nep-lma New Economics Papers
on Labor Markets - Supply, Demand, and Wages
Issue of 2022‒01‒03
twelve papers chosen by
Joseph Marchand
University of Alberta

  1. Skill Demand and Labour Market Concentration: Theory and Evidence from Italian Vacancies By Emilio Colombo; Alberto Marcato
  2. Earnings Dynamics and Its Intergenerational Transmission: Evidence from Norway By Elin Halvorsen; Serdar Ozkan; Sergio Salgado
  3. Gender Quotas and Task Assignment in Organizations By José J. Domínguez; Natalia Montinari
  4. "Identity and Well-Being in the Skilled Crafts and Trades" By Martin Binder; Ann-Kathrin Blankenberg
  5. Rural Labor and Long Recall Loss By Ambler, Kate; Herskowitz, Sylvan; Maredia, Mywish K.
  6. Does a stereotype benefit women in the labor market: An experiment on perseverance By Haeckl, Simone; Kartal, Melis
  7. Understanding cognitive decline in older ages: The role of health shocks By Schiele, Valentin; Schmitz, Hendrik
  8. The role of telework for productivity during and post-COVID-19: Results from an OECD survey among managers and workers By Chiara Criscuolo; Peter Gal; Timo Leidecker; Francesco Losma; Giuseppe Nicoletti
  9. Will it stay or will it go? Analysing developments in telework during COVID-19 using online job postings data By Pawel Adrjan; Gabriele Ciminelli; Alexandre Judes; Michael Koelle; Cyrille Schwellnus; Tara Sinclair
  10. How Does the Position in Business Group Hierarchies Affect Workers’ Wages? By Hartmut Egger; Elke Jahn; Stefan Kornitzky
  11. A Short History of Flexible Hours - Historical Baselines of Working Time Policy in Germany By Promberger, Markus
  12. A Worker’s Backpack as an alternative to PAYG pension systems By Julian Diaz Saavedra; Ramon Marimon; Joao Brogueira de Sousa

  1. By: Emilio Colombo; Alberto Marcato
    Abstract: This paper analyses the relationship between labor market concentration and employers' skill demand. Using a novel data set on Italian online job vacancies during 2013-2018 we show that employers in a highly concentrated labor market demand competencies associated with the ability of workers to learn faster (e.g. Social skills) rather than actual knowledge. They also require less experience but higher education. These results are consistent with the hypothesis that employers in more concentrated labor markets are more prone to train their employees. Instead of looking for workers who already have job-specific skills, they look for workers who can acquire them faster and efficiently.
    JEL: J24 J42 J63
    Date: 2021
  2. By: Elin Halvorsen; Serdar Ozkan; Sergio Salgado
    Abstract: Using administrative data from Norway, we first present stylized facts on labor earnings dynamics between 1993 and 2017 and its heterogeneity across narrow population groups. We then investigate the parents’ role in children’s income dynamics—the intergenerational transmission of income dynamics. We find that children of high-income, high-wealth fathers enjoy steeper income growth over the life cycle and face more volatile but more positively skewed income changes, suggesting that they are more likely to pursue high-return, high-risk careers. Children of poorer fathers also face more volatile incomes, but theirs grow more gradually and are more left skewed. Furthermore, the income dynamics of fathers and children are strongly correlated. In particular, children of fathers with steeper life-cycle income growth, more volatile incomes, or higher downside risk also have income streams of similar properties. We also confirm that fathers’ significant role in workers’ income dynamics is not simply spurious because of omitted variables, such as workers’ own permanent income. These findings shed new light on the determinants of intergenerational mobility.
    Keywords: earnings dynamics; top income inequality; heterogeneity; intergenerational mobility
    JEL: E24 J24 J31
    Date: 2021–12–16
  3. By: José J. Domínguez (Department of Economic Theory and Economic History, University of Granada.); Natalia Montinari (Department of Economics, University of Bologna.)
    Abstract: In response to the slow progress toward gender equality observed in the last decades, organizations and policy makers in many countries are increasingly looking at implementing quotas to close the gender gap. However, the expected benefits and potential drawbacks of such interventions are widely debated. We ran a laboratory experiment to investigate how gender quotas in hiring affect the allocation of workers into different tasks within an organization. 128 participants in the role of employers were asked to hire a team of six workers from a pool of 15 and assign them to one of two tasks which differed in complexity and profitability. Employers had information about workers’ age, gender, and university major as well as a signal of performance. Workers assigned to the Simple Task had to complete additions, while workers assigned to the Challenging Task had to solve mathematical problems. Although no gender difference was observable in the performance of either task, in the absence of quotas, high-ability women were both less likely to be hired and less likely to be assigned to the Challenging Task compared to high-ability men. With a quota of 50% female workers imposed on hiring, the number of women assigned to the Simple Task increased, while the number of those assigned to the Challenging Task remained significantly lower compared to men. Our findings suggest that gender quotas to increase the number of women hired may backfire, resulting in their more likely assignment to less-challenging, low-promotability tasks compared to men, and impairing their chances of career advancement. Moreover, we find that in the presence of a gender quota employers’ earnings are significantly lower, and that this is because they are more likely to hire lowability women. One explanation could be that gender quotas convey a message which suggests the overall low quality of the pool of female workers.
