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on Labor Markets - Supply, Demand, and Wages |
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Issue of 2024‒06‒17
25 papers chosen by |
| By: | Dai, Li (Hunan University); Martins, Pedro S. (Universidade Nova de Lisboa) |
| Abstract: | China hosts the world's largest secondary education sector: more than 14 million adolescents enrol in secondary academic or vocational schools every year. Despite the large literature on returns to education, little evidence exists as to how these two streams compare in the country. Using 2013 China Household Income Project data, we estimate the returns to secondary vocational education both at the mean and along the conditional wage distribution. We use instrumental variables based on the considerable variation in education provision across cities and years (and a 1995 policy reform). We find that vocational education generates a large wage premium (up to 54%), especially for those of lower earnings potential. Our findings indicate that vocational education can be a good option for those who do not wish to enter tertiary education, especially the less well-off. |
| Keywords: | returns to education, vocational education, heterogeneity, instrumental variable quantile regression, China |
| JEL: | I26 I25 J24 J31 C36 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16957&r= |
| By: | Nikolova, Milena (University of Groningen) |
| Abstract: | This study examines work orientations as a novel determinant influencing job search behaviors, quit intentions, and workplace effort, thereby integrating this concept into the field of labor economics. Work orientations, the intrinsic beliefs regarding the role of work in one's life, relate to viewing work as a paycheck, a career step, or a calling. Drawing on original, nationally representative Dutch data on work orientations, this paper reveals that those who view their work as a calling rather than a job are more committed to their roles, have lower quit intentions and are less likely to be job searching, and do not endorse 'quiet quitting'—the act of fulfilling only the minimum requirements to maintain employment. Conversely, individuals with career-centered work perspectives are more likely to consider leaving their jobs, engage actively in job searches, and show diminished work effort compared to those with a job orientation. However, this group is still unlikely to approve of quiet quitting in comparison to those who view work primarily as an income source. A key finding is that work orientations significantly predict quit intentions, job search behaviors, and effort levels—surpassing the predictive power of job satisfaction and perceived work meaningfulness. Specifically, work orientations account for about 40 % of the variation in quit intentions and job search behaviors. These insights suggest that work orientations could be a crucial, yet overlooked, factor in understanding employee behavior, challenging the conventional perspective of workers as simply income-driven and countering the notion of work as an inherent disutility. |
| Keywords: | work orientations, effort, quit intentions, job search |
| JEL: | J24 J28 J81 M59 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16960&r= |
| By: | Blazar, David (University of Maryland); Gao, Wenjing (University of Maryland at College Park); Gershenson, Seth (American University); Goings, Ramon (University of Maryland, Baltimore County); Lagos, Francisco (Universidad de Granada) |
| Abstract: | Local teacher recruitment through "grow-your-own" programs is a prominent strategy to address workforce shortages and ensure that incoming teachers resemble, understand, and have strong connections to their communities. We exploit the staggered rollout of the Teacher Academy of Maryland career and technical education certificate program across public high schools, finding that exposed students were more likely to become teachers by 0.6 percentage points (pp), or 47%. Effects are concentrated among White girls (1.4pp/39%) and Black girls (0.7pp/80%). We also identify positive impacts on wages (5% on average/18% for Black girls), countering a prevailing narrative that teaching leaves one worse off financially relative to other labor market opportunities. |
| Keywords: | teaching, high school curricula, college major choice, occupational choice, earnings |
| JEL: | I20 J24 H52 |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16983&r= |
| By: | Ashvin Gandhi; Andrew Olenski; Krista J. Ruffini; Karen Shen |
