nep-lma New Economics Papers
on Labor Markets - Supply, Demand, and Wages
Issue of 2024‒02‒12
nineteen papers chosen by
Joseph Marchand, University of Alberta

  1. Social Security and Inequality in Belgium By Klinges, Giulia; Jousten, Alain; Lefèbvre, Mathieu
  2. How Do Firms Respond to Unions? By Dodini, Samuel; Stansbury, Anna; Willén, Alexander
  3. Career Concerns As Public Good - The Role of Signaling for Open Source Software Development By Lena Abou El-Komboz; Moritz Goldbeck
  4. The Mismeasurement of Work Time: Implications for Wage Discrimination and Inequality By Borjas, George J.; Hamermesh, Daniel S.
  5. Firms and Worker Health By Ahammer, Alexander; Packham, Analisa; Smith, Jonathan
  6. The Returns to Education: A Meta-study By Gregory Clark; Christian Alexander Abildgaard Nielsen
  7. Minimum Wage Effects on Gender Gaps in Working Hours and Earnings in Germany By Clemens Ohlert
  8. Minimum Hours Constraints: The Role of Organizational Culture By Maciej Albinowski; Joanna Franaszek
  9. Digital Skills: Classification, Empirical Estimates of the Demand By Kapelyuk, Sergey; Karelin, Iliya
  10. How the 1963 Equal Pay Act and 1964 Civil Rights Act Shaped the Gender Gap in Pay By Bailey, Martha J.; Helgerman, Thomas; Stuart, Bryan Andrew
  11. Assessing the Impact of New Technologies on Wages and Labour Income Shares By Antea Barišić; Mahdi Ghodsi; Robert Stehrer
  12. How Do Recruiters Assess Applicants Who Express a Political Engagement? By Moens, Eline; De Pessemier, Dyllis; Baert, Stijn
  13. The Effect of Elder Caregiving on Labor Force Participation By Jessica Forden
  14. The effect of COVID-19 on the gender gap in remote work By Marcén, Miriam; Morales, Marina
  15. Gender Quotas, Board Diversity and Spillover Effects. Evidence from Italian Banks By Del Prete, Silvia; Papini, Giulio; Tonello, Marco
  16. A Critical Survey of Pension Provision And Pension Reform By Teresa Ghilarducci; Karthik Manickam
  17. Intergenerational (im)mobility in Pakistan: Is the social elevator broken? By Andlib, Zubaria; Sadiq, Maqsood; Scicchitano, Sergio
  18. Medical Ethics and Physician Motivations By Andrews, Brendon P.
  19. Occupational structure in a black settler colony: Sierra Leone in 1831 By Galli, Stefania

  1. By: Klinges, Giulia (University of Liège); Jousten, Alain (University of Liège); Lefèbvre, Mathieu (Aix Marseille School of Economics)
    Abstract: Over the years, the Belgian social security system has undergone substantial reform with a prime focus on increasing older worker labor force participation. The paper explores the effect of past reforms on inequality in old age. We distinguish two separate effects: The mechanical effect considers the change in inequality and expected benefit levels due to the reforms for a fixed retirement age distribution. The behavioral effect accounts for the endogenous change caused by changes in the incentives to work. Our results show that mechanically, reforms have led to losses in expected benefits for all but the lowest income quintile. Behavioral changes had a positive but orders of magnitude smaller effect. Overall, inequality decreased as a result of reforms.
    Keywords: social security and public pensions, old-age labor supply, retirement, pension reforms, inequality
    JEL: D63 H55 I38 J26
    Date: 2024–01
  2. By: Dodini, Samuel (Norwegian School of Economics); Stansbury, Anna (MIT); Willén, Alexander (Norwegian School of Economics)
    Abstract: This paper provides a comprehensive assessment of the margins along which firms in Norway respond to increased union density, using legislative changes in the tax deductibility of union dues as a quasi-exogenous shock to firm-level unionization rates. Despite higher personnel costs driven by a union wage premium, the average manufacturing firm increases employment and scales up production, charges higher prices in the product market, enjoys higher nominal value added per worker, and experiences no decrease in profits. We show that this result is a direct implication of the labor- and product-market power that the average manufacturing firm possesses, in combination with a reallocation of inputs and industry revenue shares from smaller and less unionized firms to larger and more unionized firms. Larger firms are, therefore, increasing employment and output at the same time their ability to mark up prices is growing, thereby preventing negative profit effects. For the broader private sector in which firms do not hold much price- or wage-setting power, we observe the opposite result: the average firm reduces employment and profit falls. We synthesize these findings through a partial-equilibrium model of firm decision-making that incorporates union bargaining, product-market price-setting power, and labor market monopsony power.
