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on Labor Markets - Supply, Demand, and Wages |
| By: | Kim, Jinyoung (Korea University); Kim, Seonghoon (Singapore Management University); Koh, Kanghyock (Korea University) |
| Abstract: | Despite unambiguous predictions of the canonical model of a competitive labor market, empirical studies on the labor market effects of payroll taxation provide conflicting evidence. Our meta-analysis shows that varying degrees of labor market competitiveness across places and time could be one explanation for the mixed results. We then estimate the labor market impacts of payroll taxation in Singapore, the country with most competitive and flexible labor market among the countries investigated in the literature. By exploiting the sharp reduction in payroll tax rate when workers turn 60, we find that the payroll tax cut in Singapore has a large effect on wages without changes in employment. We provide novel evidence corroborating the canonical model prediction that the welfare costs of social insurance programs financed by payroll taxes can be minimized in a competitive labor market. |
| Keywords: | payroll tax, labor market outcomes, incidence, regression discontinuity design, meta-analysis, labor market competitiveness |
| JEL: | H24 I31 J22 |
| Date: | 2021–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14321&r= |
| By: | Denning, Jeffrey T. (Brigham Young University); Jacob, Brian A. (University of Michigan); Lefgren, Lars (Brigham Young University); vom Lehn, Christian (Brigham Young University) |
| Abstract: | Prior research suggests that gender differences in hours worked play an important role in the gender pay gap. Yet common estimates of the wage returns to hours worked are close to zero, implying that hours differences cannot account much for the gender wage gap, even though men work more hours than women on average. However, while the wage returns to hours worked within occupation are small, we document that the wage returns to average hours worked across occupations are large. We develop a conceptual framework that reconciles these facts. We show that, under some assumptions, gender differences in hours worked can account for a substantial portion of the gender wage gap and that increases in the returns to hours worked over the past four decades slowed progress in reducing the gender pay gap. |
| Keywords: | hours, wages, occupation, gender wage gap |
| JEL: | J16 J22 J31 J33 |
| Date: | 2021–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14325&r= |
| By: | Lee E. Ohanian; Musa Orak; Shihan Shen |
| Abstract: | This paper revisits capital-skill complementarity and inequality, as in Krusell, Ohanian, Rios-Rull and Violante (KORV, 2000). Using their methodology, we study how well the KORV model accounts for more recent data, including the large changes in labor’s share of income that were not present in KORV. We study both labor share of gross income (as in KORV), and income net of depreciation. We also use non-farm business sector output as an alternative measure of production to real GDP. We find strong evidence for continued capital-skill complementarity in the most recent data, and that the model continues to closely account for the skill premium. The model captures the average level of labor share, though it overpredicts its level by 2-4 percentage points at the end of the period. |
| JEL: | E13 E25 J23 J3 J68 |
| Date: | 2021–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28747&r= |
| By: | David J. Deming |
| Abstract: | Machines increasingly replace people in routine job tasks. The remaining tasks require workers to make open-ended decisions and to have “soft” skills such as problem-solving, critical thinking and adaptability. This paper documents growing demand for decision-making and explores the consequences for life-cycle earnings. Career earnings growth in the U.S. more than doubled between 1960 and 2017, and the age of peak earnings increased from the late 30s to the mid-50s. I show that a substantial share of this shift is explained by increased employment in decision-intensive occupations, which have longer and more gradual periods of earnings growth. To understand these patterns, I develop a model that nests decision-making in a standard human capital framework. Workers predict the output of uncertain, context-dependent actions. Experience reduces prediction error, improving a worker’s ability to adapt using data from similar decisions they have made in the past. Experience takes longer to accumulate in high variance, non-routine jobs. I test the predictions of the model using data from the three waves of the NLS. Life-cycle wage growth in decision-intensive occupations has increased over time, and it has increased relatively more for highly-skilled workers. |
| JEL: | I26 J23 J24 J31 |
