nep-lma New Economics Papers
on Labor Markets - Supply, Demand, and Wages
Issue of 2023‒06‒19
forty-one papers chosen by
Joseph Marchand
University of Alberta

  1. Longer Careers: A Barrier to Hiring and Coworker Advancement? By Ferrari, Irene; Kabátek, Jan; Morris, Todd Stuart
  2. Prior Work Experience and Entrepreneurship: The Careers of Young Entrepreneurs By Gendron-Carrier, Nicolas
  3. Imperfect Signals By Graetz, Georg
  4. The Health Wedge and Labor Market Inequality By Amy Finkelstein; Casey McQuillan; Owen Zidar; Eric Zwick
  5. Labour Costs and the Decision to Hire the First Employee By Cockx, Bart; Desiere, Sam
  6. Intensive informal care and impairments in work productivity and activity By Kolodziej, Ingo; Coe, Norma B.; Van Houtven, Courtney Harold
  7. Forward-Looking Labor Supply Responses to Changes in Pension Wealth: Evidence from Germany By Artmann, Elisabeth; Fuchs-Schündeln, Nicola; Giupponi, Giulia
  8. Incentivizing Team Leaders: A Firm-Level Experiment on Subjective Performance Evaluation of Leadership Skills By Gall, Thomas; Hu, Xiaocheng; Vlassopoulos, Michael
  9. Cognitive Skills among Adults: An Impeding Factor for Gender Convergence? By Battisti, Michele; Fedorets, Alexandra; Kinne, Lavinia
  10. Structural Labour Market Change and Gender Inequality in Earnings By Anna Matysiak; Wojciech Hardy; Lucas van der Velde
  11. Non-college Occupations, Workplace Routinization, and the Gender Gap in College Enrollment By Chuan, Amanda; Zhang, Weilong
  12. The green side of productivity: An international classification of green and brown occupations By Nathalie Scholl; Sébastien Turban; Peter N. Gal
  13. Long-Run Consequences of Informal Elderly Care and Implications of Public Long-Term Care Insurance By Korfhage, Thorben; Fischer, Björn
  14. Minimum wages, productivity, and reallocation By Hälbig, Mirja; Mertens, Matthias; Müller, Steffen
  15. Time-Use and Subjective Well-Being: Is Diversity Really the Spice of Life? By Friedman-Sokuler, Naomi; Senik, Claudia
  16. The different returns to cognitive ability in the labor and capital markets By Bastani, Spencer; Karlsson, Kristina; Waldenström, Daniel
  17. Unsafe temperatures, unsafe jobs: The impact of weather conditions on work-related injuries By Filomena, Mattia; Picchio, Matteo
  18. Weight, Attractiveness, and Gender When Hiring: A Field Experiment in Spain By Goulão, Catarina; Lacomba, Juan A.; Lagos, Francisco; Rooth, Dan-Olof
  19. Income Gains and the Geography of the US Home Ownership Boom, 1940 to 1960 By William J. Collins; Gregory Niemesh
  20. Valuing business impacts in the areas of wage inequality and employee well-being By Fabrice Murtin; Vincent Siegerink
  21. Robots, Occupations, and Worker Age: A Production-Unit Analysis of Employment By Deng, Liuchun; Müller, Steffen; Plümpe, Verena; Stegmaier, Jens
  22. Unequal Gains from Remote Work during COVID-19 between Spouses: Evidence from Longitudinal Data in Singapore By Lee, Zeewan; Tan, Poh Lin; Tan-Soo, Jie-Sheng
  23. Hypothetical tax-benefit reforms in Hungary: Shifting from tax relief to cash transfers for family support By Agúndez García, Ana; Christl, Michael
  24. The Economic Approach to Personality, Character and Virtue By Heckman, James J.; Galaty, Bridget; Tian, Haihan
  25. 'Earned, Not Given'? The Effect of Lowering the Full Retirement Age on Retirement Decisions By Dolls, Mathias; Krolage, Carla
  26. Mortality, morbidity, and occupational decline By Hernnäs, Sofia
  27. Heterogeneous wage structure effects: a partial European East-West comparison By Olga Takács; János Vincze
  28. Using Genes to Explore the Relationship of Cognitive and Non-cognitive Skills with Education and Labor Market Outcomes By Buser, Thomas; Ahlskog, Rafael; Johannesson, Magnus; Koellinger, Philipp; Oskarsson, Sven
  29. Job Levels and Wages By Christian Bayer; Moritz Kuhn
  30. Improving the quality and efficiency of education and training in Costa Rica to better support growth and equity By Alessandro Maravalle; Alberto González Pandiella
  31. Workers' behavior after safety regulations: Impact evaluation of the Spanish Occupational Safety and Health Act By Delgado-Cubillo, Pablo; Martín Román, Ángel L.
  32. The Child Tax Credit over Time by Family Type: Benefit Eligibility and Poverty By Brehm, Margaret E.; Malkova, Olga
  33. The price of flexible jobs: Wage differentials between permanent and flexible jobs in The Netherlands By Cindy Biesenbeek; Maikel Volkerink
  34. The Impact of Margaret Sanger's Birth Control Clinics on Early 20th Century U.S. Fertility and Mortality By Bauernschuster, Stefan; Grimm, Michael; Hajo, Cathy M.
