|
on Labor Markets - Supply, Demand, and Wages |
| By: | Michael Doersam; Henrika Langen |
| Abstract: | To increase the attractiveness of vocational education and training and secure a su |
| Keywords: | minimum wage, apprenticeship market, labor demand, difference-in-differences, triple difference, synthetic difference-in-differences |
| JEL: | J23 J3 M53 |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:iso:educat:0234 |
| By: | Alexander Bick; Adam Blandin; Aidan Caplan; Tristan Caplan |
| Abstract: | This paper documents heterogeneity in work from home (WFH) across six U.S. data sets. These surveys agree that pre-pandemic differences in WFH rates by sex, education, and state of residence expanded following the Covid-19 outbreak. The surveys also show similar post-pandemic trends in WFH by firm size and industry. We show that an industry's WFH potential was highly correlated with actual WFH during the first year or two of the Covid-19 pandemic, but that this correlation was much weaker before and after the pandemic, suggesting that WFH potential is a necessary but not sufficient determinant in the decision to WFH. |
| Keywords: | work from home; remote work; telecommuting; commuting; data set comparisons |
| JEL: | I18 J21 J22 J24 L23 |
| Date: | 2024–12–12 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedlwp:99270 |
| By: | Mirko Draca; Max Nathan; Viet Nguyen-Tien; Juliana Oliveira-Cunha; Anna Rosso; Anna Valero |
| Abstract: | Which types of human capital influence the adoption of advanced technologies? We study the skill-biased adoption of information and communication technologies (ICT) across two waves in the UK. Specifically, we compare the 'new wave' of cloud and machine learning / AI technologies during the 2010s-pre-LLM-with the previous wave of personal computer adoption in the 1990s and early 2000s. At the area-level we see the emergence of a distinct STEM-biased adoption effect for the second wave of cloud and machine learning / AI technologies (ML/AI), alongside a general skill-biased effect. A one-standard deviation increase in the baseline share of STEM workers in areas is associated with around 0.3 of a standard deviation higher adoption of cloud and ML/AI. We find similar effects at the firm level where we are able to test for the influence of a wide range of skills. In turn, this STEM-biased adoption pattern has encouraged the concentration of these technologies, leading to more acute differences between high-tech and low-tech areas and firms. In contrast with classical technology diffusion, recent cloud and ML/AI adoption in the UK seems more likely to widen inequalities than reduce them. |
| Keywords: | Technology Diffusion, ICT, Human Capital, STEM |
| JEL: | D22 J24 O33 R11 |
| Date: | 2024–10–20 |
| URL: | https://d.repec.org/n?u=RePEc:csl:devewp:495 |
| By: | Costas Cavounidis; Vittoria Dicandia; Kevin Lang; Raghav Malhotra |
| Abstract: | We present a unified technological explanation of both the movement of workers across jobs using different skills and the changes in skill use within jobs. An envelope-theorem approach allows us to estimate relative skill-productivity growth from worker mobility using OLS while making minimal assumptions on each occupation's production function. Using six decades of data, we conclude that routine-cognitive- and finger-dexterity-skill productivity grew rapidly and abstract- and social-skill productivity grew slowly - a form of "skill bias." These effects, along with our estimated relationships between skill inputs, also explain changes in skill use within occupations. |
| Keywords: | skills; technological change |
| JEL: | J24 O33 |
| Date: | 2024–11–26 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedcwq:99181 |
| By: | Rudolf Winter-Ebmer; Jasmin Anderlik; Malika Jumaniyozova; Bernhard Schmidpeter |
| Abstract: | Using linked vacancy-employer-employee data from Austria, we investigate how monopsony power affects firms’ posting behavior and wage negotiations. Consistent with theoretical predictions, we find that firms with greater monopsony power post lower wages and offer fewer non-wage amenities, suggesting that wages and non-wage benefits are complementary. However, we find no evidence that monopsonistic firms demand higher levels of skill or education. Instead, our results indicate that they require more basic skills, particularly those related to routine tasks. On the workers’ side, we find that employees hired in monopsonistic labor markets face significantly lower wages, both initially and in the long-run. These lower wages are driven by both lower posted wages and reduced bargaining power, as well as reduced opportunities to climb the wage ladder later. |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:jku:econwp:2024-15 |
| By: | Guilherme Spinato Morlin; Marco Stamegna; David Cano Ortiz; Simone D'Alessandro; Pietro Guarnieri |