| Abstract: | Worker shortages are common in many industries. This paper examines the effect of government subsidies to address these shortages in the context of a reform that tied Medicaid payments to nursing home staffing levels. We find that the reform substantially increased staffing, especially for facilities serving many Medicaid patients. Facilities responded primarily by hiring workers in lower-wage roles rather than increasing hours of incumbent or high-wage staff. This contrasts with null effects we estimate for a non-incentivized rate increase, suggesting that the incentive structure of government payments—rather than just the level—is key to boosting employment in sectors facing worker shortages. |
| JEL: | I10 I18 J23 |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:32412&r= |
| By: | Rude, Johanna |
| Abstract: | This paper analyzes the relationship between demographic change and automation while taking the role of education into account. This is illustrated by incorporating skilled and unskilled labor into a theoretical model. If labor supply by households decreases, for example, due to demographic change, the model states that the optimal level of automation capital increases. However, this relationship depends crucially on the level of education in the workforce. Motivated by this novel prediction derived from the model, a new data set allowing for testing of the prediction is constructed. Patent data are combined with an automation classification to arrive at a novel measure of automation. In a series of analyses, evidence for the theoretical prediction is found. While there is a negative relationship between automation capital and population growth, the results corroborate the theoretical prediction that it is crucial to account for the role of education in that relationship. Doing so yields highly significant results which suggest that population growth is negatively correlated with automation, but that this is only true if the workforce consists of predominantly unskilled workers. |
| Keywords: | Skill, Education, Automation, Demographic Change |
| JEL: | E21 E22 E23 E24 E25 J11 J21 J24 J31 O3 |
| Date: | 2024–05–07 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:120876&r= |
| By: | Nilsson, Pia (Department of Economics, Swedish University of Agricultural Sciences, Uppsala, Sweden.); Johansson, Eleanor (Department of Economics, The Swedish University of Agricultural Sciences, Uppsala, Sweden.); Larsson, Johan P (Department of Land Economy, University of Cambridge, UK.); Naldi, Lucia (Centre for Family Business and Entrepreneurship CeFEO, Jönköping University, Jönköping Sweden.); Westlund, Hans (Department of Urban and Regional Studies, Royal Institute of Technology, Stockholm, Sweden.) |
| Abstract: | We investigate how the lockdown-induced exposure to remote work affected the likelihood of switching to longer commutes using a longitudinal full-population register of Swedish employees. Employees with little experience of long distance commuting were more likely to start commuting longer if they had occupations with high potential for remote work. Examining heterogeneity across sectors, this is especially evident among high-skilled workers in sectors with both high and low pre-existing shares of remote work and longer commutes. Our findings are important for understanding regional expansion and spatial extensions of labour markets in a world where more work can be done remotely. |
| Keywords: | Labour mobility; Commuting distance; Remote work: Knowledge-intensive sectors; Covid-19 |
| JEL: | J24 J61 R10 R30 |
| Date: | 2024–05–23 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:cesisp:0498&r= |
| By: | Daron Acemoglu; Simon Johnson |
| Abstract: | David Ricardo initially believed machinery would help workers but revised his opinion, likely based on the impact of automation in the textile industry. Despite cotton textiles becoming one of the largest sectors in the British economy, real wages for cotton weavers did not rise for decades. As E.P. Thompson emphasized, automation forced workers into unhealthy factories with close surveillance and little autonomy. Automation can increase wages, but only when accompanied by new tasks that raise the marginal productivity of labor and/or when there is sufficient additional hiring in complementary sectors. Wages are unlikely to rise when workers cannot push for their share of productivity growth. Today, artificial intelligence may boost average productivity, but it also may replace many workers while degrading job quality for those who remain employed. As in Ricardo’s time, the impact of automation on workers today is more complex than an automatic linkage from higher productivity to better wages. |
| JEL: | B12 J23 O14 |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:32416&r= |
| By: | Asai, Kentaro; Lopes, Marta C.; Tondini, Alessandro |