    Keywords: unions, price pass-through, firms, market power, labor costs
    JEL: J51 J30 D22 J42
    Date: 2023–12
  3. By: Lena Abou El-Komboz; Moritz Goldbeck
    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 frst-time OSS contributions. Our fndings 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: 2024
  4. By: Borjas, George J. (Harvard University); Hamermesh, Daniel S. (University of Texas at Austin)
    Abstract: A comparison of measures of work time in the CPS-ASEC data file (based on recall) with contemporaneous measures reveals many logical inconsistencies and probable errors. About 8 percent of ASEC respondents report weeks worked last year that contradict their work histories in the Basic monthly interviews; the error rate is over 50 percent among workers who move in and out of the workforce across their monthly interviews. Over 20 percent give contradictory information about whether they usually work a full-time weekly schedule (35 or more hours per week). A small part of the inconsistency arises because an increasing fraction of observations in the ASEC (over 20 percent by 2018) consists of people whose record was fully imputed. The errors and imputations are not random: The levels and trends differ by gender and race, and they affect the calculation of wage differentials between 1978 to 2018. After adjusting for the measurement errors and excluding imputations, we find that gender wage gaps among all workers narrowed by 4 log points more than is commonly reported, and that residual wage inequality decreased by 6 log points more. The biases also exist in measures of wage gaps and residual inequality among full-time year-round workers. Using a more carefully defined sample of such workers shows that gender and racial wage differentials have narrowed slightly less than previously estimated using ASEC data, but much more than indicated by commonly used estimates from CPS Outgoing Rotation Groups.
    Keywords: work time, measurement, wage discrimination, wage inequality
    JEL: J22 J71 D63
    Date: 2023–12
  5. By: Ahammer, Alexander (University of Linz); Packham, Analisa (Vanderbilt University); Smith, Jonathan (Georgia State University)
    Abstract: We estimate the role of firms in worker health care utilization. Using linked administrative data on Austrian workers from 1998–2018, we exploit mobility between firms to estimate how much a firm contributes to worker-level differences in utilization in a setting with non-employer provided universal health care. We find that firms are responsible for nearly 30 percent of the variation in across-worker health care expenditures. Effects are not driven by changes in geography or industry. We then estimate a measure of relative firm-specific utilization and explore existing correlates to help explain these effects.
    Keywords: firms, health care utilization, sick leave
    JEL: H51 I1 J2
    Date: 2024–01
  6. By: Gregory Clark (University of Southern Denmark); Christian Alexander Abildgaard Nielsen (University of Southern Denmark)
    Abstract: There have been many studies estimating the causal effect of an additional year of education on earnings. The majority employ administrative changes in the minimum school leaving age as the mechanism allowing identification. Here we survey 66 such estimates. However, remarkably, while the majority of these studies find substantial gains from education, a number of well-grounded studies find no effect. The average return from these studies still implies substantial average gains from an extra year of education: an average of 8.5%. But the pattern of reported returns shows clear evidence of publication biases. There is, in particular, large scale omission of studies showing negative return estimates. Correcting for these omitted studies, the implied average causal returns to an extra year of schooling are close to 0.
    Keywords: human capital, returns to education, publication bias
    JEL: I26 J24 N3
    Date: 2024–01
  7. By: Clemens Ohlert (Federal Institute for Occupational Safety and Health)
    Abstract: This paper investigates whether the introduction of a statutory minimum wage in Germany has led to a reduction in gender gaps in hourly wages, working hours and monthly earnings. Using the 2014 Structure of Earnings Survey and the 2015 Earnings Survey, a difference-in-differences approach was applied at the establishment level. The results show a reduction of the gender pay gap in establishments of up to 3.6 percentage points due to the introduction of the minimum wage. While the effects on hourly wages of women and men in low-wage jobs were the same on average, women are more often affected by the minimum wage and therefore benefit more often from it. The gender time gap in establishments decreased by about 2.4 percentage points on average and by about 3.9 percentage points among low wage workers. The minimum wage led to a reduction in the average gender gap in gross monthly earnings in establishments of up to 6.1 percentage points and by up to 4.6 percentage points among low-wage employees.
