nep-lma New Economics Papers
on Labor Markets - Supply, Demand, and Wages
Issue of 2023‒12‒04
eighteen papers chosen by
Joseph Marchand, University of Alberta

  1. A Tale of Two Fields? STEM Career Outcomes By Xuan Jiang; Joseph Staudt; Bruce A. Weinberg
  2. Demand for Personality Traits, Tasks, and Sorting By Brenčič, Vera; McGee, Andrew
  3. From fields to factories: Special economic zones, foreign direct investment, and labour markets in Vietnam By Tafese, Tevin; Lay, Jann; Van Tran
  4. The cost of job loss in carbon-intensive sectors: Evidence from Germany: Evidence from Germany By Cesar Barreto; Robert Grundke; Zeev Krill
  5. Business Cycles and Police Hires By Fernando Saltiel; Cody Tuttle
  6. Decomposing Lifetime-Earnings Differences between White, Black, and Hispanic Families By Hope Bodenschatz; Gerald Eric Daniels Jr.; Jeffrey P. Thompson
  7. Moonlighting and the Minimum Wage By Vom Berge, Philipp; Umkehrer, Matthias
  8. Career Concerns As Public Good: The Role of Signaling for Open Source Software Development By Lena Abou El-Komboz; Moritz Goldbeck
  9. So, dear applicant, do you mean working from home or shirking from home? By Eline Moens; Elsy Verhofstadt; Luc Van Ootegem; Stijn Baert
  10. Land Markets and Labor Productivity: Empirical Evidence from China By Zhang, Jian; Mishra, Ashok K.; Zhu, Peixin
  11. The Economic Geography of Lifecycle Human Capital Accumulation: The Competing Effects of Labor Markets and Childhood Environments By Ben Sprung-Keyser; Sonya Porter
  12. A Spouse and a House are all we need? Housing Demand, Labor Supply and Divorce over the Lifecycle By Bram De Rock; Mariia Kovaleva; Tom Potoms
  13. High-Speed Railways and Firms Total Factor Productivity: Evidence from a Quasi-Natural Experiment By Bottasso, Anna; Conti, Maurizio; Ferrara, Antonella Rita; Robbiano, Simone
  14. Basic Facts on the Coverage of the Paycheck Protection Program By Angela Guo; Mark E. Schweitzer
  15. Estimating Present Bias and Sophistication over Effort and Money By Claudia Cerrone; Anujit Chakraborty; Hyok Jung Kim; Leonhard Lades
  16. The Persistent Effect of Competition on Prosociality By Fabian Kosse; Ranjita Rajan; Michela Tincani
  17. When Fairness Matters: Cross-Race Responses to Intentionally Fair Treatment By Harvey, Matthew; Nickerson, David; Wozniak, Abigail
  18. The tax treatment of commuting expenses and job-related mobility By Baumgart, Eike; Blaufus, Kay; Hechtner, Frank

  1. By: Xuan Jiang; Joseph Staudt; Bruce A. Weinberg
    Abstract: Is the labor market for US researchers experiencing the best or worst of times? This paper analyzes the market for recently minted Ph.D. recipients using supply-and-demand logic and data linking graduate students to their dissertations and W2 tax records. We also construct a new dissertation-industry “relevance” measure, comparing dissertation and patent text and linking patents to assignee firms and industries. We find large disparities across research fields in placement (faculty, postdoc, and industry positions), earnings, and the use of specialized human capital. Thus, it appears to simultaneously be a good time for some fields and a bad time for others.
    JEL: I23 J24 O3
    Date: 2023–11
  2. By: Brenčič, Vera (University of Alberta); McGee, Andrew (University of Alberta)
    Abstract: In job ads, employers express demand for personality traits when seeking workers to perform tasks that can be completed with different behaviors (e.g., communication, problem-solving) but not when seeking workers to perform tasks involving narrowly prescribed sets of behaviors such as routine and mathematics tasks. For many tasks, employers appear to demand narrower personality traits than those measured at the Big Five factor level. The job ads also exhibit substantial heterogeneity within occupations in the tasks mentioned. Workers may thus sort based on personality-derived comparative advantages in tasks into jobs rather than occupations. In the National Longitudinal Survey of Youth 1997, we confirm that personality sorting based on tasks occurs at both the occupation and job levels. In this sample, however, there is little evidence of task-specific wage returns to personality traits, which would influence the supply of traits to jobs with particular tasks. This may explain why personality sorting based on tasks in the sample is very limited in spite of the correlations between tasks and employers' demands for traits.
