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on Labour Economics |
| By: | Rishabh Tyagi (Max Planck Institute for Demographic Research, Rostock, Germany); Peter Eibich (Max Planck Institute for Demographic Research, Rostock, Germany); Vegard Skirbekk (Max Planck Institute for Demographic Research, Rostock, Germany) |
| Abstract: | We study the impact of job loss on the risk of separation among German couples. We focus on job losses due to plant closures and involuntary dismissals as a source of variation that is likely to be independent of other individual risk factors for partnership dissolution. We use panel data from the German Socio-Economic Panel Study (1986–2019) for persons aged 20-65. We use event study design and propensity score matching combined with the difference-in-differences approach to analyse the effects of involuntary job loss on the likelihood of divorce or separation within three years. First, in our event study design, we find an increase in the probability of union dissolution in the year following job loss by around two percentage points (ppts). In our matching design combined with the difference-in-differences approach, union dissolution risk increases by 2.12 ppts for our treatment group compared to our control group within three years of the job loss. This increase in union dissolution risk is slightly higher in the case of male job loss (2.23 ppts) than for job loss among women (1.64 ppts) over three years compared to those not exposed to involuntary job loss. We analyse differences between East and West Germany and between migrants from different countries of origin to examine the role of gender norms. Gender norms in the place of origin do not seem to explain the increased union dissolution risk. However, the individual-level gender norms based on males’ share of home production activities in the couple over the years show an increased risk of union dissolution for the traditional half and no effect for the liberal half of the men losing their jobs. The effect of involuntary job loss on union dissolution risk is mediated by declining family life satisfaction, males’ share of hours spent on home production and lower household income for the person experiencing involuntary job loss. |
| Keywords: | Germany, dismissal, division of labor, divorce, economic demography |
| JEL: | J1 Z0 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:dem:wpaper:wp-2024-027 |
| By: | Bassetto, Jacopo (University of Bologna); Ippedico, Giuseppe (University of Nottingham) |
| Abstract: | Brain drain is a key policy concern for many countries. In this paper we study whether tax incentives are an effective policy to attract high-skilled expatriates back to their home country, exploiting a generous income tax break for Italian returnees. Using administrative data and a Triple Differences design, we find that eligible individuals are 27% more likely to return to Italy. Additionally, we uncover significant effects throughout the wage distribution, revealing that tax-induced migration is a broad phenomenon beyond top earners. A cost-benefit analysis shows that the tax scheme can pay for itself by targeting young high-skilled individuals. |
| Keywords: | brain drain, tax incentives, return migration, personal income tax |
| JEL: | F22 H24 H31 J61 |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17224 |
| By: | Camarero Garcia, Sebastian; Murmann, Martin |
| Abstract: | Business creation is economically important, and unemployment precedes the creation of a substantial share of new firms. Yet, most research has focused on analyzing the effects of unemployment insurance policies on re-employment outcomes, ignoring self-employment. In this paper, we analyze how the potential duration of unemployment benefits, a fundamental design choice of unemployment insurance systems, affects whether new firms are founded out of opportunity or necessity and their growth potential. To this end, we construct a comprehensive dataset on German firm founders that links administrative social insurance information with business survey data. Exploiting reform and age-related exogenous variation in the potential duration of unemployment benefits, we find that longer potential benefit duration implies longer actual unemployment and, as a consequence, more necessity entrepreneurship and worse startup outcomes in terms of sales and employment growth. We explain this overall effect of potential benefit duration through a mix of compositional and individual-level duration effects. Our findings underline that new firms started out of unemployment are a highly heterogeneous group and suggest that the (optimal) design of unemployment insurance systems has important externalities on whether innovation- and growth-oriented firms are started out of unemployment. |
| Keywords: | entrepreneurship, unemployment insurance, self-employment, opportunity entrepreneurship, fiscal externality |
| JEL: | L26 M13 L11 L25 D22 J21 J23 J44 J62 J64 J65 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:bubdps:301863 |
| By: | Estefanía Galván (Instituto de Economía, FCEA, Universidad de la Republica); Cecilia García-Peñalosa (Aix-Marseille University, CNRS, AMSE, Marseille France) |