  35. Productivity Spillovers among Knowledge Workers in Agglomerations: Evidence from GitHub By Lena Abou El-Komboz; Thomas Fackler
  36. Extrapolative Income Expectations and Retirement Savings By Marta Cota
  37. Donations and Unpaid Activities By Hübler, Olaf
  38. Intuit QuickBooks Small Business Index: A new employment series for the US, Canada, and the UK By Akcigit, Ufuk; Chhina, Raman; Cilasun, Seyit Mümin; Miranda, Javier; Ocakverdi, Eren; Serrano-Velarde, Nicolas
  39. Importing Automation and Wage Inequality through Foreign Acquisitions By Gardberg, Malin; Heyman, Fredrik; Tåg, Joacim
  40. How accurately are household surveys measuring the size and inequalities for the LGBT population in Bogotá, Colombia? Evidence from a list experiment By Andrés Ham; Ángela Guarín; Juanita Ruiz
  41. Dual labor markets in Spain:a firm-side perspective By Iván Auciello-Estévez; Josep Pijoan-Mas; Pau Roldan-Blanco; Federico Tagliati

  1. By: Ferrari, Irene (Ca' Foscari University of Venice); Kabátek, Jan (University of Melbourne); Morris, Todd Stuart (ARC Centre of Excellence in Population Ageing Research (CEPAR))
    Abstract: Government policies are encouraging older workers to delay retirement, which may curb younger workers' career advancement. We study a Dutch reform that raised the retirement age by 13 months and nearly tripled employment at age 66. Using monthly linked employer-employee data, we show that affected firms delay and decrease replacement hiring, and coworkers' earnings fall via reductions in hours worked, wages, and promotions. Combined, the hiring and coworker spillovers offset most of the additional hours worked by older workers, disproportionately affect career advancement for younger workers and women, and considerably increase the policy's ratio of welfare costs to fiscal savings.
    Keywords: retirement reform, labor demand, internal labor markets, firms, coworker spillovers
    JEL: H55 J23 J26 J63
    Date: 2023–04
  2. By: Gendron-Carrier, Nicolas (McGill University)
    Abstract: I investigate the mechanisms that drive sorting into entrepreneurship and entrepreneurial success among young individuals. I use Canadian matched owner-employeremployee data to conduct my investigation. Empirically, older entrepreneurs and entrepreneurs who have previously worked in high-wage firms tend to do better. To explain these findings, I develop a dynamic Roy model of career choice that features heterogeneous employers, human capital accumulation, and unobserved heterogeneity across individuals. Among other things, I find that prior work experience is particularly valuable for "subsistence" entrepreneurs. I use the estimated model to evaluate policies designed to promote entrepreneurship.
    Keywords: entrepreneurship, human capital, firm heterogeneity, career choice, dynamic Roy model, unobserved heterogeneity
    JEL: J24 J31 J62 L26
    Date: 2023–05
  3. By: Graetz, Georg (Uppsala University)
    Abstract: A pre-condition for employer learning is that signals at labor market entry do not fully reveal graduates' productivity. I model various distinct sources of signal imperfection—such as noise and multi-dimensional types—and characterize their implications for the private return to skill acquisition. Structural estimates using NLSY data suggest an important role for noise, pushing the private return below the social return. This induces substantial under-investment and causes output losses of up to 22 percent. Value-added-based evidence from Swedish high school graduates also points to noise and under-investment. Highlighting the distinction between schooling duration and skills acquired, I conclude that individuals likely spend too much time in school, but learn too little.
    Keywords: human capital, signaling, employer learning, returns to schooling
    JEL: D82 I26 J24 J31
    Date: 2023–05
  4. By: Amy Finkelstein (Massachusetts Institute of Technology); Casey McQuillan (Princeton University); Owen Zidar (Princeton University); Eric Zwick (University of Chicago, Booth School of Business)
    Abstract: Over half of the U.S. population receives health insurance through an employer, with employer premium contributions creating a flat “head tax†per worker, independent of their earnings. This paper develops and calibrates a stylized model of the labor market to explore how this uniquely American approach to financing health insurance contributes to labor market inequality. We consider a partial-equilibrium counterfactual in which employer-provided health insurance is instead financed by a statutory payroll tax on firms. We find that, under this counterfactual financing, in 2019 the college wage premium would have been 11 percent lower, non-college annual earnings would have been $1, 700 (3 percent) higher, and non-college employment would have been nearly 500, 000 higher. These calibrated labor market effects of switching from head-tax to payroll-tax financing are in the same ballpark as estimates of the impact of other leading drivers of labor market inequality, including changes in outsourcing, robot adoption, rising trade, unionization, and the real minimum wage. We also consider a separate partial-equilibrium counterfactual in which the current head-tax financing is maintained, but 2019 U.S. health care spending as a share of GDP is reduced to the Canadian share; here, we estimate that the 2019 college wage premium would have been 5 percent lower and non-college annual earnings would have been 5 percent higher. These findings suggest that health care costs and the financing of health insurance warrant greater attention in both public policy and research on U.S. labor market inequality.
    Keywords: Health insurance, inequality, taxation, health insurance tax subsidy, labor market, college premium, nonemployment
    JEL: J32 J31 I26 J22 J23 I13 H24 M52
    Date: 2023–03
  5. By: Cockx, Bart (Ghent University); Desiere, Sam (Ghent University)
    Abstract: Firms without paid employees account for up to 80% of all firms, but only a small minority ever hires. This paper investigates the relationship between labour costs and the decision to hire a first employee and become an employer. Leveraging a unique policy in Belgium that permanently reduced the labour cost of the first employee by 13%, we find that the number of new, first-time employers jumped by 31% immediately following the reform. The elasticity of the probability to hire the first employee with respect to the labour cost is −2.39 [95% CI: −3.45, −1.25].