| Date: | 2021–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28733&r= |
| By: | Ponczek, Vladimir; Ulyssea, Gabriel |
| Abstract: | How does enforcement of labor regulations shape the labor market effects of trade? Does the informal sector introduce greater de facto flexibility, reducing employment losses during bad times? To tackle these questions, we exploit local economic shocks generated by trade liberalization and variation in enforcement capacity across local labor markets in Brazil. In the aftermath of the trade opening, regions with stricter enforcement observed: (i) lower informality effects; (ii) larger losses in overall employment; and (iii) greater reductions in the number of formal plants. Regions with weaker enforcement observed opposite effects. All these effects are concentrated on low-skill workers. Our results indicate that greater de facto labor market flexibility introduced by informality allows both formal firms and low-skill workers to cope better with adverse labor market shocks. |
| Keywords: | Informality; Labor market flexibility; Trade |
| JEL: | F16 J32 J46 |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:15960&r= |
| By: | Ganau, Roberto; Rodríguez-Pose, Andrés |
| Abstract: | Europe has witnessed a considerable labour productivity slowdown in recent decades. Many potential explanations have been proposed to address this productivity 'puzzle'. However, how the quality of local institutions influences labour productivity has been overlooked by the literature. This paper addresses this gap by evaluating how institutional quality affects labour productivity growth and, particularly, its determinants at the regional level during the period 2003-2015. The results indicate that institutional quality influences regions' labour productivity growth both directly -as improvements in institutional quality drive productivity growth- and indirectly -as the short- and long-run returns of human capital and innovation on labour productivity growth are affected by regional variations in institutional quality. |
| Keywords: | Europe; Human Capital; Innovation; institutional quality; labour productivity; Physical Capital; regions |
| JEL: | E24 J24 O47 R11 |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:15870&r= |
| By: | Huang, Bin (Nanjing University of Finance and Economics); Tani, Massimiliano (University of New South Wales); Zhu, Yu (University of Dundee) |
| Abstract: | Using the 2017 China Household Finance Survey (CHFS), we estimate the effect of higher education on entrepreneurship for prime-aged males. We distinguish between own-account workers and employers of small and large businesses, respectively, and use the higher education expansion in China starting in 1999 and instruments of pre-school hukou status to help identify causal effects. While our Inverse Probability Weighted Regression Adjustment estimates show that people with more education are less likely to enter entrepreneurship in general, obtaining any qualification beyond the baseline of compulsory schooling significant increases large business ownership later in life, with the maximum effect corresponding to a 3-fold increase found for university graduates. We attribute this effect to graduates taking full advantage of the opportunities presented by access to education earlier on in their lives. |
| Keywords: | higher education, entrepreneurship, higher education expansion, China, Inverse Probability Weighted Regression Adjustment (IPWRA) |
| JEL: | I25 J24 L26 |
| Date: | 2021–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14310&r= |
| By: | Booth, Alison L; Nolen, Patrick |
| Abstract: | Gender differences in paid performance under competition have been found in many laboratory-based experiments, and it has been suggested that these may arise because men and women respond differently to psychological pressure in competitive environments. To explore this further, we conducted a laboratory experiment comprising 444 subjects, and measured gender differences in performance in four distinct competitive situations. These were as follows: (i) the standard tournament game where the subject competes with three other individuals and the winner takes all; (ii) an anonymized competition in which an individual competes against an imposed production target and is paid only if s/he exceeds it; (iii) a 'personified' competition where an individual competes against a target based on the previous performance of one anonymised person of unknown gender; and (iv) a 'gendered' competition where an individual competes against a target based on the previous performance of one anonymised person whose gender is known. We found that only men respond to pressure differently in each situation; women responded the same to pressure no matter the situation. Moreover, the personified target caused men to increase performance more than under an anonymized target and, when the gender of the person associated with the target was revealed, men worked even harder to outperform a woman but strived only to equal the target set by a male. |
