nep-lma New Economics Papers
on Labor Markets - Supply, Demand, and Wages
Issue of 2020‒12‒07
twenty-six papers chosen by
Joseph Marchand
University of Alberta

  1. Urban Air Pollution and Sick Leaves: Evidence From Social Security Data By Felix Holub; Laura Hospido; Ulrich J. Wagner
  2. Suddenly a Stay-at-Home Dad? Short- and Long-Term Consequences of Fathers' Job Loss on Time Investment in the Household By Hennecke, Juliane; Pape, Astrid
  3. First to $15: Alberta's Minimum Wage Policy on Employment by Wages, Ages, and Places By Fossati, Sebastian; Marchand, Joseph
  4. Ethnic Background and the Value of Self-Employment Experience: Evidence from a Randomized Field Experiment By Aldén, Lina; Bastani, Spencer; Hammarstedt, Mats
  5. Technological change and the Swedish labor market By Graetz, Georg
  6. How Many Jobs Did JobKeeper Keep? By James Bishop; Iris Day
  7. The gender-dependent structure of wages in Hungary: results using machine learning techniques By Olga Takács; János Vincze
  8. Does Employment Protection Unprotect Workers? The Labor Market Effects of Job Reinstatements in Peru By Jiménez, Bruno; Rendon, Silvio
  9. Workplace Incentives and Organizational Learning By Amodio, Francesco; Martinez-Carrasco, Miguel A.
  10. Personalized Digital Information and Tax-favoured Retirement Savings: Quasi-experimental Evidence from Administrative Data By Claudio Daminato; Massimo Filippini; Fabio Haufler
  11. The Effect of Manager Gender and Performance Feedback: Experimental Evidence from India By Abel, Martin; Buchman, Daniel
  12. Gender Gaps and the Role of Bosses By Moritz Drechsel-Grau; Felix Holub
  13. Social assimilation and labour market outcomes of migrants in China By Cai, Shu; Zimmermann, Klaus F.
  14. I will survive! The impact of place-based policies when public transfers fade out By Augusto Cerqua; Guido Pellegrini
  15. Productivity Loss amid Invisible Pollution By Wang, Chunchao; Lin, Qianqian; Qiu, Yun
  16. Overeducation, Major Mismatch, and Return to Higher Education Tiers: Evidence from Novel Data Source of a Major Online Recruitment Platform in China By Zheng, Yanqiao; Zhang, Xiaoqi; Zhu, Yu
  17. Do Non-Natives Catch-Up with The Natives in Terms of Earnings in Jordan? New Evidence from A Distributional Analysis By Hatem Jemmali; Rabeh Morrar
  18. Labor-Market Conditions and Leadership Styles By Dur, Robert; Kvaløy, Ola; Schöttner, Anja
  19. The Impact of ICT on Working from Home: Evidence from EU Countries By Vahagn Jerbashian; Montserrat Vilalta-Bufi
  20. Does test-based teacher recruitment work in the developing world? Experimental evidence from Ecuador By Araujo P., Maria Daniela; Heineck, Guido; Cruz Aguayo, Yyannú
  21. Talking Business: New Evidence on How Language Shapes Economic Behaviour By Campo, Francesco; Nunziata, Luca; Rocco, Lorenzo
  22. Back to the past: the historical roots of labour-saving automation By Staccioli, Jacopo; Virgillito, Maria Enrica
  23. Bargaining power and the Phillips curve: a micro-macro analysis By Marco Jacopo Lombardi; Marianna Riggi; Eliana Viviano
  24. Exploring policy options on teleworking: Steering local economic and employment development in the time of remote work By OECD
  25. Covid-19: A Crisis of the Female Self-Employed By Daniel Graeber; Alexander S. Kritikos; Johannes Seebauer
  26. Risk Preferences and Training Investments By Marco Caliendo; Deborah A. Cobb-Clark; Cosima Obst; Arne Uhlendorff

  1. By: Felix Holub; Laura Hospido; Ulrich J. Wagner
    Abstract: We estimate the causal impact of air pollution on the incidence of sick leaves in a representative panel of employees affiliated to the Spanish social security system. Using over 100 million worker-by-week observations from the period 2005-2014, we estimate the relationship between the share of days an individual is on sick leave in a given week and exposure to particulate matter (PM10) at the place of residence, controlling for weather, individual effects, and a wide range of time-by-location controls. We exploit quasi-experimental variation in PM10 that is due to Sahara dust advection in order to instrument for local PM10 concentrations. We estimate that the causal effect of PM10 on sick leaves is positive and varies with respect to worker and job characteristics. The effect is stronger for workers with pre-existing medical conditions, and weaker for workers with low job security. Our estimates are instrumental for quantifying air pollution damages due to changes in labor supply. We estimate that improved ambient air quality in urban Spain between 2005 and 2014 saved at least €503 million in foregone production by reducing worker absence by more than 5.55 million days.
