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on Labour Economics |
| By: | Aya Aboulhosn; Cevat Giray Aksoy; Berkay Ozcan |
| Abstract: | Debates about immigration’s role in addressing population aging typically concentrate on immigrant fertility rates. Moreover, standard projections account for migration’s impact on overall population growth while largely overlooking how immigration might affect native fertility. In contrast, we show that forced immigration influences native fertility as well. We investigate this relationship by examining the influx of refugees into Türkiye following the onset of the Syrian civil war in 2011. Using two complementary instrumental variable strategies, we find robust evidence that native fertility increases in response to forced migration. This result holds across three distinct datasets and is further supported by a corresponding rise in subjective fertility measures, such as the ideal number of children. Additionally, we explore four potential mechanisms and document significant heterogeneity in fertility responses among different native subgroups. Our findings suggest that factors related to the labor market and norm transmission may help explain the observed increase in native fertility. |
| Keywords: | forced migration, fertility, refugees, social interactions |
| JEL: | J13 R23 F22 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11683 |
| By: | Jeronimo Carballo; Richard K. Mansfield |
| Abstract: | This paper examines how the composition of firm exposure and competition among imperfectly substitutable workers mediate the earnings, welfare, and unemployment incidence of changes in the international trade environment. We merge LEHD job match records with firm-level import and export records from the LFTTD and use them to estimate a large-scale assignment model of the entire U.S. labor market. The model flexibly accommodates frictions from switching regions, industries, trade engagement status, and even particular employers. We construct firm-level estimates of the employment impact of China's WTO entry using exogenous tariff gap variation via four different channels, import and export competition and import and export access, and combine them with the model to evaluate the shock's worker-level incidence. Our results show that the firm composition of shock exposure does matter for medium-run worker-level earnings incidence, with workers at the highly exposed multinational manufacturing firms experiencing the largest shock-induced earnings losses. However, labor market competition causes the shock's impact to spread to seemingly unaffected sectors and trickle down the skill ladder, so that entry-level non-traded service workers and initially unemployed job-seekers account for a large share of earnings losses and particularly unemployment increases. |
| JEL: | F15 F16 F6 J23 J6 J62 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33481 |
| By: | Jorge Luis García |
| Abstract: | I investigate the intra-household labor and resource allocation consequences of an employment guarantee targeting rural households in India. The guarantee insures household earnings, replacing women as added workers and shutting down a motive for saving. Despite sizable program-job take-up, the guarantee decreases participation in other working activities, and, thus, the labor force participation of married women and total time worked by their husbands. The guarantee accounts for up to 30% of a recent countrywide decrease in rural female labor force participation. Though it increases household consumption, the guarantee reduces the command of household earnings by women, and, thereby, their well-being. |
| JEL: | I31 I32 J12 J13 O12 O15 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33494 |
| By: | Borowczyk-Martins, Daniel (Copenhagen Business School) |
| Abstract: | I produce novel evidence on worker reallocation across employers and between employment and nonemployment/unemployment for several European countries over the past two decades. I construct a dataset of monthly transition rates by developing a novel approach to measure them using cross-sectional data from the European Union Labor Force Survey. Transition rates exhibit similar cyclical patterns across countries, but their levels are persistently different. I compute an indicator of the pace of worker reallocation up the job ladder, and find that it varies substantially across countries, is pro-cyclical, and exhibits a systematic positive relationship with wage inflation. |
| Keywords: | labor market flows, job ladder, business cycles, wage inflation, Phillips curve |
| JEL: | E24 E32 J63 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17719 |
| By: | Borgbjerg, Anne Katrine (Aarhus University); Agerbo, Esben (Aarhus University); Datta Gupta, Nabanita (Aarhus University); Halliday, Timothy J. (University of Hawaii at Manoa) |