| Keywords: | psychological pressure, tournament, piece rate, gender, competitive behaviour; experiment; competitive behaviour; gender; piece rate; psychological pressure; randomized experiment; tournament |
| JEL: | C91 C92 J16 J33 M52 |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:15888&r= |
| By: | Cavapozzi, Danilo; Francesconi, Marco; Nicoletti, Cheti |
| Abstract: | We study whether mothers' labor supply is shaped by the gender role attitudes of their peers. Using detailed information on a sample of UK mothers with dependent children, we find that having peers with gender-egalitarian norms leads mothers to be more likely to have a paid job and to have a greater share of the total number of paid hours worked within their household, but has no sizable effect on hours worked. Most of these effects are driven by less educated women. A new decomposition analysis allows us to estimate that approximately half of the impact on labor force participation is due to women conforming gender role attitudes to their peers', with the remaining half being explained by the spillover effect of peers' labor market behavior. These findings suggest that an evolution towards gender-egalitarian attitudes promotes gender convergence in labor market outcomes. In turn, a careful dissemination of statistics on female labor market behavior and attitudes may accelerate this convergence. |
| Keywords: | Culture; gender; identity; norms; peer effects |
| JEL: | J12 J16 J22 J24 J31 Z13 |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:15957&r= |
| By: | Baker, Michael; Messacar, Derek; Stabile, Mark |
| Abstract: | We investigate whether child tax benefits reduce child poverty and labor force participation among single mothers within the context of the 2015 expansion of the Canadian Universal Child Care Benefit (UCCB) and the 2016 introduction of the Canada Child Benefit (CCB). We compare single mothers to single childless women as single mothers have historically had the highest poverty rates. Our analysis indicates that both reforms reduced child poverty, although the Canada Child Benefit had the greater effect. We find no evidence of a labor supply response to either of the program reforms on either the extensive or intensive margins. |
| JEL: | H27 J13 J21 J30 |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:15937&r= |
| By: | Drautzburg, Thorsten; Fernández-Villaverde, Jesús; Guerron, Pablo |
| Abstract: | We argue that social and political risk causes significant aggregate fluctuations by changing workers' bargaining power. Using a Bayesian proxy-VAR estimated with U.S. data, we show how distribution shocks trigger output and unemployment movements. To quantify the aggregate importance of these distribution shocks, we extend an otherwise standard neoclassical growth economy. We model distribution shocks as exogenous changes in workers' bargaining power in a labor market with search and matching. We calibrate our economy to the U.S. corporate non-financial business sector, and we back out the evolution of workers' bargaining power. We show how the estimated shocks agree with the historical narrative evidence. We document that bargaining shocks account for 28% of aggregate fluctuations and have a welfare cost of 2.4% in consumption units. |
| Keywords: | Aggregate fluctuations; bargaining shocks; Distribution risk; historical narrative; partial filter |
| JEL: | E32 E37 E44 J20 |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:15979&r= |
| By: | Siegloch, Sebastian; Wehrhöfer, Nils; Etzel, Tobias |
| Abstract: | We analyze the effects of a large place-based policy, subsidizing up to 50% of investment costs of manufacturing firms in East Germany after reunification. We show that a 1-percentage-point decrease in the subsidy rate leads to a 1% decrease in manufacturing employment. We document important spillovers for untreated sectors in treated counties, untreated counties connected via trade and local taxes, whereas we do not find spillovers on counties in the same local labor market. We show that the policy is at least as efficient as cash transfers to the unemployed, but is more effective in curbing regional inequality. |
| Keywords: | place-based policies,employment,spillovers,administrative microdata |
| JEL: | H24 J21 J23 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:21038&r= |
| By: | Wiji Arulampalam; Andrea Papini (European Commission - JRC) |