    Keywords: air pollution, health, sickness insurance, labor supply
    JEL: I12 I13 Q51 Q53
    Date: 2020–11
  2. By: Hennecke, Juliane (Auckland University of Technology); Pape, Astrid (Freie Universität Berlin)
    Abstract: Commonly described as the "gender care gap", there is a persistent gender difference in the division of domestic responsibilities in most developed countries. We provide novel evidence on the short- and long-run effects of an exogenous shock on paternal availability, through a job loss, on the allocation of domestic work within couples. We find that paternal child care and housework significantly increase in the short run on weekdays, while we do not see any similar shifts on weekends. Effects are positive and persistent for fathers who remain unemployed or have a working partner, but reverse after re-employment. We also find significant changes for female partners as well as in the cumulative household time investments and the outsourcing of tasks, depending on the labor force statuses of both partners. We theoretically discuss time availability and financial constraints, relative bargaining powers, gender role attitudes, and emotional bonds as potential explanations for the effects.
    Keywords: job loss, paternal child care, fatherhood, domestic labor, intra-household allocation
    JEL: J13 J22 J63
    Date: 2020–11
  3. By: Fossati, Sebastian (University of Alberta, Department of Economics); Marchand, Joseph (University of Alberta, Department of Economics)
    Abstract: Alberta is the first North American state or province with a $15 minimum wage, with an unexpectedly large increase (47%) over a short time span (3 years). The employment effects of this policy are estimated using a synthetic control approach on Labour Force Survey data. Three empirical results are documented. First, employers complied with the minimum wage increases, increment by increment, with workers moving up the wage distribution, bin by bin. Second, employment losses were found among young workers, but not among prime-age and older. Third, employment losses were found outside of Alberta's two main cities, but not within them.
    Keywords: employment; minimum wage; synthetic control
    JEL: J21 J38 J48 J82 R23
    Date: 2020–11–24
  4. By: Aldén, Lina (Department of Economics and Statistic, Linnaeus University); Bastani, Spencer (Institute for Evaluation of Labor Market and Education Policy (IFAU), Uppsala); Hammarstedt, Mats (Linneaus University)
    Abstract: In this paper, we use a randomized field experiment in Sweden to investigate how self-employment experience is valued in the labor market. We find that self-employment experience negatively impacts the probability of receiving a positive response from employers. For male applicants, this holds regardless of their ethnic background, and independently of whether we consider applicants with experience solely from self-employment, or applicants with a mix of experience from wage-employment and self-employment. For female applicants, the results are less clear-cut. Our findings provide input into the discussion about the impact of self-employment on the chances for natives and immigrants to obtain wage-employment.
    Keywords: Self-employment; Wage-employment; Randomized experiment; Discrimination; Labor market outcomes
    JEL: J15 J24 J71 L26
    Date: 2020–11–19
  5. By: Graetz, Georg (Uppsala University)
    Abstract: This report takes stock of recent research into the effects of technology on the labor market; assesses to what extent the Swedish labor market has been affected by technological change in the past three decades, in particular with respect to the themes highlighted by the research; and draws lessons for the future. The main conclusion is that so far, the Swedish labor market has adopted well to technological change, as it exhibits stable employment rates and steady wage growth across the distribution. Furthermore, there are no clear signs that this situation should change in the coming decades.