| Abstract: | This paper examines how legislative reductions in working hours impact firms’ employment, output, and productivity. We exploit a Portuguese reform that reduced standard hours from 44 to 40 hours in 1996. Our findings indicate that the reform had adverse effects on the employment and output of affected firms. These effects can be attributed to a mechanical increase in hourly labor cost induced by the restriction imposed on firms to reduce monthly salaries along with hours. Treated firms adjusted their employment by reducing hiring. Furthermore, treated firms significantly improved hourly labor productivity, and there is some evidence suggesting an intensified use of capital. Firms that reduced working hours through collective agreements prior to the reform were able to increase productivity without adverse effects on employment and output. Together, these results show that working hour reductions can decrease employment for affected firms while simultaneously inducing a more efficient use of labor. |
| Keywords: | Working hours, Wages, Labor demand, Productivity |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:cpm:docweb:2405&r= |
| By: | Tristany Armangué-Jubert; Nezih Guner; Alessandro Ruggieri |
| Abstract: | Imperfect competition in labor markets can lead to efficiency losses and lower aggregate output. This paper examines how variations in labor market competitiveness may account for differences in GDP per capita among countries. By structurally estimating an oligopsony model with free entry across different development stages, we find that labor market power increases with GDP per capita. Wage mark-downs vary from 54% in low-income countries to around 24% in the richest ones. If labor markets in poorer countries were as competitive as in more developed ones, their output per capita could rise by up to 45%. |
| Keywords: | labor market power, oligopsony, development, inequality |
| JEL: | J42 L13 O11 E24 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:bge:wpaper:1446&r= |
| By: | Abdulla, Kanat; Mourelatos, Evangelos |
| Abstract: | In this study, we investigate the employers' attitude towards Russian migrants in Kazakhstan's labor market. We conduct a field experiment by sending over 1600 fictitious job applications to real job openings posted on one of the largest job search portals in the country. The job applicants included a local Kazakh, a local Russian, a migrant from Kyrgyzstan, and a migrant from Russia. We found significant differences in employment outcomes across ethnic groups in the selected occupations. Specifically, Russian migrants were significantly less likely to receive an interview invitation. Interestingly, sympathy towards Russian applicants was weakest for occupations located more than 830 km from the Russian borders and those requiring high-skilled workers. Our findings provide evidence for less favorable attitudes towards migrant workers from Russia during the Russia-Ukraine conflict. |
| Keywords: | discrimination, labour market, migrant workers, field experiment |
| JEL: | C93 J71 J78 J64 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:1438&r= |
| By: | ORFAO E VALE TABERNERO Guillermo; FERNANDEZ MACIAS Enrique (European Commission - JRC); MALO Miguel Angel |
| Abstract: | This working paper presents a comparative analysis of the role played by occupational changes in recent wage inequality trends in six European countries between 2002 and 2018. Using the European Union Structure of Earnings Survey, the analysis shows two patterns in the share of wage inequality explained by between-occupation differentials: while the relative importance of between-occupation trends has grown in Finland and the UK, it has diminished in Spain, France, Poland and Romania. Although between-occupation differentials account for a great share of total wages’ variance, changes in the occupational structure (in particular, the patterns of job polarisation and upgrading widely discussed in the literature) have not driven recent wage inequality trends in Europe. Wage inequality, instead, has been mostly driven by changes in wage differentials within occupations. Finally, we found that occupations effectively account for the distribution of wages, yet their explanatory significance markedly declines at the highest wage tiers. This work contributes to a better understanding of how within- and between-occupation differences have influenced wage inequality trends in Europe. Consequently, our results add significant value to the debate about recent stratification theory, which has challenged the idea that occupations structure economic disparities and wage inequality as importantly as they once did. |
| Keywords: | Europe, jobs, occupational structure, occupations, wage inequality |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:laedte:202401&r= |
| By: | Sascha Keil (Chemnitz University of Technology); Walter Paternesi Meloni (Sapienza University of Rome) |
