nep-lma New Economics Papers
on Labor Markets - Supply, Demand, and Wages
Issue of 2020‒05‒18
24 papers chosen by
Joseph Marchand
University of Alberta

  1. Does Retirement Affect Voluntary Work Provision? Evidence from England, Ireland and the U.S. By Eibich, Peter; Lorenti, Angelo; Mosca, Irene
  2. The Short-Term Economic Consequences of COVID-19: Occupation Tasks and Mental Health in Canada By Béland, Louis-Philippe; Brodeur, Abel; Mikola, Derek; Wright, Taylor
  3. Apprenticeship and Youth Unemployment By Cahuc, Pierre; Hervelin, Jeremy
  4. The Ability Gradient in Bunching By Bastani, Spencer; Waldenström, Daniel
  5. The Graduate Wage and Earnings Premia and the Role of Non-Cognitive Skills By Buchmueller, Gerda; Walker, Ian
  6. The Short-Term Economic Consequences of COVID-19: Exposure to Disease, Remote Work and Government Response By Béland, Louis-Philippe; Brodeur, Abel; Wright, Taylor
  7. Quantifying Goodwin Growth Cycles with Minimum Wage Shares By Sasaki, Hiroaki; Asada, Yasukuni
  8. Do productive workers sort into fexible work arrangements? By Marie Boltz; Bart Cockx; Ana María Díaz; Luz Magdalena Salas; Bart Cockx; Ana María Díaz; Luz Magdalena Salas
  9. Inequality of Fear and Self-Quarantine: Is There a Trade-off between GDP and Public Health? By Sangmin Aum; Sang Yoon (Tim) Lee; Yongseok Shin
  10. Firm-level Expectations and Behavior in Response to the COVID-19 Crisis By Buchheim, Lukas; Dovern, Jonas; Krolage, Carla; Link, Sebastian
  11. Why Are Average Hours Worked Lower in Richer Countries? By Bick, Alexander; Fuchs-Schündeln, Nicola; Lagakos, David; Tsujiyama, Hitoshi
  12. Labour Market Institutions, Technology and Rent Sharing By Fukao, Kyoji; Perugini, Cristiano; Pompei, Fabrizio
  13. A theory of the gender pay gap. Evidence from Colombia and the United States By Edgar Villa; Luz Karime Abadía; Ernesto A. Cárdenas; Luz Karime Abadía; Ernesto A. Cárdenas
  14. Pension contributions and tax-based incentives: evidence from the TCJA By Ahmed Ahmed; Anna Zabai
  15. Does Biology Drive Child Penalties? Evidence from Biological and Adoptive Families By Henrik Kleven; Camille Landais; Jakob Egholt Soegaard
  16. Payroll Share, Real Wage and Labor Productivity across US States By Ivan Mendieta-Muñoz; Codrina Rada; Ansel Schiavone; Rudi von Arnim
  17. The Economics and Politics of Social Democracy: A Reconsideration By Servaas Storm
  18. Wage Inequality and Lobbying: a directed technical change approach By Tiago Sequeira; Óscar Afonso
  19. Labor Demand in the Past, Present, and Future By Graetz, Georg
  20. Trade Policy and the China Syndrome By Lorenzo Trimarchi
  21. Labour market consequences of a transition to a circular economy: A review paper By Elisa Lanzi; Frithjof Laubinger; Jean Chateau
  22. Occupational exposure to contagion and the spread of COVID-19 in Europe By Piotr Lewandowski
  23. The Cost of the Covid-19 Crisis: Lockdowns, Macroeconomic Expectations, and Consumer Spending By Olivier Coibion; Yuriy Gorodnichenko; Michael Weber
  24. Lockdowns, Loneliness and Life Satisfaction By Hamermesh, Daniel S.

  1. By: Eibich, Peter (Max Planck Institute for Demographic Research); Lorenti, Angelo (Max Planck Institute for Demographic Research); Mosca, Irene (National University of Ireland, Maynooth)
    Abstract: Voluntary work is an important contribution for many non-profit organizations, such as charities, political and religious organizations. Older individuals make up a sizable share of the volunteer workforce, and volunteering is often regarded as an example of "active ageing". In this study, we examine whether retirement has a causal effect on the frequency of voluntary work provision in three English-speaking countries - England, Ireland and the U.S. We draw on data from the ELSA, TILDA and HRS studies and employ a harmonised approach in the empirical analysis. We use eligibility ages for old age pensions in an instrumental variable estimation to address potential confounding. We find that retirement increases the frequency of voluntary work provision in all three countries, especially among men. This suggests that labour market policies aimed at increasing labour force participation at older ages might have unintended consequences for the size of the volunteer workforce.