    Keywords: Technology; employment; wages; the Swedish economy
    JEL: J21 J23 J24 J31 O30 O52
    Date: 2020–11–12
  6. By: James Bishop (Reserve Bank of Australia); Iris Day (Reserve Bank of Australia)
    Abstract: The JobKeeper Payment is a wage subsidy to help firms affected by COVID-19 retain their staff. We examine the extent to which JobKeeper cushioned employment losses in the first four months of the program. To do this, we use worker-level data from the Labour Force Survey and an identification strategy that exploits a threshold in eligibility to infer causality. We find that one in five employees who received JobKeeper (and, thus, remained employed) would not have remained employed during this period had it not been for the JobKeeper Payment. Given that 3½ million individuals were receiving the payment over the period from April to July 2020, this implies that JobKeeper reduced total employment losses by at least 700,000 over the same period. We discuss the potential sources of bias that might affect our results, some of which stem from the fact that our conclusions are based on a sample of casual employees who may have responded differently to JobKeeper than other workers. Our paper does not consider the longer-run effects of JobKeeper on employment or the indirect channels through which JobKeeper may have affected employment.
    Keywords: wage subsidy; employment; COVID-19
    JEL: E24 E62 H25 H32 J23 J38 J63 J68
    Date: 2020–11
  7. By: Olga Takács (Corvinus University of Budapest, Hungary, H-1093 Budapest, Fõvám Square 8); János Vincze (Corvinus University of Budapest, Hungary , H-1093 Budapest, Fõvám Square 8 and Centre for Economic and Regional Studies, Institute of Economics, (KRTK KTI),)
    Abstract: This paper reports the results of a Blinder-Oaxaca style decomposition analysis on Hungarian matched employer-employee data to study the gender pay-gap. We carry out the decomposition by Random Forest regressions. The raw gap in our horizon (2008-2016) is increasing, but we find that the wage structure effects are rather stable, thus the rise in the gap is due to the disappearance of the formerly negative composition effects. Graphical analysis sheds light on interesting non-linear relationships; some of them can be readily interpreted by the previous literature. A Classification and Regression Tree analysis suggests that complicated interaction patterns exist in the data. We identify segments of the Hungarian labour market that are most and least exposed to gender-dependent wage determination. Our findings lend support to the idea that an important part of the gender wage gap is attributable to monopsonistic competition with gender-dependent supply elasticities.
    Keywords: Gender pay gap ,Blinder-Oaxaca decomposition,Random Forest Regression Hungary
    JEL: J7 J3 C14
    Date: 2020–11
  8. By: Jiménez, Bruno (Universidad de Piura); Rendon, Silvio (Independent Researcher)
    Abstract: We investigate the labor market effects of the reestablishment of private-sector workers' right to reinstatement for unfair dismissals, which occurred in 2002 in Peru. Using data from Peruvian Household Surveys from 2004 to 2015, and the Specialized Employment Survey 1998-2001, we estimate a quasi-experimental difference-in-difference model. We find that this reestablishment is associated with increases in new contracting in the private sector, by 5.9 % for permanent hiring and 3.0 % for temporary hiring. By means of placebo tests, we only fund a causal effect of the reinstatement on temporary hiring, not on permanent hiring. We also find a negative association between reinstatements and real wages of 3.9 %, but placebo tests indicate that this is not a causal effect. Our findings call into question the effectiveness of removing reinstatement laws as a policy to increase permanent hiring and wages.
    Keywords: labor costs, employment, fixed-term contracts
    JEL: J23 J65 E24
    Date: 2020–11
  9. By: Amodio, Francesco (McGill University); Martinez-Carrasco, Miguel A. (Universidad de los Andes)
    Abstract: This paper studies learning within organizations when incentives change. We use a simple principal-agent model to show how, in the presence of imperfect information over the shape of the production function, worker's effort choice changes over time as information is disclosed and processed. We also show that changes in workers compensation can trigger such learning process. We test this hypothesis using personnel records from a Peruvian egg production plant. Exploiting a sudden change in the compensation schedule, we find that workers learn from each other over the shape of the production function. This adjustment process is costly for the firm.