| Abstract: | Over the past decades, models of circular and cumulative causation, based on the endogenous relations between prices, exports, and labour productivity, have lost prominence in explaining economic dynamics. We argue that, in the absence of counterbalancing mechanisms, the combination of price-sensitive exports and the triggering effect of exports on productivity can enable feedback loops and can significantly shape macroeconomic reality in the short-to-medium run. We apply an adapted export-led model of cumulative causation to 10 major countries belonging the Euro area, a region characterized by divergent wage growth trajectories reflected in divergent export competitiveness and lack of equilibrating mechanisms. Specifically, the model is tested for the period 1995–2020 employing a country-level system of equations (3SLS-ARDL). Our findings indicate that for the majority of the countries examined, this feedback mechanism – comprising price-sensitive exports and export demand affecting productivity growth – exacerbates macroeconomic disparities in terms of labour productivity. While nominal wages act as a potential trigger through their impact on price competitiveness, they also serve as a central factor that retards the feedback mechanism due to the Verdoorn effect of wage-induced demand. Overall, our results affirm the significance of price-induced and export-led theories of cumulative causation while also delineating its limitations, particularly regarding price competitiveness-oriented export-led growth strategies. |
| Keywords: | international trade, export, competitiveness, unit labour cost, wages, productivity, European imbalances |
| JEL: | F16 F41 J30 |
| Date: | 2024–05 |
| URL: | https://d.repec.org/n?u=RePEc:tch:wpaper:cep063&r= |
| By: | Antea Barišić; Mahdi Ghodsi (The Vienna Institute for International Economic Studies, wiiw); Michael Landesmann (The Vienna Institute for International Economic Studies, wiiw); Alireza Sabouniha (The Vienna Institute for International Economic Studies, wiiw); Robert Stehrer (The Vienna Institute for International Economic Studies, wiiw) |
| Abstract: | In this note, we study the relationship between the use of new technologies (e.g. robots and various ICT assets), labour demand and migration patterns. The adoption of new technologies might change the demand for labour in various ways, which in turn will have an impact on skill composition and wage levels of different types of workers. We report the main results from a study that first analyses the impact of robot adoption on wages by sector and skills. Second, we study the impact of robot adoption in manufacturing industries on the attraction of migrants while controlling for other factors in the labour demand function. This is followed by an analysis of push and pull factors of bilateral migration that focuses on the impact of relative automation gaps across countries. Finally, using the OeNB Euro Survey, we examine determinants of the intention to migrate and the role of income differentials between the countries of origin and destination. |
| Keywords: | Migration, migrant jobs, wages, employment, novel technologies, adoption of robots, digitalisation, European labour markets, Central Eastern European countries |
| JEL: | F22 F66 J61 J24 J20 O33 |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:wii:pnotes:pn:77&r= |
| By: | Bautista, María Angélica (University of Chicago); González, Felipe (Queen Mary University of London); Martinez, Luis R. (University of Chicago); Muñoz, Pablo (Universidad de Chile); Prem, Mounu (Einaudi Institute for Economics and Finance) |
| Abstract: | We study the effect of political regime change on higher education and its distributional and political consequences. We focus on the 1973 coup that brought Augusto Pinochet to power in Chile. The Pinochet dictatorship's aims of political control and fiscal conservatism led to a large reduction in the number of openings for new students across all universities. Individuals that reached college age shortly after the coup experienced a sharp decline in college enrollment, had worse labor market outcomes throughout the life cycle and struggled to climb up the socioeconomic ladder. This contraction of higher education disproportionately affected applicants from less affluent backgrounds and plausibly contributed to the increase in inequality observed under Pinochet. We further show that individuals exposed to reduced access to college registered to vote at higher rates for the 1988 plebiscite that triggered Chile's democratic transition and we provide suggestive evidence that they increasingly voted against Pinochet. |
| Keywords: | dictatorship, college, technocracy, austerity, inequality |
| JEL: | H52 I23 I24 I25 |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16989&r= |
| By: | van der Velden, Rolf (ROA / Labour market and training, RS: GSBE other - not theme-related research); Glebbeek, Arie |
