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on Labour Economics |
| By: | Claudia Goldin |
| Abstract: | Fertility levels have greatly decreased in virtually every nation in the world, but the timing of the decline has differed even among developed countries. In Europe, Asia, and North America, total fertility rates of some nations dipped below the magic replacement figure of 2.1 as early as the 1970s. But in other nations, fertility rates remained substantial until the 1990s but plummeted subsequently. This paper addresses why some countries in Europe and Asia with moderate fertility levels in 1980s, have become the “lowest-low” nations today (total fertility rates of less than 1.3), whereas those that decreased earlier have not. Also addressed is why the crossover point for the two groups of nations was around the 1980s and 1990s. An important factor that distinguishes the two groups is their economic growth in the 1960s and 1970s. Countries with “lowest low” fertility rates today experienced rapid growth in GNP per capita after a long period of stagnation or decline. They were catapulted into modernity, but the beliefs, values, and traditions of their citizens changed more slowly. Thus, swift economic change may lead to both generational and gendered conflicts that result in a rapid decrease in the total fertility rate. |
| JEL: | J11 J13 J16 N30 |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33311 |
| By: | Hall, Caroline (d Uppsala Center for Labor Studies (UCLS)); Lindahl, Erica (IFAU - Institute for Evaluation of Labour Market and Education Policy); Roman, Sara (IFAU - Institute for Evaluation of Labour Market and Education Policy) |
| Abstract: | We study the effects of access to a child home care allowance on parents’ labor supply and childcare decisions, as well as their longer-term earnings trajectories and children’s school performance. To establish causality, we exploit variation in the availability of the allowance over time and across municipalities. The analysis is based on rich administrative data for the entiren Swedish population. Our results suggest a negative impact of benefit eligibility on mothers’ labor supply and earnings as well as on children’s enrollment in childcare during the time the family is entitled to the benefit (until the child turns 3 years old). Negative impacts on mothers’ earnings persist after benefit eligibility has expired and are still visible 7 years after childbirth. These effects are driven by mothers who lacked earnings before childbirth, while there are no lasting impacts for mothers with prior employment. We find no effects on fathers’ earnings. As for the children, our results suggest that access to the home care allowance had a negative impact on boys’ scores on standardized tests at age 10, while there are no significant effects on girls’ test scores. |
| Keywords: | Home care allowance; labor supply; earnings; childcare; preschool; school performance |
| JEL: | J13 J18 J24 |
| Date: | 2024–12–06 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:ifauwp:2024_023 |
| By: | Marianna Brunetti (CEIS & DEF, University of Rome "Tor Vergata"); Annalisa Fabretti (DEF, University of Rome "Tor Vergata"); Mariangela Zoli (CEIS & DEF, University of Rome "Tor Vergata") |
| Abstract: | This paper investigates the gender gap in academic promotions. The theoretical model proposed, in which men and women collectively negotiate their career upgrades but with different bargaining power, predicts that the likelihood of career progression for women depends negatively on the share of female scholars among the eligible candidates and positively on the available resources and women’s bargaining power. We relate the latter to metrics of women’s relative representation, such as the Glass-Ceiling Index, the Female Ratio, and the Share of Females in the boards in charge of deciding about those promotions. Leveraging a novel and suitably built dataset covering the universe of Italian Universities’ Departments, we find robust evidence supporting these predictions. In particular, the probability of women being upgraded to associate and full professors is strongly and positively associated with the shares of women in the pool of professors in charge of deciding about those promotions. |
| Keywords: | gender gap, bargaining power, gender representation, career advancement, academia |
| JEL: | J16 J71 J53 D79 |
| Date: | 2024–12–20 |
| URL: | https://d.repec.org/n?u=RePEc:rtv:ceisrp:590 |
| By: | Angela Dalmonte; Tommaso Frattini; Sofia Giorgini |
