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on Labour Economics |
| By: | Schmieder, Julia; Weichselbaumer, Doris (University of Linz); Welteke, Clara (Bundesministerium der Finanzen); Wrohlich, Katharina (DIW Berlin) |
| Abstract: | Promoting fathers to take parental leave is seen as a promising way to advance gender equality. However, there is still a very limited understanding of its impact on fathers' labor market outcomes. We conducted a correspondence study to analyze whether fathers who take parental leave face discrimination during the hiring process in three different occupations. Fathers who took parental leave in a female-dominated or gender-neutral occupation are not less likely to be invited to a job interview compared to fathers who did not take leave. However, in the male-dominated occupation, fathers who have taken long parental leave are penalized. Regardless of leave-taking, fathers are treated less favorably than mothers in the female-dominated and the gender-neutral occupation, while the opposite is true for the male-dominated occupation. This suggests the presence of strong gender norms concerning the perception of ideal employees in different occupations. |
| Keywords: | discrimination, parental leave, gender, hiring, experiment |
| JEL: | C93 J13 J71 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17451 |
| By: | Gould, Eric D. (Hebrew University, Jerusalem); Lichtinger, Guy (Harvard University) |
| Abstract: | This paper analyzes how the "child penalty" associated with career interruptions for women after becoming a mother is influenced by preferences absorbed during childhood, and how the child penalty, in turn, is related to the quantity and quality (education) of her own children. Using linked administrative data on Israeli parents and children, the analysis shows that mothers who grew up in larger and more traditional families marry men from larger families, and together they have more children. Growing up with more siblings is also associated with a larger child penalty for a mother in earnings and employment, as well as in terms of commuting less and moving to "mother friendly" firms at the expense of higher wage firms. The results also indicate that the child penalty produces two opposing effects on child human capital – a negative impact due to the loss of parental income, and a positive influence of increased maternal time away from work. Overall, the evidence suggests that the family preferences and norms absorbed during childhood significantly influence a woman's choices of spouse, fertility, and child penalty later in life – but with little overall impact on her children's high school achievements. |
| Keywords: | child penalties, child outcomes, family culture |
| JEL: | J12 J13 J16 J22 J24 J31 J62 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17455 |
| By: | Eichhorst, Werner (IZA); Krause-Pilatus, Annabelle (IZA); Dolls, Mathias (Ifo Institute for Economic Research); Lay, Max (Ifo Institute for Economic Research) |
| Abstract: | This paper studies the crisis resilience of European welfare states. We analyse the capacity of social policy arrangements to contain poverty and inequality and avoid exclusion before, during and after periods of economic shocks. To achieve this goal, the paper takes a broad perspective to include different layers of protective arrangements, notably upstream systems such as unemployment insurance (UI), job retention and employment protection that are complemented by minimum income support (MIS) schemes. Together, these multiple layers play a crucial role in providing income and job protection in situations of crisis. In that respect we also distinguish systematically between regular/permanent policies (automatic stabilisers) and discretionary, typically temporary crisis response measures. We use a mixed-method approach that combines quantitative and qualitative research, such as descriptive and multivariate quantitative analyses and microsimulation methods based on EUROMOD. This is combined with in-depth case studies covering a sample of five countries that represent different welfare state types (Nordic, Continental, Mediterranean, Liberal and Central/East European) so that we can show the complex mechanisms of multi-layered protection at work and how the policies in place have evolved over time in response to crisis episodes, disentangling the role of automatic stabilisers and discretionary elements. Our observation period ranges from the mid-2000s to the early 2020s and allows us to cover both the Great Recession of 2008/09 and its aftermath as well as the Covid-19 pandemic. We find consistent differences in terms of crisis resilience across countries and welfare state types. In general, Nordic and Continental European welfare states with strong upstream systems and minimum income support show better outcomes in core socio-economic outcomes such as poverty and exclusion risks. However, labour market integration shows some dualisms in Continental Europe. The study shows that minimum income support holds particular importance if there are gaps in upstream systems or cases of severe and lasting crises. |
| Keywords: | minimum income support, crisis resilience, unemployment insurance, job retention, welfare states |
| JEL: | J65 J68 I38 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17463 |