| Abstract: | Education is in a deep crisis. A race has arisen in which everyone has started to receive more and more education to stay ahead of the rest. This is due to the coincidence of two developments: • Education is increasingly the dominant route through which social success is achieved, legitimized by a meritocratic ideology. • It is rational for individuals to obtain the highest possible education because this provides access to the best jobs in terms of income and status. The phenomenon of a vertical top-heavy education ladder is eroding the position of upper secondary vocational education and has major negative individual and social consequences. This has prompted Dutch Minister of Education Robbert Dijkgraaf to argue for a change from the current unidimensional ‘educational ladder’ to an ‘educational fan’ with various horizontal and vertical options. A number of measures are proposed for this purpose, but due to the lack of a clear problem analysis, the possible effectiveness of these measures is limited. In this contribution we explain why and argue that this first and foremost requires a number of social changes that remove the underlying financial incentives to obtain more and more education. In addition, measures are needed that lead to a better allocation of scarce talent, measures aimed at strengthening vocational education and the revaluation of craftsmanship and measures that are more focused on the broad development of talent. |
| JEL: | J24 |
| Date: | 2024–05–22 |
| URL: | http://d.repec.org/n?u=RePEc:unm:umaror:2024002e&r= |
| By: | Cowgill, Bo (Columbia Business School); Davis, Jonathan (University of Chicago); Montagnes, B. Pablo (Emory University); Perkowski, Patryk (Yeshiva University) |
| Abstract: | A principal often needs to match agents to perform coordinated tasks, but agents can quit or slack off if they dislike their match. We study two prevalent approaches for matching within organizations: Centralized assignment by firm leaders and self-organization through market-like mechanisms. We provide a formal model of the strengths and weaknesses of both methods under different settings, incentives, and production technologies. The model highlights tradeoffs between match-specific productivity and job satisfaction. We then measure these tradeoffs with data from a large organization's internal talent market. Firm-dictated matches are 33% more valuable than randomly assigned matches within job categories (using the firm's preferred metric of quality). By contrast, preference-based matches (using deferred acceptance) are only 5% better than random but are ranked (on average) about 38 percentiles higher by the workforce. The self-organized match is positively assortative and helps workers grow new skills; the firm's preferred match is negatively assortative and harvests existing expertise. |
| Keywords: | internal labor markets, assortative matching, assignment mechanisms, team formation, matching |
| JEL: | M5 D47 J4 |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16986&r= |
| By: | Radu Barza; Edward L. Glaeser; César A. Hidalgo; Martina Viarengo |
| Abstract: | Are developing-world cities engines of opportunities for low-wage earners? In this study, we track a cohort of young low-income workers in Brazil for thirteen years to explore the contribution of factors such as industrial structure and skill segregation on upward income mobility. We find that cities in the south of Brazil are more effective engines of upward mobility than cities in the north and that these differences appear to be primarily related to the exposure of unskilled workers to skilled co-workers, which in turn reflects industry composition and complexity. Our results suggest that the positive effects of urbanization depend on the skilled and unskilled working together, a form of integration that is more prevalent in the cities of southern Brazil than in northern cities. This segregation, which can decline with specialization and the division of labor, may hinder the ability of Brazil's northern cities to offer more opportunities for escaping poverty. |
| JEL: | D63 I24 N90 N96 O10 O11 O18 O43 R10 R23 |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:32426&r= |
| By: | Eliasson, Kent (Swedish Agency for Growth Policy Analysis); Hansson, Pär (Swedish Agency for Growth Policy Analysis); Lindvert, Markus (Swedish Agency for Growth Policy Analysis) |
| Abstract: | In the paper, we break down business sector R&D at an appropriate regional level (functional analysis regions, FA-regions) in Sweden. We describe the variation and development at the regional level. In an econometric analysis, we examine what affects the location and size of enterprise groups’ R&D activities in different FA-regions. We find that enterprise groups concentrate their R&D to the same regions, which are also regions with significant academic R&D (external agglomeration). Moreover, colocation of R&D and manufacturing within an enterprise group in a region (internal agglomeration) appears to be a significant location factor. Last but not least, the local availability of qualified R&D labor is another important localization factor for business sector R&D. Finally, when we compare the results from the econometric analysis with what enterprise groups themselves states as important motives for location, we find that they match quite well. |