| Abstract: | A considerable body of work has shown that motherhood is accompanied by a reduction in labor market participation and hours of market work, while more recent ndings indicate that women who earn more than their husbands tend to subsequently take actions that reduce their market income. Both patterns of behaviour have been interpreted as women trying to conform to child-rearing norms and to the prescription that the husband should be the main breadwinner. In this paper we use panel data for US couples to re-examine women's behaviour when they become mothers and when they are the main breadwinner. We start by asking whether the arrival of a child a ects women who are the main breadwinner and those who are not in the same way, and then turn to how mothers and childless women react when they are the main breadwinner. Our results are consistent with the breadwinner norm only a ecting mothers, suggesting that the salience of gender norms may depend on the household's context, notably on whether or not children are present. Concerning the arrival of a child, we nd that although the labor supply of women who earn more than their husbands initially responds to motherhood less than that of secondary earners, the two groups converge after 10 years. Moreover, women in the former category exhibit a disproportionately large increase in the share of housework they perform after becoming mothers. The latter results suggest that the presence of children pushes women to seek to compensate breaking a norm by adhering to another one. |
| Keywords: | gender identity norms, female labor supply, children, relative income |
| JEL: | D10 J16 J22 |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:aim:wpaimx:2424 |
| By: | Görg, Holger; Jäkel, Ina Charlotte |
| Abstract: | In this paper, we investigate whether gender norms and institutions act as a constraint to the performance of female businesses. We exploit novel and unique micro data on start-ups in Denmark, which we combine with information on individual-level characteristics of the entrepreneur as main decision maker of the firm. We overcome the challenge of disentangling norms and institutional biases against women from other constraints and hurdles that female businesses might face by exploiting detailed trade data. In this trade context, we study the relative performance of firms across markets with varying institutions, while controlling for other factors that affect female businesses uniformly across all markets. We provide evidence that gender inequality and institutional biases against women in trade partner countries play an important role in explaining gender differences in export and import behaviour. We also perform an event study of a concrete policy change in a destination market - the introduction of quotas for the share of females on the boards of directors in Norway - and how it has affected the gender gap in trade participation. |
| Keywords: | Gender Inequality, Firm Internationalization, Start-up Performance |
| JEL: | F14 J16 M13 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:ifwkwp:302556 |
| By: | Paul H\"unermund; Ann Hipp |
| Abstract: | This study examines the inter-organizational and spatial mobility patterns of East German inventors following the fall of the Berlin Wall. Existing research often overlooks the role of informal institutions in the mobility decisions of inventors, particularly regarding access to and transfer of knowledge. To address this gap, we investigate the unique circumstances surrounding the dissolution of the German Democratic Republic, which caused a significant shock to establishment closures and prompted many inventors to change their jobs and locations. Our sample comprises over 25, 000 East German inventors, whose patenting careers in reunified Germany post-1990 are traced using a novel disambiguation and matching procedure. Our findings reveal that East German inventors in technological fields where access to Western knowledge was facilitated by industrial espionage were more likely to pursue inter-organizational mobility and continue their inventive activities in reunified Germany. Additionally, inventors from communities with strong political support for the ruling socialist party encountered difficulties in sourcing knowledge through weak ties, resulting in a lower likelihood of continuing to patent. However, those who overcame these obstacles and continued to produce inventions were more likely to relocate to West Germany, leaving their original social contexts behind. |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2409.01861 |
| By: | Jose, Anu |