    Keywords: voluntary work, instrumental variable, retirement
    JEL: J22 J26
    Date: 2020–04
  2. By: Béland, Louis-Philippe (Carleton University); Brodeur, Abel (University of Ottawa); Mikola, Derek (Carleton University); Wright, Taylor (University of Ottawa)
    Abstract: In this paper, we document the short-term impact of COVID-19 on labour market outcomes in Canada. Following a pre-analysis plan, we investigate the negative impact of the pandemic on unemployment, labour force participation, hours and wages in Canada. We find that COVID-19 had drastic negative effects on labour market outcomes, with the largest effects for younger, not married, and less educated workers. We investigate whether the economic consequences of this pandemic were larger for certain occupations. We then built indices for whether (1) workers are relatively more exposed to disease, (2) work with proximity to coworkers, (3) are essential workers, and (4) can easily work remotely. Our estimates suggest that the impact of the pandemic was significantly more severe for workers more exposed to disease and workers that work in proximity to coworkers, while the effects are significantly less severe for essential workers and workers that can work remotely. Last, we rely on a unique survey, the Canadian Perspective Survey, and show that reported mental health is significantly lower among the most affected workers during the pandemic. We also find that those who were absent form work because of COVID-19 are more concerned with meeting their financial obligations and with losing their job than those who remain working outside of home, while those who transition from working outside the home to from home are not as concerned with job loss.
    Keywords: COVID-19, unemployment, wages, remote work, essential workers, exposure to disease
    JEL: I15 I18 J21
    Date: 2020–05
  3. By: Cahuc, Pierre (Sciences Po, Paris); Hervelin, Jeremy (CREST (ENSAE))
    Abstract: In France, two years after school completion and getting the same diploma, the employment rate of apprentices is about 15 percentage points higher than that of vocational students. Despite this difference, this paper shows that there is almost no difference between the probability of getting a callback from employers for unemployed youth formerly either apprentices or vocational students. This result indicates that the higher employment rate of apprentices does not rely, in the French context, on better job access of those who do not remain in their training firms. The estimation of a job search and matching model shows that the expansion of apprenticeship has very limited effects on youth unemployment if this is not accompanied by an increase in the retention of apprentices in their training firm.
    Keywords: field experiment, school-to-work transitions, apprenticeship
    JEL: J24 M53 M51
    Date: 2020–04
  4. By: Bastani, Spencer (Linnaeus University); Waldenström, Daniel (Research Institute of Industrial Economics, Stockholm)
    Abstract: We analyze the relationship between cognitive ability and bunching in the context of a large and salient kink point of the Swedish income tax schedule. Using population-wide register data from the Swedish military enlistment and administrative tax records, we find that high-ability individuals bunch more than low-ability individuals. This ability gradient is stronger for the self-employed, but is also present among wage earners. We also use high-school GPA and math grades to analyze gender differences, finding a stronger ability gradient among men.
    Keywords: bunching, ability, skills, complexity, optimal taxation
    JEL: H21 H24 J22 J24
    Date: 2020–04
  5. By: Buchmueller, Gerda (Lancaster University); Walker, Ian (Lancaster University)
    Abstract: Estimates of the graduate earnings premium typically do not allow for the effect of non-cognitive skills. Since such skills are unobservable in most datasets there is a concern that existing estimates of the graduate premium are contaminated by selection on such unobservables. We use data on a young cohort of individuals that allows us to control for the effects of non-cognitive skills. We find that the inclusion of non-cognitive skills, themselves jointly significantly positive reduces the estimated returns by an insignificant 1-2 percentage points from an average of 10-12%. Our second contribution is motivated by the greater reliance on administrative datasets in recent research that has focused on annual earnings rather than hourly wages and our results show that the graduate earnings differential is significantly greater than the wage differential. Since we use estimation methods that are NOT robust to selection on unobservables, we adopt Oster (2016) tests to show that it would take an implausible degree of selection on unobservables to drive our estimated wage and earings returns to zero, and that a plausible lower bound to returns is around one-quarter to one-third below the OLS returns. We further find heterogeneous returns by broad major group and elite university, and we find large degree class differentials.
