nep-lma New Economics Papers
on Labor Markets - Supply, Demand, and Wages
Issue of 2021‒06‒28
twenty-six papers chosen by
Joseph Marchand
University of Alberta

  1. Does Vocational Education Pay Better, or Worse, Than Academic Education? By Chen, Jie; Pastore, Francesco
  2. Tasks, Automation, and the Rise in US Wage Inequality By Daron Acemoglu; Pascual Restrepo
  3. The Impact of Selection into the Labor Force on the Gender Wage Gap By Francine D. Blau; Lawrence M. Kahn; Nikolai Boboshko; Matthew L. Comey
  4. The Impacts of Opportunity Zones on Zone Residents By Matthew Freedman; Shantanu Khanna; David Neumark
  5. The More the Gloomier: development of informal employment and its effect on wages in Turkey By Duman, Anil; Duman, Alper
  6. Can Competitiveness predict Education and Labor Market Outcomes? Evidence from Incentivized Choice and Survey Measures By Thomas Buser; Muriel Niederle; Hessel Oosterbeek
  7. Shocks, Institutions and Secular Changes in Employment of Older Individuals By Richard Rogerson; Johanna Wallenius
  8. Outcome Mechanisms for Improved Employment and Earnings through Screened Job Training: Evidence from an RCT By Baird, Matthew; Engberg, John; Gutierrez, Italo A.
  9. Entrepreneurial Reluctance: Talent and Firm Creation in China By Chong-En Bai; Ruixue Jia; Hongbin Li; Xin Wang
  10. The Gender Pay Gap in Ireland from Austerity through Recovery By Doorley, Karina; Privalko, Ivan; Russell, Helen; Tuda, Dora
  11. Why Making Promotion After a Burnout Is Like Boiling the Ocean By Sterkens, Philippe; Baert, Stijn; Rooman, Claudia; Derous, Eva
  12. The Effects of COVID-19 on Employment, Labour Markets and Gender Equality in Central America By Webster, Allan; Khorana, Sangeeta; Pastore, Francesco
  13. Equilibrium Effects of Pay Transparency By Zoe B. Cullen; Bobak Pakzad-Hurson
  14. The Effect of Changes in Social Security's Delayed Retirement Credit: Evidence from Administrative Data By Mark Duggan; Irena Dushi; Sookyo Jeong; Gina Li
  15. Technological Change and Obsolete Skills: Evidence from Men’s Professional Tennis By Ian Fillmore; Jonathan Hall
  16. The Psychosocial Value of Employment By Reshmaan N. Hussam; Erin M. Kelley; Gregory V. Lane; Fatima T. Zahra
  17. It Ain’t Where You’re From, It’s Where You’re At: Hiring Origins, Firm Heterogeneity, and Wages. By Sabrina L. Di Addario; Patrick M. Kline; Raffaele Saggio; Mikkel Sølvsten
  18. Local Public Goods and the Spatial Distribution of Economic Activity By Arthur Guillouzouic--Le Corff; Emeric Henry; Joan Monras
  19. The labor market returns to ‘first in family’ university graduates By Anna Adamecz-Volgyi; Morag Henderson; Nikki Shure
  20. Signaling and Discrimination in Collaborative Projects By Paula Onuchic ⓡ; Debraj Ray
  21. Female labour force participation and household income inequality in Italy By Segato, Federico
  22. How Does Social Security Reform Indecision Affect Younger Cohorts? By John B. Shoven; Sita Slavov; John G. Watson
  23. Efficiency and effectiveness of the COVID-19 government support: Evidence from firm-level data By Lalinsky, Tibor; Pál, Rozália
  24. Green Mobility and Well-Being By Echeverría, Lucía; Gimenez-Nadal, J. Ignacio; Molina, José Alberto
  25. Sexual Orientation and Earnings. A Meta-Analysis 2012-2020 By Drydakis, Nick
  26. Even more discouraged? The NEET generation at the age of COVID-19 By Aina, Carmen; Brunetti, Irene; Mussida, Chiara; Schicchitano, Sergio

  1. By: Chen, Jie (UNSW Sydney); Pastore, Francesco (Università della Campania Luigi Vanvitelli)
    Abstract: In this paper, we use the Chinese General Social Survey data to analyse the returns to upper secondary vocational education in China. To address possible endogeneity of vocational training due to omitted heterogeneity, we construct a novel instrumental variable using the proportion of tertiary education graduates relative to the entire population by year. Our main finding is that, although returns to vocational upper secondary education appear higher than returns to academic upper secondary education according to the Mincerian equation, the results from the instrumental variable method tell the opposite story: vocational upper secondary graduates face a wage penalty compared to academic upper secondary graduates. The wage penalty is confirmed by an alternative and more recent IV method - the Lewbel method (Lewbel, 2012). Our findings highlight the importance of properly accounting for endogeneity when estimating the returns to vocational education.