| Abstract: | The effectiveness of statutory minimum wages in reducing income inequality and alleviating working poverty is widely recognized in labour market policy discussions. Less attention has been paid to the potential of salary caps to further reduce wage disparities by targeting the top of the income distribution. In this paper, we simulate the introduction of statutory minimum and maximum wages in Italy using Eurogreen, a dynamic macro-simulation model that combines input output analysis with labour market heterogeneity. Our findings indicate that the joint implementation of the two policies can substantially reduce labour market inequalities across gender, skill levels, occupational categories, and industrial sectors, without negatively affecting the overall performance of the economy. |
| Keywords: | Labour-market policy, Industry heterogeneity, gender gap, Dynamic Macrosimulation |
| JEL: | E24 E27 J24 J31 |
| Date: | 2024–11–01 |
| URL: | https://d.repec.org/n?u=RePEc:pie:dsedps:2024/320 |
| By: | Octavio Bertín (CEDLAS-IIE-FCE-UNLP); Guillermo Cruces (CEDLAS-IIE-FCE-UNLP & University of Nottingham); Fabian Enrique Gonzalez (CEDLAS-IIE-FCE-UNLP); Ignacio Lunghi (CEDLAS-IIE-FCE-UNLP); Azul Menduiña (CEDLAS-IIE-FCE-UNLP) |
| Abstract: | This study assesses the impact of a hiring credit policy introduced in Argentina in 2014 on various labor outcomes of firms. The reform established differentiated labor cost reductions in the employers contributions to be paid for their new employees, according to the size that firms had at a date prior to the announcement of the policy. Using a differences-in-differences approach and employer-employee administrative data, we analyze the intervention’s effects. Our results show a significant 4.1 percentage point increase in employment growth rates for small firms compared to medium-sized ones, persisting for several years post-reform. This paper also explores the relationship between the intervention’s effects and sector labor informality; we find a significant 6.2 percentage point increase in employment growth rates for firms in high-informality sector, whereas no significant effect is found for firms in low-informality sectors. |
| JEL: | C31 J08 J23 O17 |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:dls:wpaper:0342 |
| By: | Anna Zamberlan; Alessio Tomelleri; Antonio Schizzerotto; Paolo Barbieri |
| Abstract: | Mastering digital skills is an increasingly important factor in the job matching process. This paper employs experimental methods to study how recruiters assess digital skills in the labour markets of Germany, Italy, and the United Kingdom. The aim is to determine the causal impact of job applicants’ digital competences on recruiters’ assessment within the hiring process. The analysis further explores the heterogeneous effects of digital skills in the distribution of opportunities for candidates with varying levels of education applying to high- and mid/low-skilled jobs. Our results show that intermediate and advanced digital skills increase a candidate’s employability, with larger effects in the UK, a highly flexible labour market characterised by the relevance of general educational skills and relatively high returns to tertiary education. Focusing on heterogeneity by education and job types, the impact of digital skills is not univocal and highlights differing patterns across labour markets in shaping job candidate opportunities. |
| Keywords: | Digital skills, Education, Hiring intentions, Job matching, Factorial survey experiment, Germany, Italy, United Kingdom |
| JEL: | H25 H71 L25 D22 D25 L20 |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:fbk:wpaper:2024-04 |
| By: | José Javier Domínguez; Juan Antonio Lacomba; Francisco Lagos; Natalia Montinari |
| Abstract: | The underrepresentation of women in male-dominated labor markets is often linked to biased perceptions of their capabilities. In recent decades, Spain has advanced significantly in including women in political and economic roles. This study examines how these shifts impact perceptions of women’s abilities and managerial decisions (i.e. hiring and task assignments). We conducted an online experiment with a representative sample of the Spanish population (N=806), focusing on the effects of age and gender. Results show either gender equality or positive discrimination favouring women. Additionally, age positively influences hiring decisions, likely due to shifting beliefs as workplace exposure to women increases. Evidence from a new Spanish sample (N=1, 450) supports this mechanism through the contact hypothesis, indicating that increased exposure to women in the workplace reduces gender bias among older male employers. To test whether results are specific to Spain, we conducted a robustness check with a representative sample from Italy (N=1, 450), a country with similar culture but differing gender equality trends. The findings were consistent. These age-related patterns underscore the importance of workplace characteristics in shaping employment decisions and offer insights for strategies to foster inclusion and reduce gender discrimination. |