| Abstract: | This paper explores the overeducation of tertiary-educated migrants in European labour markets. Using data from the European Labour Force Survey (2012-2022), we show that immigrants, particularly those from non-EU countries, are significantly more likely to be overeducated than natives. Despite a general decline in overeducation levels for all groups over time, the immigrant-native gap remains, especially for foreign-educated migrants. Furthermore, the likelihood of overeducation for foreign-educated migrants increases until 15-19 years after migration, a pattern consistent across all areas of origin and migration cohorts. Importantly, differences in educational quality between origin and destination countries do not primarily account for these overeducation differentials. The findings underscore the need for policies that better align immigrants' skills with labour market demands in Europe to avoid the waste of valuable immigrants' skills, which are harmful not only to migrants but to the economies of receiving countries too. |
| Keywords: | EU labour markets, immigration, Skill mismatch |
| JEL: | J15 J61 F22 |
| Date: | 2024–10–18 |
| URL: | https://d.repec.org/n?u=RePEc:csl:devewp:496 |
| By: | Katrina Borovickova; Robert Shimer |
| 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. |
| Keywords: | Assortative matching; labor market |
| Date: | 2024–11–14 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedrwp:99249 |
| By: | Chiara Puccioni (Research Department, Confindustria); Daniela Vuri (DEF & CEIS, University of Rome "Tor Vergata") |
| Abstract: | This study evaluates the impact of an Italian government initiative launched in 2007, which allocated e1 billion to regional governments to enhance early childhood care services for children aged 0-2, targeting both public and private childcare options. Exploiting variations in the timing of implementation across regions, we assess the program’s effectiveness in increasing the public provision of early childcare services and maternal labor market participation. Results show a significant increase in both public childcare slots and labor market participation among mothers. However, the initiative had limited effects on less-educated women, likely due to the service’s relatively high costs, which may hinder broader accessibility. |
| Keywords: | early childcare services; mothers’ labor supply; staggered difference-in-difference; dynamic estimates |
| JEL: | C21 C22 H52 H75 J13 J22 |
| Date: | 2024–12–19 |
| URL: | https://d.repec.org/n?u=RePEc:rtv:ceisrp:588 |
| By: | Grenet, Julien (Paris School of Economics and CNRS); Grönqvist, Hans (Department of Economics and Statistics); Hertegård, Edvin (SOFI, Stockholm University); Nybom, Martin (IFAU, Uppsala University); Stuhler, Jan (Department of Economics, Universidad Carlos III de Madrid) |
| Abstract: | We study how students adjust their early career choices in response to economic crises, and how this behavioral response affects their long-run labor market outcomes. We specifically examine the context of the severe recession that struck Sweden in the early 1990s, which disproportionally affected the manufacturing and construction sectors. We find that students who experienced paternal job loss in these heavily affected sectors were more likely to choose high school programs linked to sectors less impacted by the recession. These individuals achieved better labor market outcomes in adulthood, including higher employment rates and career earnings. Our findings are consistent with informational frictions being a key obstacle to structural change, and we identify career choice as an important mechanism through which recessions reshape labor markets in the very long run. |
| Keywords: | High School Major; Recession; Information Frictions; Structural Change |
| JEL: | E32 I25 J24 J63 |
| Date: | 2024–11–15 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:vxesta:2024_013 |
| By: | Alison Baulos (The University of Chicago Center for the Economics of Human Development); Jorge Luis Garcia (Texas A&M University); James J. Heckman (The University of Chicago) |
| Abstract: | The Perry Preschool Project, the longest-running experimental study of an early childhood education program, demonstrates how such interventions can yield long-term personal, societal, and intergenerational benefits for disadvantaged populations. The evidence is clear: investments in high-quality early childhood education and parental engagement can deliver returns even 50 years later. The program’s findings remain scientifically robust, particularly when analyzed through rigorous small-sample inference methods. The program’s findings also contradict common criticisms of preschool, as, when measured correctly, treatment effects on IQ do not fadeout. This paper draws insights from both the original founders and recent empirical studies, emphasizing the critical role of parental involvement in early education. The authors advocate for a scientific agenda focused on understanding the mechanisms behind treatment effects, rather than replicating specific programs. The analysis also underscores the broader implications of early childhood interventions for social mobility and human capital formation. Analysts of early childhood education should recognize that although credentials and formal curricula contribute to successful programs, the true measure of quality lies in adult-child interactions, which play an essential role. |
| Keywords: | Perry Preschool Project, early childhood education, long-term follow3-up study, intergenerational mobility |