    Keywords: returns to higher education, non-cognitive skills
    JEL: I23 I26 J24
    Date: 2020–05
  6. By: Béland, Louis-Philippe (Carleton University); Brodeur, Abel (University of Ottawa); Wright, Taylor (University of Ottawa)
    Abstract: In this ongoing project, we examine the short-term consequences of COVID-19 on employment and wages in the United States. Guided by a pre-analysis plan, we document the impact of COVID-19 at the national-level using a simple difference and test whether states with relatively more confirmed cases/deaths were more affected. Our findings suggest that COVID-19 increased the unemployment rate, decreased hours of work and labor force participation and had no significant impacts on wages. The negative impacts on labor market outcomes are larger for men, younger workers, Hispanics and less-educated workers. This suggest that COVID-19 increases labor market inequalities. We also investigate whether the economic consequences of this pandemic were larger for certain occupations. We built three indexes using ACS and O*NET data: workers relatively more exposed to disease, workers that work with proximity to coworkers and workers who can easily work remotely. Our estimates suggest that individuals in occupations working in proximity to others are more affected while occupations able to work remotely are less affected. We also find that occupations classifed as more exposed to disease are less affected, possibly due to the large number of essential workers in these occupations.
    Keywords: COVID-19, unemployment, wages, remote work, exposure to disease
    JEL: I15 I18 J21
    Date: 2020–04
  7. By: Sasaki, Hiroaki; Asada, Yasukuni
    Abstract: This study extends Goodwin's (1967) growth cycle model to consider two types of workers, low- and high-skilled workers. Using Japanese data from 1989 to 2018, we theoretically and empirically investigate how the introduction of the minimum wage share affects the wage shares and employment rates. Introducing the minimum wage share diminishes the amplitude of fluctuations of both the wage shares and the employment rates, and in this sense, it has a stabilizing effect. Reducing the wage gap between low- and high-skilled workers increases the amplitude of fluctuations of the wage shares and employment rates.
    Keywords: growth cycles; low-skilled and high-skilled workers; minimum wage share
    JEL: E11 E24 E25 E32 J31
    Date: 2020–04–28
  8. By: Marie Boltz; Bart Cockx; Ana María Díaz; Luz Magdalena Salas; Bart Cockx; Ana María Díaz; Luz Magdalena Salas
    Abstract: Resumen Publicamos anuncios de trabajo reales para observar la elección de personas buscando empleo en el mercado laboral Bogotano en su entorno natural. Diseñamos un experimento de campo que se llevó a cabo en tres etapas. Primero, los aplicantes llenan su información básica para aplicar al puesto de trabajo y realizan una prueba previa al empleo para medir su productividad ex ante. Segundo, aleatorizamos a todos los aplicantes en diferentes tratamientos, variando el número de horas trabajadas a la semana y el grado de flexibilidad en el horario de trabajo. Finalmente, realizamos ofertas de trabajo reales a un subconjunto de aplicantes dentro de los que estaban interesados en continuar en el proceso de selección. Nuestro estudio es innovador porque tiene una medida ex ante de productividad que permite distinguir entre la productividad inducida por la selección (sorting) y la inducida por la motivación (u otras características ex post). Los resultados muestran que no se puede aumentar la productividad ex post al ofrecer contratos flexibles porque las personas más productivas no se seleccionan; es decir no hay evidencia de sorting. Sin embargo, encontramos que los contratos flexibles atraen más a mujeres con personas dependientes dentro del hogar. ***** Abstract We placed real job advertisements to observe labor market participants’ choices in their natural environment. We used a three stage experimental method. Following a standard job post, applicants had to fill in their credentials and to perform a pre-employment test to measure their ex ante productivity. We then randomized all participants into different treatments varying the flexibility in working hours and the total hours worked, and finally, made real job offers. Our study is innovative in that it has an ex ante measure of productivity that allows distinguishing between the enhanced productivity induced by sorting and the one induced by motivation (or other ex post features). We find that productivity cannot be raised by announcing flexible contracts because more productive individuals do not sort. We do find that flexible contracts attract more women with dependents.