| Abstract: | Analysis of the relationship between taxes and self-employment should account for the interplay between responses in self-employment and wage employment. To this end, we estimate a two-state multi-spell duration model which accounts for both observed and unobserved heterogeneity using a large longitudinal administrative dataset for Norway for 1993 to 2011. Our findings confirm theoretical predictions, and are robust to various changes to definitions and sample selections. A policy experiment simulating a flatter tax schedule in the year 2000 is found to encourage self-employment, delivering a net increase of predicted inflow into self-employment from 2.8% to 5.3%. |
| Keywords: | Tax progressivity; Income tax; Self-employment; Duration analysis. |
| JEL: | H24 H25 J24 C41 |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:taxref:202103&r= |
| By: | Allan, Julia L.; Andelic, Nicole; Bender, Keith A.; Powell, Daniel; Stoffel, Sandro; Theodossiou, Ioannis |
| Abstract: | A growing literature has found a link between performance-related pay (PRP) and poor health, but the causal direction of the relationship is not known. To address this gap, the current paper utilises a crossover experimental design to randomly allocate subjects into a work task paid either by performance or a fixed payment. Stress is measured through self-reporting and salivary cortisol. The study finds that PRP subjects had significantly higher cortisol levels and self-rated stress than those receiving fixed pay, ceteris paribus. By circumventing issues of self-report and self-selection, these results provide novel evidence for the detrimental effect PRP may have on health. |
| Keywords: | performance-related pay,stress,experiment,cortisol |
| JEL: | J33 I0 C91 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:838&r= |
| By: | Rostam-Afschar, Davud; Unsorg, Maximiliane |
| Abstract: | We examine a deregulation of German pharmacists to assess its effects on retail and labor markets. From 2004 onward, the reform allowed pharmacists to expand their single-store firms and to open or acquire up to three affiliated stores. This partial deregulation of multi-store prohibition reduced the cost of firm expansion substantially and provides the basis for our analysis. We develop a theoretical model that suggests that the general limitation of the total store number per firm to four is excessively restrictive. Firms with high managerial efficiency will open more stores per firm and have higher labor demand. Our empirical analysis uses very rich information from the administrative panel data on the universe of pharmacies from 2002 to 2009 and their affiliated stores matched with survey data, which provide additional information on the characteristics of expanding firms before and after the reform. We find a sharp immediate increase in entry rates, which continues to be more than five-fold of its pre-reform level after five years for expanding firms. Expanding firms can double revenues but not profits after three years. We show that the increase of the number of employees by 50% after five years and the higher overall employment in the local markets, which increased by 40%, can be attributed to the deregulation. |
| Keywords: | egulation,acquisitions,entry,market concentration,wages,employment,pharmacists |
| JEL: | L4 L5 L2 J44 J23 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:836&r= |
| By: | Hale, Galina B; Regev, Tali; Rubinstein, Yona |
| Abstract: | We document appearance effects in the economics profession. Using unique data on PhD graduates from ten of the top economics departments in the United States we test whether more attractive individuals are more likely to succeed. We find robust evidence that appearance has predictive power for job outcomes and research productivity. Attractive individuals are more likely to study at higher ranked PhD institutions and are more likely to be placed at higher-ranking academic institutions not only for their first job, but also for jobs as many as 15 years after their graduation, even when we control for the ranking of PhD institution and first job. Appearance also predicts the success of research output: while it does not predict the number of papers an individual writes, it predicts the number of citations for a given number of papers, again even when we control for the ranking of the PhD institution and first job. All these effects are robust, statistically significant, and substantial in magnitude. |
| Keywords: | appearance; beauty; economists * |
| JEL: | I23 J16 J71 M51 |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:15893&r= |
| By: | Baert, Stijn (Ghent University); Clays, Els (Ghent University); Derous, Eva (Ghent University); George, Bert (Ghent University); Neyt, Brecht (Ghent University); Schollaert, Eveline (Ghent University); Wille, Bart (Ghent University) |