| JEL: | I24 I32 J15 C53 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:hka:wpaper:2024-019 |
| By: | Italo Colantone (Bocconi University, Baffi Research Centre, GREEN Research Centre, CESifo and Fondazione Eni Enrico Mattei); Gianmarco I.P. Ottaviano (Bocconi University, Baffi Research Centre, CEP, CEPR and IGIER); Kohei Takeda (National University of Singapore and CEP) |
| Abstract: | This paper studies the impact of globalization on intergenerational income mobility. Exploiting U.S. data, we find that stronger trade exposure at the commuting zone level lowers the intergenerational income mobility of residents. In particular, higher exposure to Chinese import competition lowers the income mobility of the cohort of U.S. workers born in 1980-1982. We present a general equilibrium theory in which path dependence in sector choice of individuals over generations and mobility frictions determine the dynamics of industrial compositions across locations in a country. The theory predicts that rising import competition reduces intergenerational income mobility, consistent with the empirical findings. |
| Keywords: | Import competition, Distributional consequences, Intergenerational income mobility |
| JEL: | F1 F14 F16 |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:fem:femwpa:2024.29 |
| By: | Sophie Harnay (EconomiX (UMR 7235), UPL, Université Paris Nanterre, CNRS, 200 avenue de la République, 92001 Nanterre cedex, France); Fabienne Llense (EconomiX (UMR 7235), UPL, Université Paris Nanterre, CNRS, 200 avenue de la République, 92001 Nanterre cedex, France); Antoine Rebérioux (LADYSS (UMR 7533), Université Paris Cité, 8 place Paul Ricoeur, 75013 Paris, France); Gwenaël Roudaut (Département dâéconomie, Ecole Polytechnique, Route de Saclay, 91128 Palaiseau cedex, France) |
| Abstract: | In 2011, Britain and France introduced affirmative action policies aiming at improving board gender mix in listed companies. While the reforms were similar in terms of target and timing, Britain opted for a âsoft lawâ (comply or explain) approach, while France enacted a mandatory quota. Using difference-in-differences analyses, we examine the differential impact of these two reforms on board composition and on women empowerment within boards. We first show that the quota has been associated with a more rapid adjustment of the gender mix without significant disruptive effects on board composition. However, we report that the quota has induced a more limited access of women to monitoring committees within boards, relative to soft law. As these committees are the most influential, this evidence shows that the quota came at a cost when considering within-board womenâs influence. |
| Keywords: | company boards, gender inequalities, leadership positions, quota, soft law, board committees |
| JEL: | J16 J78 K22 G34 G38 |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:afd:wpaper:2408 |
| By: | Castro, Rui; Lange, Fabian; Poschke, Markus |
| Abstract: | Labor Force States and flows between are useful tools to model individual dynamics in the labor market. This chapter reviews recent literature uncovering substantial heterogeneity in transitions across Labor Force States. We review methods and results by replicating leading studies using Canadian data and relate our findings to important literatures on recall non-employment, duration dependence, and job ladders. |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:clefwp:306846 |
| By: | Richard V. Burkhauser; Kevin Corinth; Thomas O'Rourke; Angela K. Rachidi |
| Abstract: | Non-disabled, working age adults without children are required to work 20 hours per week in order to maintain eligibility for the Supplemental Nutrition Assistance Program. However, states may waive the work requirement for areas that meet conditions reflective of a weak labor market. We construct a dataset with the waiver status of each United States county for every month from 1997–2023 and evaluate waiver coverage, counter-cyclicality and targeting. Waiver coverage has grown over time and in December 2023, when the national unemployment rate was 3.5 percent, waivers covered 29 percent of the U.S. population. In terms of counter-cyclicality, a county’s probability of receiving a waiver increases by 3.1 percentage points for every one percentage point increase in its unemployment rate. In terms of targeting, counties with an unemployment rate below 5 percent received 25 percent of waivers in the average month from 1997–2023. We simulate the effects on waiver eligibility of counterfactual regulations finalized in 2019—but never implemented—by the U.S. Department of Agriculture. Altogether, the 2019 rule would have decreased waiver eligibility in all months, increased the responsiveness of waivers to county unemployment rates, and increased the share of waivers targeted to high unemployment counties. |
| JEL: | H53 I38 |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33316 |
| By: | Rozi Kumari (Guru Gobind Singh Indraprastha University); A. Ganesh Kumar (Indira Gandhi Institute of Development Research); Rajendra Vaidya (Indira Gandhi Institute of Development Research) |