    Keywords: vocational education, academic education, upper secondary, China, Lewbel
    JEL: I26 I25 J24 J31 C36
    Date: 2021–06
  2. By: Daron Acemoglu; Pascual Restrepo
    Abstract: We document that between 50% and 70% of changes in the US wage structure over the last four decades are accounted for by the relative wage declines of worker groups specialized in routine tasks in industries experiencing rapid automation. We develop a conceptual framework where tasks across a number of industries are allocated to different types of labor and capital. Automation technologies expand the set of tasks performed by capital, displacing certain worker groups from employment opportunities for which they have comparative advantage. This framework yields a simple equation linking wage changes of a demographic group to the task displacement it experiences. We report robust evidence in favor of this relationship and show that regression models incorporating task displacement explain much of the changes in education differentials between 1980 and 2016. Our task displacement variable captures the effects of automation technologies (and to a lesser degree offshoring) rather than those of rising market power, markups or deunionization, which themselves do not appear to play a major role in US wage inequality. We also propose a methodology for evaluating the full general equilibrium effects of task displacement (which include induced changes in industry composition and ripple effects as tasks are reallocated across different groups). Our quantitative evaluation based on this methodology explains how major changes in wage inequality can go hand-in-hand with modest productivity gains.
    JEL: J23 J31 O33
    Date: 2021–06
  3. By: Francine D. Blau; Lawrence M. Kahn; Nikolai Boboshko; Matthew L. Comey
    Abstract: We study the impact of selection bias on estimates of the gender pay gap, focusing on whether the gender pay gap has fallen since 1981. Previous research has found divergent results across techniques, identification strategies, data sets, and time periods. Using Michigan Panel Study of Income Dynamics data and a number of different identification strategies, we find robust evidence that, after controlling for selection, there were large declines in the raw and the unexplained gender wage gaps over the 1981-2015 period. Under our preferred method of accounting for selection, we find that the raw median wage gap declined by 0.378 log points, while the median unexplained gap declined by a more modest but still substantial 0.204 log points. These declines are larger than estimates that do not account for selection. Our results suggest that women’s relative wage offers have increased over this period, even after controlling for their measured covariates, including education and actual labor market experience. However, we note that substantial gender wage gaps remain. In 2015, at the median, the selectivity-corrected gaps were 0.242 log points (raw gap) and 0.206 log points (unexplained gap).
    JEL: C21 C24 J16 J3 J31 J71
    Date: 2021–05
  4. By: Matthew Freedman; Shantanu Khanna; David Neumark
    Abstract: Created by the Tax Cuts and Jobs Act in 2017, the Opportunity Zone program was designed to encourage investment in distressed communities across the U.S. We examine the early impacts of the Opportunity Zone program on residents of targeted areas. We leverage restricted-access microdata from the American Community Survey and employ difference-in-differences and matching approaches to estimate causal reduced-form effects of the program. Our results point to modest, if any, positive effects of the Opportunity Zone program on the employment, earnings, or poverty of zone residents.