    Keywords: personality, tasks, sorting, job ads, employer demand
    JEL: D22 J23 J24 J33 M51
    Date: 2023–11
  3. By: Tafese, Tevin; Lay, Jann; Van Tran
    Abstract: Vietnam has integrated into global value chains through the establishment of special economic zones (SEZs). This paper examines the local labour-market impacts of this programme, building on a unique dataset of SEZs in combination with labour force survey (LFS) data. Using historical satellite imagery, we trace the built-up area of SEZs over time to construct a continuous measure of SEZ exposure, which we link to the LFSs at the districtyear level for 2013-2019. In a difference-in-differences design with continuous treatment, we find that SEZs have led to a rapid shift in employment from agriculture and services to manufacturing and to an improvement in the quality of employment through higher wages and more formal employment. Foreign firms drive these effects, but there are positive spillovers to workers in domestic firms in agriculture and services. The effects are particularly strong for women, and younger individuals with low and medium levels of education.
    Keywords: Vietnam, Special Economic Zones, foreign direct investment, labour markets, structural change, informality
    JEL: J23 J24 J30 J80 O14 O17 O19 P33
    Date: 2023
  4. By: Cesar Barreto; Robert Grundke; Zeev Krill
    Abstract: The green transformation of the economy is expected to lead to a sharp reduction in employment in carbon-intensive industries. For designing policies to support displaced workers, it is crucial to better understand the cost of job loss, whether there are specific effects of being displaced from a carbon-intensive sector and which workers are most at risk. By using German administrative labour market data and focusing on mass layoff events, we estimate the cost of involuntary job displacement for workers in high carbon-intensity sectors and compare it with the displacement costs for workers in low carbon-intensity sectors. We find that displaced workers from high carbon-intensity sectors have, on average, higher earnings losses and face stronger difficulties in finding a new job and recovering their earnings. Our results indicate that this is mainly due to human capital specificity, the regional clustering of carbon-intensive activities and higher wage premia in carbon-intensive firms. Workers displaced in high carbon-intensity sectors are older, face higher local labour market concentration and have fewer outside options for finding jobs with similar skill requirements. They have a higher probability to switch occupations and sectors, move to occupations that are more different in terms of skill requirements compared to the pre-displacement job, and are more likely to change workplace districts after displacement. Women, older workers and those with vocational degrees as well as workers in East Germany, experience particularly high costs in case they are displaced from high carbon-intensity sectors.
    Keywords: carbon-intensive sectors, difference-in-differences, green transition, human capital specificity, Job loss effect, labour displacement, labour market concentration, labour reallocation
    JEL: J24 J31 J42 J63 J64 J65 Q52
    Date: 2023–11–13
  5. By: Fernando Saltiel (McGill University); Cody Tuttle (University of Texas)
    Abstract: We show that the quality of police hires varies over the business cycle. Officers hired when the unemployment rate is high have fewer complaints, disciplines, and are less likely to be fired than officers hired when the unemployment rate is low. Effects are larger for younger workers who have weaker outside options in recessions. We find that the size and quality of the applicant pool increases in high unemployment years–morepeople take entry exams and a larger fraction pass the exam. Our findings shed light on how outside options affect police hires and speak to policy questions about police recruitment.
    Keywords: Police hiring, police quality, public sector labor markets, outside options
    JEL: J24 J33 J45 K42
    Date: 2023–11
  6. By: Hope Bodenschatz; Gerald Eric Daniels Jr.; Jeffrey P. Thompson
    Abstract: This paper explores disparities between White, Black, and Hispanic families using a measure of lifetime earnings developed by Jacobs et al. (2022) for the Survey of Consumer Finances (SCF). Lifetime earnings are a particularly important measure of well-being, with relevance for wealth accumulation among other economic and social outcomes, but they are under-studied in the context of racial disparities. We describe how the different components of lifetime earnings— including annual earnings of workers, number of working household members, and number of years of employment during the working life—vary by race. We then decompose the differences in lifetime earnings using the recentered influence function and show that human capital-related variables, including educational attainment and years of full-time employment, account for most of the observed differences in lifetime earnings between White, Black, and Hispanic families. We also explore the contribution of business ownership to explained disparities in lifetime earnings and find that it is significant and that business ownership’s explanatory power increases at the top of the lifetime-earnings distribution.