| Abstract: | Despite impressive growth performance, empowering women and bridging gender gaps in entrepreneurship remains a key challenge for India. Given the crucial role of finance functioning of businesses, we investigate whether females face disproportionate barriers in seeking and receiving loans. Using nationally representative datasets from the World Banks's World Enterprise survey (WBES) data for 2014 and 2022, we analyse the role of manager's and owner's gender in the loan seeking behaviour and loan approval rate. On the demand side, we find that female managers are less likely to seek loans while female owners are more likely to seek loans. Particularly, female managed firms even with male owners are less likely to seek loans while male managed firms with female owners are more likely to apply for loan. On the supply side, we find that loans of female managed firms are less likely to be approved whereas female owned firms do not have significantly less chances of loan approval. Interestingly, the female owned firms with male managers do not face any significant chance of loan denial but male owned firms with female managers have higher and significant chances of loan denial. Female owned and female managed firms also have lower chances of loan approval. |
| Keywords: | Female, Entrepreneurship, Loans, Heckprobit, India, Discrimination |
| JEL: | J16 L26 G2 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:ind:igiwpp:2024-025 |
| By: | Grönqvist, Hans (Department of Economics and Statistics); Niknami, Susan (Stockholm University); Palme, Mårten (Stockholm University); Priks, Mikael (Stockholm University) |
| Abstract: | We estimate the causal effects of parental incarceration on children’s short- and long-run outcomes using administrative data from Sweden. Our empirical strategy exploits exogenous variation in parental incarceration from the random assignment of criminal defendants to judges with different incarceration tendencies. We find that the incarceration of a parent in childhood leads to a significant increase in teen criminal convictions, a decrease in high school graduation, and worse labor market outcomes in adulthood. The effects are concentrated among children from disadvantaged families, in particular families where the remaining non-convicted parent is disadvantaged. These results suggest that the incarceration of parents with young children may significantly increase the intergenerational persistence of poverty and criminal behavior in affluent countries with extensive social safety nets and progressive criminal justice systems. |
| Keywords: | incarceration; crime |
| JEL: | K42 |
| Date: | 2024–11–15 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:vxesta:2024_012 |
| By: | Mulubrhan Amare; Lucia Carrillo; Katrina Kosec; Jordan Kyle; |
| Abstract: | Using original survey data from three states in rural, southwestern Nigeria, this study examines the relationship between conflict intensity at various distances and the empowerment and aspiration levels of women whose households are primarily engaged in farming. We analyze geo-coded data on violent clashes between ethnic groups that primarily herd livestock for their livelihood and those that primarily farm crops; these clashes are growing more frequent across West Africa with climate-induced land degradation, as herding populations are moving further south in search of grazing land. Our outcomes of interest include women’s economic and social aspirations, and women’s economic, social, and political behaviors that could impact their long-run empowerment. We find that exposure to higher conflict intensity is closely linked to adverse outcomes, including income loss, assault, and forced migration. Higher conflict intensity is also associated with lower women’s economic and social aspirations, though social aspirations are more affected by proximate conflicts, while economic aspirations are more affected by more distant conflicts. Women’s economic, social, and political activities also vary with conflict-affectedness. With more conflict nearby, women are more likely to own their own off-farm businesses and less likely to own an off-farm business in which they share ownership with their husband. With more exposure to distant conflicts, women devote less time to off-farm labor and more time to agricultural labor. Near conflict, women are less likely to be members of mutual aid groups and to contact government officials and more likely to engage local security groups for protection and to be members of political parties. These differences could have long-run implications for women’s empowerment. |
| Keywords: | aspirations, farmer-herder conflict, gender, nigeria, women’s empowerment |
| JEL: | D13 D71 D74 J16 Q12 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:hic:wpaper:421 |
| By: | Munseob Lee; Claudia Macaluso; Felipe Schwartzman |
