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on Labor Markets - Supply, Demand, and Wages |
| By: | Sangmin Aum; Sang Yoon (Tim) Lee; Yongseok Shin |
| Abstract: | Aggregate productivity growth in the U.S. has slowed down since the 2000s. We quantify the importance of differential productivity growth across occupations and across industries, and the rise of computers since the 1980s, for the productivity slowdown. Complementarity across occupations and industries in production shrinks the relative size of those with high productivity growth, reducing their contributions toward aggregate productivity growth, resulting in its slowdown. We find that such a force, especially the shrinkage of occupations with above-average productivity growth through “routinization,” was present since the 1980s. Through the end of the 1990s, this force was countervailed by the extraordinarily high productivity growth in the computer industry, of which output became an increasingly more important input in all industries (“computerization”). It was only when the computer industry's productivity growth slowed down in the 2000s that the negative effect of routinization on aggregate productivity became apparent. We also show that the decline in the labor income share can be attributed to computerization, which substitutes labor across all industries. |
| JEL: | E01 E22 E25 O41 O47 |
| Date: | 2018–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24357&r=lma |
| By: | Glenda Quintini |
| Abstract: | This study focuses on the risk of automation and its interaction with training and the use of skills at work. Building on the expert assessment carried out by Carl Frey and Michael Osborne in 2013, the paper estimates the risk of automation for individual jobs based on the Survey of Adult Skills (PIAAC). The analysis improves on other international estimates of the individual risk of automation by using a more disaggregated occupational classification and identifying the same automation bottlenecks emerging from the experts’ discussion. Hence, it more closely aligns to the initial assessment of the potential automation deriving from the development of Machine Learning. Furthermore, this study investigates the same methodology using national data from Germany and United Kingdom, providing insights into the robustness of the results. The risk of automation is estimated for the 32 OECD countries that have participated in the Survey of Adult Skills (PIAAC) so far. Beyond the share of jobs likely to be significantly disrupted by automation of production and services, the accent is put on characteristics of these jobs and the characteristics of the workers who hold them. The risk is also assessed against the use of ICT at work and the role of training in helping workers transit to new career opportunities. |
| JEL: | J20 J21 J23 J24 |
| Date: | 2018–03–08 |
| URL: | http://d.repec.org/n?u=RePEc:oec:elsaab:202-en&r=lma |
| By: | Joshua S. Graff Zivin; Elizabeth Lyons |
| Abstract: | Existing theories and empirical research on how innovation occurs largely assume that innovativeness is an inherent characteristic of the individual and that people with this innate ability select into jobs that require it. In this paper, we investigate whether people who do not self-select into being innovators can be induced to innovate, and whether they innovate differently than those who do self-select into innovating. To test these questions, we designed and implemented an innovation contest for engineering and computer science students which allowed us to differentiate between those who self-select into innovative activities and those who are willing to undertake them only after receiving an additional incentive for doing so. We also randomly offer encouragement to subsets of both the induced and self-selected contest participants in order to examine the importance of confidence-building interventions on each sample. We find that while induced participants have different observable characteristics than those that were ‘innately’ drawn to the competition, on average, the success of induced participants was statistically indistinguishable from their self-selected counterparts and encouragement does not change this result. Heterogeneity in treatment effects suggests an important role for the use of targeted interventions. |
| JEL: | J24 M54 O32 |
| Date: | 2018–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24339&r=lma |
| By: | Bhalotra, S.;; Karlsson, M.;; Nilsson, T.;; Schwarz, N.; |
| Abstract: | We estimate impacts of exposure to an infant health intervention trialled in Sweden in the early 1930s using purposively digitised birth registers linked to school catalogues, census files and tax records to generate longitudinal data that track individuals through four stages of the life-course, from birth to age 71. This allows us to measure impacts on childhood health and cognitive skills at ages 7 and 10, educational choice during young adulthood, employment, earnings and occupation at age 36-40, and pension income at age 71. Leveraging quasi-random variation in eligibility by birth date and birth parish, we estimate that exposure was associated with substantial increases in earnings and (public sector) employment among women, alongside no improvements for men. This appears to be related to the intervention having made it more likely that primary school test scores for girls were in the top quintile of the distribution and, related, that they attended secondary school. The greater investments of women in education are consistent with their comparative advantage in cognitive tasks, but opportunities are also likely to have played a role. Our sample cohorts were exposed to a massive expansion of the Swedish welfare state, which created unprecedented employment opportunities for women. |
