nep-lma New Economics Papers
on Labor Markets - Supply, Demand, and Wages
Issue of 2012‒10‒20
ten papers chosen by
Erik Jonasson
Lund University

  1. Wage Growth and Job Mobility in the Early Career: Testing a Statistical Discrimination Model of the Gender Wage Gap By Belley, Philippe; Havet, Nathalie; Lacroix, Guy
  2. Minimum Wages and Female Labor Supply in Germany By Bredemeier, Christian; Juessen, Falko
  3. Consumption Inequality and Family Labor Supply By Blundell, Richard; Pistaferri, Luigi; Saporta-Eksten, Itay
  4. Union Membership does not pay: Evidence from recent French Micro Data By Mathieu Bunel; Gilles Reveaud
  5. Do Firms Demand Temporary Workers When They Face Workload Fluctuation? Cross-Country Firm-Level Evidence on the Conditioning Effect of Employment Protection By Dräger, Vanessa; Marx, Paul
  6. The Labor-Market Returns to Community College Degrees, Diplomas, and Certificates By Jepsen, Christopher; Troske, Kenneth; Coomes, Paul A.
  7. Offshoring, Wages and Job Security of Temporary Workers By Görg, Holger; Görlich, Dennis
  8. Between privilege and burden: Work past retirement age in Germany and the UK By Scherger, Simone; Hagemann, Steffen; Hokema, Anna; Lux, Thomas
  9. The Human Capital (Schooling) of Immigrants in America By Smith, James P.
  10. Sick Leaves: Understanding Disparities Between French Departments By Mohamed Ali Ben Halima; Thierry Debrand; Camille Regaert

  1. By: Belley, Philippe (Kansas State University); Havet, Nathalie (CNRS, GATE); Lacroix, Guy (Université Laval)
    Abstract: The paper focuses on the early career patterns of young male and female workers. It investigates potential dynamic links between statistical discrimination, mobility, tenure and wage profiles. The model assumes that it is more costly for an employer to assess female workers' productivity and that the noise/signal ratio tapers off more rapidly for male workers. These two assumptions yield numerous theoretical predictions pertaining to gender wage gaps. These predictions are tested using data from the 1979 cohort of the National Longitudinal Survey of Youth. As predicted by our statistical discrimination model, we find that men and women have the same wage at the start of their career, but that female wages grow at a slower rate, creating a gender wage gap. Also consistent with our model, we find that mean wages are higher for workers who keep their job, while wage growth is stronger for workers who change job.
    Keywords: gender wage gap, job transitions, tenure, returns to mobility, experience
    JEL: J16 J71 J41
    Date: 2012–10
  2. By: Bredemeier, Christian (TU Dortmund); Juessen, Falko (TU Dortmund)
    Abstract: In Germany, there is a vivid political debate on introducing a general statutory minimum wage. In this paper, we study the effects of minimum wages on labor supply using a structural household model where we distinguish between married and single households. In the model, labor supply of married women reacts positively and relatively strongly to minimum wages which we model as a wage subsidy as proposed in the German political debate. By contrast, other population subgroups show ambiguous reactions. An empirical analysis for Germany shows that minimum wages would affect total labor supply only weakly. Yet, in our baseline experiments, average labor supply of married women increases by 3-5%, whereas hours supplied by married female recipients of the minimum wage may increase by up to 28%. Further, we find that costs of a subsidized minimum wage increase sharply in its level while its effects on labor supply level out.
    Keywords: minimum wage, wage subsidies, labor supply, gender
    JEL: J22 J16 J38
    Date: 2012–10
  3. By: Blundell, Richard (University College London); Pistaferri, Luigi (Stanford University); Saporta-Eksten, Itay (Stanford University)
    Abstract: In this paper we examine the link between wage inequality and consumption inequality using a life cycle model that incorporates household consumption and family labor supply decisions. We derive analytical expressions based on approximations for the dynamics of consumption, hours, and earnings of two earners in the presence of correlated wage shocks, non-separability and asset accumulation decisions. We show how the model can be estimated and identified using panel data for hours, earnings, assets and consumption. We focus on the importance of family labour supply as an insurance mechanism to wage shocks and find strong evidence of smoothing of male's and female's permanent shocks to wages. Once family labor supply, assets and taxes are properly accounted for, there is little evidence of additional insurance.
    Keywords: consumption, labor supply, earnings, inequality
    JEL: J22
    Date: 2012–10
  4. By: Mathieu Bunel (University of Caen Basse-Normandie - CREM UMR CNRS 6211, France); Gilles Reveaud (Institut d’Etudes Européennes, Université Paris 8 Saint-Denis)
    Abstract: We used a French employer–employee representative survey to estimate, within private firms covered by union contracts, the union member wage premium. Our estimates are based on several methods: ordinary least squares with averaged individual characteristics at the workplace level, the propensity score and separated equations. We found no wage penalty for free riders, except for blue collar and office workers. But even for these workers, the estimated wage premium is very small. Globally, in France, union membership does not seem to be motivated by monetary raisons. This situation could explain the low level of union membership observed.