    Keywords: flexible working time arrangements, part-time workers, productivity, labor market sorting, labormarket flexibility, work-life balance
    JEL: J21 J22 J23 J24 J33
    Date: 2020–04–03
  9. By: Sangmin Aum (Myongji University); Sang Yoon (Tim) Lee (Queen Mary University of London and CEPR); Yongseok Shin (Washington University in St. Louis and Federal Reserve Bank of St. Louis)
    Abstract: We construct a quantitative model of an economy hit by an epidemic. People differ by age and skill, and choose occupations and whether to commute to work or work from home, to maximize their income and minimize their fear of infection. Occupations differ by wage, infection risk, and the productivity loss when working from home. By setting the model parameters to replicate the progression of COVID-19 in South Korea and the United Kingdom, we obtain three key results. First, government-imposed lock-downs may not present a clear trade-off between GDP and public health, as commonly believed, even though its immediate effect is to reduce GDP and infectionsby forcing people to work from home. A premature lifting of the lock-down raises GDP temporarily, but infections rise over the next months to a level at which many people choose to work from home, where they are less productive, driven by the fear of infection. A longer lock-down eventually mitigates the GDP loss as well as flattens the infection curve. Second, if the UK had adopted South Korean policies, its GDP loss and infections would have been substantially smaller both in the short and the long run. This is not because Korea implemented policies sooner, but because aggressive testing and tracking more effectively reduce infections and disrupt the economy less than a blanket lock-down. Finally, low-skill workers and self-employed lose the most from the epidemic and also from the government policies. However, the policy of issuing "visas" to those who have antibodies will disproportionately benefi t the low-skilled, by relieving them of the fear of infection and also by allowing them to get back to work.
    Keywords: Covid-19, SIR model, quarantine, antibody test, occupations and sectors, economic inequality
    JEL: E24 J22 J24
    Date: 2020–04–27
  10. By: Buchheim, Lukas (University of Munich); Dovern, Jonas (University of Erlangen-Nuremberg); Krolage, Carla (Ifo Institute for Economic Research); Link, Sebastian (Ifo Institute for Economic Research)
    Abstract: This paper studies the determinants of firms' business outlook and managerial mitigation strategies in the wake of the COVID-19 crisis using a representative panel of German firms. We first demonstrate that the crisis amplifies pre-crisis weaknesses: Firms that appear relatively weak before the crisis are harder hit initially, and, on top of the initial impact, expect more difficulties for their businesses going forward. Consequently, such firms are first to cut employment and investment. Second, our results highlight that expectations regarding the duration of the shutdown—which, at this point of the crisis, exhibit plausibly random variation—are an important determinant of the chosen mitigation strategies: Firms that expect the shutdown to last longer are more likely to lay off workers and to cancel or postpone investment projects.
    Keywords: expectations, firm behavior, COVID-19, shutdown, employment, investment
    JEL: D22 D84 E23
    Date: 2020–05
  11. By: Bick, Alexander (Arizona State University); Fuchs-Schündeln, Nicola (Goethe University Frankfurt); Lagakos, David (National Bureau of Economic Research); Tsujiyama, Hitoshi (Goethe University Frankfurt)
    Abstract: Why are average hours worked per adult lower in rich countries than in poor countries? We consider two natural explanations: income effects in preferences, in which leisure becomes more valuable when income rises, and distortionary tax systems, which are more prevalent in richer countries. To assess the importance of these two forces, we build a simple model of labor supply by heterogeneous individuals and calibrate it to match international data on labor income taxation, government transfers relative to GDP, and hours worked per adult. The model predicts that income effects are the main driving force behind the decline of average hours worked with GDP per capita. We reach a similar conclusion in an extended model that matches cross-country patterns of labor supply along the extensive and intensive margins and of the prevalence of subsistence self-employment.
    Keywords: income effects, hours worked, taxation
    JEL: E24 J22 O11
    Date: 2020–04
  12. By: Fukao, Kyoji (Hitotsubashi University); Perugini, Cristiano (University of Perugia); Pompei, Fabrizio (University of Perugia)
    Abstract: In this paper we analyse how labour market institutions and technology affect wage determination through rent sharing. To this aim we first extend the theoretical framework of Estevao and Tevlin (2003) to account for heterogeneity of labour (regular and non-regular workers). The predictions of the model are then tested with detailed industry-level data over four decades (1970-2012) for Japan, where the functioning of labour markets changed significantly along directions (de-unionisation, decline in standard employment and in the role of seniority) similar to the majority of advanced OECD countries. Our results indicate that such labour market evolutions weaken the capacity of regular workers to appropriate rents and might have contributed shaping the long-run wage stagnation observed in Japan. However, more advanced technologies help regular workers to appropriate higher rents.
