nep-lma New Economics Papers
on Labor Markets - Supply, Demand, and Wages
Issue of 2017‒04‒16
eight papers chosen by
Joseph Marchand
University of Alberta

  1. Working hours and productivity By Collewet, Marion; Sauermann, Jan
  2. The Selection and Causal Effects of Work Incentives on Labor Productivity: Evidence from a Two-Stage Randomized Controlled Trial in Malawi By Kim, Hyuncheol Bryant; Kim, Seonghoon; Kim, Thomas T.
  3. Are Conditional Cash Transfers Fulfilling Their Promise? Schooling, Learning, and Earnings After 10 Years By Barham, Tania; Macours, Karen; Maluccio, John
  4. Wage losses due to overqualification: The role of formal degrees and occupational skills By Kracke, Nancy; Reichelt, Malte; Vicari, Basha
  5. Performance Pay and Applicant Screening By Jirjahn, Uwe; Mohrenweiser, Jens
  6. The Employment Effects of Countercyclical Infrastructure Investments By Buchheim, Lukas; Watzinger, Martin
  7. The Dispersion of Bonus Payments within and between Firms By Grund, Christian; Hofmann, Tanja
  8. Back to Bentham, Should We? Large-Scale Comparison of Experienced versus Decision Utility By Akay, Alpaslan; Bargain, Olivier B.; Jara, H. Xavier