    Keywords: Union wage premium, union membership, employer-employee data, propensity score method, separated equations method
    JEL: J31 J71
    Date: 2012–09
  5. By: Dräger, Vanessa (IZA); Marx, Paul (University of Southern Denmark)
    Abstract: Although the negative economic effects of temporary employment are widely discussed, cross-country research on firms’ demand for temporary employment is rare. National studies indicate that workload fluctuations are one major motive for firms to employ temporary workers. By studying a novel data set of 18,500 firms from 20 countries, we show that workload fluctuations increase the probability of hiring temporary workers by eight percentage points in rigid labour markets, but no such effect is observed in flexible labour markets. This conditioning effect of employment protection is in line with a recently developed search-and-matching model. Our results are robust to subgroups, subsamples and alternative estimation strategies.
    Keywords: temporary employment, employment protection, labour demand, firm-level data
    JEL: J23 J28 J21 J63 J68 J82
    Date: 2012–10
  6. By: Jepsen, Christopher (University College Dublin); Troske, Kenneth (University of Kentucky); Coomes, Paul A. (University of Louisville)
    Abstract: This paper provides among the first rigorous estimates of the labor-market returns to community college certificates and diplomas, as well as estimating the returns to the more commonly-studied associate's degrees. Using administrative data from Kentucky, we estimate panel-data models that control for differences among students in pre-college earnings and educational aspirations. Associate's degrees and diplomas have quarterly earnings returns of nearly $2,400 for women and $1,500 for men, compared with much smaller returns for certificates. There is substantial heterogeneity in returns across fields of study. Degrees, diplomas, and – for women – certificates correspond with higher levels of employment.
    Keywords: returns to school, community college, diploma, certificate
    JEL: J24
    Date: 2012–10
  7. By: Görg, Holger (Kiel Institute for the World Economy); Görlich, Dennis (Kiel Institute for the World Economy)
    Abstract: We investigate the impact of offshoring on individual level wages and unemployment probabilities and pay particular attention to the question of whether workers on temporary contracts are affected differently than workers on permanent contracts. Data are taken from the German Socio-Economic Panel (SOEP), linked with industry-level data on offshoring of materials and services inputs calculated from the World Input Output Database (WIOD). In manufacturing we find that temporary workers face a significant reduction in wages as materials offshoring increases, while permanent workers' wages are unaffected or even tend to increase. Offshoring of core activities generally also tends to reduce the probability of becoming unemployed, and more so for temporary than for permanent workers. By contrast, offshoring of services inputs does not have any statistically significant effects on either wages or employment probabilities in manufacturing. In the service industries, workers are affected in terms of employment probabilities from offshoring of services inputs only, although, in contrast to manufacturing industries, there are no statistically significant effects on individual wages from any type of offshoring.
    Keywords: offshoring, temporary work, job security, wages
    JEL: J31 F14
    Date: 2012–10
  8. By: Scherger, Simone; Hagemann, Steffen; Hokema, Anna; Lux, Thomas
    Abstract: The paper investigates paid work beyond retirement age in Germany and the UK. This comprises a combination of work, payments from a pension (or several pensions) and old age which is counter to the assumed finality of retirement and the corresponding standardised passage from end of work into retirement and receipt of a pension. Paid work beyond retirement has not only become more frequent in the last decade, but is also part of heated policy debates on pension reform. The paper first gives a comprehensive literature review, presenting empirical results, conceptual differentiations and theoretical approaches to post-retirement work from previous studies. A heuristic model summarises the most important individual and structural influences on post-retirement work. Thereafter, the most important features of the pension systems and labour markets in Germany and in the UK are outlined. In terms of institutional settings, the countries represent opposing cases whose comparison helps to better understand the institutional factors shaping employment beyond retirement age. In the second half of the paper, data from the German Ageing Survey (DEAS) and the English Longitudinal Study of Ageing (ELSA) serve to empirically describe paid work beyond retirement age. In addition to the demographic and regional distribution of postretirement work, particular attention is paid to the socio-economic status of people working past retirement, in comparison to those who do not work. Other important areas studied are non-paid activities of post-retirement workers, their health and living arrangements as well as their life satisfaction and subjective reasons for employment. On the one hand, the results of the empirical description confirm the privileged situation of many post-retirement workers who, for example, tend to be more highly educated and have better health than their non-working counterparts. On the other hand, some post-retirement workers work for financial reasons and in the low-paid service sector. There are some indications that the latter group, who experience post-retirement work more