    Keywords: lifetime earnings; racial disparities; inequality
    JEL: D31 I31 J15 J24 J31
    Date: 2023–10–01
  7. By: Vom Berge, Philipp (Institute for Employment Research (IAB), Nuremberg, Germany); Umkehrer, Matthias (Institute for Employment Research (IAB), Nuremberg, Germany)
    Abstract: "In this paper, we investigate the effects of the introduction of a nationwide minimum wage in Germany on main jobs, secondary jobs and their interaction by exploiting large-scale administrative data and variation in exposure to the minimum wage across jobs. While we find that the national minimum wage raised earnings but did not lower employment for both job types at an individual level, we document differential effects on working time adjustments: For main jobs, it increased the likelihood of upgrading marginal to regular jobs. For secondary jobs, it rather led to working hours reductions in order to maintain tax advantages. We also provide evidence that individuals holding more than one job (moonlighters) who experienced a minimum-wage-induced decline of working hours on their main job partially transferred hours to their secondary job instead." (Autorenreferat, IAB-Doku)
    Keywords: Bundesrepublik Deutschland ; Stichprobe der Integrierten Arbeitsmarktbiografien (SIAB) ; IAB-Open-Access-Publikation ; Auswirkungen ; Einkommenseffekte ; Erwerbsverhalten ; geringfügige Beschäftigung ; Hauptberuf ; individuelle Arbeitszeit ; labour turnover ; Lohnhöhe ; Mehrfachbeschäftigung ; Mindestlohn ; Mindestlohnrecht ; Nebentätigkeit ; Normalarbeitsverhältnis ; Reform ; Statusmobilität ; Teilzeitarbeit ; Vollzeitarbeit ; Zeitverwendung ; 2011-2015
    JEL: J23 J38 J88
    Date: 2023–10–11
  8. By: Lena Abou El-Komboz (ifo Institute); Moritz Goldbeck (ifo Institute)
    Abstract: Much of today’s software relies on programming code shared openly online. Yet, it is unclear why volunteer developers contribute to open-source software (OSS), a public good. We study OSS contributions of some 22, 900 developers worldwide on the largest online code repository platform, GitHub, and find evidence in favor of career concerns as a motivating factor to contribute. Our difference-in-differences model leverages time differences in incentives for labor market signaling across users to causally identify OSS activity driven by career concerns. We observe OSS activity of users who move for a job to be elevated by about 16% in the job search period compared to users who relocate for other reasons. This increase is mainly driven by contributions to projects that increase external visibility of existing works, are written in programming languages that are highly valued in the labor market, but have a lower direct use-value for the community. A sizable extensive margin shows signaling incentives motivate first-time OSS contributions. Our findings suggest that signaling incentives on private labor markets have sizable positive externalities through public good creation in open-source communities, but these contributions are targeted less to community needs and more to their signal value.
    Keywords: software; knowledge work; digital platforms; signaling; open source; job search;
    JEL: L17 L86 H40 J24 J30
    Date: 2023–11–15
  9. By: Eline Moens; Elsy Verhofstadt; Luc Van Ootegem; Stijn Baert (-)
    Abstract: Many applicants want a job with the possibility of telework. However, the literature is unclear on whether being explicit about this wish and the reason for it leads to negative consequences on hiring intentions. In this paper we therefore investigate how expressing a desire for telework, for work-life balance and for productivity in particular, impacts the probability of receiving an interview and what it signals to recruiters. To this end, we set up a state-ofthe-art vignette experiment in which recruiters evaluate fictitious applicants for different jobs. As a result of this experimental set-up, the answers to our research questions can be interpreted causally, and external validity benefits from the heterogeneity of the jobs. We find that if the desire for work-life balance is the stated motivation, the preference is punished more severely than if the motivation is productivity. Compared to applicants who do not mention a preference for telework, recruiters are 5.1 percentage points less inclined to invite applicants who pronounce this desire for work-life balance to an interview and 2.1 percentage points less inclined to invite applicants for whom the motivation is productivity. Lastly, mentioning a telework preference for work-life balance has a clear negative effect on anticipated achievement striving, commitment, and availability.