  1. By: Collewet, Marion (universite catholique de louvain); Sauermann, Jan (sofi, stockholm university)
    Abstract: This paper studies the link between working hours and productivity using daily information on working hours and performance of a sample of call centre agents. We exploit variation in the number of hours worked by the same employee across days and weeks due to central scheduling, enabling us to estimate the eect of working hours on productivity. We nd that as the number of hours worked increases, the average handling time for a call increases, meaning that agents become less productive. This result suggests that fatigue can play an important role, even in jobs with mostly part-time workers.
    Keywords: working hours, productivity, output, labour demand
    JEL: J23 J22 M12 M54
    Date: 2017
  2. By: Kim, Hyuncheol Bryant (Cornell University); Kim, Seonghoon (Singapore Management University); Kim, Thomas T. (Yonsei University)
    Abstract: Incentives are essential to promote labor productivity. We implemented a two-stage field experiment to measure effects of career and wage incentives on productivity through self-selection and causal effect channels. First, workers were hired with either career or wage incentives. After employment, a random half of workers with career incentives received wage incentives and a random half of workers with wage incentives received career incentives. We find that career incentives attract higher-performing workers than wage incentives but do not increase productivity for existing workers. Instead, wage incentives increase productivity for existing workers. Observable characteristics are limited in explaining the selection effect.
    Keywords: career incentive, wage incentive, internship, self-selection, labor productivity
    JEL: J30 O15 M52
    Date: 2017–03
  3. By: Barham, Tania; Macours, Karen; Maluccio, John
    Abstract: Interventions aimed at improving the nutrition, health, and education of young children are often motivated by their potential to break the intergenerational transmission of poverty. A prominent example, conditional cash transfers (CCTs), has become the anti-poverty program of choice in many developing countries. Evidence is inconclusive as to whether the demonstrated short-term gains translate into the longer-term educational and labor market benefits needed to fully justify them. This paper uses the randomized phase-in of a 3-year CCT program in Nicaragua to estimate long-term effects. We estimate these effects using experimental variation, complemented by two alternative non-experimental identification strategies. We focus on boys aged 9-12 years at the start of the program who, due to the program's eligibility criteria and prior school dropout patterns, were more likely to have been exposed to the program in the early treatment than in the late treatment group. Previously demonstrated short-term increases in schooling are sustained after 10 years, and there are substantial gains in learning. These improvements in human capital coincide with positive labor market returns - the young men are more likely to engage in wage work, migrate temporarily for better paying jobs, and have higher earnings. In Nicaragua, schooling and learning gains hence translate into earning gains for these young men, implying important long-term returns to CCT programs.
    Keywords: CCT; education; labor markets; learning; long-term effects
    JEL: I25 I28 I38 O12
    Date: 2017–03
  4. By: Kracke, Nancy (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Reichelt, Malte (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]); Vicari, Basha (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])
    Abstract: "Wage penalties in overqualified employment are well documented, but little is known regarding the underlying mechanisms. We test two explanations, namely, formal overqualification and a mismatch of occupational skills. By using the National Educational Panel Study (NEPS) survey that is linked to German administrative data, we can objectively measure both types of mismatches. By using fixed-effects models, we confirm that overqualification is associated with a wage loss of approximately 5 percent, which indicates penalties from a lower requirement level. We find that some of this wage loss can be explained by a mismatch of skills between the current and training occupation. Further analyses show that mismatches of occupational skills explain the wage loss of the formal overqualification of employees with vocational training. For academics, both types of mismatch are unrelated. We conclude that because of occupational boundaries and more specific occupational skills, the people who are overqualified with vocational training more often work in jobs with lower and different skill requirements." (Author's abstract, IAB-Doku) ((en))
    JEL: I21 I26 J24 J31
    Date: 2017–04–04
  5. By: Jirjahn, Uwe (University of Trier); Mohrenweiser, Jens (Bournemouth University)
    Abstract: Using German establishment data, we show that the relationship between intensity of performance pay and intensity of applicant screening depends on the nature of production. In establishments with increased multitasking, performance pay is positively associated with applicant screening. By contrast, in establishments without increased multitasking, performance pay is negatively associated with applicant screening. The findings fit the hypothesis that performance pay induces a positive self-sorting of employees if jobs are less multifaceted. In this case, employers with a high intensity of performance pay do not need intensive applicant screening to ensure a high quality of matches between workers and jobs. However, if jobs are more multifaceted, performance pay can entail problems of adverse self-sorting. In order to mitigate or overcome these problems, employers making intensive use of performance pay also screen applicants more intensively.
    Keywords: performance pay, multitasking, self-sorting, applicant screening, non-managerial employees, managerial employees
    JEL: J33 J60 M51 M52
    Date: 2017–03
  6. By: Buchheim, Lukas; Watzinger, Martin
    Abstract: We estimate the causal impact of a sizable German infrastructure investment program on employment at the county level. The program focused on improving the energy efficiency of school buildings, making it possible to use the number of schools as an instrument for investments. We find that the program was effective, creating one job for one year for each €25’000 of investments. The employment gains reached their peak after nine months and dropped to zero quickly after the program’s completion. The reductions in unemployment amounted to two-thirds of the job creation, and employment grew predominately in the construction and non-tradable industries
    Keywords: Infrastructure Investments; Job Creation; Employment Dynamics; Countercyclical Fiscal Policy
    JEL: E24 E62 H72 J23
    Date: 2017–02
  7. By: Grund, Christian (RWTH Aachen University); Hofmann, Tanja (RWTH Aachen University)
    Abstract: We explore the dispersion of bonus payments of managers within and between five large firms from the German chemical sector. We use data from a yearly salary survey in these firms during the observation period 2008 to 2013. Bonus payments account for 20 percent of base salaries on average. Both the amount and the dispersion of bonus-to-base ratios differ across firms. We disentangle the dispersion between and within the levels of firms' hierarchies. Revealed differences are consistent with differences in firms' value statements.
    Keywords: bonus payments, bonus to base rate, firm differences, pay policies, wage dispersion
    JEL: J31 J33 M52
    Date: 2017–03
  8. By: Akay, Alpaslan; Bargain, Olivier B.; Jara, H. Xavier
    Abstract: Subjective well-being (SWB) data is increasingly used to perform welfare analyses. In- terpreted as 'experienced utility', SWB has recently been compared to 'decision utility' using specific experiments, most often based on stated preferences. Results point to an overall congruence between these two types of welfare measures. We question whether these findings hold in the more general framework of non-experimental and large-scale data, i.e. the setting commonly used for policy analysis. For individuals in the British household panel, we compare the ordinal preferences either "revealed" from their labor supply decisions or elicited from their reported SWB. The results show striking similari- ties on average, reflecting the fact that a majority of individuals made decisions that are consistent with SWB maximization. Di¤erences between the two welfare measures arise for particular subgroups, lending themselves to intuitive explanations that we illustrate for specific factors (health and labor market constraints, 'focusing illusion', aspirations).
    Keywords: decision utility,experienced utility,labor supply,subjective well-being
    JEL: C90 I31 J22
    Date: 2017

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