| Abstract: | This study uses survey data among both a random sample (N = 500) and a convenience sample (N = 2,919) of Flemish adults to assess public support for 24 potential labour market reforms. The results show that there is a lot of public support for (both encouraged and mandatory) training and community service for the unemployed and for the so-called 'job bonus', which are all reforms planned by the Flemish government Jambon I. However, there is little public support for reforms which should make the – apparently strongly desired – increase of the minimum pension to 1,500 euro after taxes possible, such as gradually eliminating early retirement possibilities, decreasing how much equated periods (such as periods of sick leave and unemployment) count towards pension accrual, and (partly) unlinking wages from seniority. This indicates that the end-of-career-debate that the Belgian federal government De Croo I wants to have will not be an easy one. For the planned increased monitoring to fight social and fiscal fraud, there is, however, a lot of public support. Somewhat surprisingly, there is little public support for reforms which aim to strengthen the position of women on the labour market, such as more quota for women in boards of directors in private companies, more parental leave for couples who divide this leave more equally, and increased paternity leave from 10 to 20 days. |
| Keywords: | labour market policy, labour market reforms, public support |
| JEL: | J0 J28 J38 J58 J68 J78 |
| Date: | 2021–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izapps:pp176&r= |
| By: | Jörn Kleinert (University of Graz) |
| Abstract: | Most theory treats productivity as exogenously given by technological capabilities. Moreover, technology is very often assumed to be freely tradable. It is therefore puzzling to observe the huge differences in productivity as we find in empirical studies even of firms working in the same market environment. To reconcile the heterogeneity, I deviate from a purely technological view and stress the organizational function of a firm. Firms are vehicles to facilitate the division of labor between people with different skills who join forces to produce a particular good. A firm’s management decides about technology jointly with investment projects and changes in the labor force, thereby determining productivity. If a firm is managed well, productivity increases with a larger labor force, because gains from specialization can be exploited. Moreover, as result of the decisions by the management, firms grow over time, shrink or even exit. The growth process is necessarily stochastic, since the future is uncertain and many effects influence the outcome of management’s decisions. Stochastic firm growth, in turn, yields a stationary firm size distribution which reflects large heterogeneity of the firms. |
| Keywords: | Productivity; firm heterogeneity; firm size distribution. |
| JEL: | D23 D24 J24 |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:grz:wpaper:2021-03&r= |
| By: | Thoresson, Anna (IFAU - Institute for Evaluation of Labour Market and Education Policy) |
| Abstract: | This paper studies how wages respond to a sudden change in employer concentration. It exploits a reform that deregulated the Swedish pharmacy market, which until 2009 was a monopoly. The reform involved a substantial increase in the number of employers on the pharmacy labor market. However, the change in employer concentration was not geographically uniform: certain areas experienced large changes while others were largely unaffected. Exploiting this geographical variation, elasticities of wages with respect to labor market concentration are estimated to be between -0.02 and -0.05. The empirical approach relies only on the variation in concentration controlled by the policymaker to remedy the concern that actual labor market concentration is endogenous. The positive wage effects from reduced labor market concentration are found to be most prevalent for stayers, rather than new hires, as well as those with more industry experience and longer tenure. Overall, the paper adds to a growing literature that finds that market concentration matters for workers' wages, in a context where labor is highly industry-specific. |
| Keywords: | Wages; Competition; Market concentration |
| JEL: | J31 J42 J45 |
| Date: | 2021–05–04 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2021_006&r= |
| By: | Jose Maria Barrero; Nicholas Bloom; Steven J. Davis |