    Keywords: Affirmative action, gender quotas, gender gap, task assignment, laboratory experiments.
    JEL: D03 C91 J71
    Date: 2021–12–02
  4. By: Martin Binder; Ann-Kathrin Blankenberg
    Abstract: We analyze the extent to which occupational identity is conducive to worker well-being. Using a unique survey dataset of individuals working in the German skilled crafts and trades, we use a novel occupational identity measure that captures identity more broadly than just referring to organizational identification and social group membership, but rather comprises personal and relational elements inherent in one's work. The latter are linked to significant social interactions a worker has in their job and the former to specific work characteristics of the work conducted itself. We find that higher job satisfaction is related to a stronger sense of occupational identity in our sample. This relationship is quite sizable and robust across model specifications, whereas income is not associated with job satisfaction in most models. Occupational identity is positively associated with a number of work characteristics, viz. task significance, task and skill variety, as well as social support, and our analysis shows that identity mediates the influence of these characteristics with regard to job satisfaction.
    Keywords: Occupational Identity; Identity Utility; Job Satisfaction; Crafts; Work Characteristics
    JEL: J28 J24 I31 B55
    Date: 2021–12
  5. By: Ambler, Kate; Herskowitz, Sylvan; Maredia, Mywish K.
    Abstract: Commonly used data collection practices use annual recall to capture individuals’ labor activities over a year. However, long recall periods are likely to suffer from distortions and loss, particularly when work patterns are seasonal and informal. In a panel of rural households in Malawi, we use a survey experiment to test the effect of using long recall periods on the reported number of labor activities, labor supply, and types of work relative to those resulting from a set of shorter, quarterly interviews. We document large losses from the longer recall window, particularly on the extensive margin of labor supply with reductions of over 20%. These losses are greatest for periods furthest from the last survey round and are especially large among individuals whose labor supply is being reported for them, reaching as high as 50% losses for some outcomes. The composition of households’ primary respondents, predominantly male and older, as well as differential effects by age both suggest that use of long recall may lead to meaningful biases by both age and gender in resulting data.
    Keywords: Agricultural and Food Policy, Community/Rural/Urban Development, Consumer/Household Economics, Labor and Human Capital
    Date: 2021–12–23
  6. By: Haeckl, Simone (University of Stavanger); Kartal, Melis (WU Vienna)
    Abstract: We design a novel real-effort experiment to investigate gender differences and stereotypes regarding perseverance and how these affect employment decisions. We find that women are more persistent than men and that the subjects anticipate this difference. While it pays off, in expectation, to hire a female over a male candidate in our experimental employment setting, employers are not more likely to hire a female candidate. Thus, even in a setting where female candidates are statistically better workers and employers hold a positive stereotype about women, employers do not hire women more often than men. This finding contrasts with studies showing that men do benefit from positive stereotypes associated with them, and suggests that stereotypes might be more beneficial for men than for women.
    Keywords: non-cognitive skills; perseverance; conscientiousness; gender and stereotypes; labor market experiment
    JEL: C91 J16 J71
    Date: 2021–12–07
  7. By: Schiele, Valentin; Schmitz, Hendrik
    Abstract: Individual cognitive functioning declines over time. We seek to understand how adverse physical health shocks in older ages contribute to this development. By use of event-study methods and data from the USA, England and several countries in Continental Europe we find evidence that health shocks lead to an immediate and persistent decline in cognitive functioning. This robust finding holds in all regions representing different health insurance systems and seems to be independent of underlying individual demographic characteristics such as sex and age. We also ask whether variables that are susceptible to policy action can reduce the negative consequences of a health shock. Our results suggest that neither compulsory education nor retirement regulations moderate the effects, thus emphasizing the importance of maintaining good physical health in old age for cognitive functioning.