| Keywords: | business sector R&D; regional location; external agglomeration; colocation of R&D and production; abundance of qualified labor |
| JEL: | J24 O32 R11 R12 |
| Date: | 2024–05–28 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:oruesi:2024_004&r= |
| By: | Jens Matthias Arnold; Aida Caldera Sánchez; Paula Garda; Alberto González Pandiella; Sebastián Nieto Parra |
| Abstract: | Informality is a long-standing structural challenge of Latin American labour markets, as almost half of people in the region live in a household that depends solely on informal employment. Informal workers are often insufficiently covered by social protection policies, for which the eligibility is often tied to formal-sector employment. The need to reform social protection systems across Latin America to make them more effective and fiscally sustainable has become more salient after the COVID pandemic. This paper argues that a basic set of social protection benefits available to all workers, whether they work in the formal or the informal sector, should and can be put in place, although it would require the ability to raise additional tax revenues. Moreover, the incentives for formal job creation would be strengthened if its principal source of financing for such basic social protection were shifted towards general tax revenues, as opposed to social security contributions, which tend to increase the cost of formal job creation. Reforming social protection systems will not be easy, but these reforms can provide the basis for both stronger and more inclusive growth in Latin America. |
| Keywords: | Labour Markets, Latin America, Pensions, Poverty, Productivity, Social Protection |
| JEL: | I38 J32 J46 O17 O43 O54 |
| Date: | 2024–05–30 |
| URL: | https://d.repec.org/n?u=RePEc:oec:ecoaaa:1804-en&r= |
| By: | Paul Hufe (University of Bristol) |
| Abstract: | Converging labor market opportunities of men and women have altered the economic incentives for how families invest monetary and time resources into the skill development of their children. In this paper, I study the causal impact of changes in the parental wage gap (PWG)—defined as the relative difference in potential wages of mothers and fathers—on children’s socio-emotional skills. I leverage administrative and survey data from Germany to create exogenous between-sibling variation in the PWG through a shift-share design. I find that decreases in the PWG do not affect children’s socio-emotional development as measured by their Big Five personality traits and externalizing/internalizing behaviors. This null effect can be rationalized by the offsetting effects of the PWG on monetary investments, i.e., more disposable household income that is increasingly controlled by mothers, and time investments, i.e., a substitution from in-home maternal care to informal childcare. |
| Keywords: | gender gap, skill development, parental investments |
| JEL: | J13 J16 J22 J24 |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:hka:wpaper:2024-010&r= |
| By: | Dang, Hai-Anh (World Bank); Salehi-Isfahani, Djavad (Harvard Kennedy School); Do, Minh N.N. (National Economics University Vietnam) |
| Abstract: | While female labor force participation (LFP) in Iran is among the lowest in the world, there is hardly any study on the COVID-19 pandemic effects on the country's female LFP. We find that female LFP decreased during the pandemic years by around 1 percentage point in 2021 and 2022. When controlling for excess mortality rates, the declines could increase to between 3.9 and 8.7 percentage points, with the larger impacts occurring in late 2021 and early 2022. Compared to modest, pre-pandemic female LFP rates, these figures translate into 5 percent and 18-40 percent decreases, respectively. Heterogeneity exists, with more educated individuals being more likely to work. Compared to married individuals, divorcees were more likely to work while those that were divorced or never married were less likely to work. Our results offer relevant inputs for labor policy, particularly those aimed at reducing gender inequalities. |
| Keywords: | COVID-19, employment, women's labor force participation, differences-in-differences, triple differences, labor force survey, Iran |
| JEL: | E24 I30 J21 O12 |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp17001&r= |
| By: | Crick Lund; Kate Orkin; Marc Witte; John H. Walker; Thandi Davies; Johannes Haushofer; Sarah Murray; Judy Bass; Laura Murray; Wietse Tol; Vikram H. Patel |