| JEL: | D03 C91 J71 |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:bol:bodewp:wp1199 |
| By: | Gustafsson, Johan (Department of Economics, Umeå University); Lanot, Gauthier (Department of Economics, Umeå University) |
| Abstract: | We analyze the impact of improved automation on the size and distribution of pension benefits, and on the optimal size of public pension systems. To this end, we build an overlapping generations model with heterogeneous agents. Automation is either conceptualized in a capital-skill complementarity (CSC) or task-based (TB) fashion. We find that any productivity gains of automation realized as increased returns to savings disproportionately benefit high-skilled workers who are less dependent on illiquid public pensions. A redistributive pension system can reduce public pension inequality but increase inequality in private retirement savings. The optimal size of the pension system is larger in the TB specification where displacement effects of automation are accounted for. We do not find that automation-driven growth warrants any change to the optimal size of the public pension system. |
| Keywords: | Automation; General Equilibrium; Overlapping Generations; Public Pensions |
| JEL: | H55 J22 J26 |
| Date: | 2024–11–26 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:umnees:1030 |
| By: | César Barreto (OECD); Jonas Fluchtmann (OECD); Alexander Hijzen (OECD); Stefano Lombardi (VATT); Patrick Bennett (University of Liverpool); Antoine Bertheau (NHH); Winnie Chan (Statistics Canada); Andrei Gorshkov (IFAU); Jonathan Hambur (Reserve Bank of Australia); Nick Johnstone (IEA); Benjamin Lochner (FAU); Jordy Meekes (Leiden University); Tahsin Mehdi (Statistics Canada); Balázs Muraközy (University of Liverpool); Gulnara Nolan (Reserve Bank of Australia); Kjell Salvanes (NHH); Oskar Nordström Skans (Uppsala University); Rune Vejlin (Aarhus University) |
| Abstract: | This paper provides a comprehensive analysis of the costs of job displacement in energy-intensive industries in selected OECD countries. Based on harmonised linked employer-employee data from 14 OECD countries, we estimate the effect of job displacement in three energy-intensive industries, namely energy supply, heavy manufacturing and transport, compared to other industries. We find that workers displaced from energy supply and heavy manufacturing, experience larger earnings losses compared with workers in non-energy-intensive and transport sectors. Larger earnings losses mainly result from weaker re-employment outcomes in terms of wages and job instability but also challenges with finding another job. They reflect significant differences in the composition of workers and firms in energy supply and heavy manufacturing and the rest of the economy. Displaced workers in these sectors tend to be older, are less skilled and more likely to be previously employed in high-wage firms. |
| Keywords: | dismissal; linked employer-employee data; just transition |
| JEL: | J31 J63 Q43 |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:rba:rbardp:rdp2024-09 |
| By: | Sofoklis Goulas (Brookings Institution, Economic Studies, and IZA); Silvia Griselda (e61 Institution); Rigissa Megalokonomou (Department of Economics, Australia, IZA, and CESifo); Yves Zenou (Monash University, Department of Economics, Australia, CEPR, and IZA) |
| Abstract: | How do disruptive peers shape academic and career paths? We examine this question by leveraging the random assignment of students to classrooms in Greece and identifying the effects of peer disruptiveness on academic performance and career paths. Using suspension hours as a measure of disruptiveness, we find that students assigned to more disruptive classrooms have lower academic achievement, a higher risk of grade retention, and reduced likelihood of graduating from high school on time. They are also less likely to pursue competitive STEM fields or enroll in selective postsecondary programs. The adverse effects are more pronounced for students from low-income areas, in larger classrooms, or with fewer female peers. Using a lab-in-the-field experiment, we find that exposure to multiple disruptors, compared to just one, reduces students’ study motivation, college aspirations, and readiness for science studies and careers, especially for those seated closer to disruptive peers. |
| Keywords: | disruption, suspension, random classroom assignment, high school graduation, STEM careers |