often as a burden, or at least in a more ambivalent way, is larger in the UK than in Germany, mainly for institutional and structural reasons. -- Dieses Arbeitspapier beschäftigt sich mit Erwerbsarbeit jenseits der Rentengrenze in Deutschland und Großbritannien. Mit Erwerbsarbeit jenseits der Rentengrenze ist eine Kombination von bezahlter Arbeit, Rentenzahlungen und Alter gemeint, die im Kontrast steht zur Endgültigkeit des Ruhestands und dem entsprechenden standardisierten Übergang aus der Erwerbsarbeit in den Ruhestand und zum Empfang von Rentenzahlungen. Erwerbsarbeit jenseits der Rentengrenze ist in den letzten zehn Jahren nicht nur häufiger geworden; sie wird auch intensiv debattiert, etwa im Rahmen von Diskussionen zu Rentenreformen. Das Arbeitspapier gibt zunächst einen umfassenden Literaturüberblick, der bisherige empirische Ergebnisse, konzeptuelle Differenzierungen und theoretische Annäherungen an Erwerbsarbeit jenseits der Rentengrenze einschließt. Ein heuristisches Modell fasst die wichtigsten individuellen und strukturellen Einflüsse auf Arbeit jenseits der Rentengrenze zusammen. Anschließend werden sowohl die Rentensysteme als auch die Arbeitsmarktstrukturen Deutschlands und Großbritanniens in groben Zügen beschrieben. Was den institutionellen Rahmen angeht, repräsentieren die beiden Länder zwei gegensätzliche Fälle, deren Vergleich dazu beiträgt, die institutionellen Faktoren zu verstehen, welche Erwerbsarbeit jenseits der Rentengrenze prägen. In der zweiten Hälfte des Arbeitspapiers werden Daten des Deutschen Alters-Surveys (DEAS) und der English Longitudinal Study of Ageing dazu genutzt, Erwerbsarbeit jenseits der Rentengrenze empirisch zu beschreiben. Über die soziodemographischen Charakteristika von erwerbstätigen Rentnern und die regionale Verteilung dieser Form von Arbeit hinaus wird dem sozio-ökonomischem Status erwerbstätiger Rentner im Vergleich zu anderen Rentnern besondere Aufmerksamkeit gewidmet. Außerdem werden unbezahlte Aktivitäten erwerbstätiger Rentner, ihre Gesundheit und Lebensformen sowie ihre Lebenszufriedenheit und die subjektiven Gründe für ihre Arbeit beschrieben. Einerseits bestätigen die Ergebnisse der Beschreibung die eher privilegierte Situation erwerbstätiger Rentner, die beispielsweise eine bessere Bildung aufweisen und gesünder sind als nicht-erwerbstätige Rentner. Andererseits gibt es erwerbstätige Rentner, die aus finanziellen Gründen und im schlechtbezahlten Dienstleistungssektor arbeiten. Einiges deutet darauf hin, dass die letztgenannte Gruppe, die ihre Arbeit häufiger als eine Bürde oder zumindest ambivalent erlebt, in Großbritannien größer ist als in Deutschland, und zwar vor allem aus institutionellen und strukturellen Gründen.
    Date: 2012
  9. By: Smith, James P. (RAND)
    Abstract: This paper deals with several salient issues about immigrants to the United States and their education. These issues include a comparison of the schooling accomplishments of immigrants and the native-born that emphasizes the considerable diversity in the schooling accomplishments among different immigrant sub-groups and between legal and undocumented migrants. I also examine the role of the foreign-born who come to the United States for post-secondary schooling. Finally, I show that the educational generational progress among all groups of immigrants to the United States has been quite impressive during the 19th and 20th centuries.
    Keywords: immigration, education
    JEL: I20 I23 I28 J10 J15 J61
    Date: 2012–10
  10. By: Mohamed Ali Ben Halima (IRDES Institute for research and information in health economics); Thierry Debrand (IRDES Institute for research and information in health economics); Camille Regaert (IRDES Institute for research and information in health economics)
    Abstract: The purpose of this publication is to better understand disparities between the proportions of sick leaves granted among various departments in France. The Hygie database was used for this study. It was created by merging a number of administrative files of employees in the private sector in France in 2005. This database allows for the determination of «employer/employee» relations, the impact of the characteristics of firms on the health of their employees and the interactions between health and work. After briefly reviewing the various determinants for the effect of composition and the effect of context, as well as sick leaves and their importance for understanding geographic differences, we present a three-phase empirical analysis: a descriptive analysis to detect differences between departments, a multivariate analysis to highlight explanatory factors of probability of being on sick leave and, finally, an analysis of determinants of differences between departments. Our different models explain a significant portion of the disparities between departments. The effects of composition and effects of context account for approximately two-thirds of the mean squared error. The variables describing the medical supply (density of general practitioners), monitoring by National Health Insurance and patient age when the professional career began best explain the disparities between departments concerning sick leave. In contrast to other compositions or contexts included in our model, the percentage of sick leaves verified and the density of general practitioners are important factors with respect to health policies. Our research shows that they could be used as public policy instruments aimed at reducing geographic disparities.
    Keywords: Sick leave, Geographic disparities, Effect of context, Effect of composition, Absenteeism.
    JEL: I18 J21 J29 C25
    Date: 2012–10

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