    Keywords: nonemployers, hiring decisions, payroll taxes, small businesses
    JEL: D22 H25 J08 J23 L26 M13
    Date: 2023–05
  6. By: Kolodziej, Ingo; Coe, Norma B.; Van Houtven, Courtney Harold
    Abstract: Informal care reduces work on the intensive and extensive margins; however, we do not know how caregiving affects work productivity. We link two new unique national U.S. data sets to provide the first causal estimates of the effect of providing at least 80 hours of informal care in the past month on work productivity, compared to less intensive caregiving. We control for caregiver selection into work using a Heckman selection model and use instrumental variables to estimate the causal effect of providing at least 80 hours in the past month on work productivity, using the Work Productivity and Activity Impairment (WPAI) instrument, and weekly hours worked. The IV is widowhood status of the care recipient. For both the OLS and IV results, providing at least 80 hours in the past month is associated with a 0.07-0.13 point increase in the WPAI compared to non-intensive caregivers, signifying lower work productivity. This result is mainly driven by presenteeism, or employees being less productive on the job, as opposed to absenteeism, measured by missed days of work. The OLS models are precisely estimated (p
    Keywords: Informal care, work productivity, Heckman selection correction, instrumental variables
    JEL: C36 I1 J14 J24
    Date: 2023
  7. By: Artmann, Elisabeth (Institute for Employment Research (IAB), Nuremberg); Fuchs-Schündeln, Nicola (Goethe University Frankfurt); Giupponi, Giulia (Bocconi University)
    Abstract: We provide new evidence of forward-looking labor supply responses to changes in pension wealth. We exploit a 2014 German reform that increased pension wealth for mothers by an average of 4.4% per child born before January 1, 1992. Using administrative data on the universe of working histories, we implement a difference-in-differences design comparing women who had their first child before versus after January 1, 1992. We document significant reductions in labor earnings, driven by intensive margin responses. Our estimates imply that, on average, an extra euro of pension wealth in a given period reduces unconditional labor earnings by 54 cents.
    Keywords: labor supply, social security, pension wealth
    JEL: H55 J22 J26
    Date: 2023–05
  8. By: Gall, Thomas (University of Southampton); Hu, Xiaocheng (University of Exeter); Vlassopoulos, Michael (University of Southampton)
    Abstract: In teamwork settings, providing effective leadership can be challenging for team leaders due to multitasking and the difficulty in measuring and rewarding leadership input. These challenges might lead to underprovision of leadership activities, which can ultimately impede the productivity of the team. To address this problem, we conduct a field experiment at a manufacturing firm, introducing a relative subjective performance evaluation of team leaders' leadership activities by their managers, coupled with bonuses based on their leadership rank among all leaders. Our intervention increased worker productivity by approximately 7%, while leaving team leaders' productivity unchanged, and was profitable for the firm. During the intervention, we observe a positive correlation between the evaluations of team leaders and the productivity of team members, suggesting that the subjective evaluation indeed increased leadership activities and thus productivity.
    Keywords: multitasking, subjective evaluation, teamwork, incentive schemes, productivity, leadership
    JEL: J24 J33 M52 C93
    Date: 2023–05
  9. By: Battisti, Michele (University of Glasgow); Fedorets, Alexandra (DIW Berlin); Kinne, Lavinia (Ifo Institute for Economic Research)
    Abstract: While gender differences in labor force participation and wages have been studied extensively, gender gaps in cognitive skills among adults are not yet well understood. Using the PIAAC dataset, this paper presents novel findings on cognitive skill distributions by gender across 34 countries. Despite increasing educational equality, inequalities in numeracy skills favoring men compared to women are pervasive. These skill differences account for a sizable part of the gender wage gap. Furthermore, there are larger disadvantages for women at the top of the wage distribution, which are complemented by lower returns to skills compared to men. We also find that these numeracy-wage patterns are especially pronounced for parents and for those with the highest degree in a non-STEM field of study.
    Keywords: gender wage gap, skills, numeracy, PIAAC
    JEL: I24 J16 J24
    Date: 2023–05
  10. By: Anna Matysiak (University of Warsaw, Faculty of Economic Sciences); Wojciech Hardy (University of Warsaw, Faculty of Economic Sciences); Lucas van der Velde (bFAME|GRAPE, University of Warsaw, Warsaw School of Economics)
    Abstract: Research from the US argues that women will benefit from a structural labour market change as the importance of social tasks increases and that of manual tasks declines. This article contributes to this discussion in three ways: (a) by extending the standard framework of task content of occupations in order to account for diversity of social tasks; (b) by developing measures of occupational task content tailored to the European context; and (c) by testing this argument in 13 European countries. Data are analysed from the European Skills, Competences, Qualifications and Occupations Database and the European Structure of Earnings Survey. The analysis demonstrates that relative to men the structural labour market change improves earnings potential of women working in low- and middle-skilled occupations but not those in high-skilled occupations. Women are overrepresented in low paid social tasks (e.g. care) and are paid less for analytical tasks than men.
    Keywords: task content of occupations, care work, wages, gender, Europe
    JEL: J16 J21 J23 J24
    Date: 2023
  11. By: Chuan, Amanda (Michigan State University); Zhang, Weilong (University of Cambridge)
    Abstract: This paper explores how non-college occupations contributed to the gender gap in college enrollment, where women overtook men in college-going. Using instrumental variation from routinization, we show that the decline of routine-intensive occupations displaced the non-college occupations of women, raising female enrollment. Embedding this instrumental variation into a dynamic Roy model, we find that routinization decreased returns to the non-college occupations of women, increasing their college premium. In contrast, men's non-college occupations were less susceptible to routinization. Our model estimates that workplace routinization accounted for 44% of the growth in female enrollment during 1980-2000.
    Keywords: gender, college enrollment, human capital, occupations, automation
    JEL: I23 I24 I26 J16 J24 J23
    Date: 2023–04
  12. By: Nathalie Scholl; Sébastien Turban; Peter N. Gal
    Abstract: This paper describes the methodology used for crosswalking occupation-based measures of Green (“environmentally friendly”) and Brown (“polluting”) jobs from the Standard Occupational Classification (SOC) system to the International Standard Occupation Classification (ISCO) 08 at the most detailed (4-digit) level. The original, task-based Greenness scores by Vona et al. (2018) are provided at the 8-digit SOC level, and the industry-based Brownness measures are provided in 6-digit SOC. Crosswalking these measures requires several choices in terms of weighting and aggregating, which this paper describes in detail. The robustness of the resulting measures to the different weighting options and underlying assumption is tested using Linked Employer-Employee data from Portugal. An empirical application to the Productivity-Greenness link at the firm level shows the robustness of this link to different weighting choices, and confirms that all of the different measures derived are consistent in measuring the Greenness of jobs.