| JEL: | I24 I26 J16 J24 |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:mos:moswps:2024-21 |
| By: | Kunze, Astrid (Dept. of Economics, Norwegian School of Economics and Business Administration) |
| Abstract: | On 9 October 2023, Claudia Goldin was announced as winner of the 2023 Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel. It can certainly be said that many had long awaited the recognition of her research on women and inequality in labour markets. Goldin is a labour economist and economic historian who has shed new light on economic questions related to gender equality, particularly through historical data. This article summarises some of her major contributions to our understanding of the labour market behaviour of women and gender inequality. |
| Keywords: | gender; labour market; wages; employment; discrimination; equal pay for equal work; gender segregation; labour demand and supply |
| JEL: | J10 J20 J23 |
| Date: | 2024–12–03 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:nhheco:2024_019 |
| By: | Lunzheng Li; Philippos Louis; Zacharias Maniadis; Dimitrios Xefteris |
| Abstract: | Peer assessment’s reliability can be undermined when participants behave strategically. Using a formal model we show how reciprocity can lead to reviewers inflating their rating of each others’ work, which is exacerbated when review takes place sequentially. We conduct a pre-registered online experiment and we find that reviewers engaged in mutual-review relationships inflate their reports more, compared to when reviews are one-sided. For sequential reviews, a non-trivial fraction of first movers maximally over-report. In accordance to our theoretical model, we also find that second movers are responsive to the review they received, but only when reviews are mutual. This reveals the potential for a quid-pro-quo element in mutual reviews. Our results highlight the importance of appropriately structuring peer assessment to take strategic reciprocity motives into account and ensure the system’s reliability. |
| Keywords: | Reciprocity, Lying, Peer Assessment, Experiment |
| JEL: | D9 L2 M5 |
| Date: | 2024–12–05 |
| URL: | https://d.repec.org/n?u=RePEc:ucy:cypeua:06-2024 |
| By: | Joachim Hubmer (University of Pennsylvania); Mons Chan (Queen’s University); Serdar Ozkan (Federal Reserve Bank of St. Louis, University of Toronto); Sergio Salgado (University of Pennsylvania); Guangbin Hong (University of Chicago) |
| Abstract: | Do larger firms have more productive technologies, are their technologies more scalable, or both? We use administrative data on Canadian and US firms to estimate a joint distribution of output elasticities of capital, labor, and intermediate inputs—thus, returns to scale (RTS)—along with total factor productivity (TFP). We find significant heterogeneity in RTS across firms within industries. Furthermore, larger firms operate technologies with higher RTS, whereas the largest firms do not exhibit the highest TFP. Higher RTS for large firms are entirely driven by higher intermediate input elasticities. Descriptively, these align with higher intermediate input revenue shares. We also show that high-RTS firms grow faster, pay higher wages, and are owned by wealthier households. We then incorporate RTS heterogeneity into the workhorse model of endogenous entrepreneurship that matches the observed heterogeneity in TFP and RTS. We find that the efficiency losses from financial frictions are more than twice as large compared to a conventional calibration that attributes all heterogeneity to TFP and assumes a common RTS parameter. |
| Keywords: | Production function heterogeneity, returns to scale, misallocation |
| JEL: | E22 L11 L25 |
| Date: | 2024–11–21 |
| URL: | https://d.repec.org/n?u=RePEc:pen:papers:24-036 |
| By: | CRUCES Hugo (European Commission - JRC); HERNANDEZ Adrian; NARAZANI Edlira |
| Abstract: | The Ingreso Mínimo Vital (Minimum Vital Income), Spain’s nationwide minimum income scheme introduced in 2020, offers beneficiaries a unique national guaranteed income as a last-resort benefit. However, the scheme’s design featured a lack of work incentives for low earners, potentially leading to inactivity traps. To address this flaw the Spanish government introduced an earnings disregard in 2022 enabling beneficiaries to keep all or part of the benefit when their earnings increase up to a certain limit. This paper provides an ex-ante assessment of this reform, looking into its expected fiscal, distributional, and labour market effects using the tax-benefit microsimulation model EUROMOD, and the behavioural labour supply model EUROLAB. Our results show that the reform has the potential to incentivise work for very low earners, particularly lone parents, mainly by promoting part-time employment. Also, the reform and its subsequent employment effects are expected to slightly reduce inequality and poverty. While entailing a step in the right direction, we discuss some avenues for improvement. |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:ipt:taxref:202411 |