| By: | Borovickova, Katarina (Federal Reserve Bank of Richmond); Shimer, Robert (University of Chicago) |
| Abstract: | We develop a random search model with two-sided heterogeneity and match-specific productivity shocks to explain why high-productivity workers tend to work at high-productivity firms despite low-productivity workers gaining about as much from such matches. Our model has two key predictions: i) the average log wage that a worker receives is increasing in the worker's and employer's productivity, with low-productivity workers gaining proportionally more at high-productivity firms and ii) there is assortative matching between a worker's productivity and that of her employer. Selective job acceptance drives these patterns. All workers are equally likely to meet all firms, but workers have higher surplus from meeting firms of similar productivity. The high surplus meetings result in matches more frequently, generating assortative matching. Only the subset of meetings that result in matches are observed in administrative wage data, shaping wages. We show that our findings are quantitatively consistent with recent empirical results. Moreover, we prove this selection is not detected using standard empirical approaches, highlighting the importance of theory-guided empirical work. Our results imply that encouraging high-wage firms to hire low-wage workers may be less effective at reducing wage inequality than wage patterns suggest. |
| JEL: | J31 J64 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17454 |
| By: | Carol H. Shiue; Wolfgang Keller |
| Abstract: | This paper documents persistence in the power of elite families in Central China despite dynastic change. We study the impact of the fall of the Ming Dynasty (1368-1644) on couples and their descendants (treatment of people), and present evidence on the response of multigenerational family lines to a big shock. Local Ming elites suffered a decline in influence in the short run, but in the long-run their descendants recovered and tightened their grip on power in their role as the elites of the new Qing Dynasty (1644-1911). In contrast to the recovery of family lines, the fall of Ming had a more persistently negative impact on the regions that historically were most strongly negatively affected by the shock (treatment of regions). The paper suggests that the elite reversal is due to trauma caused by Ming destruction that shifted norms towards the most socially respectable career paths based on the civil service exam; these norms were, to a greater degree, intergenerationally transmitted in family lines that suffered more from the destruction in the fall of the Ming dynasty. |
| JEL: | N35 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33121 |
| By: | RAMACHANDRA, VARUN KAREKURVE |
| Abstract: | This paper uses the staggered implementation of gender quota policy in India to understand whether women who won office due to quotas go on to win higher-level office. Indian local government elections impose mandatory gender quotas, but state elections do not. This provides a setting to assess if there is an increase in women's representation at higher levels of governance due to quotas at the local level. The identification strategy allows me to ascribe an increase of three percentage points in the share of women at the state-level to gender quotas in local government. Additionally, to establish upward political mobility of local-level leaders I tracked political biographies of over 1000 women legislators across India's 15 major state assemblies. In doing so, I identify that political dynasties, and ground-level leadership --- those who entered politics due to mandatory gender quotas --- are the two primary channels that enable entry of women into state-level politics. Further, I show that the effect of democratic entry of women into politics via quotas is pronounced in states with parties that are reliant on empowered rank and file members. Overall, these results highlight the importance of gender quotas as a democratic state-building tool and provide evidence for career advancement of women in politics whose democratic entry into politics was facilitated by the implementation of mandatory gender quotas. |
| Date: | 2024–11–22 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:4zqve |
| By: | Gromadzki, Jan (Vienna University of Economics and Business) |
| Abstract: | I study fertility adjustments after the introduction of a large universal child benefit in Poland. The program caused a six percent increase in the number of births. Patterns of selection into parenthood changed significantly and persistently, with a weakening of positive selection based on education and a strengthening of negative selection based on income. The share of births in the bottom half of the income distribution increased from 51 percent to 58 percent. Using a microsimulation approach, I combine changes in the births structure with existing estimates of the transfer's effect on labor supply to study the impact of these adjustments on poverty reduction. These impacts are very small due to the exceptional generosity of the transfer, but they become more pronounced in the middle of the income distribution. |
| Keywords: | fertility, child benefit, unconditional cash transfer, poverty |
| JEL: | J13 H31 I38 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17456 |