    Keywords: Brown occupations, Green occupations, Green skills, Green transition, , Occupation Classification, productivity
    JEL: J21 J24 L25
    Date: 2023–05–25
  13. By: Korfhage, Thorben (RWI); Fischer, Björn (ZEW Mannheim)
    Abstract: We estimate a dynamic structural model of labor supply, retirement, and informal care supply, incorporating labor market frictions and the German tax and benefit system. We find that in the absence of Germany's public long-term insurance scheme, informal elderly care has adverse and persistent effects on labor market outcomes and, thus, negatively affects lifetime earnings and future pension benefits. These consequences of caregiving are heterogeneous and depend on age, previous earnings, and institutional regulations. Policy simulations suggest that public long-term care insurance policies are fiscally costly and induce negative labor market effects. But we also show that they can offset the personal costs of caregiving to a large extent and increase welfare for those providing care, especially for low-income individuals.
    Keywords: long-term care, informal care, long-term care insurance, labor supply, retirement, pension benefits, dynamic structural model
    JEL: I18 I38 J14 J22 J26
    Date: 2023–05
  14. By: Hälbig, Mirja; Mertens, Matthias; Müller, Steffen
    Abstract: We study the productivity effect of the German national minimum wage by applying administrative firm data. At the firm level, we confirm positive effects on wages and negative employment effects and document higher productivity even net of output price increases. We find higher wages but no employment effects at the level of aggregate industry × region cells. The minimum wage increased aggregate productivity in manufacturing. We do not find that employment reallocation across firms contributed to these aggregate productivity gains, nor do we find improvements in allocative efficiency. Instead, the productivity gains from the minimum wage result from within-firm productivity improvements only.
    Keywords: minimum wage, productivity, reallocation
    JEL: D24 J31 L11 L25
    Date: 2023
  15. By: Friedman-Sokuler, Naomi (Bar-Ilan University); Senik, Claudia (Paris School of Economics)
    Abstract: Using the American and the French time-use surveys, we examine whether people have a preference for a more diversified mix of activities, in the sense that they experience greater well-being when their time schedule contains many different activities rather than is concentrated on a very small number. This could be due to decreasing marginal utility, as is assumed for goods consumption, if each episode of time is conceived as yielding a certain level of utility per se. With returns to specialization, people would then face a trade-off between efficiency and diversity in choosing how to allocate time. We examine these issues and investigate potential gender differences, considering both instantaneous feelings and life satisfaction.
    Keywords: time allocation, time-use diversity, subjective well-being, life satisfaction, momentary utility, gender
    JEL: I31 J22
    Date: 2023–04
  16. By: Bastani, Spencer (IFAU - Institute for Evaluation of Labour Market and Education Policy); Karlsson, Kristina (Department of Economics, Uppsala University); Waldenström, Daniel (Research Institute of Industrial Economics (IFN))
    Abstract: We investigate the returns to cognitive ability in the labor and capital markets. Using population-wide Swedish military enlistment data and administrative tax records, we find that cognitive ability is much better at predicting capital income than labor earnings. The difference is almost a factor of three and remains substantial even after controlling for education, occupation, savings, inheritance, and parental background. Moreover, ability is significantly positively correlated with wealth returns. Our results provide new insights into why inequality in capital income is greater than in labor income and shed light on the drivers of economic mobility.
    Keywords: Ability; Skills; Education; Capital income; Wealth
    JEL: D31 H20 J24
    Date: 2023–03–31
  17. By: Filomena, Mattia; Picchio, Matteo
    Abstract: We estimate the impact of temperatures on work-related accident rates in Italy by using daily data on weather conditions matched to administrative daily data on work-related accidents. The identification strategy of the causal effect relies on the plausible exogeneity of short-term daily temperature variations in a given spatial unit. We find that both high and cold temperatures impair occupational health by increasing workplace injury rates. The positive effect of warmer weather conditions on work-related accident rates is larger for men, in manufacturing and service sectors, and for workplace injuries. Colder temperatures lead to a substantial increase in commuting accidents, especially during rainy days.
    Keywords: climate change, temperatures, weather conditions, work-related accidents, job safety
    JEL: J28 J81 Q52 Q54
    Date: 2023
  18. By: Goulão, Catarina (Toulouse School of Economics); Lacomba, Juan A. (Universidad de Granada); Lagos, Francisco (Universidad de Granada); Rooth, Dan-Olof (Stockholm University)
    Abstract: Being overweight or obese is associated with lower employment and earnings, possibly arising from employer discrimination. A few studies have used field experiments to show that obese job applicants are, in fact, discriminated against in the hiring process. However, whether overweight job applicants also face employer discrimination is still an open question. To this end, we have designed a correspondence testing experiment in which fictitious applications are sent to real job openings across twelve different occupations in the Spanish labor market. We compare the callback rate for applications with a facial photo of a normal weight person to the one for applications with a photo of the same person manipulated into looking overweight. Applications with a photo of the weight-manipulated male receive significantly fewer callbacks for a job interview compared to normal weight, and this differential treatment is especially pronounced in female-dominated occupations. For women, we find the opposite result. Weight-manipulated female applications receive slightly more callbacks, especially in female-dominated occupations. Our experimental design allows us to disentangle whether employers act on attractiveness or weight when hiring. For men, the weight manipulation effect is explained by an attractiveness premium, while for women we find evidence of an attractiveness penalty, as well as a weight penalty, in explaining the effect.