    Keywords: Opportunity Zones, Place-Based Policies, Tax Incentives, Employment, Poverty
    JEL: H25 J23 J38 R12 R38
    Date: 2021–06
  5. By: Duman, Anil; Duman, Alper
    Abstract: Various studies found wage gaps between formal and informal sector workers even after controlling for a number of individual and firm level characteristics. It has also been shown that earnings differentials across these sectors are quite stable over the years. While there is limited amount of research considering the same issues focusing on Turkish labor market, the development of wage gap between formal and informal employment has not been examined. In our paper, we carry this analysis for Turkey and estimate the wage gap between formal and informal sector workers by utilizing the Household Labor Force Survey (LFS) for the period of 2005 and 2019. There are three main findings; first, decline in informal employment is not uniform and especially after 2012 there is a slight increase in the share of informal jobs at the lower end of wage distribution. Second, we demonstrate that returns to informality vary significantly across quantiles even after a matching technique through inverse probability treatment weights are considered. While at the upper end of the distribution, the penalty is extremely small and stable over the years, at the bottom end, the informal sector considerably reduces wages, and the effect becomes larger over time. The negative and increasing penalty is observable well before the refugee inflows. The last part of our analysis looks at the occupational composition within formal and informal sectors over time and points out that the rise of white collar low skilled service (WCLS) jobs among informal employment is mainly responsible for the increasing wage gap for the workers at the bottom end.
    Keywords: wage gap,quantile regression,informal sector,compensation,skills,occupation
    JEL: J31 C31 O17 J46
    Date: 2021
  6. By: Thomas Buser; Muriel Niederle; Hessel Oosterbeek
    Abstract: We assess the predictive power of two measures of competitiveness for education and labor market outcomes using a large, representative survey panel. The first is incentivized and is an online adaptation of the laboratory-based Niederle-Vesterlund measure. The second is an unincentivized survey question eliciting general competitiveness on an 11-point scale. Both measures are strong and consistent predictors of income, occupation, completed level of education and field of study. The predictive power of the new unincentivized measure for these outcomes is robust to controlling for other traits, including risk attitudes, confidence and the Big Five personality traits. For most outcomes, the predictive power of competitiveness exceeds that of the other traits. Gender differences in competitiveness can explain 5-10 percent of the observed gender differences in education and labor market outcomes.
    JEL: C9 I20 J16 J24
    Date: 2021–06
  7. By: Richard Rogerson; Johanna Wallenius
    Abstract: Employment rates of males aged 55-64 have changed dramatically in the OECD over the last 5 decades. The average employment rate decreased by more than 15 percentage points between the mid-1970s and the mid-1990s, only to increase by roughly the same amount subsequently. One proposed explanation in the literature is that spousal non-working times are complements and that older males are working longer as a result of secular increases in labor supply of older females. In the first part of this paper we present evidence against this explanation. We then offer a new narrative to understand the employment rate changes for older individuals. We argue that the dramatic U-shaped pattern for older male employment rates should be understood as reflecting a mean reverting low frequency shock to labor market opportunities for all workers in combination with temporary country specific policy responses that incentivized older individuals to withdraw from market work.
    JEL: E24 J21 J26
    Date: 2021–06
  8. By: Baird, Matthew (RAND); Engberg, John (RAND Corporation); Gutierrez, Italo A. (Amazon)
    Abstract: This study fills a gap in the literature on the outcome mechanisms in which successful training programs improve employment and earnings, such as raises on the job or longer job duration. The city of New Orleans implemented a job training program as an RCT for low-income workers. Individuals in the treatment group were more likely to work in the target industries and move out of low-skill industries. In the first 9 months after training, the treatment group experienced higher earnings with new employers and with existing employments. After 9 months, the effects were driven by higher probability of staying with an employer (with now-higher earnings). Findings encourage patience on the part of trainees and the government, as workers may not find their stable, target employment immediately. Government may also want to find ways to improve early connections with employers after training.
    Keywords: job training, RCT, disadvantaged workers
    JEL: J24 J38 J64 M53
    Date: 2021–06
  9. By: Chong-En Bai; Ruixue Jia; Hongbin Li; Xin Wang
    Abstract: The theoretical literature has long noted that talent can be used in both the entrepreneurial and non-entrepreneurial sectors, and its allocation depends on the reward structure. We test these hypotheses by linking administrative college admissions data for 1.8 million individuals with the universe of firm registration records in China. Within a college, we find that individuals with higher college entrance exam scores – the most important measure of talent in this context – are less likely to create firms, but, when they do, their firms are more successful than those of their lower-score counterparts. Additional survey data suggest that higher-score individuals enjoy higher wages and are more likely to join the state sector. Moreover, the score-to-firm creation relationship varies greatly across industry, according to the size of the state sector. These findings suggest that the score is positively associated with both entrepreneurial ability and wage-job ability but higher-score individuals are attracted away by wage jobs, particularly those of the state sector.