| By: | Aaberge, Rolf (Statistics Norway); Modalsli, Jorgen Heibo (Oslo Metropolitan University); Francesconi, Marco (University of Essex); Vestad, Ola L. (Statistics Norway) |
| Abstract: | This paper presents estimates of income concentration and inequality for Norway using a new comprehensive measure of income, which identifies business income as it is earned by companies rather than when it is paid out as dividends to owners. We assemble several sources of high quality register data that allow us to account for multiple layers of business ownership across all companies between 2001 and 2018. Compared to official statistics, the new measure implies that the share of income attributable to the top 1% of the distribution more than doubles and the Gini coefficient estimates increase by about 40%. Our new measure identifies substantial tax regressivity for individuals in the top percentile, a feature that cannot be detected by standard income measures. For instance, while the share of gross income paid in taxes by individuals at the 99th percentile is about 36% in 2016, the corresponding share paid by individuals in the top 1% is 19%. |
| Keywords: | income distribution, top income shares, Gini coefficient, dividends, retained earnings, tax burden |
| JEL: | D31 D63 E01 H24 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17458 |
| By: | Usman, Sehrish |
| Abstract: | Who thrives when alimony payments change? Restrictions on spousal alimony influence intra-family economic decisions by altering bargaining positions and raising concerns about post-divorce financial instability. Existing findings on restricted regimes are contradictory and need more clarity on the differential impact across heterogeneous households. This paper explores behavioural adaptations in labour supply and saving decisions of intact married partners in response to amendments in alimony reform in Germany. Using a difference-in-difference framework and longitudinal and retrospective datasets, I show that policy led to increased labour market participation of married women. However, behavioural responses vary significantly depending on the age cohort, family composition, duration of relationship, and income levels. |
| Keywords: | Household Economics, Spousal bargaining, Intra-family Decisions, Saving, Labor Supply, Policy Reform |
| JEL: | D13 D14 J12 J18 J22 |
| Date: | 2024–11–13 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:122675 |
| By: | Gayani Rathnayake; Akanksha Negi; Otavio Bartalotti; Xueyan Zhao |
| Abstract: | Endogenous treatment and sample selection are two concomitant sources of endogeneity that challenge the validity of causal inference. In this paper, we focus on the partial identification of treatment effects within a standard two-period difference-in-differences framework when the outcome is observed for an endogenously selected subpopulation. The identification strategy embeds Lee's (2009) bounding approach based on principal stratification, which divides the population into latent subgroups based on selection behaviour in counterfactual treatment states in both periods. We establish identification results for four latent types and illustrate the proposed approach by applying it to estimate 1) the effect of a job training program on earnings and 2) the effect of a working-from-home policy on employee performance. |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2411.09221 |
| By: | RUSSO Margherita; SIMONAZZI Annamaria; CETRULO Armanda |
| Abstract: | This study investigates the impact of technological upgrades and automation, on employment and working conditions in the automotive, sector in Romania, Spain and Germany. Utilising qualitative research methods, the study examines work organisation, job quality, and occupational composition from a gender perspective. The findings of the study exploring the impact of technology, identified main drivers for automation implementation as increased productivity, quality, and reduced manual labour availability. Automation and robotisation have also increased flexibility to cope with the variable composition of final products and the traceability of production processes. Barriers include high costs, technical difficulties, and the need for worker training. It observed that automation can simplify tasks, create new jobs, and increase responsibilities in middle management and team/shift leaders, while potentially reducing worker autonomy and increasing work pace. Positive job quality implications include ergonomics and improved operators' safety. Automation has reduced the number of line operators, while increased maintenance workers, quality control, logistics and indirect labour. The study observed vertical and horizontal gender segregation in hybrid production processes, with advancements towards horizontal gender equality in technologically advanced establishments. Addressing cultural attitudes and technical challenges is crucial for equitable benefits, as both industries currently undergo a transitional phase. |
| Date: | 2024–10 |
| URL: | https://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc136545 |
| By: | Gideon Bornstein; Alessandra Peter |