    Keywords: minimum wage, gender pay gap, gender time gap, gender earnings gap
    JEL: J08 J16 J22 J31
    Date: 2024–01
  8. By: Maciej Albinowski; Joanna Franaszek
    Abstract: We develop a model in which minimum hours constraints (MHC) arise due to both the characteristics of the production function and managerial attitudes. The importance of the organizational culture can be deduced from the correlation between the MHC faced by core tasks personnel and by administrative workers. The tasks performed by administrative workers, such as secretaries, accountants, and HR specialists, are similar across firms. If organizational culture played no role in the origination of MHC, the MHC for administrative workers should be independent of the MHC for core tasks personnel. We test the prediction of our model using the Structure of Earnings Survey data from 19 European countries. We find that across all economic sectors and countries, non-administrative workers are significantly more likely to face MHC in firms with rigid MHC for administrative workers. The explanatory power of our proxy for organizational culture is comparable to that of sector fixed effects. We also find that a culture of rigid working hours is more common in small and medium-sized firms, and in firms with a low share of young managers.
    Keywords: hours constraints, organizational culture, part-time employment
    JEL: J22 J29 L23
    Date: 2024–01
  9. By: Kapelyuk, Sergey; Karelin, Iliya
    Abstract: We provide a review of the various approaches used in the literature to classify digital skills. Utilizing this classification, we conduct an empirical analysis to estimate the demand for digital skills and the wage premium for digital skills in the Russian labor market. Our study uses an extensive dataset of 8 million vacancies posted on the Unified Digital Platform "Work in Russia" from 2018 to 2022. The uniqueness of this dataset lies in the specification of wage data in over 99 percent of the vacancies. The demand for digital skills is determined through the automated processing of employer requirements outlined in job postings. We explore the advantages and limitations of different indicators of digital skills demand and suggest the ratio of vacancies requiring digital skills to the labor force as the most appropriate measure. The findings reveal substantial regional differentiation in the employer’s demand for all groups of digital skills in Russia. Regions with a higher level of economic development tend to have increased requirements for digital skills. Digital skills are more frequently required in regions characterized by higher economic development and those with a focus on natural resources. Of the federal districts, the North Caucasian Federal District stands out with a substantially lower demand for digital skills. A positive wage premium is associated only with advanced and professional digital skills.
    Keywords: human capital; digital skills; digital skills classification; vacancies; labor demand; wage premium; labor force; regional differentiation
    JEL: J23 J24 R10
    Date: 2023–12–24
  10. By: Bailey, Martha J. (University of California, Los Angeles); Helgerman, Thomas (University of Minnesota); Stuart, Bryan Andrew (Federal Reserve Bank of Philadelphia)
    Abstract: In the 1960s, two landmark statutes—the Equal Pay and Civil Rights Acts—targeted the long-standing practice of employment discrimination against U.S. women. For the next 15 years, the gender gap in median earnings among full-time, full-year workers changed little, leading many scholars to conclude the legislation was ineffectual. This paper revisits this conclusion using two research designs, which leverage (1) cross-state variation in pre-existing state equal pay laws and (2) variation in the 1960 gender gap across occupation-industry-state-group cells to capture differences in the legislation's incidence. Both designs suggest that federal anti-discrimination legislation led to striking gains in women's relative wages, which were concentrated among below-median wage earners. These wage gains offset pre-existing labor-market forces which worked to depress women's relative pay growth, resulting in the apparent stability of the gender gap at the median and mean in the 1960s and 1970s. The data show little evidence of short-term changes in women's employment but suggest that firms reduced their hiring and promotion of women in the medium to long term. The historical record points to the key role of the Equal Pay Act in driving these changes.
    Keywords: gender gap, Equal Pay Act, Civil Rights Act
    JEL: J16 J71 N32
    Date: 2023–12
  11. By: Antea Barišić; Mahdi Ghodsi (The Vienna Institute for International Economic Studies, wiiw); Robert Stehrer (The Vienna Institute for International Economic Studies, wiiw)
    Abstract: This paper advances the literature on the impacts of new technologies on labour markets, focusing on wage and labour income shares. Using a dataset from 32 countries and 38 industries, we analyse the effects of new technologies – proxied by patents, information and communication technology (ICT) capital usage, and robot intensity – on average wages and labour income shares over time. Our results indicate a positive correlation between patents and wage levels along with a minor negative impact on labour income shares, suggesting that technology rents are not fully passed on to labour. Robot intensity is positively associated with labour income shares, while ICT capital has an insignificant effect. These effects persist over time and are reinforced by global value chain (GVC) linkages. Our conclusions align with recent research indicating that new technologies have a generally limited impact on wages and labour income shares.