| Abstract: | Mental health conditions are prevalent but rarely treated in low- and middle-income countries (LMICs). Little is known about how these conditions affect economic participation. This paper shows that treating mental health conditions substantially improves recipients’ capacity to work in these contexts. First, we perform a systematic review and meta-analysis of all randomized controlled trials (RCTs) ever conducted that evaluate treatments for mental ill-health and measure economic outcomes in LMICs. On average, treating common mental disorders like depression with psychotherapy improves an aggregate of labor market outcomes made up of employment, time spent working, capacity to work and job search by 0.16 standard deviations. Treating severe mental disorders, like schizophrenia, improves the aggregate by 0.30 standard deviations, but effects are noisily estimated. Second, we build a new dataset, pooling all available microdata from RCTs using the most common trial design: studies of psychotherapy in LMICs that treated depression and measured days participants were unable to work in the past month. We observe comparable treatment effects on mental health and work outcomes in this sub-sample of highly similar studies. We also show evidence consistent with mental health being the mechanism through which psychotherapy improves work outcomes. |
| JEL: | D9 I14 J24 O1 |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:32423&r= |
| By: | Adema, Joop (University of Munich); Aksoy, Cevat Giray (European Bank for Reconstruction and Development); Giesing, Yvonne (Ifo Institute for Economic Research); Poutvaara, Panu (University of Munich) |
| Abstract: | What is the causal effect of conflict on refugees' return and integration? To answer this question, we launched a panel survey of Ukrainian refugees across Europe in June 2022 and combined it with geocoded conflict data. Most refugees plan to return, and initial return intentions strongly predict actual return. Those who initially plan to settle outside Ukraine integrate faster. Increased conflict intensity in the home municipality discourages return there, but not to Ukraine as a whole. It also has no effect on the likelihood of working. Liberation of the home district increases return, while increased pessimism about the outcome of the war reduces return intentions. |
| Keywords: | conflict, Ukraine, migration, refugees, return migration, integration |
| JEL: | D74 F22 J15 J24 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16962&r= |
| By: | Victor Hernandez Martinez |
| Abstract: | This paper tests the existence of capital-skill complementarity in the manufacturing sector using quasi-experimental increases in the relative price of low-skill labor induced by the US shale boom. I find that in response to the shale boom, local manufacturing firms decreased their relative usage of low-skill labor while increasing their capital expenditures. These endogenous changes in the input mix allowed manufacturers to maintain the value added despite the increase in the price of low-skill labor, avoiding the potential short-term crowding-out effects of the natural resource boom. Combined with the findings of previous work, my results indicate that the degree of skill substitutable with capital in manufacturing has increased over the last several decades. |
| Keywords: | capital-skill complementarity; manufacturing; fracking; natural resources; labor markets |
| JEL: | E22 E24 O13 J24 |
| Date: | 2024–05–30 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedcwq:98308&r= |
| By: | Fabeienne Jedelhauser (Department of Business Administration, University of Zurich); Raphael Flepp (Department of Business Administration, University of Zurich); Pascal Flurin Meier (Department of Business Administration, University of Zurich); Egon Franck (Department of Business Administration, University of Zurich) |
| Abstract: | Outcome bias refers to the tendency to overweight the informativeness of observed outcomes in evaluations, consequently underestimating the influence of luck. However, observed outcomes that fall short of expectations simultaneously trigger performance pressure, potentially reinforcing outcome bias in evaluation decisions such as managerial dismissals. Using data from European football, we investigate whether managerial dismissal decisions are influenced by luck operationalized as opponent player injuries and whether this influence is more pronounced under performance pressure. Our findings reveal that luck significantly impacts dismissal decisions, particularly as performance pressure mounts. Importantly, this amplified outcome bias under performance pressure is predominantly driven by instances of bad luck. These results suggest that the extent of outcome bias has been underappreciated, especially in situations involving bad luck. |
| Keywords: | Outcome Bias, Luck, Performance Pressure, Managerial Dismissal, Principal-Agent Setting |
| JEL: | D81 D86 D91 J44 Z2 |
| Date: | 2024–05 |
| URL: | http://d.repec.org/n?u=RePEc:zrh:wpaper:402&r= |