    Keywords: organizational learning, workplace incentives, inputs
    JEL: D22 D24 J24 J33 M11 M52 M54 O12
    Date: 2020–11
  10. By: Claudio Daminato (CER–ETH – Center of Economic Research at ETH Zurich, Switzerland); Massimo Filippini (CER–ETH – Center of Economic Research at ETH Zurich and Department of Economics, University of Lugano, Switzerland); Fabio Haufler (CER–ETH – Center of Economic Research at ETH Zurich, Switzerland)
    Abstract: This paper studies the impact of making personalized digital information available through a pension app on contributions to tax-favored retirement accounts. Using Swiss administrative pension fund data, we document limited take-up of fiscal incentives for retirement savings. Exploiting the staggered introduction of the pension app across occupational pension funds, we show that its availability increases individual tax-favored contributions. Men and higher-income earners are more likely to access the digital environment and respond to its introduction. These findings suggest that providing access to a pension app reduces information and transaction costs and facilitates the take-up of financial incentives for retirement saving.
    Keywords: Defined contribution plans, Fiscal incentives, Pension app, Savings
    JEL: D14 G51 H31 H55
    Date: 2020–11
  11. By: Abel, Martin (Middlebury College); Buchman, Daniel (Middlebury College)
    Abstract: We hire 1,800 Indian gig economy workers for a real-effort transcription task and randomize the gender of the (fictitious) manager as well as the delivery of performance feedback. We find that negative feedback (i.e. criticism) leads to moderate deterioration in worker attitudes, but it increases effort provision in both mandatory and voluntary tasks. By contrast, praise affects neither attitudes nor effort provision. Importantly, feedback effects do not vary between workers assigned to female and male managers. Consistent with this finding, there is no evidence for attention discrimination towards female managers, implicit gender bias, or gendered expectations among workers. By contrast, Abel (2019) employs the same research design in the U.S. and finds substantial gender discrimination and no effect of feedback on effort. This highlights that the effects of feedback and manager gender vary across different contexts.
    Keywords: India, gender discrimination, gig economy, feedback
    JEL: J50 J70
    Date: 2020–11
  12. By: Moritz Drechsel-Grau; Felix Holub
    Abstract: This paper investigates the contribution of managers to gender gaps and analyzes whether the over-representation of men in management positions puts women at a disadvantage. Relying on personnel data from one of the largest European manufacturing firms, we separate out the factors explaining gender gaps. Adjusted pay gaps are positive, which means that men earn more than observationally equivalent women. A significant share of pay gaps can be explained by the sorting of men and women to different managers. More importantly, gender gaps in bonus payments causally depend on the manager's gender. Accounting for worker and manager heterogeneity, bonus gaps are larger when the manager is male. This is driven by the fact that performance ratings are more favorable to men if handed out by a male manager. We present suggestive evidence that the relevance of manager gender for pay gaps is driven by discrimination rather than same-gender complementarities in productivity. However, independent of the root cause of these differences in evaluations by manager gender, the findings imply that a lower number of female managers increases gender gaps and thus constitutes a structural disadvantage for women.
    Keywords: gender wage gap, performance ratings, managers, manager gender, sorting, personnel data, unconscious discrimination
    JEL: J16 J31 J33 J71 M5 D83
    Date: 2020–11
  13. By: Cai, Shu (Jinan University and Global Labor Organization.); Zimmermann, Klaus F. (UNU-MERIT, Maastricht University, CEPR and Global Labor Organization)
    Abstract: Previous research has found identity to be relevant for international migration, but has neglected internal mobility as in the case of the Great Chinese Migration. However, the context of the identities of migrants and their adaption in the migration process is likely to be quite different. The gap is closed by examining social assimilation and the effect on the labourmarket outcomes of migrants in China, the country with the largest record of internal mobility. Using instrumental variable estimation, the study finds that identifying as local residents significantly increase migrants’ hourly wages and reduce hours worked, although their monthly earnings remained barely changed. Further findings suggest that migrants with strong local identity are more likely to use local networks in job search, and to obtain jobs with higher average wages and lower average hours worked per day.