| Abstract: | We analyze administrative and genetic data from over 200, 000 Danes to study the effects of genetic risk for Alzheimer's Disease (AD) on labor market outcomes. Higher AD genetic risk increases dementia diagnoses and GP visits for both genders. Among women aged 45–65, it reduces labor participation and raises disability pension uptake, especially near retirement. These effects weaken for women with high polygenic scores for education. For men, AD genetic risk shows no employment impact. These gender differences align with evidence that AD genetic markers are more predictive in women. |
| Keywords: | Alzheimer's Disease, labor supply, genoeconomics |
| JEL: | I14 J14 J22 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17714 |
| By: | Bächli, Mirjam (University of Lausanne); Lalive, Rafael (University of Lausanne); Pellizzari, Michele (University of Geneva) |
| Abstract: | Searching for jobs is challenging, and online platforms now often offer tailored job recommendations. In a randomized controlled trial with over 1, 250 participants, we evaluate recommendations based on prior experience and based on skill profiles assessed at study enrolment, respectively. We find that on average both types of recommendations improve job finding rates. Profile-based recommendations are especially effective for individuals with limited experience and mismatch in the prior job, while experience-based recommendations may slower job finding for those with limited experience but a well-matched previous job. These findings highlight the need to align job search advice with jobseekers' skills. |
| Keywords: | occupation recommendations, online job search, jobseekers |
| JEL: | J24 J62 J64 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17713 |
| By: | Axel Gottfries; Gregor Jarosch |
| Abstract: | We model and analyze employer cartels that fix wages by committing to a wage ceiling. The setting is a frictional labor market with large employers that compete for workers via posted wages. Wage fixing reduces competition both inside and outside the cartel, leading to market-wide wage depression. Competition from outside employers disciplines the cartel and hence governs its wage impact and profitability. Consequently, wage-fixing schemes are more likely to emerge and remain stable when the labor market has slack, concentration is high, the span of control is small, product demand is elastic, and firms also collude in the product market. We describe a simple sufficient statistic to gauge the harm caused by a wage-fixing cartel. |
| JEL: | E0 J0 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33501 |
| By: | Albouy, David (University of Illinois); Faberman, Jason (Federal Reserve Bank of Chicago) |
| Abstract: | We examine sorting behavior across metropolitan areas by skill over individuals' life cycles. We show that high-skill workers disproportionately sort into high-amenity areas, but do so relatively early in life. Workers of all skill levels tend to move towards lower-amenity areas during their thirties and forties. Consequently, individuals' time use and expenditures on activities related to local amenities are U-shaped over the life cycle. This contrasts with well-documented life-cycle consumption profiles, which have an opposite inverted-U shape. We present evidence that the move towards lower-amenity (and lower-cost) metropolitan areas is driven by changes in the number of household children over the life cycle: individuals, particularly the college educated, tend to move towards lower-amenity areas after having their first child. We develop an equilibrium model of location choice, labor supply, and amenity consumption and introduce life-cycle changes in household composition that affect leisure preferences, consumption choices, and required home production time. Key to the model is a complementarity between leisure time spent going out and local amenities, which we estimate to be large and significant. Ignoring this complementarity and the distinction between types of leisure misses the dampening effect child rearing has on urban agglomeration. Since the value of local amenities is capitalized into housing prices, individuals will tend to move to lower-cost locations to avoid paying for amenities they are not consuming. |
| Keywords: | urban amenities, sorting, migration, life-cycle dynamics |
| JEL: | J30 J61 R23 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17723 |
| By: | Ginja, Rita (University of Bergen); Riise, Julie (University of Bergen); Willage, Barton (University of Delaware); Willén, Alexander (Norwegian School of Economics) |