    Keywords: obesity, overweight, gender, attractiveness, hiring, correspondence testing
    JEL: J64 J71
    Date: 2023–05
  19. By: William J. Collins; Gregory Niemesh
    Abstract: Income and home ownership both surged in the United States between 1940 and 1960. We use cross-place variation in changes in real income to assess the importance of income gains to the mid-century home ownership boom. OLS and IV estimates suggest that a large share of the overall increase in home ownership was attributable to wage gains that were both large on average and widely spread across workers. This research complements the literatures on how New Deal mortgage market innovations and the World War II and Korean War GI Bills promoted home ownership in this period.
    JEL: J31 N32 N92 R21
    Date: 2023–05
  20. By: Fabrice Murtin; Vincent Siegerink
    Abstract: This working paper proposes a methodology to monetise five aspects of employee well-being (wage inequality, being employed, excess working hours, relationships with management and job security) using theoretical and empirical frameworks drawn from welfare economics. Preliminary results highlight a large loss of welfare arising from within-firm wage inequality as well as a strong impact of working conditions on workers’ well-being. On the aggregate, suppressing the negative externalities of the firm linked to excess working hours, tensions with management and job insecurity would yield an increase in social welfare equivalent to a 25% increase in household income, representing many years of economic growth. Greater transparency on company wage distributions and working conditions is necessary to apply these methodologies to real firms.
    Keywords: employee well-being, monetary valuation, Wage inequality, working conditions
    JEL: J31 J81 M52 I31
    Date: 2023–06–08
  21. By: Deng, Liuchun (Yale-NUS College); Müller, Steffen (IWH Halle); Plümpe, Verena (IWH Halle); Stegmaier, Jens (Institute for Employment Research (IAB), Nuremberg)
    Abstract: We analyze the impact of robot adoption on employment composition using novel micro data on robot use of German manufacturing plants linked with social security records and data on job tasks. Our task-based model predicts more favorable employment effects for the least routine-task intensive occupations and for young workers, the latter being better at adapting to change. An event-study analysis for robot adoption confirms both predictions. We do not find decreasing employment for any occupational or age group but churning among low-skilled workers rises sharply. We conclude that the displacement effect of robots is occupation-biased but age neutral whereas the reinstatement effect is age-biased and benefits young workers most.
    Keywords: robots, jobs, occupation, worker age
    JEL: J23
    Date: 2023–05
  22. By: Lee, Zeewan; Tan, Poh Lin; Tan-Soo, Jie-Sheng
    Abstract: The rise of remote work arrangements under the COVID-19 pandemic has generated important benefits, enhancing worker productivity by providing flexibility and reducing commuting costs. Would such positive labor market outcomes enjoyed equally between spouses? Using a longitudinal dataset of married women and their spouses before, during and after the lockdown in Singapore, we examine the effect of the pandemic and the availability of remote work on the respondents’ salary income, while accounting for the moderating roles of gendered differences in time use (e.g., in childcare) and presence of helpers. We find a significant salary income growth among male remote workers, but not among females. While both male and female remote workers experienced an increase in income if they spent less time on household work, women were less likely to face such smaller household responsibilities than men. This study provides empirical evidence that unequal division of household labor leads to unequal gains from remote work.
    Keywords: gender, income, COVID-19, remote work, flexible work, time use
    JEL: J16 J24
    Date: 2023
  23. By: Agúndez García, Ana; Christl, Michael
    Abstract: This paper evaluates two hypothetical budget-neutral reforms that shift resources from family tax expenditures to family cash transfers. We evaluate these reforms using a structural labor supply model based on the microsimulation EUROMOD model and EUSILC data. We find that both reforms have an inequality-decreasing impact. However, when looking at labor supply responses for different household types, we show that the reforms have a non-negligible impact, especially for females in couple households. Additionally, we show that females in the middle of the income distribution in particular will reduce labor supply in response to the reforms.
    Keywords: family benefits, reform, labor supply, discrete choice, microsimulation, EUROMOD
    JEL: J20 J08 H31
    Date: 2023
  24. By: Heckman, James J. (University of Chicago); Galaty, Bridget (University of Chicago); Tian, Haihan (University of Chicago)
    Abstract: This chapter presents an economic approach to character and personality traits with an application to the study of virtue. Economists interpret psychological traits, including character traits and virtue, as strategies that shape responses to situations (actions) determined by underlying endowments, preferences and resources, as well as incentives to act in situations. Philosophers of virtue consider a more limited set of goals than economists but the same tools can be applied to the economics of virtue ethics. Character traits and personality are not considered immutable in either field. They are shaped by genetics, parents, peers, and schools, as well as life experiences. We develop economic models to interpret and give empirical content to virtue ethics and suggest what virtue ethics contributes to the study of economic models.
    Keywords: traits, philosophy, ethics, economic models
    JEL: J24 J13 I24
    Date: 2023–05
  25. By: Dolls, Mathias (Ifo Institute for Economic Research); Krolage, Carla (Ifo Institute for Economic Research)
    Abstract: This paper analyzes behavioral responses to a 2014 reform in the German public pension system that lowered the full retirement age (FRA) of individuals with a long contribution history by up to two years and framed the new FRA as reference age for retirement. Using administrative data from public pension insurance accounts, we first document a substantial bunching response at the FRA exceeding the control group's bunching by 83%. Second, we show in a difference-in-difference setting that a 1.0 year decrease in the FRA leads to a reduction in the average pension claiming age by 0.3-0.4 years. Treated individuals neither have poorer health nor are more likely to be liquidity-constrained than individuals in the control group. Our results suggest that the strong responses to the reform are driven both by the new FRA serving as a reference point and by financial incentives. Estimated fiscal costs of the reform are at the upper end of the range of previous back-of-theenvelope calculations.