    Keywords: telework, interview probability, factorial survey experiment
    JEL: M51 M54 J22 J32 J63 J81
    Date: 2023–11
  10. By: Zhang, Jian (China University of Mining and Technology); Mishra, Ashok K. (Arizona State University); Zhu, Peixin (Nanjing Agricultural University)
    Abstract: This study investigates the impact of the land rental market (LRM) on labor productivity in rural China. Particular attention is given to farm and non-farm labor productivity. Using 2012 household-level data and a multinomial endogenous switching treatment regression (MESTR) technique, we find that rural households renting-in farmland increased labor productivity in the farm sector by about 55%, while labor productivity in the non-farm sector decreased by about 6%. We also find that rural households renting-out farmland had lower labor productivity in both the farm and non-farm sectors by 13% and 9%, respectively. More family labor transferred from the farm to the non-farm sector after renting-out land.
    Keywords: land rental market, labor productivity, farm sector, non-farm sector
    JEL: C31 J22 Q15 Q18
    Date: 2023–11
  11. By: Ben Sprung-Keyser; Sonya Porter
    Abstract: We examine how place shapes the production of human capital across the lifecycle. We ask: do those places that most effectively produce human capital in childhood also have local labor markets that do so in adulthood? We begin by modeling wages across place as driven by 1) location-specific wage premiums, 2) adult human capital accumulation due to local labor market exposure, and 3) childhood human capital accumulation. We construct estimates of location wage premiums using AKM style estimates of movers across US commuting zones and validate these estimates using evidence from plausibly exogenous out migration from New Orleans in response to Hurricane Katrina. Next, we examine differential earnings trajectories among movers to construct estimates of human capital accumulation due to labor market exposure. We validate these estimates using wage changes of multi-time movers. Finally, we estimate the impact of place on childhood human capital production using age variation in moves during childhood. Crucially, our estimates of location wage premiums and adult human capital accumulation allow us to construct estimates of the causal effect of place during childhood that are not confounded by correlated labor market exposure. Using these estimates, we show there is a tradeoff between those places that most effectively produce human capital in childhood and the local labor markets that do so in adulthood. We find that each 1-rank increase in earnings due to adult labor market exposure trades off with a 0.43 rank decrease in earnings due to the local childhood environment. This pattern is closely linked to city size, as adult human capital accumulation generally increases with city size, while childhood human capital accumulation falls. These divergent trajectories are associated with differences in both the physical structure of cities and the nature of social interaction therein. There is no tradeoff present in the largest cities, which provide greater exposure to high-wage earners and higher levels of local investment. Finally, we examine how these patterns are reflected in local rents. Location wage premia are heavily capitalized into rents, but the determinants of lifecycle human capital accumulation are not.
    Date: 2023–11
  12. By: Bram De Rock; Mariia Kovaleva; Tom Potoms
    Abstract: To analyze the impact of changes in the value of marriage on household decisions, we present a limited commitment framework of household behavior in which decisions are made regarding labor supply, divorce and housing demand over the lifecycle. We identify and estimate our structural model using exogenous variation in female labor supply and divorce rates due to the White v. White case in England. We conclude that limited commitment dampens the added worker effect, while the changes in the value of marriage due to a housing price shock have an asymmetric impact on individual welfare both across gender and marital state. We also show that tightening the credit market in different ways can lead to opposite behavior in terms of household savings and female labor supply.
    Keywords: Limited commitment, divorce legislation, value of marriage, housing demand, labor supply, credit market policy.
    Date: 2023–10
  13. By: Bottasso, Anna (University of Genoa); Conti, Maurizio (University of Genoa); Ferrara, Antonella Rita (University of Calabria); Robbiano, Simone (University of Eastern Piedmont)
    Abstract: The focus of this study is to assess the causal impact of the connection of a local area to a high-speed rail network (HSR) on firms' total factor productivity (TFP). The quasi-random location of the HSR station in the Italian city of Reggio Emilia is exploited in a Difference-in Differences (DiD) research design applied to a large sample of firms, observed over the period 2010-2018. The results suggest that the opening of the HSR station improved treated firms' TFP of about 5%; in particular, such effect is larger for firms closer to the HSR station and slightly increases over the sample period. We also find that the impact of the connection to the HSR station is heterogeneous across industries and depends on firms' size and past productivity. Overall results are robust to a large number of sensitivity checks and falsification tests.