| Abstract: | Our paper addresses the heterogeneous effects of monetary policy on households of different races. The cyclical volatility of real income differs significantly for households of different races and income levels, reflecting differential exposure to fluctuations in employment and consumer prices. All Black households are disproportionately affected by employment fluctuations, whereas price volatility is only particularly pronounced for Black households with income above the national median. The latter face 40 percent higher price volatility than both poorer households of the same race and white households of similar income. To evaluate the effects of policy, we propose a New Keynesian framework with heterogeneous exposure to employment and price volatility. We find that an accommodative monetary stance generates asymmetric outcomes within race groups. Low-income households experience unemployment stabilization benefits, while high-income ones incur real income volatility costs. Differences are especially large among Black households. Reducing the volatility of unemployment by 1 percentage point engenders a 1.17 percentage point reduction in overall income volatility for poorer Black households, but an increase of 0.6 percentage points in income volatility for richer Black households. |
| Keywords: | inflation; monetary policy; Employment and labor markets; economic inequality |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedrwp:99275 |
| By: | Justin Bloesch (Cornell University) |
| Abstract: | This paper reviews evidence on the role of the labor market in driving inflation and analyzes the US labor market, and its contribution to inflation, during the COVID-19 pandemic and recovery. The author argues that the quits rate is a good measure of labor market tightness and is the best predictor of nominal wage growth. He further argues that wages largely pass through into prices, but other factors like sector-specific supply shocks are needed to explain the dynamics of price inflation. The COVID pandemic created large disruptions in the labor market, resulting in an increase in job openings and quits, high nominal wage growth, and temporary labor market mismatch. The shocks associated with COVID have subsequently faded, and nonlinearities in both the wage Phillips curve and Beveridge curve allowed for nominal wage growth to normalize without a large increase in unemployment. Lastly, the author argues that the relationship between wages and prices is mostly one-directional: Past price increases are not a major driver of wage gains. The period of high nominal wage growth in the recovery from COVID therefore reflected temporarily high labor demand as the economy quickly reopened, but not a classic wage-price spiral. |
| Keywords: | Labor Market Tightness, Inflation, Wage Growth |
| JEL: | J63 E31 E24 J31 |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:iie:wpaper:wp24-23 |
| By: | Michell Yoonjei Dong (Green Climate Fund); Hee-Seung Yang (Yonsei University) |
| Abstract: | This paper examines the impact of an earthquake in Indonesia on children’s school and work activities and how that relationship differs by access to credit. We find that the earthquake decreases educational attainment while increasing child labor and the effect is stronger for households with access to credit. Following the 2006 Yogyakarta earthquake, years of schooling for earthquake-affected children aged 7-14 decreased by 0.5 years, but the effect was stronger for those living close to a microfinance institution. Heterogeneity in treatment effects suggests that the opportunity cost of schooling increases as households with micro-loans open up businesses. Our finding indicates the complementary effect between credit and child labor and suggests the need for policies to increase educational investment when providing micro-loans to help households affected by shocks. |
| Keywords: | natural disaster, earthquake, education, child labor, microfinance, Indonesia |
| JEL: | I20 O12 J13 H81 |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:yon:wpaper:2024rwp-235 |
| By: | Sabrina Di Addario; Michela Giorcelli; Agata Maida |
| Abstract: | The share of female inventors remains significantly lower than that of men in both developed and developing countries. This paper studies gender bias in patenting activity, using a unique dataset that matches Italian administrative employer-employee records both to patent data from the European Patent Office (1987-2005) and to municipality-level information on medieval guilds from the Italian Central Archive of State. We empirically verify whether women's low propensity to patent can be explained by the historical local conception of women's role in society, which we measure with the share of women in guild founders from the Middle Ages. The results indicate that the presence of women in Medieval guilds is associated with a higher probability of observing a female inventor and a higher number of yearly patent submissions by women. |
| Keywords: | patents, women, inventors, guilds |
| JEL: | J60 |
| Date: | 2024–12–20 |
| URL: | https://d.repec.org/n?u=RePEc:csl:devewp:500 |