    JEL: H11 J24 O12 O15
    Date: 2021–05
  10. By: Doorley, Karina (Economic and Social Research Institute, Dublin); Privalko, Ivan (Economic and Social Research Institute, Dublin); Russell, Helen (Economic and Social Research Institute, Dublin); Tuda, Dora (Economic and Social Research Institute, Dublin)
    Abstract: This paper estimates the raw and adjusted gender pay gap in Ireland between 2011 and 2018, a period of austerity measures and recovery from the Great Recession. Using survey data sources linked to administrative information on earnings, we show that the raw gender wage gap across the wage distribution has not changed much over this period: it is larger for higher earners and is mainly concentrated in the private sector. Using a Distribution Regression method, we estimate the relative contributions of explained and unexplained components to the overall gender wage gap at each point at the wage distribution and summarise the findings by wage quantile. The explained gender wage gap is negative, indicating that women have better labour market characteristics than men, on average. The unexplained gender wage gap is positive and increases with the wage level. This results in a small or zero gender wage gap at the bottom of the wage distribution which rises to 10% at the top of the wage distribution. The stability of the gender pay gap across the wage distribution in the private sector over the period suggest the strong structural inequalities, that are unlikely to change without significant interventions
    Keywords: gender pay gap, occupational segregation, discrimination, Ireland
    JEL: J31 J71 D31
    Date: 2021–06
  11. By: Sterkens, Philippe; Baert, Stijn; Rooman, Claudia; Derous, Eva
    Abstract: Recent studies have explored hiring discrimination as an obstacle to former burnout patients. Many workers, however, return to the same employer, where they face an even more severe aftermath of burnout syndrome: promotion discrimination. To our knowledge, we are the first to directly address this issue in research. More specifically, we conducted a vignette experiment with 406 genuine managers, testing the potential of the main burnout stigma theoretically described in the literature as potential mediators of promotion discrimination. Estimates reveal that compared to employees without an employment interruption, former burnout patients have no less than a 34.4% lower probability of receiving a promotion. Moreover, these employees are perceived as having low (1) leadership, (2) learning capacity, (3) motivation, (4) autonomy and (5) stress tolerance, as well as being (6) less capable of taking on an exemplary role, (7) having worse current and (8) future health, (9) collaborating with them is regarded more negatively, and (10) managers perceive them as having fewer options to leave the organisation if denied a promotion. Four of these perceptions, namely lower leadership capacities, stress tolerance, abilities to take on an exemplary role and chances of finding another job explain almost half the burnout effect on promotion probabilities.
    Keywords: promotion,burnout,statistical discrimination,taste-based discrimination,invisibility hypothesis
    JEL: J71 I14 C83 C91
    Date: 2021
  12. By: Webster, Allan; Khorana, Sangeeta; Pastore, Francesco
    Abstract: This study considers the economic impact of Covid-19 on enterprises in four Central American countries - El Salvador, Guatemala, Honduras and Nicaragua. At the time of the analysis neither the pandemic nor its economic consequences had fully run their course. It is not, therefore, a definitive analysis but it is important to try to draw important lessons as soon as possible. The main focus of the study was the initial impact on labour markets. The analysis was based on World Bank enterprise surveys§ undertaken before the outbreak of Covid-19 and follow-up surveys on the effects of the pandemic, also undertaken by the World Bank. These were combined with data on government containment measures and on morbidity and mortality rates. The use of enterprise data to analyse labour market issues has some limitations but also many strengths. The data is useful for analysing the consequences for gender equality in employment. Since the demand for labour is a derived demand firm level data provides a clear link to labour market effects. The pandemic has caused a significant loss in sales for many firms, This creates a loss of liquidity which, in turn, has caused some firms to reduce employment, working hours and wages. Government containment measures necessary to save lives such as temporary workplace closures have added to the burden for both firms and employees. The study starts by using the surveys to identify the important stylised facts. Although some issues are already well documented anecdotally through media reports this provides a more evidence based approach. It also helps identify several issues, such as the impact on gender equality which have received less journalistic attention. The study is further supported by a regression analysis (OLS and SURE) of several key outcomes (changes in sales, employment, the share of females in employment and firm expectations of survival). A limitation of such analysis with any enterprise level is heterogeneity and, in consequence, a risk of sample selection bias. To provide robustness checks we use a matching approach. The results suggest that a significant proportion of surviving firms are vulnerable to permanent closure. The ability of firms to retain labour depends on sales which are affected by both the pandemic itself and the government containment measures. Only a small proportion of firms have received government support and there is evidence that it could help both firm survival and the retention of labour. There is some doubt whether the four countries have the institutional capacity to provide effective support. If such doubts prove well founded then support may need to be externally driven.
