazon on the labor market, quantitatively—in terms of the number of jobs created—and qualitatively—exploring the distribution of those jobs by region and according to gender and race categories. We build synthetic sectors representing each area of investment in a two-region input-output matrix (“Brazilian Amazon†and “Rest of Brazil†). Using employment multipliers, we simulate a demand shock on the Amazonian economy and its impact on job creation in the two regions. Results suggest that green spending in the Amazon offers good perspectives (but also highlights limitations) for a just transition to a low-carbon economy in Brazil: the effects on employment favored the female workforce (both black and white) relative to the male and black workforce in the Amazon, leading to inequality-reducing composition changes in the Brazilian workforce as whole. |
| Keywords: | Green and just transition; Brazilian Amazon; employment multipliers; green spending |
| JEL: | J15 Q57 Q58 R11 R53 R58 |
| Date: | 2024–03–11 |
| URL: | http://d.repec.org/n?u=RePEc:spa:wpaper:2024wpecon9&r=lab |
| By: | Faguet, Jean-Paul; Matajira, Camilo; Sánchez, Fabio |
| Abstract: | The Spanish encomienda, a colonial forced-labour institution that lasted three centuries, killed many indigenous people and caused others to flee into nomadism. What were its long-term effects? We digitize a great deal of historical data from the mid-1500s onwards and reconstruct the Spanish conquerors’ route through Colombia using detailed topographical features to calculate their least-cost path. We show that Colombian municipalities with encomiendas in 1560 enjoy better outcomes today across multiple dimensions of development than those without: higher municipal GDP per capita, tax receipts, and educational attainment; lower infant mortality, poverty, and unsatisfied basic needs; larger populations; and superior fiscal performance and bureaucratic efficiency, but also higher inequality. Why? Two mediation exercises using data on local institutions, populations and racial composition in 1794 shows that encomiendas affected development primarily by helping build the local state. Deep historical evidence fleshes out how encomenderos founded local institutions early on in the places they settled. Places lacking encomiendas also lacked local states for 3-4 centuries. Local institutions mobilized public investment in ways that doubtless suited encomenderos, but, over time, spurred greater economic and human development. |
| Keywords: | Encomienda; Colombia; development; colonialism; extraction; state capacity; forced labour; institutions |
| JEL: | N0 R14 J01 |
| Date: | 2024–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:122257&r=lab |
| By: | Berg, Gerard J. van den (University of Groningen, University Medical Center Groningen ; IFAU Uppsala ; ZEW ; IZA ; CEPR); Kunaschk, Max (Institute for Employment Research (IAB), Nuremberg, Germany); Lang, Julia (Institute for Employment Research (IAB), Nuremberg, Germany); Stephan, Gesine (Institute for Employment Research (IAB), Nuremberg, Germany); Uhlendorff, Arne (Institute for Employment Research (IAB), Nuremberg, Germany) |
| Abstract: | "We analyze unique data on three sources of information on the probability of re-employment within 6 months (RE6), for the same individuals sampled from the inflow into unemployment. First, they were asked for their perceived probability of RE6. Second, their caseworkers revealed whether they expected RE6. Third, random-forest machine learning methods are trained on administrative data on the full inflow, to predict individual RE6. We compare the predictive performance of these measures and consider how combinations improve this performance. We show that self-reported (and to a lesser extent caseworker) assessments sometimes contain information not captured by the machine learning algorithm." (Author's abstract, IAB-Doku) ((en)) |
| Keywords: | Bundesrepublik Deutschland ; IAB-Open-Access-Publikation ; berufliche Reintegration ; Fremdbild ; Integrierte Erwerbsbiografien ; Langzeitarbeitslosigkeit ; Profiling ; Prognosegenauigkeit ; Risikoabschätzung ; Selbsteinschätzung ; Arbeitsberater ; Machine learning ; Arbeitslose ; Arbeitslosenversicherung ; Arbeitslosigkeitsdauer ; Arbeitsmarktchancen ; 2012-2013 |
| JEL: | C21 C41 C53 J64 J65 C55 |
| Date: | 2024–02–08 |
| URL: | http://d.repec.org/n?u=RePEc:iab:iabdpa:202403&r=lab |