    Keywords: bargaining power, non-regular work, rent-sharing, Japan
    JEL: J30 J41 C23
    Date: 2020–04
  13. By: Edgar Villa; Luz Karime Abadía; Ernesto A. Cárdenas; Luz Karime Abadía; Ernesto A. Cárdenas
    Abstract: Abstract We construct a competitive model that explains the gender pay gap per hour by a statistical discrimination mechanism based on unobserved effort provided by men and women in accordance to an intrahousehold division of labor in which only women engage in child rearing activities. For unskilled labor an additional physical endowment effect arises and increases the pay gap against women. The model explains several empirical regularities in the literature of regression analysis. We show empirical evidence for Colombia and the United States that is consistent with the predictions of the model. Further, we study an equal parental leave and equal pay for equal work policies and find conditions for these policies to be effective at reducing the pay gap.
    Keywords: Gender Pay Gap, Statistical Discrimination, Self Selection, Equal pay for Equal work.
    JEL: J13 J16 J24 J71
    Date: 2020–05–01
  14. By: Ahmed Ahmed; Anna Zabai
    Abstract: We document that corporate pension contributions respond to tax-based incentives using the 2017 Tax Cut & Jobs Act (TCJA) as a natural experiment. The TCJA cut the U.S. federal corporate tax rate, temporarily increasing contribution incentives for sponsors of defined-benefit retirement plans. We exploit cross-sectional variation in ex-ante exposure to these incentives. We find that the tax break induced an extra $3 billion of sponsor contributions to medium- and large-scale plans in 2017. But we also find strong evidence of a reversal, both in terms of sponsor contributions and plan funding ratios by 2018. We find no evidence of impact on plan asset allocations. Our results suggest that the TCJA did not have a long-lasting impact on corporate defined-benefit pension funds.
    Keywords: defined-benefit pension plans, contributions, Tax Cuts & Jobs Act
    JEL: H22 H25 H26 H32 J32
    Date: 2020–05
  15. By: Henrik Kleven (Princeton University, NBER, CEPR, and CEBI); Camille Landais (London School of Economics and CEPR); Jakob Egholt Soegaard (CEBI, Department of Economics, University of Copenhagen)
    Abstract: This paper investigates if the impact of children on the labor market trajectories of women relative to men child penalties can be explained by the biological links between mother and child. We estimate child penalties in biological and adoptive families using event studies around the arrival of children and almost forty years of adoption data from Denmark. Long-run child penalties in earnings and its underlying determinants are virtually identical in biological and adoptive families. This implies that biology is not important for child-related gender gaps. Based on additional analyses, we argue that our results speak against the importance of specialization based on comparative advantage more broadly.
    Keywords: Gender Wage Gap, Children, Adoption, Denmark
    JEL: D63 J13 J16 J22 J31 J71
    Date: 2020–05–04
  16. By: Ivan Mendieta-Muñoz (University of Utah); Codrina Rada (University of Utah); Ansel Schiavone (University of Utah); Rudi von Arnim (University of Utah)
    Abstract: This paper analyzes regional contributions to the US payroll share from 1977 to 2017 and the four major business cycles throughout this period. We implement two empirical exercises. First, we decompose the US payroll share across states. Utilizing a Divisia index decomposition technique yields exact contributions of real wages, employment structure, labor productivity and relative prices across the states to the aggregate change in the payroll share. Key findings are that the decline in the aggregate (i) is driven by decoupling between real wage and labor productivity; and (ii) is initially driven by the rust belt states, but subsequently dominated by relatively large states. Second, we employ mixture models on real wages and labor productivity across US states to discern whether distinct mechanisms appear to generate these distributions. Univariate models (iii) indicate the possibility that two distinct mechanisms generate state labor productivities, raising the question of whether regional dualism has taken hold. Lastly, we use bivariate mixture models to investigate whether such dualism and decoupling manifest in the joint distributions of payroll shares and labor productivity, too. Results (iv) are affirmative, and further suggest a tendency for high performing states to have relatively high payroll shares initially, and low payroll shares more recently.