    Keywords: Social assimilation, identity, labour market, migration
    JEL: J22 J31 J61 O15 Z13
    Date: 2020–11–18
  14. By: Augusto Cerqua (Department of Social Sciences and Economics, Sapienza University of Rome); Guido Pellegrini (Department of Social Sciences and Economics, Sapienza University of Rome)
    Abstract: Are place-based policies capable of taking lagging areas to a higher growth trajectory permanently? We answer this key question by investigating what happens when strongly subsidised regions suddenly experience a substantial reduction in external funding. We analyse an extensive database and estimate the average causal impact of exiting the convergence region status of the EU regional policy via the mean balancing approach, an econometric technique created appositely to fully exploit time-series cross-sectional data. Such an approach also allows us to investigate the heterogeneity of the impact concerning relevant covariates. We find that regions which experienced a considerable reduction in funding in a period of economic expansion did not suffer from the loss of such funding. On the other hand, we find that the sharp reduction in funding during the crisis led to a negative, but not statistically significant, impact on economic growth. However, the impact varies with the features of the regions and the local economic context. These findings differ from previous literature and signal a long-term positive effect of the EU funds on growth and employment.
    Keywords: Place-based policy, European Union, mean balancing, regional growth
    JEL: C23 O47 R11
    Date: 2020–11
  15. By: Wang, Chunchao; Lin, Qianqian; Qiu, Yun
    Abstract: Ground-level ozone is a continuing problem worldwide, but research on the influences of ozone pollution on labour productivity in developing countries is insufficient. We investigate the effect of ozone pollution on outdoor worker productivity in the service sector using a unique panel dataset of courier productivities from a top five express company in China. Using an instrumental variable constructed from ozone pollution of upwind nearby cities, we find that a one-standard-deviation increase in daily ozone pollution decreases courier productivity by 8.91%. The same increase in ozone in the previous 30 days decreases worker productivity by 37.9%.
    Keywords: ozone pollution,air pollution,labour productivity,outdoor workers,contemporaneous effect,cumulative effect,express delivery industry
    JEL: J24 O13 P23 P28 Q51 Q53
    Date: 2020
  16. By: Zheng, Yanqiao (Zhejiang University); Zhang, Xiaoqi (Southeast University); Zhu, Yu (University of Dundee)
    Abstract: We develop a novel approach to study overeducation by extracting pre-match information from online recruitment platforms using word segmentation and dictionary building techniques, which can offer significant advantages over traditional survey-based approaches in objectiveness, timeliness, sample sizes, area coverage and richness of controls. We apply this method to China, which has experienced a 10-fold expansion of its higher education sector over the last two decades. We find that about half of online job-seekers in China are two or more years overeducated, resulting in 5.1% pay penalty. However, the effect of overeducation on pay varies significantly by college quality, city type, and the match of college major with industry. Graduates in STEM (Science, Technology, Engineering and Mathematics) or LEM (Law, Economics and Management) from Key Universities are much less likely to be overeducated in the first place, and actually enjoy a significant pay premium even when they are in the situation.
    Keywords: overeducation, online recruitment data, major-industry mismatch, China
    JEL: I23 I26
    Date: 2020–11
  17. By: Hatem Jemmali (University of Manouba); Rabeh Morrar (An-Najah National University)
    Abstract: Using a nationally representative data set extracted from the Jordanian Labor Market Panel Survey (JLMPS) for the two years 2010 and 2016, we examine the wage differentials between natives-born workers and migrants in Jordan's labor market. By applying Oaxaca– Blinder and quantile decomposition methods we decompose the distributional wage differentials into endowment effects, explained by differences in productivity characteristics, and discrimination effects attributable to unequal returns to covariates. We find an increasing average wage gap in favor of residents workers over time. The wage differentials are found to be larger at the bottom and middle parts of the wage distributions in both 2010 and 2016. The compositional differences in education between natives and non-natives explain significantly the wage gap only in 2010 but not in 2016, while main drivers of the unexplained component (discrimination effect) of the average wage gap appears to stem from the education covariate in both 2010 and 2016. We also find that discrimination against migrant workers increases with the quantiles of wage distribution in both 2010 and 2016 except for the 90th quantile.