    Keywords: Robot adoption, ICT investment, new technologies, GVC, wages, labour income shares
    JEL: C13 C23 F14 F16 O33
    Date: 2024–01
  12. By: Moens, Eline (Ghent University); De Pessemier, Dyllis (Ghent University); Baert, Stijn (Ghent University)
    Abstract: Although unequal treatment of workers based on political affiliation is prohibited in many countries, it is conspicuously understudied in the discrimination literature. In this study, we set up a vignette experiment with genuine recruiters to provide more insight into the effect of political engagement in job applicants on the assessment of their resumes by these professionals. We find that, overall, recruiters view an applicant as less creative, open-minded, empathetic and emotionally sensitive when a political engagement is expressed. These stigma are greater for candidates with a right-wing nationalist commitment. Relatedly, these candidates are assessed worse in terms of overall hireability and perceived inclination or taste among employers, colleagues and customers to collaborate with them. They are, however, seen as somewhat more assertive. In contrast to research conducted in one- or two-party systems, we do not find interactions with the political preference of the recruiter herself/himself. Overall, the effect of mentioning a political engagement in a resume is more negative when the required education level of the vacancy is high.
    Keywords: hiring discrimination, political preference, vignette experiment
    JEL: D72 J21 J71 P16 C91
    Date: 2024–01
  13. By: Jessica Forden (Schwartz Center for Economic Policy Analysis (SCEPA))
    Abstract: Unpaid eldercare provided by friends and family comes with costs to caregivers, including the limitations eldercare responsibilities may place on labor force participation and work hours. This study examines the relationship between the intensity of unpaid elder care and work behavior for previously full-time workers using multivariate regression to analyze 2011-2018 American Time Use Survey data. High frequency eldercare provision is associated with a decreased probability of being in the labor force for women (2.7 percentage points) and a decrease in weekly hours worked for both men (3.4 hours) and women (2.3 hours), conditional on working full-time 2-5 months prior.
    Keywords: elder care, long-term care, unpaid care, informal care, labor force participation, hours worked
    JEL: J14 J26 J81
  14. By: Marcén, Miriam; Morales, Marina
    Abstract: We examine changes in the gender gap in working from home (WFH) in response to the unanticipated first wave of the COVID-19 pandemic. Using data from the American Time Use Survey, we find a non-negligible widening of the gender gap with WFH being more prevalent among women than among men. Respondents' job traits played a significant role in the gender gap variations, those working in the private sector being the most affected. Young individuals, those more educated, and those living with a dependent person increased the gender gap more in terms of the proportion of time devoted to WFH. We further show evidence suggesting the mitigating effect of non-pharmaceutical interventions during the first wave of the pandemic, positively affecting the WFH tendency for men but not for women. Overall, the gender gap change proves robust to identification checks. In addition, the gender gap response has had a long-lasting impact on the gender gap.
    Keywords: COVID-19, working from home (WFH), gender, American Time Use Survey (ATUS)
    JEL: D10 J16 J21 J22
    Date: 2024
  15. By: Del Prete, Silvia; Papini, Giulio; Tonello, Marco
    Abstract: We study the impact of a law, which required the increase of the proportion of women on boards of listed companies to at least one third. We look at its impact on listed banks, but also test whether it led to spillovers into non-listed banks belonging to listed groups or along other board diversity dimensions. Using administrative data, we compare diversity measures of boards of listed and non-listed banks in listed groups with those in non-listed groups, before and after the introduction of the law, in a difference-in-differences specifi- cation. We find that the imposition of the gender quota only changed the composition of the boards of listed banks, with no effect on their economic performance, nor spillovers on other non-listed banks in listed groups. The law enhanced diversity of boards of listed banks, also along individual characteristics other than gender.