    Keywords: retirement age, early retirement, pension reform
    JEL: H55 J14 J18 J26
    Date: 2023–05
  26. By: Hernnäs, Sofia (Institute for Housing and Urban Research, Uppsala Univeristy.)
    Abstract: Does the long-term economic stress of occupational decline cause health problems, or even death? This paper explores this question using Swedish administrative data, and a measure of occupational decline obtained from detailed US data on employment changes over almost 30 years. I investigate whether people who experience occupational decline have higher mortality or hospitalization rates, and in particular if they are more likely to suffer from cardio-vascular disease or deaths of despair: deaths caused by alcohol, drug or suicide. I find that workers who in 1985 worked in occupations that subsequently declined, had a 5-11 percent higher risk of death in the 30 years that followed, compared to same-aged, similar workers in non-declining occupations. For men in declining occupations, the risk of death by cardio-vascular disease was 7-14 percent elevated, while women in declining occupations faced 31-37 percent higher risk of death by despair. The risk was higher for workers who were lowest paid in their occupations.
    Keywords: Technological change; Occupations; Health
    JEL: I11 J24 O33
    Date: 2023–03–29
  27. By: Olga Takács (Corvinus University of Budapest); János Vincze (Corvinus University of Budapest and Centre for Economic and Regional Studies)
    Abstract: We estimate heterogeneous wage structure effects for country-pairs within the EU by the Causal Forest algorithm, then identify groups of workers with the highest and lowest discrepancies in terms of wage differentials. We find that, in the East-West comparison, age is the most consistently differentiating factor. People over 40 are most adversely treated in the East relative to the West, and especially those who have no tertiary education and work in small or medium-sized enterprises.
    Keywords: Wage structure effects, Generalized Random Forest Regression, Conditional average treatment effects, Wage convergence in the EU
    JEL: J31 F66 C14
    Date: 2023–03
  28. By: Buser, Thomas (University of Amsterdam); Ahlskog, Rafael (Uppsala University); Johannesson, Magnus (Stockholm School of Economics); Koellinger, Philipp (Vrije Universiteit Amsterdam); Oskarsson, Sven (Uppsala University)
    Abstract: A large literature establishes that cognitive and non-cognitive skills are strongly correlated with educational attainment and professional achievement. Isolating the causal effects of these traits on career outcomes is made difficult by reverse causality and selection issues. We suggest a different approach: instead of using direct measures of individual traits, we use differences between individuals in the presence of genetic variants that are associated with differences in skills and personality traits. Genes are fixed over the life cycle and genetic differences between full siblings are random, making it possible to establish the causal effects of within-family genetic variation. We link genetic data from individuals in the Swedish Twin Registry to government registry data and find evidence for causal effects of genetic differences linked to cognitive skills, personality traits, and economic preferences on professional achievement and educational attainment. Our results also demonstrate that education and labor market outcomes are partially the result of a genetic lottery.
    Keywords: personality traits, economic preferences, cognitive skills, labor markets, education, polygenic indices
    JEL: J24 D91 I26
    Date: 2023–05
  29. By: Christian Bayer (Universität Bonn, CEPR, and IZA, Adenauerallee 24-42, 53113 Bonn, Germany); Moritz Kuhn (Universität Bonn, ECONtribute, CEPR, and IZA, Adenauerallee 24-42, 53113 Bonn, Germany)
    Abstract: Job levels summarize the complexity, autonomy, and responsibility of task execution. Conceptually, job levels are related to the organization of production, are distinct from occupations, and can be constructed from data on task execution. We highlight their empirical role in matched employer-employee data for life-cycle wage dynamics, refine a task-based view of wage determination, and demonstrate that differences in job levels account for most of the observed wage differences. We also show, within a structural framework, that a job-level perspective provides a novel and fruitful interpretation of widely studied phenomena such as the gender wage gap and the returns to education and seniority.
    Keywords: job levels, wage structure, career ladder
    JEL: D33 E24 J31
    Date: 2023–05
  30. By: Alessandro Maravalle; Alberto González Pandiella
    Abstract: Education and training are a high priority for Costa Rica that devotes to them more than 6.5% of GDP, one of the highest spending shares among OECD countries. However, educational outcomes remain poor and firms struggle to fill their vacancies, particularly in technical and scientific positions, which may endanger Costa Rica’s capacity to keep attracting foreign direct investment. Its complex fiscal situation requires Costa Rica to improve efficiency and quality of public spending in education to better support growth and equity. There is a fundamental need to improve the quality of early and general basic education to avoid that too many Costa Ricans leave education too early and without the skills needed to find a formal job. This requires a more targeted support to students with learning gaps, improving teachers’ selection and training and expanding access to early education. Revisiting the university funding mechanism will improve its accountability and can help increase the number of graduates in scientific areas. Reforms in vocational education may increase the supply of high-quality technicians, which will reduce existing skills mismatches and help more Costa Ricans access better-paid formal jobs.
    Keywords: education governance, general education, inequality, skills mismatch, training
    JEL: H52 I20 I21 I24 I25 J24 O15
    Date: 2023–05–24
  31. By: Delgado-Cubillo, Pablo; Martín Román, Ángel L.
    Abstract: While the 1995 Occupational Safety and Health Act (OSH) regulation transformed the outlook on workplaces in Spain, characterized by a lack of preventive protection, public statistics have reported an increasing trend in the postregulation workplace accident rates. This study uses microdata from official national statistics to examine the effect of the OSH regulation on the reported accidents while focusing on its severity. Accordingly, we apply a difference-in-difference assessment method where a comparable group is formed by the contemporaneous in itinere accidents (commuting), which are legally and statistically considered work-related accidents but not directly impacted by the OSH regulation, with a focus on the workplace environment. The results reveal that the nonfatal accident rate decreased after the implementation of the regulation. However, when we isolate the effect of the regulation on accidents that usually provoke hard-to-diagnose injuries (dislocations, back pain, sprains, and strains), we obtain a significant increase in the accident rate. Moral hazard mixed effects seem to have played a crucial role in these dynamics through overreporting and/or Peltzman effects, often offsetting accident reduction intended by the OSH regulation.