    Keywords: labor demand,temporary closures,furloughs,firm’ level data,COVID-19,emergency
    JEL: I18 J23 J28 J65
    Date: 2021
  13. By: Zoe B. Cullen; Bobak Pakzad-Hurson
    Abstract: The public discourse around pay transparency has focused on the direct effect: how workers seek to rectify newly-disclosed pay inequities through renegotiations. The question of how wage-setting and hiring practices of the firm respond in equilibrium has received less attention. To study these outcomes, we build a model of bargaining under incomplete information and test our predictions in the context of the U.S. private sector. Our model predicts that transparency reduces the individual bargaining power of workers, leading to lower average wages. A key insight is that employers credibly refuse to pay high wages to any one worker to avoid costly renegotiations with others under transparency. In situations where workers do not have individual bargaining power, such as under a collective bargaining agreement or in markets with posted wages, greater transparency has a muted impact on average wages. We test these predictions by evaluating the roll-out of U.S. state legislation protecting the right of workers to inquire about the salaries of their coworkers. Consistent with our prediction, the laws lead wages to decline by approximately 2% overall, but declines are progressively smaller in occupations with higher unionization rates. Our model provides a unified framework to analyze a wide range of transparency policies, and reconciles effects of transparency mandates documented in a variety of countries and contexts.
    JEL: C78 D82 D83 J31 M52
    Date: 2021–06
  14. By: Mark Duggan; Irena Dushi; Sookyo Jeong; Gina Li
    Abstract: The delayed retirement credit (DRC) increases monthly OASI (Old Age and Survivors Insurance) benefits for primary beneficiaries who claim after their full retirement age (FRA). For many years, the DRC was set at 3.0 percent per year (0.25 percent monthly). The 1983 amendments to Social Security more than doubled this actuarial adjustment to 8.0 percent per year. These changes were phased in gradually, so that those born in 1924 or earlier retained a 3.0 percent DRC while those born in 1943 or later had an 8.0 percent DRC. In this paper, we use administrative data from the Social Security Administration (SSA) to estimate the effect of this policy change on individual claiming behavior. We focus on the first half of the DRC increase (from 3.0 to 5.5 percent) given changes in other SSA policies that coincided with the later increases. Our findings demonstrate that the increase in the DRC led to a significant increase in delayed claiming of social security benefits and strongly suggest that the effects were larger for those with higher lifetime incomes, who would have a greater financial incentive to delay given their longer life expectancies.
    JEL: H55
    Date: 2021–06
  15. By: Ian Fillmore (Washington University in St. Louis); Jonathan Hall (University of Toronto)
    Abstract: Technological innovation can raise the returns to some skills while making others less valuable or even obsolete. We study the effects of such skill-altering technological change in the context of men’s professional tennis, which was unexpectedly transformed by the invention of composite racquets during the late 1970s. We explore the consequences of this innovation on player productivity, entry, and exit. We find that young players benefited at the expense of older players and that the disruptive effects of the new racquets persisted over two to four generations.
    Keywords: technological change, human capital, tennis
    JEL: J24 O33 Z22
    Date: 2021–06
  16. By: Reshmaan N. Hussam; Erin M. Kelley; Gregory V. Lane; Fatima T. Zahra
    Abstract: In settings where an individual’s labor choices are constrained, the inability to work may generate psychosocial harm. This paper presents a causal estimate of the psychosocial value of employment in the Rohingya refugee camps of Bangladesh. We engage 745 individuals in a field experiment with three arms: (1) a control arm, (2) a weekly cash arm, and (3) a gainful employment arm, in which work is offered and individuals are paid weekly the approximate equivalent of that in the cash arm. We find that employment confers significant psychosocial benefits beyond the impacts of cash alone, with effects concentrated among males. The cash arm does not improve psychosocial wellbeing, despite the provision of cash at a weekly amount that is more than twice the amount held by recipients in savings at baseline. Consistent with these findings, we find that 66% of those in our work treatment are willing to forego cash payments to instead work for free. Our results have implications for social protection policies for the unemployed in low income countries and refugee populations globally.