| Abstract: | COVID-19 drove a mass social experiment in working from home (WFH). We survey more than 30,000 Americans over multiple waves to investigate whether WFH will stick, and why. Our data say that 20 percent of full workdays will be supplied from home after the pandemic ends, compared with just 5 percent before. We develop evidence on five reasons for this large shift: better-than-expected WFH experiences, new investments in physical and human capital that enable WFH, greatly diminished stigma associated with WFH, lingering concerns about crowds and contagion risks, and a pandemic-driven surge in technological innovations that support WFH. We also use our survey data to project three consequences: First, employees will enjoy large benefits from greater remote work, especially those with higher earnings. Second, the shift to WFH will directly reduce spending in major city centers by at least 5-10 percent relative to the pre-pandemic situation. Third, our data on employer plans and the relative productivity of WFH imply a 5 percent productivity boost in the post-pandemic economy due to re-optimized working arrangements. Only one-fifth of this productivity gain will show up in conventional productivity measures, because they do not capture the time savings from less commuting. |
| JEL: | D13 D23 E24 G18 J22 M54 R3 |
| Date: | 2021–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28731&r= |
| By: | D’Ambrosio, Anna (Polytechnic of Turin); Leombruni, Roberto (University of Turin); Razzolini, Tiziano (University of Siena) |
| Abstract: | Populist parties' propaganda portrays immigrants as a threat to native workers' jobs. When propaganda materializes as an electoral success, it may drive changes in natives' attitudes towards immigrants. As shown experimentally by Bursztyn et al. (2020), electoral results may signal a change in social preferences about immigration and make individuals more likely to express anti-immigrant resentment that they were previously hiding. We employ Italian administrative data to explore whether this mechanism implies actual differences in native and foreign workers' labor market outcomes. We estimate the impact of the electoral results of an Italian populist party, the Lega Nord, on natives and foreigners' workplace injuries and wages. We show that, on average, a 1% increase in the votes for the Lega Nord increases within-job-spell injury rates of foreign workers by 0.9%. Firms below fifteen employees benefiting from less employment protection drive the result. We argue that this is due to a reallocation of hazardous tasks to immigrant workers only in contexts characterized by higher job insecurity. The evidence is weaker for wage reductions, arguably due to labor market rigidity. |
| Keywords: | social norms, discrimination, workplace injuries |
| JEL: | D72 J28 J71 |
| Date: | 2021–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14322&r= |
| By: | Boehm, Michael; Siegel, Christian |
| Abstract: | This paper studies the impact of demographic change on experienced workers' relative wages and employment rates. We investigate empirical predictions from a framework of supply and demand for experience skill, using variation across U.S. local labor markets (LLMs) over the last decades and instrumenting experience skill supply by the LLMs' age structures a decade earlier. We find that aging substantially reduces experienced workers' relative wages and full-time employment rates, and also their labor market participation rates. Our results imply that the effect of demographic change on labor markets might be more severe than previously recognized, as it reaches beyond wages. |
| Keywords: | Demographic Change; Employment of Experienced Workers; Return to Experience |
| JEL: | J11 J21 J31 |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:15953&r= |
| By: | Wei Jiang; Yuehua Tang; Rachel (Jiqiu) Xiao; Vincent Yao |
| Abstract: | This paper studies how demand for labor reacts to financial technology (fintech) shocks based on comprehensive databases of fintech patents and firm job postings in the U.S. during the past decade. We first develop a measure of fintech exposure at the occupation level by intersecting the textual information in job task descriptions and fintech patents. We then document a significant decline of job postings in the most exposed occupations, and an increase in industry as well as geographical concentration of these occupations. Firms resort to an upskilling strategy in face of the fintech disruption, requiring “combo” (finance and software) skills, higher education attainments, and longer work experiences in the hiring of fintech-exposed jobs. Financial firms and those with high innovation outputs are able to offset the disruptive effect from the fintech shock. Among innovating firms, however, only inventors (but not acquisition-driven innovators) experience growth in hiring, sales, investment, and enjoy better returns on assets. |
| JEL: | G30 J23 O33 |
| Date: | 2021–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28668&r= |
| By: | Tito Boeri (Università Bocconi, IZA, CEP-LSE); Edoardo Di Porto (CSEF, INPS, Università di Napoli Federico II, UCFS, Uppsala University); Paolo Naticchioni (INPS, Università Roma Tre, IZA); Vincenzo Scrutinio (LSE, IZA, Università di Bologna) |