    Keywords: labor share; US states; Divisia decomposition; mixture models
    JEL: D33 C43 O41 O5
    Date: 2020–04
  17. By: Servaas Storm (Delft University of Technology)
    Abstract: Questions about the decline of Social democracy continue to excite wide interest, even in the era of Covid-19. This paper takes a fresh look at topic. It argues that social democratic politics faces a fundamental dilemma: short-term practical relevance requires it to accept, at least partly, the very socio-economic conditions which it purports to change in the longer run. Bhaduri’s (1993) essay which analyzes social democracy’s attempts to navigate this dilemma by means of ‘a nationalization of consumption’ and Keynesian demand management, was written before the rise of New (‘Third Way’) Labor and before the Great Financial Crisis of 2007-8. This paper provides an update, arguing that New Labor’s attempt to rescue ‘welfare capitalism’ entailed a new solution to the dilemma facing social democracy based on an expansion of employment, i.e. an all-out emphasis on “jobs, jobs, jobs”. The flip-side (or social cost) of the emphasis on job growth has been a stagnation of productivity growth—which, in turn, has put the ‘welfare state’ under increasing pressure of fiscal austerity. The popular discontent and rise of ‘populist’ political parties is closely related to the failure of New Labor to navigate social democracy’s dilemma.
    Keywords: social democracy, wage-led growth, profit-led growth, NAIRU economics, Europe 1945- , New Labor.
    JEL: E6 E10 E12 N10 P11
    Date: 2020–04
  18. By: Tiago Sequeira (Centre for Business and Economics CeBER and Faculty of Economics, University of Coimbra); Óscar Afonso (CEF-UP, and Faculty of Economics of University of Porto)
    Abstract: We devise a generalized Directed Technical Change growth model in which firms spend resources in lobbying activity. As expected, the presence of lobbying distorts the skill premium and economic growth. Lobbying also contributes to a lower technological-knowledge bias toward the skill-sector and constitutes a possible explanation for the diverging empirical evidence on the relationship between the skill premium and the relative supply of skills. An increase in the relative lobbying power of the skilled intensive intermediate goods firms can lead to an increase or decrease in the skill premium, depending on the elasticity of substitution between the skilled and unskilled sectors. Lobbying also introduces possibility of a dual economy, with two different steady states, one characterized by low growth and another by high growth, depending on a threshold level of the lobbying power and on the elasticity of substitution. Quantitative exercises show that lobbying can indeed be quite important in distorting the skill premium and the economic growth.
    Keywords: Directed technical change; lobbying power; ineciency; economic growth; wage inequality; quantitative implications.; Directed technical change; lobbying power; ineciency; economic growth; wage inequality; quantitative implications.
    JEL: J31 P16 O30 O41
    Date: 2020–04
  19. By: Graetz, Georg (Uppsala University)
    Abstract: Since the beginning of the Industrial Revolution, technological change has led to the automation of existing tasks and the creation of new ones, as well as the reallocation of labor across occupations and industries. These processes have been costly to individual workers, but labor demand has remained strong, and real wages have steadily increased in line with productivity growth. I provide evidence suggesting, however, that in recent decades automation has outpaced the creation of new tasks and thus the demand for labor has declined. There is strong disagreement about the future of labor demand, and predictions about technological breakthroughs have a poor track record. Given the importance of overall labor demand for workers' standard of living as well as their ability to adjust to a changing labor market, obtaining accurate forecasts should be a priority for policy makers.
    Keywords: automation, labor demand, labor share, technology, wages
    JEL: J23 O33
    Date: 2020–04
  20. By: Lorenzo Trimarchi (Université de Namur)
    Abstract: The recent backlash against free trade is partially motivated by the decline in manufacturing employment due to rising import competition from China. Previous studies about the “China syndrome†neglect the role of trade policy. This is surprising, given that politicians in high-income countries have extensively used antidumping (AD) measures to protect their economies from rising Chinese imports. In this paper, I estimate the causal effect of trade protection on imports and employment, by constructing a new instrument for AD measures based on industries’ importance in swing states and experience in filing AD petitions. I show that AD duties have reduced import competition, decreasing the annual growth rate of US imports from China by 0.40 percentage points on average. They have also helped contain the China syndrome, by increasing the annual growth rate of employment in protected industries by 0.07 percentage points. These results show that protectionist instruments allowed under GATT/WTO rules can be used to attenuate the effects of import competition on employment.