    Keywords: bank boards, diversity, gender, corporate governance
    JEL: G21 G38 J48 J78
    Date: 2024
  16. By: Teresa Ghilarducci; Karthik Manickam (Schwartz Center for Economic Policy Analysis (SCEPA))
    Abstract: This essay surveys global pension developments and intellectual basis for pension reform in the last 40 years. National retirement income security systems share similar goals: smoothing consumption over a lifetime, providing insurance against long life and poverty; avoiding accidental bequests; and distorting capital and labor markets. Pension systems should be efficient and anticipate business cycles and financial uncertainties. Experts agree transitioning from unfunded to funded systems creates dead-weight losses and legacy debt. Despite similar goals national pension institutions vary by a nation’s political economy—large wealthy social democracies have different systems than less developed nations. Intellectual and political debate concern whether advance–funding pensions leads to more private savings and investment, whether collective institutions are more cost-effective than private alternatives; and how to manage long term public systems when government capacity is weak and influences by private financial interests. There is no consensus that longer working lives is a one-size-fits-all solution to pension affordability, labor shortages, and elder well-being.
    Keywords: Pension systems, Retirement policies, Nonwage costs, Older workers, welfare programs, Labor force size, Labor standards
    JEL: J14 J26 J81
  17. By: Andlib, Zubaria; Sadiq, Maqsood; Scicchitano, Sergio
    Abstract: There is a large literature on intergenerational social and educational mobility in developed countries, but the evidence in developing countries is still scant In the current literature, household background has been predicted as a significant determinant of individuals' current and future social status because it influences almost every aspect of their liv es . W e examine various channels through which household socio economic background and other household and individual characteristics affect individuals' educational and social opportunities in a developing economy , Pakistan. To accomplish the objectives, we have used a rich dataset: the Pakistan Standards of Living Measurement (PSLM) survey 2019 20, which contains information on individuals and their real parents. The empirical analysis highlights that the level of parents' education is more relevant than the level of parents' occupation skills in individuals' social and educational opportuni ties. In addition, household wealth, region and province of reside nce, migration status, and disabilities are also significant predictors of intergenerational mobilities in Pakistan. Our results narrate an unequal and dual labour market in Pakistan. Based on empirical outcomes, the study has offered suitable policy implications for developing economies and Pakistan in particular.
    Keywords: intergenerational mobility, inequality of opportunities, household characteristics, developing economy, sustainable development goals
    JEL: J08 J21 J24
    Date: 2024
  18. By: Andrews, Brendon P. (University of Alberta, Department of Economics)
    Abstract: This paper provides an institutional economics framework for analyzing medical ethics: ethical policies are partitions of a set of possible physician actions into ethical and unethical subsets, where unethical actions are unavailable (or sufficiently heavily penalized) in future decision making. Individual doctors' preferences over these policies combined with a political process determine equilibrium constraints. Examining a general model of physician support for `liberal' versus `restrictive' ethics, I show that altruism for one's own patients and concern for all patients have different implications. The latter motivation may justify restrictions on physician behavior, but this argument rests on heavy assumptions. Even identical physicians might ban actions they would otherwise select for reasons varying from solving commons-type problems in patient welfare to differences in the costs of maintaining ethical policies, but heightened altruism for others' patients makes the former reasoning less credible. Novel models for the ethics `Provide Free Care to Physicians' and `Duty to Treat in a Pandemic' demonstrate how shifting economic parameters predict the realized evolution of formal ethical rules. Key model predictions include: (i) rising physician income can explain long-run weakening of both formal ethics in the United States; and (ii) the duty to treat can deteriorate as the ability for a small number of physicians to improve pandemic outcomes increases.
    Keywords: Physician Behavior; Altruism; Medical Ethics; Institutions
    JEL: D71 I12 I18 J44 N30
    Date: 2024–01–25
  19. By: Galli, Stefania (Unit for Economic History, School of Business, Economics and Law, Göteborg University)
    Abstract: Occupational structure is a valuable proxy for economic development when more direct indicators are lacking. This study employs occupational structure for the Colony of Sierra Leone in 1831 with the aim of contributing to shed new light on African economic development at a very early stage. This work is based on data extracted from the 1831 census, one of the first reliable censuses in African history. This source provides valuable information on the whole colonial population, including occupational titles for a vast part of it. The results show that the Colony was far from homogeneous, combining a largely primary oriented countryside with a more modern urban sector centre around the Freetown’s harbour.
    Keywords: Occupational structure; colonialism; settler colony; development
    JEL: J21 J46 N37
    Date: 2024–01–20

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