| Abstract: | We estimate doctor value-added (VA) combining population-wide patient-doctor register data with exogenous variation in the assignment of patients to GPs. We find substantial variation in the quality of GPs as measured by patients' post-assignment mortality. Certain doctor characteristics and practice styles predict VA, but most of the variation in GP quality is driven by differences in GPs' unobserved ability. VA variation across GPs primarily reflects differences in GPs' ability to engage in prevention and assign the right procedure to the patient. Finally, patients are unable to identify who the high-quality doctors are, and patient-generated ratings are uncorrelated with GP VA. |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17726 |
| By: | Felipe Alves; Giovanni L. Violante |
| Abstract: | The current monetary policy framework of the Fed intends to be more ’inclusive’ by running the economy hot for longer during expansions. The logic of this strategy rests on Okun’s (1973) hypothesis that sustaining a ‘high-pressure economy’ persistently improves labor market outcomes of low-wage workers. To evaluate this conjecture, we develop a Heterogeneous Agent New Keynesian framework with a three-state frictional model of the labor market where low-skilled workers are more exposed to the business cycle and recessions have a long-lasting effect on their labor force participation and earnings, in line with the evidence. Under a canonical Inflation Targeting rule, the ZLB generates a deflationary bias and severely amplifies the persistent scars of recessions at the bottom of the wage distribution. The Lower-for-Longer strategy is an effective antidote to the ZLB-driven hysteresis and leads to notable earnings gains for low-wage workers and a reduction to overall earnings inequality. If pursued aggressively, however, the policy reverts the inflation bias from negative to positive. Since policymakers might prioritize differently inflation relative to inclusion, we conclude by quantifying the inflation-inclusion trade-off implied by various monetary policy rules. |
| JEL: | E10 E30 E5 J63 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33488 |
| By: | Bradford, William D. (University of Washington); Wang, Chunbei (Virginia Tech); Lofstrom, Magnus (Public Policy Institute of California); Verchot, Michael (University of Washington) |
| Abstract: | This study uses survey data on small business loans granted 2022 -2023 to explore racial disparities in the terms of loans to small firms. Similar data has not been available since the 2003 Survey of Small Business Finances (SSBF). We find that for Hispanic-, Asian American- and Black-owned firms, the interest rate paid was higher than for comparable white-owned firms, adjusting for risk factors determining interest rate on loans, including the firm's industry, financial attributes, owner traits, credit history and type of loan. We also find that while Black-owned firms pay higher interest rates in states with greater broad racial disparity, while it is not statistically significant for the other minority groups. We conducted robustness tests to verify the strength of these results. If our results are nationally representative of firms that borrowed during the period we observe, then collectively on average, Asian, Black-, and Hispanic-owned businesses annually pay $9.1 billion more in interest than white-owned firms of equivalent risk attributes. Another component of credit is collateral. We find that co-signatures from third parties are required more frequently for minority firms than is justified by our economic analysis. |
| Keywords: | entrepreneurship, self-employment, business ownership, racial disparity, minority, loan pricing |
| JEL: | D4 G2 J15 L26 M |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17730 |
| By: | Momi Dahan |
| Abstract: | This study reveals that, over the past six decades, development towns have improved their socio-economic status both in terms of absolute mobility (compared to their past position) and relative mobility (progressing at a faster rate than other Jewish cities and towns). Between 1961 and 2019, economic mobility was evident in the narrowing gap between development towns and non-development towns (NDT) across five key economic development indicators: population size, median age, education level, income per capita, and ranking on a socioeconomic index. Despite this progress, development towns remain, on average, below the median socio-economic ranking. The empirical analysis also provides measures of absolute and conditional convergence. It demonstrates that the change in socio-economic rankings between 1961 and 2019 was more significant in localities that were ranked lower in 1961. The degree of conditional convergence was even more substantial when differences in the characteristics of the localities were accounted for. This paper shows that the two standard measures of immobility and convergence which appear in two separate literatures are in fact interconnected, representing two sides of the same coin. I speculate that the reduction in socioeconomic inequality between development towns and NDT can be attributed to factors such as free universal public education, Israel's advanced healthcare system, and cultural diffusion resulting from interactions with the host population. |