    Keywords: transport infrastructure, Difference-in-Differences, total factor productivity
    JEL: C50 D24 L92 R30
    Date: 2023–11
  14. By: Angela Guo; Mark E. Schweitzer
    Abstract: This paper applies loan-level information from Paycheck Protection Program loans to analyze the coverage of this extraordinary lending program. We show that loans went to a large share of small businesses across most industries in the US, especially to industries that were most negatively impacted by COVID-19 stay-at-home orders. We geocode the loans and then identify that 2021 loans were more concentrated in low- and moderate-income communities, along with census tracts where minority residents are a majority of the population. The growth of nonemployer loans and fintech lending in the program were key components of the broadened reach of the program.
    Keywords: small business lending; credit access; fintech; discrimination
    JEL: G21 L5 R3 J71
    Date: 2023–11–07
  15. By: Claudia Cerrone; Anujit Chakraborty; Hyok Jung Kim; Leonhard Lades (Department of Economics, University of California Davis)
    Abstract: We use a real-effort experiment to jointly estimate present bias (β) and sophistication (̂ β) parameters, separately over money (βm, ̂ βm) and effort (βe, ̂ βe). Our novel incentive structure aligns the choice scenario with the canonical assumption of choices being the interior optima of a concave utility-maximization exercise. Participants choose to (and predict to) complete 14% (and 10%) fewer tasks on the same day than on a future day, leading to an estimated βe between 0.70 and .79 (and ̂ βe between 0.80 and .88). We find no evidence of present bias or sophistication over money
    Keywords: present bias, sophistication, beliefs, experiment, real effort task, experiment
    Date: 2023–11–06
  16. By: Fabian Kosse (LMU Munich); Ranjita Rajan (The Karta Initiative); Michela Tincani (University College London)
    Abstract: We present the first causal evidence on the persistent impact of enduring competition on prosociality. Inspired by the literature on tournaments within firms, which shows that competitive compensation schemes reduce cooperation in the short-run, we explore if enduring exposure to a competitive environment persistently attenuates prosociality. Based on a large-scale randomized intervention in the education context, we find lower levels of prosociality for students who just experienced a 2-year competition period. 4-year follow-up data indicate that the effect persists and generalizes, suggesting a change in traits and not only in behavior.
    Keywords: prosociality, competition, cooperation, social skills, socio-emotional skills, tournaments, comparative pay, incentive schemes
    JEL: D74 D91 J13 J24
    Date: 2023–11
  17. By: Harvey, Matthew (University of Washington Tacoma); Nickerson, David (Temple University); Wozniak, Abigail (Federal Reserve Bank of Minneapolis)
    Abstract: Do White and Black Americans differ in their response to fair versus unfair treatment, and do these reactions depend on whether treatment is intentional? We study an ultimatum game in which we non-deceptively vary three dimensions: racial identities of participants, offer inequality, and whether the offer was made intentionally or assigned by lottery. Unequal offers are more likely to be rejected in all conditions, but participants differed in how intentionality behind an offer affected their response. White respondents did not differentiate between intentional and randomly assigned offer inequality. In contrast, among Black respondents, intentionality increased acceptance of fair offers.
    Keywords: race identities, fairness, ultimatum game, inequality aversion, intentionality
    JEL: D63 J71 C90
    Date: 2023–11
  18. By: Baumgart, Eike; Blaufus, Kay; Hechtner, Frank
    Abstract: Amid global climate change concerns, policymakers worldwide are increasingly scrutinizing environmentally harmful subsidies. This study examines the tax-deductibility of job-related commuting expenses, which has faced criticism for promoting longer commutes and congestion. Through a controlled, randomized survey experiment, we confirm that the tax-deductibility of commuting expenses results in longer commutes but does so with minimal economic impact. Increasing the deduction rate by e0.10 leads to an average acceptance of 377-meter-longer commutes. Surprisingly, subjects are inattentive to changes in the tax deduction's size when such changes are presented as tax-deductible expenses rather than as direct cash effects. In contrast, abolishing the tax deductibility significantly reduces average commuting distances by nearly 9 percent. These findings highlight people's responsiveness to the mere presence of the commuter tax break while being less sensitive to its specific size. Policymakers should consider these findings when evaluating the effectiveness of such tax deductions in mitigating climate change or their economic efficiency effects.
    Keywords: Commuting Behavior, Commuting Subsidies, Tax Policy, Tax Complexity, Rational Inattention
    JEL: D90 H21 H24 J22 R23 R28 R41
    Date: 2023

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