| Keywords: | Infant health; early life interventions; cognitive skills; education; earnings; occupational choice; programme evaluation; Sweden; |
| JEL: | I15 I18 H41 |
| Date: | 2018–03 |
| URL: | http://d.repec.org/n?u=RePEc:yor:hectdg:18/06&r=lma |
| By: | Thomas Ferreira (Department of Economics, Stellenbosch University) |
| Abstract: | Malawi is a low-income country where the majority of the poor live and work in smallholder agriculture. In settings like these, schooling is believed to be a valuable tool in lifting people out of poverty. Yet, little is known about how schooling affects agricultural productivity. The effect of education on smallholder agricultural production has been estimated before but this paper contributes to the literature by estimating, for the first time, the causal effects of education on agricultural productivity using an instrumental variable approach (IV). The introduction of free primary education (FPE) and the age of paternal orphanhood are used as IV's for education. The instruments are shown to calculate local average treatment effects for individuals who only entered school due to FPE and only left school due to paternal orphanhood. It is found that there are large differences in returns to education between the subgroups. Returns are low and insignificant when FPE is used as an IV but they are larger and there is a significant effect when age of paternal orphanhood is used. Thus, while education can have large effects on agricultural productivity, this is not so for individuals specifically targeted by large scale expansions in educational access. |
| Keywords: | Returns to education; agricultural productivity; Instrumental variables; Malawi |
| JEL: | J24 J43 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:sza:wpaper:wpapers298&r=lma |
| By: | Mariacristina De Nardi; Giulio Fella; Gonzalo Paz Pardo |
| Abstract: | Earnings dynamics are much richer than typically assumed in macro models with heterogenous agents. This holds for individual-pre-tax and household-post-tax earnings and across administrative (Social Security Administration) and survey (Panel Study of Income Dynamics) data. We study the implications of two household-post-tax earnings processes in a standard life-cycle model: the canonical earnings process (that includes a persistent and a transitory shock) and a rich earnings dynamics process (that allows for age-dependence of moments, non-normality, and nonlinearity in previous earnings and age). Allowing for richer earnings dynamics implies a substantially better fit of the evolution of the cross-sectional consumption inequality over the life cycle and of the individual-level degree of consumption insurance against persistent earnings shocks. Richer earnings dynamics also imply lower welfare costs of earnings risk, but, as the canonical earnings process, do not generate enough concentration at the upper tail of the wealth distribution. |
| JEL: | E21 H21 J3 |
| Date: | 2018–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24326&r=lma |
| By: | Luca Paolo Merlino (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, Universiteit Antwerpen [Antwerpen]); Dario Pozzoli (CBS - Copenhagen Business School [Copenhagen]); Pierpaolo Parrotta (BETA - Bureau d'Economie Théorique et Appliquée - INRA - Institut National de la Recherche Agronomique - UNISTRA - Université de Strasbourg - UL - Université de Lorraine - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | In this paper, we investigate gender differences in workers' career development within and outside the firm to explain the existence of gender wage gaps. Using Danish employer-employee matched data, we find that good female workers are more likely to move to better firms than men but are less likely to be promoted. Furthermore, these differences in career advancement widen after the first child is born. Our findings suggest that career impediments in certain firms cause the most productive female workers to seek better jobs in firms where there is less gender bias. |
| Keywords: | Sorting,Assortative Matching,Gender Gap |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:hal-01687343&r=lma |
| By: | Emily Breza; Cynthia Kinnan |
| Abstract: | In October 2010, the state government of Andhra Pradesh, India issued an emergency ordinance, bringing microfinance activities in the state to a complete halt and causing a nation-wide shock to the liquidity of lenders, especially those with loans in the affected state. We use this massive dislocation in the microfinance market to identify the causal impacts of a reduction in credit supply on consumption, earnings, and employment in general equilibrium. Using a proprietary, hand-collected district-level data set from 25 separate, for-profit microlenders matched with household data from the National Sample Survey, we find that district-level reductions in credit supply are associated with significant decreases in casual daily wages, household wage earnings and consumption. We also find that wages in the non-tradable sector fall more than in the tradable sector (agriculture), suggesting that one important impact of the microfinance contraction was transmitted through its effect on aggregate demand. We present a simple two period, two-sector model of the rural economy illustrating this channel and show that our wage results are consistent with a simple calibration of the model. |
| JEL: | D50 G21 O16 |
| Date: | 2018–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24329&r=lma |