| Keywords: | development towns, mobility, economic convergence |
| JEL: | J62 N95 R11 R58 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11685 |
| By: | David G. Blanchflower; Alex Bryson |
| Abstract: | We examine the age profile of subjective wellbeing and illbeing in nine Asian countries (Bangladesh, Hong Kong, India, Indonesia, Japan, Pakistan, Philippines, Singapore, Sri Lanka) and seven Middle Eastern countries (Iraq, Israel, Jordan, Turkey, Saudi Arabia, the UAE and Yemen). We find the relationship between age and reported wellbeing differs according to the way the survey is conducted. In the Gallup World Poll, where the data are collected by interviewers face-to-face or by telephone (computer-aided telephone interviews, or CATI) the young are the happiest and the results are the same across the two survey modes. We find the same result in CATI surveys in the Global Flourishing Survey (GFS) of 2022-2024 in 7 Asian and Middle Eastern (AME) countries. However, when the GFS survey is conducted on the web (computer-aided web interview, or CAWI) wellbeing is u-shaped in age, and is highest among the oldest respondents. If we turn to negative affect measures (loneliness, anxiety, depression, worry) these rise with age using CATI but fall with age using CAWI. We look for survey mode switching in the age coefficient across 40 outcomes. In general, the switch is confined to subjective wellbeing and illbeing metrics. Switching does not occur when respondents are asked about their physical health, bodily pain, unemployment status, drinking and smoking, or personality-related questions. It appears that the mode effect is largely confined to how individuals rate their subjective wellbeing and illbeing. The results are suggestive of social desirability response bias which leads young people to under-report socially undesirable affective states to interviewers. |
| JEL: | I31 J13 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33475 |
| By: | Premkumar, Deepak (Public Policy Institute of California); Lofstrom, Magnus (Public Policy Institute of California); Hayes, Joseph (Public Policy Institute of California); Martin, Brandon (Public Policy Institute of California); Cremin, Sean (Public Policy Institute of California) |
| Abstract: | Racial disparities within the criminal justice system continue to be a pressing issue in the U.S. In this paper, we analyze data for almost four million stops by California's fifteen largest law enforcement agencies in 2019, examining the extent to which people of color experience searches, enforcement, intrusiveness, and use of force differently from white people. Black Californians are more likely to be searched than white Californians, but searches of Black civilians reveal less contraband and evidence. Black people are overrepresented in stops not leading to enforcement as well as in stops leading to an arrest. While differences in location and context for the stop significantly contribute to racial disparities, notable inequities remain after accounting for such factors. These disparities are concentrated in traffic stops. A notable proportion of which lead to no enforcement or discovery—suggesting that gains in efficiency and equity are possible. Through a "veil of darkness" analysis, we find evidence that racial bias may be a contributing factor to disparities in traffic stops for Black and Latino drivers. These findings suggest that traffic stops for non-moving violations deserve consideration for alternative enforcement strategies. |
| Keywords: | policing, racial disparities, racial bias, stops, searches, enforcement |
| JEL: | J15 K42 K14 H41 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17729 |
| By: | Naufal, George S (Texas A&M University); Patterson, Bethany (Texas A&M University); Danser, Renee (Harvard Law School); Greiner, D. James (Harvard Law School) |
| Abstract: | This paper examines the impact of defense counsel at first appearance (CAFA) on criminal justice outcomes using randomized control trials in two Texas counties. The study evaluates the influence of CAFA on bond amounts, pretrial release, conditions, and post-magistration outcomes such as recidivism and failure to appear. Results show that while CAFA reduces bond amounts and influences bond types in one jurisdiction, its effects on pretrial release and recidivism are limited. These findings highlight jurisdictional differences and suggest that CAFA's impact may be more modest than previous studies indicate, underscoring the need for further research in this area. |
| Keywords: | first appearance, RCT, bail, pretrial release |
| JEL: | C93 J08 K4 K14 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17712 |