| Abstract: | How do income shocks affect intra-household expenditure patterns in agricultural economies? Using rainfall data and household panel data, with responses from both spouses, from rural Ethiopia, we show that a negative household level income shock significantly reduces female expenditures relative to male expenditures (31.4% greater reduction). We specifically explore the channel of female and male labour supply as an explanation behind the observed differentiated impacts on spousal consumption. We find evidence that engaging in off-farm employment provides women with an independent income and allows them to smooth their expenditures during farm income shock. We also find evidence that the wife’s involvement in managing and controlling the household farm, measured as her time spent on the farm relative to the husband, negates the shock-induced gender differential in expenditures. Together, these results highlight gender-specific impacts of household income shocks on consumption and the role female economic opportunities play in negating intra-household impacts of such household shocks. |
| Keywords: | Income shocks, gender, intrahousehold allocation, labour supply, Ethiopia |
| JEL: | D13 J16 J22 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:121873 |
| By: | Bharti Nandwani (Indira Gandhi Institute of Development Research); Punarjit Roychowdhury (Shiv Nadar University) |
| Abstract: | The paper examines whether granting property inheritance rights to females improves their participation in politics as election candidates in India. Conservative gender norms in patriarchal societies like India discourage women from actively participating in politics, with socially enforced sanctions for non-compliance. Additionally, being politically active is costly, requiring significant contributions of time and resources. Improvement in property rights is likely to financially empower women, easing both the constraints. Using state-level variation in legal changes to women's property rights and employing a large administrative data on elections in India, we show that better property rights for women lead to an increase in women contesting for elections and likelihood of winning for women candidates. We also document that regional parties contest more female candidates and there is increased entry of new female candidates after the reform. Further, using a large household survey data, we provide evidence that the increased political participation is driven by improved financial autonomy of women after the inheritance reforms. We confirm that pre-existing trends are not confounding our results. |
| Keywords: | Gender, India, Female Political Participation, Property Rights |
| JEL: | J16 D72 K11 O12 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:ind:igiwpp:2024-012 |
| By: | Carlotta Nani (Geneva Graduate Institute) |
| Abstract: | Is it possible to improve women's agency by providing information about their abilities? Using a lab experiment in the field, I study how perceived abilities and gender stereotypes shape intra-household dynamics. I use an incentivized decision-making game with 525 married couples from 42 rural villages in Bangladesh to investigate whether women are discriminated against because they are perceived to be less skilled than their husband, and whether it is possible to reduce this gender bias within households. During the game, I provide information on women's abilities and I observe how beliefs and decisions change. The empirical analysis shows that the less capable women are perceived compared to men, the less they are involved in decisionmaking. After the information treatment, husbands with the lowest regard for their wife's skills are 20 percent more likely to make allocations in her favour. The treatment has a larger impact on younger couples, on men with stronger control preferences and on risk-averse women. This brings further evidence of the inability of spouses to observe each other's skills. Two weeks after the experiment, women in treated couples report being more involved in household decisions. These results suggest that gender discrimination within households has a statistical component that can be corrected by increasing skills' observability. |
| Keywords: | Bangladesh, field experiment, gender discrimination, intra-household dynamics |
| JEL: | D82 D83 D91 J12 J16 |
| Date: | 2024–09–12 |
| URL: | https://d.repec.org/n?u=RePEc:gii:giihei:heidwp19-2024 |
| By: | William Kratochwill (PhD Student, University of Coimbra, Faculty of Economics); Paulino Teixeira (University of Coimbra, CeBER, Faculty of Economics, and IZA Bonn) |
| Abstract: | This study examines the wage curve in Brazil, considering the unique characteristics of the country’s labor market, marked by significant regional and socioeconomic disparities. Using a robust econometric model with fixed effects and control for endogeneity, the analysis covers both the standard wage curve and an extended version that includes additional labor force underutilization measures, such as time-related underemployment (TRU) and potential labor force (PLF). The results indicate that a 10% increase in the unemployment rate (UR) results in a reduction of approximately 0.4% in wages. The wage elasticity is higher for male and young workers, while workers with a college degree show no wage sensitivity with respect to the unemployment rate. Interestingly, model estimation with regional versus group-specific labor underutilization reveals no cross effects of women’s UR on men’s wages, for example. However, there are cross-effects when the PLF and TRU variables are included in the model, as the estimated differences between the two models are statistically significant. Within this comparative