| Abstract: | This paper studies the effect of nonlinear pricing on markups and misallocation. We develop a general equilibrium model of firms that are allowed to set a quantity-dependent pricing schedule—contrary to the typical assumption in macroeconomic models. Without the restriction to linear pricing, markup heterogeneity is no longer a sign of misallocation. Larger firms charge higher markups, yet the allocation of resources across firms is efficient. Further, we point to a new source of misallocation. In general equilibrium, high-taste consumers are allocated too much of each good, low-taste consumers too little. When labor supply is elastic, firms’ market power depresses aggregate labor, but this effect is independent of the level of the aggregate markup in the economy. Using micro data from the retail sector, we show that nonlinear pricing is prevalent and quantify the model. We find that the welfare losses from misallocation across consumers under nonlinear pricing are substantially larger than those from misallocation across firms under linear pricing. |
| JEL: | D4 E2 L1 O4 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33144 |
| By: | Nicolas Cabra-Ruiz; Sandra V. Rozo; Maria Micaela Sviatschi |
| Abstract: | How does forced displacement shape development in origin countries? We examine the case of Venezuela, where over seven million people have been forcibly displaced. Our study compares municipalities with different proportions of foreign-born populations before and after the international oil price shocks that accelerated forced displacement between 2014 and 2019. Our findings show that municipalities with higher foreign-born populations in 1990, exhibiting greater out-migration from Venezuela after 2014, experienced lower economic development and higher inequality. We shed light on a novel mechanism: forced displacement facilitates the perpetuation of autocratic leaders, further hindering development. It does so by weakening the opposition’s voices and facilitating the expansion of organized crime and illicit sources of income. |
| JEL: | O10 P0 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33131 |
| By: | Stephen J. Redding |
| Abstract: | This paper reviews recent quantitative urban models. These models are sufficiently rich to capture observed features of the data, such as many asymmetric locations and a rich geography of the transport network. Yet these models remain sufficiently tractable as to permit an analytical characterization of their theoretical properties. With only a small number of structural parameters (elasticities) to be estimated, they lend themselves to transparent identification. As they rationalize the observed spatial distribution of economic activity within cities, they can be used to undertake counterfactuals for the impact of empirically-realistic public-policy interventions on this observed distribution. Empirical applications include estimating the strength of agglomeration economies and evaluating the impact of transport infrastructure improvements (e.g., railroads, roads, Rapid Bus Transit Systems), zoning and land use regulations, place-based policies, and new technologies such as remote working. |
| JEL: | R32 R41 R52 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33130 |
| By: | Rainer Kotschy; David E. Bloom; Andrew J. Scott |
| Abstract: | Analysis of population aging is typically framed in terms of chronological age. However, chronological age itself is not necessarily deeply informative about the aging process. This paper reviews literature and conducts empirical analyses aimed at investigating whether chronological age is a reliable proxy for physiological functioning when used in models of economic behavior and outcomes. We show that chronological age is an unreliable proxy for physiological functioning due to appreciable differences in how aging unfolds across people, health domains, and over time. We further demonstrate that chronological age either fails to predict economic variables when used in lieu of physiological functioning, or that it predicts additional effects on economic behavior and outcomes that are largely unrelated to physiological aging. Continued reliance on chronological age as a proxy for physiological functioning might impede the ability of societies to fully harness the benefits of increasing longevity. |
| JEL: | I10 I30 J10 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33124 |
| By: | Banda, Mutisunge Allan |
| Abstract: | Just as human age is a key determinant of individual economic productivity, a population’s age structure is a significant causal factor of economic productivity and growth. This paper attempts to update the traditional theories of economic growth by incorporating demographic transition theory and intergenerational transfers into long run economic growth. Whereas contemporary theory interprets the demographic dividend as a transitory and uncertain exogenous stimulant to economic growth, this paper will attempt to demonstrate that age structure is instead a persistent and endogenous determinant of economic productivity. In addition, the paper will argue that a significant portion of modern and ancient economic divergence can be explained by variations in age structure. These findings will have important implications for policymakers and researchers interested economic development. |
| Keywords: | Demographic Economics; Economic Growth; Economic Theory; Macroeconomics; Quantitative Methods |
| JEL: | E0 J1 O47 |
| Date: | 2024–11–18 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:122725 |