    Keywords: OSH, impact evaluation, moral hazard, difference-in-difference
    JEL: K31 I18 D04 H43 J28
    Date: 2023
  32. By: Brehm, Margaret E. (Oberlin College); Malkova, Olga (University of Kentucky)
    Abstract: We examine disparities in Child Tax Credit (CTC) eligibility and anti-poverty effects since 1998 by family type. Initially, single mothers were least likely to be eligible and were underrepresented among those lifted from poverty by the CTC, because the credit was virtually nonrefundable. By 2017, disparities by family type mostly disappear, as eligibility and anti-poverty effectiveness of the CTC among single mothers increases dramatically, because of reforms increasing CTC refundability. When the credit doubles in 2018, disparities revert toward initial levels, as eligibility and the anti-poverty effectiveness of single mothers rises least, because of a phaseout threshold expansion and partial refundability.
    Keywords: Child Tax Credit, poverty, gender, tax policy
    JEL: H24 H71 J22
    Date: 2023–05
  33. By: Cindy Biesenbeek; Maikel Volkerink
    Abstract: Employees with a flexible contract, i.e., those with either a temporary contract, temporary agency workers, or those on a contract with flexible working hours, face more job and income insecurity than employees with a permanent contract. In competitive labor markets, they should be compensated for this uncertainty. In most countries, however, wages of flexible jobs are lower than those of permanent jobs. We find that this is also the case for The Netherlands between 2006 and 2019, in particular for men and higher educated employees. A critique on wage comparisons is that sample selection may lead to biased results. We use two methods to control for sample selection - Regression Adjustment and Propensity Score Matching - and find wage differentials close to our baseline estimates.
    Keywords: Wage Gap; Flexible Employment; Earnings; Hourly wages;Wage differential; Non- standard work
    JEL: J31
    Date: 2023–06
  34. By: Bauernschuster, Stefan (University of Passau); Grimm, Michael (University of Passau); Hajo, Cathy M. (Ramapo College of New Jersey)
    Abstract: Margaret Sanger established the first birth control clinic in New York in 1916. From the mid-1920s, "Sanger clinics" spread over the entire U.S. Combining newly digitized data on the roll-out of these clinics, full-count Census data, and administrative vital statistics, we find that birth control clinics accounted for 5.0–7.8% of the overall fertility decline until 1940. Moreover, birth control clinics had a significant and meaningful negative effect on the incidence of stillbirths and infant mortality. The effect of birth control clinics on puerperal deaths is consistently negative, yet insignificant. Further suggestive evidence points towards positive effects on female employment.
    Keywords: birth control, fertility, mortality, Margaret Sanger, demographic transition
    JEL: D10 J13 J23 N32 O12
    Date: 2023–05
  35. By: Lena Abou El-Komboz (ifo Institute, LMU Munich); Thomas Fackler (ifo Institute, LMU Munich, CESifo, Laboratory for Innovation Science at Harvard)
    Abstract: Software engineering is a field with strong geographic concentration, with Silicon Valley as the epitome of a tech cluster. Yet, most studies on the productivity effects of agglomerations measure innovation with patent data, thus capturing only a fraction of the industry's activity. With data from the open source platform GitHub, our study contributes an alternative proxy for productivity, complementing the literature by covering a broad range of software engineering. With user activity data covering the years 2015 to 2021, we relate cluster size to an individual's productivity. Our findings suggest that physical proximity to a large number of other knowledge workers in the same field leads to spillovers, increasing productivity considerably. In further analyses, we confirm the causal relationship with an IV approach and study heterogeneities by cluster size, initial productivity and project characteristics.
    Keywords: agglomeration effects; knowledge spillovers; open source; online collaboration;
    JEL: D62 J24 O33 O36 R32
    Date: 2023–05–26
  36. By: Marta Cota
    Abstract: Why do employees’ retirement contributions gradually increase throughout their careers? This paper uses a structural life-cycle model based on household expectations data to explain workers’ retirement contribution decisions. The Michigan Survey of Consumers data shows that young households extrapolate from their recent income realizations and overstate the persistence and volatility of their future income. The structural life-cycle model with extrapolative expectations quantifies the difference in retirement contribution rates compared to rational expectations. Contrary to rational workers, extrapolative workers’ contributions match the data on retirement contributions over the life cycle. Consequently, mandating automatic enrollment yields negligible effects on retirement savings.
    Keywords: extrapolative expectations; forecast errors; illiquid savings; retirement contribution;
    JEL: E21 J26 J32
    Date: 2023–04
  37. By: Hübler, Olaf (Leibniz University of Hannover)
    Abstract: Donations and unpaid working are two important forms of non-market activities that are usually considered separately in the literature. The purpose of this paper is to empirically test hypotheses on determinants of giving to organizations. In particular, the importance of voluntary work for giving behavior is examined in comparison to other unpaid activities. In addition, the aim is to find out whether mutual dependencies exist and to what extent benefits, measured by satisfaction, can be derived from both forms. Estimates using data from the Socio-Economic Panel for the years 2019/2020 lead to the following results for Germany: - Personality traits and individual assessment, under which conditions a society is judged to be just, are important for donation behavior. These two aspects are widely neglected in the literature. - If honorary offices are exercised as a major activity, a clear positive donation effect is derived in contrast to a secondary activity. - Participation in citizens' initiatives shows a similar correlation. In contrast, unpaid overtime in professional life shows a negative link. - No effect can be discerned, based on an honorary office, for payments to unrelated individuals. - Donations to organizations and voluntary work show mutual dependencies. - Life satisfaction is increased both by donating and by doing voluntary work.