    Date: 2020–11–20
  18. By: Dur, Robert (Erasmus University Rotterdam); Kvaløy, Ola (University of Stavanger); Schöttner, Anja (University of Bonn)
    Abstract: Why do some leaders use praise as a means to motivate workers, while other leaders use social punishment? This paper develops a simple economic model to examine how leadership styles depend on the prevailing labor-market conditions for workers. We show that the existence of a binding wage floor for workers (e.g., due to trade union wage bargaining, minimum-wage legislation, or limited-liability protection) can make it attractive for firms to hire a leader who makes use of social punishment. While the use of social punishments generally is socially inefficient, it lessens the need for high bonus pay, which allows the firm to extract rents from the worker. In contrast, firms hire leaders who provide praise to workers only if it is socially efficient to do so. Credible use of leadership styles requires either repeated interaction or a leader with the right social preferences. Only moderately altruistic leaders offer praise, whereas only moderately spiteful leaders employ social punishment. Lastly, we show that when the leaders' and workers' reservation utilities give rise to a bigger income gap between leaders and workers, attracting spiteful leaders becomes relatively less costly and unfriendly leadership becomes more prevalent.
    Keywords: leadership styles, incentives, motivation, social preferences, labor-market conditions, wage-setting
    JEL: D2 J3 M5
    Date: 2020–11
  19. By: Vahagn Jerbashian (Universitat de Barcelona); Montserrat Vilalta-Bufi (Universitat de Barcelona)
    Abstract: We use data from 14 European countries and provide evidence that the fall in prices of information and communication technologies (ICT) is associated with a significant increase in the share of employees who work from home. Similar results hold within age, gender, and occupation groups. There are notable differences across age groups, however. The effect of the fall in ICT prices on working from home increases with age. A rationale for such a result is that the preference for working from home increases with age.
    Keywords: Working from Home, ICT, Age, Gender, Occupations.
    JEL: J23 J24 O33
    Date: 2020
  20. By: Araujo P., Maria Daniela; Heineck, Guido; Cruz Aguayo, Yyannú
    Abstract: Since 2007, the Ecuadorian government has required teacher candidates to pass national skill and content knowledge tests before they are allowed to participate in merit-based selection competitions for tenured positions at public schools in an attempt to raise teacher quality. We evaluate the impact of this policy using linked administrative teacher information to data from a unique experimental study where almost 15,000 kindergarten children were randomly assigned to their teachers in the 2012-2013 school year in Ecuador. We find positive and significant effects of testscreened tenured teachers of at least a 0.105 standard deviation for language and a 0.085 standard deviation for math, which persist even after controlling for teacher education, experience, cognitive ability, personality traits and classroom practices.
    Keywords: teacher quality,education policy evaluation,Latin America
    JEL: I20 I21 I25 I28 J45
    Date: 2020
  21. By: Campo, Francesco (University of Milan Bicocca); Nunziata, Luca (University of Padova); Rocco, Lorenzo (University of Padova)
    Abstract: We provide a large scale within-country analysis of the effect of language future time reference (FTR) on the choice of being an entrepreneur using individual-level data from Switzerland, a country characterized by a unique long-standing multilingualism and a large share of immigrant population. We test the hypothesis that speakers of weak FTR languages may have a closer perception of future rewards and be more willing to become entrepreneurs, a choice that reflects future orientation. Our analysis consistently indicates that immigrants who speak weak FTR languages are around 2 percent more likely to be entrepreneurs compared to speakers of strong FTR languages, net of unobservable ancestral cultural traits, districts of destination's characteristics, linguistic features other than FTR, and whether individuals maintain their native language or switch to one of the four Swiss languages.
    Keywords: entrepreneurship, language, future time reference, culture, migration, Switzerland
    JEL: D15 J24 J6 L26 Z1
    Date: 2020–11
  22. By: Staccioli, Jacopo; Virgillito, Maria Enrica
    Abstract: This paper, relying on a still relatively unexplored long-term dataset on U.S. patenting activity, provides empirical evidence on the history of labour-saving innovations back to early 19th century. The identification of mechanisation/automation heuristics, retrieved via textual content analysis on current robotic technologies by Montobbio et al. (2020), allows to focus on a limited set of CPC codes where mechanisation and automation technologies are more prevalent. We track their time evolution, clustering, eventual emergence of wavy behaviour, and their comovements with long-term GDP growth. Our results challenge both the general-purpose technology approach and the strict 50-year Kondratiev cycle, while provide evidence of the emergence of erratic constellations of heterogeneous technological artefacts, in line with the developmentblock approach enabled by autocatalytic systems.