exercise, cohorts of workers from low-density areas have their wages affected by labor underutilization observed in high-density areas. Our results also show significant differences for workers in either rural or non-metropolitan areas, while the converse is not true, that is, the wage elasticity in urban or metropolitan areas depend exclusively on the labor underutilization rate observed in the corresponding area, without any significant cross effects from the rural or non-metropolitan areas, respectively. Finally, there is no statistically significant difference between the model with group-specific versus the overall (regional) measure in the case of young workers. In other words, there is evidence that the salary of young workers is not affected by variations in the UR, PLF, and TRU of other age groups. |
| Keywords: | Wage curve, labor underutilization, econometric model, unemployment, time-related underemployment..; Wage curve, labor underutilization, econometric model, unemployment, time-related underemployment |
| JEL: | C23 C26 J21 J31 J64 |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:gmf:papers:2024-03 |
| By: | Miescu, Mirela (Lancaster University); Mumtaz, Haroon (Queen Mary University); Theodoridis, Konstantinos (Cardiff Business School) |
| Abstract: | This paper employs Threshold (T)VAR models to investigate the asymmetric impact of oil supply news shocks, analysing variations in both the size and direction of the shocks. Our findings reveal that large and adverse oil shocks exert a stronger effect on real activity, labour market indicators, and risk variables compared to small and favourable shocks. Interestingly, we observe no asymmetry in the response of prices and monetary policy to oil shocks of different magnitudes and signs. Using a theoretical nonlinear model and predictive prior analysis, we demonstrate that search and matching labour frictions cause the risk of becoming unemployed to increase after an oil shock. This rise in unemployment risk triggers strong precautionary savings motives, which increase with the size of the shock, leading to asymmetric responses in real economic and labour market variables, whereas price indicators and the policy rate do not exhibit such nonlinearities consistently with the empirical findings. |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:cdf:wpaper:2024/18 |
| By: | Albrecht, James (Georgetown University); Cai, Xiaoming (Peking University); Gautier, Pieter A. (Vrije Universiteit Amsterdam); Vroman, Susan (Georgetown University) |
| Abstract: | This paper considers competitive search equilibrium in a market for a good whose quality differs across sellers. Each seller knows the quality of the good that he or she is offering for sale, but buyers cannot observe quality directly. We thus have a "market for lemons" with competitive search frictions. In contrast to Akerlof (1970), we prove the existence of a unique equilibrium, which is separating. Higher-quality sellers post higher prices, so price signals quality. The arrival rate of buyers is lower in submarkets with higher prices, but this is less costly for higher-quality sellers given their higher continuation values. For some parameter values, higher-quality sellers post the full-information price; for other values these sellers have to post a higher price to keep lower-quality sellers from mimicking them. In an extension, we show that if sellers compete with auctions, the reserve price can also act as a signal. |
| Keywords: | competitive search, signaling |
| JEL: | C78 D82 D83 |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17246 |
| By: | Ardila Brenoe, Anne (University of Zürich); Eyibak, Zeynep (University of Zürich); Heursen, Lea (Humboldt- Universität zu Berlin); Ranehill, Eva (Department of Economics, School of Business, Economics and Law, Göteborg University); Weber, Roberto A (University of Zürich) |
| Abstract: | Economic research on gender gaps in preferences and economic outcomes has focused on variation with respect to sex—abinary classification as either a “man” or “woman.” We validate a novel and simple measure of self-reported continuous gender identity (CGI) and explore whether gender identity correlates with variation in economic decisions and outcomes beyond the relationship with binary sex.We use four datasets (N=8, 073) measuring various dimensions of economic preferences and educational and labor market outcomes for which prior research has documented gaps between men and women. Our analysis rejects the null hypothesis that CGI has no relationship with behaviors and preferences beyond the relationship with binary sex, particularly for men, and suggests that incorporating self-reported measures of gender identity may have value for understanding gender gaps and for targeting policy. However, when considering specific domains, the relationships vary in statistical significance and are often small. |
| Keywords: | Gender identity; non-binary gender; economic preferences; economic outcomes |
| JEL: | C91 J16 J20 |
| Date: | 2024–09–05 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:gunwpe:0845 |
| By: | Muñoz, Ercio |