    Keywords: citizens' initiative, donations, life satisfaction, personality traits, unpaid work, volunteering
    JEL: D64 D91 I30 J30
    Date: 2023–05
  38. By: Akcigit, Ufuk; Chhina, Raman; Cilasun, Seyit Mümin; Miranda, Javier; Ocakverdi, Eren; Serrano-Velarde, Nicolas
    Abstract: Small and young businesses are essential for job creation, innovation, and economic growth. Even most of the superstar firms start their business life small and then grow over time. Small firms have less internal resources, which makes them more fragile and sensitive to macroeconomic conditions. This suggests the need for frequent and real-time monitoring of the small business sector's health. Previously this was difficult due to a lack of appropriate data. This paper fills this important gap by developing a new Intuit QuickBooks Small Business Index that focuses on the smallest of small businesses with at most 9 workers in the US and the UK and at most 19 workers in Canada. The Index aggregates a sample of anonymous QuickBooks Online Payroll subscriber data (QBO Payroll sample) from 333, 000 businesses in the US, 66, 000 in Canada, and 25, 000 in the UK. After comparing the QBO Payroll sample data to the official statistics, we remove the seasonal components and use a Flexible Least Squares method to calibrate the QBO Payroll sample data against official statistics. Finally, we use the estimated model and the QBO Payroll sample data to generate a near real-time index of economic activity. We show that the estimated model performs well both in-sample and out-of-sample. Additionally, we use this analysis for different regions and industries.
    Keywords: employment, entrepreneurship, index, job creation, small businesses, turnover
    JEL: J23 J63 O47
    Date: 2023
  39. By: Gardberg, Malin (Research Institute of Industrial Economics (IFN)); Heyman, Fredrik (Research Institute of Industrial Economics (IFN)); Tåg, Joacim (Research Institute of Industrial Economics (IFN))
    Abstract: Is technology or trade driving increases in wage inequality? We propose that technology interacts with trade in the form of foreign direct investments to widen domestic wage inequality. We show that foreign acquisitions of domestic firms disproportionately affect wages for workers who perform tasks sensitive to the technology specialization (software or robotics) of the acquiring firm. Based on Swedish matched employer-employee data covering two decades and staggered difference-in-differences methods we find wages to decline by up to 5.2% annually over an eight-year post period. Our results suggest that a trade policy aimed at attracting foreign companies with high technological capabilities can help countries advance technologically, but this may come at the cost of increased domestic wage inequality.
    Keywords: Acquisitions; AI; Automation; Inequality; Robots; Technology; Trade; Mergers and Acquisitions; Multinational firms; Wages
    JEL: F23 G34 J30 R10
    Date: 2023–04–05
  40. By: Andrés Ham; Ángela Guarín; Juanita Ruiz
    Abstract: This paper studies whether household surveys precisely identify the LGBT population and are suitable to measure labor market discrimination in Colombia. We first quantify the size of the LGBT population and estimate labor market inequalities from household survey data, highlighting potential pitfalls from using this approach. We then present findings from a list experiment in Bogotá, Colombia. Results show that household surveys underestimate the size of the LGBT population and may yield biased estimates of labor market inequalities. While survey estimates range between 1-4%, we find that LGBT people constitutes around 12-22% of the total population. We find heterogeneous reporting by sex, age groups, educational attainment, and marital status. Our findings suggest that while current measurement practices are a step forward for the LGBT population’s statistical visibility, additional steps are required before household surveys may be used to consistently estimate discrimination and guide policy responses to protect this population. ****** Este trabajo estudia si las encuestas de hogares están identificando con precisión a la población LGBT en Colombia y, por lo tanto, si son adecuadas para medir su bienestar y experiencias de discriminación en diferentes ámbitos, incluido el mercado laboral. Primero, cuantificamos el tamano de la población LGBT y estimamos las desigualdades en el mercado laboral usando datos de encuestas de hogares, resaltando las posibles limitaciones de usar esta aproximación. Después, llevamos a cabo un experimento de lista en Bogotá, ciudad capital. Nuestros resultados muestran que en las encuestas de hogares hay un subreporte en el tamano de la población LGBT, lo cual puede arrojar estimaciones sesgadas de las desigualdades en el mercado laboral. Con la metodología de las encuestas de hogares, calculamos que el tamano de la población LGBT oscila entre el 1-4 %, mientras nuestros resultados sugieren que el tamano de la población LGBT se encuentra entre 12-22 % para Bogotá. Encontramos, además, resultados heterogéneos por sexo, edad, nivel educativo y estado civil. Nuestros resultados sugieren que, si bien ha habido avances considerables en la visibilidad estadística de la población LGBT, es necesario tomar acciones adicionales para que las encuestas de hogares puedan medir de manera consistente esta población, sus experiencias de discriminación y, de esa manera, guiar respuestas de política pública.
    Keywords: LGBT population, measurement, discrimination, household surveys, list experiment.
    JEL: C90 D10 J10 J21 J70
    Date: 2023–03–21
  41. By: Iván Auciello-Estévez (Banco de España); Josep Pijoan-Mas (CEMFI AND CEPR); Pau Roldan-Blanco (Banco de España); Federico Tagliati (Banco de España)
    Abstract: Using comprehensive balance-sheet data for Spain, we document the use of fixed-term and open-ended contracts by firms over the period 2004-2019. We show that the use of temporary contracts is very heterogeneous across firms, with the distribution of the temporary share being severely right-skewed: the median share of temporary employment is only 3%, while the average is 18%. Part of this variation is related to the sector and region where firms operate as well as to the macroeconomic cycle. However, around 80% of the variation reflects differences across firms operating in the same industry, in the same location and at the same point of the business cycle. At the individual level, even after controlling for sector and region, we observe that larger and younger firms make more extensive use of temporary contracts.
    Keywords: dual labor markets, temporary contracts, unemployment
    JEL: D83 E24 J41 L11
    Date: 2023–04

This nep-lma issue is ©2023 by Joseph Marchand. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.