    Keywords: Cognitive decline,health shocks,retirement,education,event study
    JEL: J24 J14 I1 I12 J2
    Date: 2021
  8. By: Chiara Criscuolo; Peter Gal; Timo Leidecker; Francesco Losma; Giuseppe Nicoletti
    Abstract: Motivated by the sudden adoption of telework in the wake of the COVID 19 pandemic, the Global Forum on Productivity (GFP) undertook an online survey among managers and workers in 25 countries about their experience and expectations, with a particular focus on productivity and well-being. This paper presents analysis and results from this endeavour. It finds that managers and workers had an overall positive assessment from teleworking both for firm performance and for individual well-being, and wish to increase substantially the share of regular teleworkers from pre-crisis levels. Respondents, on average, find that the ideal amount of telework is around 2-3 days per week, in line with other recent evidence and with the idea that the benefits (e.g., less commuting, fewer distractions) and costs (e.g., impaired communication and knowledge flows) need to be balanced at an intermediate level of telework intensity. To meet the challenges of this “hybrid” working mode, as the survey finds, further changes from management are needed, such as the co-ordination of schedules to encourage a sufficient degree of in-person interaction, and further investment in ICT tools and skills as well as more soft skills to master online communication.
    Keywords: productivity, survey, telework, well-being, working from home
    JEL: D24 M1 O3
    Date: 2021–12–16
  9. By: Pawel Adrjan; Gabriele Ciminelli; Alexandre Judes; Michael Koelle; Cyrille Schwellnus; Tara Sinclair
    Abstract: The COVID-19 crisis has triggered a major shift towards telework and virtual interactions. This paper uses information on job postings from the online job site Indeed to analyse developments in the adoption of telework across 20 countries. It finds, first, that the incidence of advertised telework almost tripled during the pandemic, albeit with large differences both across sectors and across countries. Second, cross-country differences are to a notable extent explained by differences in the extent to which governments restricted mobility during the pandemic. However, while the tightening of restrictions substantially raises advertised telework, their easing only modestly reverses the increase. Third, digital preparedness plays an important role in mediating the response of advertised telework to changes in restrictions. The tightening of restrictions has particularly large effects in sectors that are better prepared to adopt digital business models, while their easing has almost no effect in countries with high-quality digital infrastructure. Overall, these results suggest that telework is here to stay, especially in countries with high levels of digital preparedness. Public policies will need to adapt to reap the potential benefits for productivity and worker well-being.
    Keywords: digital infrastructure, mobility restrictions, telework
    JEL: D23 E24 J23 G18 M50
    Date: 2021–12–16
  10. By: Hartmut Egger; Elke Jahn; Stefan Kornitzky
    Abstract: We merge firm-level data on ownership linkages with administrative data on German workers to analyze how the position in a business group hierarchy affects workers’ wages. To acknowledge that ownership linkages are not onedirectional, we propose an index of hierarchical distance to the ultimate owner that accounts for the complex network structure of business groups. After controlling for unobserved heterogeneity, we find a positive effect of larger hierarchical distance to the ultimate owner of a business group on workers’ wages. To explain this finding, we develop a monitoring-based theory of business groups. Our model predicts higher wages to prevent shirking by workers if a larger hierarchical distance to the ultimate owner is associated with lower monitoring efficiency.
    Keywords: Business groups, ownership networks, workers wages, differencein-difference, hierarchical distance
    JEL: C23 J31 L23
    Date: 2021–12
  11. By: Promberger, Markus (Institute for Employment Research (IAB), Nuremberg, Germany)
    Abstract: "This paper analyses the structures and patterns, dimensions and interest relations behind 200 years of working time negotiations and conflicts, based on historical and contemporary literature and research, mainly but not exclusively in Germany. One main thesis is that ‘new’ flexibilization trends are not new at all, while the effective standardization of working hours is limited to a couple of decades in the 20th century. Nevertheless and for various reasons, working time arrangements are a social and political issue which should not be left to individual contracting but subject to reflexive labour policy." (Author's abstract, IAB-Doku) ((en))
    JEL: J22 J50 N30 N33 N35 O52 O35
    Date: 2021–12–01
  12. By: Julian Diaz Saavedra (Department of Economic Theory and Economic History, University of Granada.); Ramon Marimon (European University Institute, UPF - Barcelona GSE, CEPR and NBER.); Joao Brogueira de Sousa (Nova School of Business and Economics.)
    Abstract: With ageing population and historical trends of low employment rates, pay-as-you-go (PAYG) pension systems, currently in place in several European countries, imply very large economic and welfare costs in the coming decades, threatening the sustainability of these systems. In an overlapping generations economy with incomplete insurance markets and frictional labour markets, an employment fund, which can be used while unemployed or retired can enhance production efficiency and social welfare. With an appropriate design, the sustainable Backpack employment fund (BP) can greatly outperform – measured by average social welfare in the economy – existing pay-as-you go systems and also Pareto dominate a full privatization of the pension system, as well as a standard fully funded defined contribution pension system. We show this in a calibrated model of the Spanish economy, by comparing steady-state economies after the ongoing demographic transition under these different pension systems and by showing how a front-loaded transition from the PAYG to the BP system, ahead of the ‘ageing transition’, can be Pareto improving (i.e. without losers), while minimizing the cost of the reform.
    Keywords: Social security reform, Ageing, Taxation.
    JEL: C68 H55 J26
    Date: 2021–12–03

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