    JEL: D91 I31 J22
    Date: 2021–06
  17. By: Sabrina L. Di Addario; Patrick M. Kline; Raffaele Saggio; Mikkel Sølvsten
    Abstract: We develop a theoretically grounded extension of the two-way fixed effects model of Abowd et al. (1999) that allows firms to differ both in the wages they offer new hires and the wages required to poach their employees. Expected hiring wages are modeled as the sum of a worker fixed effect, a fixed effect for the “destination” firm hiring the worker, and a fixed effect for the “origin” firm, or labor market state, from which the worker was hired. This specification is shown to nest the reduced form for hiring wages delivered by semi-parametric formulations of the sequential auction model of Postel-Vinay and Robin (2002b) and its generalization in Bagger et al. (2014). Using Italian social security records that distinguish job quits from firings and layoffs, we find that origin effects explain only 0.7% of the variance of hiring wages among job movers, while destination effects explain more than 23% of the variance. Across firms, destination effects are more than 13 times as variable as origin effects. Interpreted through the lens of Bagger et al. (2014)’s model, this finding requires that workers possess implausibly strong bargaining strength. Studying a cohort of workers entering the Italian labor market in 2005, we find that differences in origin effects yield essentially no contribution to the evolution of the gender gap in hiring wages, while differences in destination effects explain the majority of the gap at the time of labor market entry. These results suggest that where a worker is hired from is relatively inconsequential for his or her wages in comparison to where he or she is currently employed.
    JEL: C1 J3 J5
    Date: 2021–06
  18. By: Arthur Guillouzouic--Le Corff; Emeric Henry (Département d'économie); Joan Monras (Universitat Pompeu Fabra (UPF))
    Abstract: Using French data, we provide: a) causal evidence that a drop in local public goods provision decreases private sector activity, and b) evidence consistent with monopsony power of the public sector in local labor markets. We introduce a public sector with these two key characteristics in an otherwise standard spatial equilibrium model, and show that it delivers the main stylized facts established in our data, in particular, that the share of the public sector relative to the private is independent of the productivity of the city. We emphasize the tradeoffs between allowing governments to freely choose local public employment and wages (as in most of the US public sector), versus imposing rules that constrain public sector pay with some indexation to the local cost of living (as in many European countries). We show that wage indexation limits monopsony power – leading to a larger public sector – and is optimal if the indexation is sufficiently strong.
    Keywords: Local public goods; Public service; Market power,; Spatial economics
    JEL: H41 J42 J45 R12
    Date: 2021–06
  19. By: Anna Adamecz-Volgyi (UCL Social Research Institute, University College London, 27 Woburn Square, London WC1H 0AA and Institute of Economics, Centre for Economic and Regional Studies (KRTK KTI), Toth Kalman u. 4, 1097 Budapest); Morag Henderson (UCL Social Research Institute, University College London, 27 Woburn Square, London WC1H 0AA); Nikki Shure (UCL Social Research Institute, University College London, 27 Woburn Square, London WC1H 0AA and Institute of Labor Economics (IZA), Schaumburg-Lippe-Str. 5-9, D-53113 Bonn)
    Abstract: We examine how first in family (FiF) graduates (those whose parents do not have university degrees) fare on the labor market. We find that among women, FiF graduates earn 7.4% less on average than graduate women whose parents have a university degree. For men, we do not find a FiF wage penalty. In some specifications FiF men actually earn a premium, although this relationship is not stable across all robustness checks. A decomposition of the wage difference between FiF and non-FiF graduates reveals that FiF men earn higher returns on their endowments than non-FiF men and thus compensate for their relative social disadvantage, while FiF women do not. We also show that a substantial share of the graduate gender wage gap is due to, on the one hand, women being more likely to be FiF than men and, on the other hand, that the FiF wage gap is gendered. Lastly, we estimate the returns to graduation for potential FiF and non-FiF young people. We find that the wage returns to graduation are not lower among FiF graduates compared to those who match their parents with a degree. The effects of coming from a lower educated family are large and positive for men and large and negative for women in general, irrespective of graduation. We provide some context, offer explanations, and suggest implications of these findings.