| Abstract: | This paper estimates intergenerational mobility in education using data from 91 censuses in 24 countries in Latin America and the Caribbean spanning over half a century. It measures upward mobility as the likelihood that individuals will complete one educational stage more than their parents (primary education for those whose parents did not finish primary school, or secondary education for those whose parents did not complete secondary school). It measures downward mobility as the likelihood that an individual will fail to complete a level of education (primary or secondary) that their parents did attain. In addition, the paper explores the geography of educational intergenerational mobility using nearly 400 “provinces” and more than 6, 000 “districts, ” finding substantial cross-country and within-country heterogeneity. It documents a decline in the mobility gap between urban and rural populations and small differences by gender. It also finds that upward mobility is increasing and downward mobility is decreasing over time. Within countries, the level of mobility correlates closely to the share of the preceding generation that completed primary school. In addition, upward mobility is negatively correlated with distance to the capital and the share of the workforce employed in agriculture, but is positively correlated with the share of the workforce employed in industry. The opposite is true of downward mobility. |
| Keywords: | Socioeconomic mobility;Education;Latin America and the Caribbean |
| JEL: | D63 I24 J62 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:idb:brikps:13623 |
| By: | Steven Brakman; Tristan Kohl; Charles van Marewijk; Charles van Marrewijk |
| Abstract: | The availability and composition of labor is fundamental for the structure of international trade. This points towards the importance of demographic transitions that affect trade through, for example, changing capital-labor ratios, urbanization dynamics, or changes in the composition of demand over the life cycle of individuals. Key in this respect is the so-called demographic dividend, which is the potential economic growth stemming from lower dependency ratios. We use the gravity model to link long-run changes of the demographic dividend to changes in the level of world trade for the 21st century. All the scenarios that we distinguish point towards the same conclusion: Compared to the current situation, North America and Europe will no longer be the center of global trade in 2100 due to their aging populations. In contrast, South Asia and Sub-Saharan Africa will experience a substantial increase in their share of world trade throughout the remainder of this century, while the impact of the demographic drag facing China will be most pronounced around 2060. |
| Keywords: | demographic transition, trade, income, gravity model |
| JEL: | F10 J11 O11 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11262 |
| By: | Pagel, Jeffrey; Sileci, Lorenzo |
| Abstract: | One potential nature-based solution to jointly address poverty and environmental concerns is large-scale tree planting. This study examines the National Greening Program (NGP) in the Philippines, a major tree planting initiative involving 80, 522 localized projects that directly or indirectly generated hundreds of thousands of jobs. Utilizing a dynamic difference-in-differences approach that leverages the staggered implementation of the NGP, we find a significant and sizable reduction in poverty, measured via traditional and remotely sensed indicators. The NGP also spurred structural shifts, notably decreasing agricultural employment while boosting unskilled labor and service sector jobs. Our analysis estimates that the NGP sequestered 71.4 to 303 MtCO2 over a decade, achieving a cost efficiency of $2 to $10 per averted tCO2. These findings underscore the potential of tree planting as a dual-purpose strategy for climate mitigation and poverty alleviation. |
| JEL: | R14 J01 N0 J1 |
| Date: | 2024–08–01 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:125259 |
| By: | António Afonso; M. Carmen Blanco-Arana |
| Abstract: | The gender pay gap and the gender gap in employment remains persistent in Europe despite the basic assertion of gender equality under EU law. We assess the factors that influence the gender pay gap and gender employment gap across European countries. Therefore, we use an unbalanced panel of 31 European countries over the period 2000-2022, and estimate a system generalized method of moment model (GMM). The main conclusions confirm that tertiary education significantly reduces gender pay gap and part-time and temporary contracts significantly increase this gap. Moreover, part-time reduces significantly gender employment gap. Gross Domestic Product (GDP) per capita does not affect these gaps and the Global Financial Crisis (GFC) saw a narrowing of the gender pay and employment gaps in European countries. The results are robust when using a fixed effects (FE) model. |
| Keywords: | Gender Pay Gap; Gender Employment Gap; Secondary Education; Tertiary Education; Part-time; Temporary Work; GMM; European countries |
| JEL: | J0 J16 C23 |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:ise:remwps:wp03382024 |