    Keywords: Labour-Saving Technologies,Search Heuristics,Industrial Revolutions,Wavelet analysis
    JEL: O3 C38 J24
    Date: 2020
  23. By: Marco Jacopo Lombardi (Bank for International Settlements); Marianna Riggi (Bank of Italy); Eliana Viviano (Bank of Italy)
    Abstract: We use a general equilibrium model to show that a decrease in workers’ bargaining power amplifies the relative contribution to the output gap of adjustments along the extensive margin of labour utilization. This mechanism reduces the cyclical movements of marginal cost (and inflation) relative to those of the output gap. We show that the relationship between bargaining power and adjustments along the extensive margin (relative to the intensive margin) is supported by microdata. Our analysis relies on panel data from the Italian survey of industrial firms. The Bayesian estimation of the model using euro-area aggregate data covering the 1970-1990 and 1991-2016 samples confirms that the decline in workers’ bargaining power has weakened the inflation-output gap relationship.
    Keywords: low inflation, bargaining power, Phillips curve
    JEL: E31 E32 J23 J60
    Date: 2020–11
  24. By: OECD
    Abstract: This paper explores and classifies some of the most common policy options adopted by national, regional and local policy makers in the context of or prior to the COVID-19 pandemic to enable, encourage and make the most of teleworking. It also considers efforts to foster the attraction and retention of remote workers and entrepreneurs in particular places. The current crisis represents, among other things, a mass experiment in teleworking, unprecedented in size and scope. A shift towards large-scale, long-lasting teleworking would have profound implications for the geography of local employment. However, SMEs may be less equipped than larger firms to face this change. Public policy can play an important role in turning teleworking into an opportunity for all, to minimise the potential of widening pre-existing disparities between people, places and firms.
    Keywords: future of work, geography of jobs, local employment, SMEs, teleworking
    JEL: J28 J62 J68 J88 R11
    Date: 2020–11–17
  25. By: Daniel Graeber; Alexander S. Kritikos; Johannes Seebauer
    Abstract: We investigate how the economic consequences of the pandemic, and of the government-mandated measures to contain its spread, affected the self-employed relative to employed individuals in Germany and, secondly, to what extent the female self-employed were more strongly hit than their male counterparts. For our analysis, we use representative real-time survey data in which respondents were asked about their situation during the COVID-19 pandemic. Our findings indicate that self-employed individuals were much more likely to suffer income losses than employees. Among the self-employed, women were 35% more likely to experience income losses than men, as women are disproportionately working in industries that are more severely affected by the COVID-19 pandemic. We conclude that future policy measures intended to mitigate such shocks should account for this variation in economic hardship.
    Keywords: Self-employed, COVID-19, income, gender, representative real-time survey data, decomposition methods
    JEL: L26 J31 J71 I18
    Date: 2020
  26. By: Marco Caliendo; Deborah A. Cobb-Clark; Cosima Obst; Arne Uhlendorff
    Abstract: We analyze workers’ risk preferences and training investments. Our conceptual framework differentiates between the investment risk and insurance mechanisms underpin-ning training decisions. Investment risk leads risk-averse workers to train less; they undertake more training if it insures them against future losses. We use the German Socio-Economic Panel (SOEP) to demonstrate that risk affinity is associated with more training, implying that, on average, investment risks dominate the insurance benefits of training. Crucially, this relationship is evident only for general training; there is no relationship between risk attitudes and specific training. Thus, as expected, risk preferences matter more when skills are transferable – and workers have a vested interest in training outcomes – than when they are not. Finally, we provide evidence that the insurance benefits of training are concentrated among workers with uncertain employment relationships or limited access to public insurance schemes.
    Keywords: Human Capital Investment, Work-related Training, Risk Preferences
    JEL: J24 C23 D81
    Date: 2020

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