    Keywords: Antidumping, Import Competition, Manufacturing Jobs, US-China Trade Relations
    JEL: F13 F14 F16 J20
    Date: 2020–05
  21. By: Elisa Lanzi (OECD); Frithjof Laubinger (OECD); Jean Chateau (OECD)
    Abstract: Resource efficiency and circular economy policies aim at reducing resource intensity and use throughout the economy, thereby decreasing environmental impacts. Besides the environmental benefits expected from these policies, potential employment benefits are often emphasised, which would follow the anticipated structural changes in the economy from material-intensive to more labour-intensive activities. However, the size of the employment effect is still unclear and difficult to quantify. To date, the quantitative literature on the employment impacts of the circular economy is still scarce. This study is the first of its kind to review the available studies on this increasingly important policy issue.
    Keywords: circular economy, employment & redistributive effects, labour markets, macro-economic modelling, natural resources, resource efficiency
    JEL: Q52 Q53 O14 J4 C68
    Date: 2020–05–15
  22. By: Piotr Lewandowski
    Abstract: Social contacts are a key transmission channel of infectious diseases spread by the respiratory or close-contact route, such as COVID-19. There is no evidence, however, on the question of whether the nature and the organisation of work affect the spread of COVID-19 in different countries. I have developed a methodology to measure country-specific levels of occupational exposure to contagion driven by social contacts. I combined six indicators based on Occupation Information Network (O*NET) and the European Working Condition Survey (EWCS) data. I then applied them to 26 European countries, and found substantial cross-country differences in levels of exposure to contagion in comparable occupations. The resulting country-level measures of levels of exposure to contagion (excluding health professions) predict the growth in COVID-19 cases, and the number of deaths from COVID-19 in the early stage of pandemic (up to four weeks after the 100th case). The relationship between levels of occupational exposure to contagion and the spread of COVID-19 is particularly strong for workers aged 45-64. I found that 20-25% of the cross-country variance in numbers of COVID-19 cases and deaths can be attributed to cross-country differences in levels of occupational exposure to contagion in European countries. My findings are robust to controlling for the stringency of containment policies, such as lockdowns and school closures. They are also driven by country-specific patterns of social contacts at work, rather than by occupational structures. Thus, I conclude that measuring workplace interactions may help to predict the next waves of the COVID-19 pandemic.
    Keywords: COVID-19, contagion, exposure to disease, occupations, organisation of work
    JEL: J01 I10 J44
    Date: 2020–05
  23. By: Olivier Coibion; Yuriy Gorodnichenko; Michael Weber
    Abstract: We study how the differential timing of local lockdowns due to COVID-19 causally affects households’ spending and macroeconomic expectations at the local level using several waves of a customized survey with more than 10,000 respondents. About 50% of survey participants report income and wealth losses due to the corona virus, with the average losses being $5,293 and $33,482 respectively. Aggregate consumer spending dropped by 31 log percentage points with the largest drops in travel and clothing. We find that households living in counties that went into lockdown earlier expect the unemployment rate over the next twelve months to be 13 percentage points higher and continue to expect higher unemployment at horizons of three to five years. They also expect lower future inflation, report higher uncertainty, expect lower mortgage rates for up to 10 years, and have moved out of foreign stocks into liquid forms of savings. The imposition of lockdowns can account for much of the decline in employment in recent months as well as declines in consumer spending. While lockdowns have pronounced effects on local economic conditions and households’ expectations, they have little impact on approval ratings of Congress, the Fed, or the Treasury but lead to declines in the approval of the President.
    JEL: C83 D84 E31 J26
    Date: 2020–05
  24. By: Hamermesh, Daniel S. (Barnard College)
    Abstract: Using the 2012-13 American Time Use Survey, I find that both who people spend time with and how they spend it affect their happiness, adjusted for numerous demographic and economic variables. Satisfaction among married individuals increases most with additional time spent with spouse. Among singles, satisfaction decreases most as more time is spent alone. Assuming that lockdowns constrain married people to spend time solely with their spouses, simulations show that their happiness may have been increased compared to before the lockdowns; but sufficiently large losses of work time and income reverse this inference. Simulations demonstrate clearly that, assuming lockdowns impose solitude on singles, their happiness was reduced, reductions that are made more severe by income and work losses.
    Keywords: Coronavirus, time use, happiness, isolation, well-being, COVID-19
    JEL: I12 J22 I31
    Date: 2020–04

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