    Keywords: socioeconomic gaps, intergenerational educational mobility, higher education, labor market returns, gender economics
    JEL: I24 I26 J24
    Date: 2021–06–01
  20. By: Paula Onuchic ⓡ; Debraj Ray
    Abstract: We propose a model of collaborative work in pairs. Each potential partner draws an idea from a distribution that depends on their unobserved ability. The partners then choose to combine their ideas, or work separately. These decisions are based on the intrinsic value of their projects, but also on signaling payoffs, which depend on the public’s assessment of individual contributions to joint work. In equilibrium, collaboration strategies both justify and are justified by public assessments. When partners are symmetric, equilibria with symmetric collaborative strategies are often fragile, in a sense made precise in the paper. In such cases, asymmetric equilibria exist: upon observing a collaborative outcome, the public ascribes higher credit to one of the partners based on payoff-irrelevant “identities.” Such favored identities do receive a higher payoff relative to their disfavored counterparts conditional on collaborating, but may receive lower overall expected payoff. Finally, we study a policy that sometimes (but not always) clarifies the ordinal ranking of partners’ contributions, and find that such disclosures can be Pareto-improving and reduce the scope for discrimination across payoff-irrelevant identities.
    JEL: D70 D82 J71
    Date: 2021–06
  21. By: Segato, Federico
    Abstract: This study contributes in investigating how female participation in the workforce, together with main related socio-demographic changes, has affected household incomes and their distribution in Italy. The Italian case has been investigated again, relying on theoretical and methodological knowledge of previous researches in the field of female employment and income inequality. The data employed in the analysis belong to the Bank of Italy’s Historical Archive of the Survey on Household Income and Wealth (SHIW) for years between 2000 and 2016. From a methodological point of view the approach has been complemented and has enabled to fill previous research gaps. Not only married women have been considered and they are no more divided between working women and inactive one. The choice of consider existing heterogeneity in working hours has allowed to examine part-time role in inequality increase. How female employment increase has affected income inequality has been analysed first at individual level and only later at the household one. The first analysis level has been performed with descriptive statistics and the second with two different decomposition methods, one for income sources and one for household types. To these a shift-share analysis and a counterfactual analysis have been applied. In Italy, even with regional differences, female employment has continued to grow with overall equalizing effects on household income distribution. With regard to socio-demographic changes, male breadwinner households reduction and single households increase have contributed in household income inequality drop. For the Italian case, part-time can contribute in inequality decline only in the case of female breadwinner households.
    Keywords: female employment, household income inequality, household composition
    JEL: D31 J12 J22
    Date: 2021–06
  22. By: John B. Shoven; Sita Slavov; John G. Watson
    Abstract: The Social Security trust fund will be exhausted in the early 2030s. The U.S. government will need to make a choice about how to address the impending trust fund exhaustion, but it is unclear what it will choose to do. This indecision leaves young and middle-aged workers not knowing whether they will face Social Security benefit cuts, payroll tax increases, or an increase in the full retirement age. This uncertainty about what will happen in the future causes young and middle-aged cohorts who are saving for retirement to make mistakes that could be avoided if the government decided earlier what will happen when the trust fund runs dry. This paper examines the cost of government indecision on Social Security reform. We calculate the value that people in different income classes and different birth cohorts would receive if the government decided now what it will do when the trust funds are exhausted. We find that the cost of indecision can be large. In some cases, the value of knowing today what the policy change will be in 2035 is worth more than two months of labor market earnings.
    JEL: G5 G51 H55 J26
    Date: 2021–05
  23. By: Lalinsky, Tibor; Pál, Rozália
    Abstract: We utilize several unique firm-level datasets in order to assess the efficiency and effectiveness of the government support aiming to curb the economic consequences of the coronavirus (COVID19) pandemic. The results, drawing on the experience of a small open European country (Slovakia), suggest the distributed COVID-19 subsidies save non-negligible number of jobs and sustain economic activity during the first wave of the pandemic. General distribution rules designed on the fly may bring close to optimal results, as relatively more productive, privately owned, foreign-demand oriented firms are prioritized and firms with a higher environmental footprint or zombie firms record a relatively lower chance of obtaining government funding. By assuming constant cost elasticities to sales, we show that the pandemic deteriorates strongly firm profits and increases significantly the share of illiquid and insolvent firms. Government wage subsidies somewhat mitigate firm losses and have statistically significant effect, but relatively mild compared to the size of the economic shock. Our estimates also confirm that larger firms, receiving smaller relative size of the support, have more space to cover their additional liquidity needs by increasing trade liabilities or liabilities to affiliated entities, while SMEs face higher risk of insolvencies.