| Abstract: | This paper provides the first analysis of a population-wide controlled field experiment for home visits checking on sick leave in the public sector. The experiment was carried out in Italy, a country with large absenteeism in the public sector, and it concerned the universe of public employees. We exploit unique administrative data from the Italian social security administration (INPS) on sick leave and work histories. We find that receiving a home visit reduces the number of days on sick leave in the following 16 months by about 12% (5.5 days). The effect is stronger for workers who are found irregularly on sick leave (-10.2 days). We interpret our findings as a deterrence effect of home visits: workers being found irregularly on sick leave experience a decline of about 2% of their wage in the following 12 months. Uncertainty aversion (there is no automatism in these sanctions) can play a role in these results. Our estimates suggest that home visits are cost-effective: every Euro spent for the visits involves up to 10 Euros reductions in sick benefits outlays. We estimate the marginal value of public funds (MVPF) spent on home visits at about 1.13, which is significantly lower than estimates of MVPF of income taxes in the US. |
| Keywords: | Sick leave, Absenteeism, Randomized trial. |
| JEL: | I12 J45 |
| Date: | 2021–05–03 |
| URL: | http://d.repec.org/n?u=RePEc:sef:csefwp:610&r= |
| By: | Bolt, Uta; French, Eric Baird; Maccuish, Jamie; ODea, Cormac |
| Abstract: | Using data covering a single cohort's first 55 years of life, we show that most of the intergenerational elasticity of earnings (IGE) is explained by differences in: years of schooling, cognitive skills, investments of parental time and school quality, and family circumstances during childhood. To decompose the fraction of the IGE explained by each of these channels, we implement a multi-level mediation analysis combined with a latent factor framework that accounts for measurement error. Multilevel mediation analysis allows us to assess not only the direct effect of each channel on the IGE, but also its indirect effects working through the other channels, thus providing an in-depth understanding of the link between parents' and children's earnings. Of these channels, we show that the main driver of the IGE is increased levels of parental investments received by children of high income parents early in their lives, which encourages greater cognitive development and lifetime earnings. |
| Keywords: | cognitive skills; Intergenerational Elasticity of Earnings; Parental investments |
| JEL: | C38 I24 J24 |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:15975&r= |
| By: | Daniel Goller; Stefan C. Wolter |
| Abstract: | This study is, to the best of our knowledge, the first analysis of apprenticeship supply that allows us to analyse the effects of the shutdowns triggered by the COVID-19 pandemic before, during and after these shutdowns by means of daily searches for vacant apprenticeships. Analysing over 10 million search queries on the national administrative platform for apprenticeship offers from February 2020 until April 2021 we find a sharp reduction of up to 40% in the daily number of search queries associated to the first shutdown in March 2020, followed by some catch-up effect thereafter. Although we find a strong relationship between the intensity of the politically imposed restrictions due to the COVID-19 pandemic and daily search queries, this relationship weakens over time as the pandemic progresses. Finally, we find a large heterogeneity of effects, but all regions and occupational groups studied show a statistically significant negative effect of the measures on the search intensity for apprenticeships. |
| Keywords: | COVID-19, Switzerland, stringency index, apprenticeship |
| JEL: | I20 J22 |
| Date: | 2021–05 |
| URL: | http://d.repec.org/n?u=RePEc:iso:educat:0182&r= |
| By: | Posada, H. M.; Garcia-Suaza, A. F. |
| Abstract: | Transportation policies have an important incidence on the allocation of resources within cities. Therefore, investigating the impacts of transit investment is relevant especially in developing countries where informal housing is highly prevalent and spatial disparities are remarkable. We study the impact of a transit expansion of the Metrocable system in Medellín (Colombia) as a natural scenario to understand the causal links between lowering access cost and informal housing. Using a difference-in-difference identification strategy, we estimate that the expasion of Line H of Metrocable reduces informal housing up to 15 percentage points. We also show that the magnitude of the effect depends on the distance to the intervention. When exploring potential mechanisms mediating the analyzed causal relation we find that the labor market plays a crucial role. |
| Keywords: | Informal housing, Transportation cost, Land value, Informal labor market, Colombia |
| JEL: | R41 R42 R31 J46 |
| Date: | 2021–04–22 |
| URL: | http://d.repec.org/n?u=RePEc:col:000092:019239&r= |