    Keywords: coronavirus,COVID-19,firm-level,policy measures,wage subsidies,profit,liquidity,solvency
    JEL: D22 H20 G32 G33 J38
    Date: 2021
  24. By: Echeverría, Lucía (University of Zaragoza); Gimenez-Nadal, J. Ignacio (University of Zaragoza); Molina, José Alberto (University of Zaragoza)
    Abstract: Recent years have witnessed efforts worldwide to promote green mobility, aimed at boosting sustainable economic growth. However, how green mobility relates to travelers' well-being remains an open question. We explore whether "green" modes of transportation (public transit and walking/cycling) are associated with higher levels of well-being in comparison to private driving, placing special focus on different types of travel (related to paid work, unpaid work, personal care, childcare, and leisure). We use the UK Time Use Survey (UKTUS) from 2014-2015, and exploit information on self-reported enjoyment during travel, as a measure of experienced well-being. We estimate Ordinary Least Squares and Random Effects regressions for each travel category, and find relative, positive effects of physical transport on enjoyment, in terms of personal care and leisure, while the relative negative effects of public transport are observed for childcare and work/paid travel, in relationship to traditional driving modes. Our evidence suggests a need to develop strategies to effectively promote mobility by physical modes, while improving the experience of public transit users.
    Keywords: subjective well-being, green travelling, walking/cycling, public transport
    JEL: R4 J22
    Date: 2021–05
  25. By: Drydakis, Nick
    Abstract: This meta-analysis utilizes 24 papers published between 2012-2020 that focus on earnings differences by sexual orientation. The papers cover the period between 1991 and 2018, and countries in Europe, North America and Australia. The meta-analysis indicates that gay men earned less than heterosexual men. Lesbian women earned more than heterosexual women, while bisexual men earned less than heterosexual men. Bisexual women earned less than heterosexual women. According to the meta-analysis, in data sets after 2010, gay men and bisexual men and women continue to experience earnings penalties, while lesbian women continue to experience earnings premiums. Τhe meta-regression estimates indicate relationships between study characteristics and the estimated earnings effects for sexual minorities. For instance, regions, sexual minority data set sizes, and earnings classifications influence the outcomes. The persistence of earnings penalties for gay men and bisexual men and women in the face of anti-discrimination policies represents a cause for concern and indicates the need for comprehensive legislation and workplace guidelines to guarantee that people receive fair pay and not experience any form of workplace inequality simply because of their sexual orientation.
    Keywords: Sexual Orientation,Discrimination,Earnings
    JEL: C93 E24 J15 J16 J71
    Date: 2021
  26. By: Aina, Carmen; Brunetti, Irene; Mussida, Chiara; Schicchitano, Sergio
    Abstract: This paper evaluates if and to what extend the risk of becoming Not in Employment, Education or Training (NEET) has worsened during the Covid-19 pandemic in Italy. The analysis is based on a unique dataset from the merging of two sample surveys, the Italian Labor Force Survey and the Institutional Quality Index dataset. We find that the probability of being NEET significantly increased during the pandemic, but heterogeneously between age cohorts and geographical areas. The most affected categories have been young people (aged 25-34) and those living in North-West regions. Females are mostly affected compared to males, especially those experiencing motherhood and living in a Southern province. Investment in education reduces the NEET status, mainly for age-group 25-34 in the South. Participation in the civil society significantly reduces the probability to being NEET. Finally, active policies conducted at regional level are a further educational investment that protect from becoming NEET, although their effectiveness is not significant in the Southern regions. We provide novel evidence to inform policymakers and help building evidence-based policies, tailored on local needs.
    Keywords: NEET,Covid-19 pandemic,quality institutions,Italian provinces
    JEL: I20 J18 J21
    Date: 2021

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