| By: | Peter W. Kennedy (Department of Economics, University of Victoria); Herbert Schuetze (Department of Economics, University of Victoria) |
| Abstract: | We characterize the educational choices made by workers in terms of their innate aptitudes and how closely those aptitudes match available job types. A worker can choose to specialize in a narrow field or pursue a more general education based on the closeness of that match. Workers fortunate enough to have an innate aptitude closely matched to a job type will become highly specialized, and will reap high market rewards. Less fortunate workers will be less well-rewarded. Thus, there arises a distribution of income in the economy. The mean, variance and skewness of that distribution is a function of education policy, relating in particular to the educational opportunities made available, and how they are funded, whether through income tax or tuition charges. We cast this policy choice in terms of picking a point on a Kuznets curve, which dictates the relationship between average income and income-equality in this economy. JEL Classification: J24, I24, I26, I28 |
| Keywords: | human capital; specialization; education |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:vic:vicddp:2404 |
| By: | Josep M. Nadal-Fernandez (Michign State University); Gabrielle Pepin (W.E. Upjohn Institute for Employment Research); Kane Schrader (W.E. Upjohn Institute for Employment Research) |
| Abstract: | Work requirements are perhaps the most controversial aspect of the Temporary Assistance for Needy Families (TANF) program, America’s sole federal cash assistance program for low-income families with children. In 2025, for the first time in nearly 20 years, the Fiscal Responsibility Act of 2023 (FRA) will implement policy changes intended to strengthen states’ work requirements. However, researcher’ and policymakers’ understanding of how FRA will impact states’ compliance with federal requirements is hampered by a lack of research and publicly available data. We tie information from reports submitted to the U.S. Department of Health and Human Services that are collected to administrative caseload and expenditure data to document several strategies that states currently use to comply with federal work requirements. We estimate that FRA will increase the stringency of work requirements in 23 states and that 5 states will begin to fall short of requirements. We note that several compliance strategies available to those states do not encourage work. We discuss changes in states’ work requirements that would promote better long-term economic and labor market outcomes for TANF recipients. |
| Keywords: | Cash assistance, Temporary Assistance for Needy Families, Fiscal Responsibility Act of 2023, forecasting |
| JEL: | J38 H75 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:upj:weupjo:24-408 |
| By: | Jad Moawad; Daniel Oesch |
| Abstract: | The public debate portrays the middle class as the big losers in recent decades, while people above and below seemingly fared better in terms of employment and income growth. This narrative is both conceptually and empirically flawed. Based on the Luxembourg Income Study 1980–2020, we show for France, Germany, Poland, Spain, the UK, and the US that middle-class employment expanded, while the working class shrank. The middle class also experienced consistently larger income gains than the working class over the past four decades. The disposable real incomes of working-class households in France, Germany or the US grew by less than half a percent per year, compared to 1% or more for the middle class. Cohort analysis also shows that the promise of doing better than one’s parents held for the middle class, but vanished for the working class. |
| Keywords: | social class; income; labor market; occupations; economic growth |
| JEL: | D31 J31 |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:irs:cepswp:2024-11 |
| By: | Stefan Bach; Charlotte Bartels; Theresa Neef |
| Abstract: | This paper analyzes the distribution and composition of pre-tax national income in Germany since 1992, combining personal income tax returns, household survey data, and national accounts. Inequality rose from the 1990s to the late 2000s due to falling labor incomes among the bottom 50% and rising incomes in the top 10%. This trend reversed after 2007 as labor incomes across the bottom 90% increased. The top 1% income share, dominated by business income, remained relatively stable between 1992 and 2019. A large share of Germany’s top 1% earners are non-corporate business owners in laborintensive professions. At least half of the business owners in P99-99.9 and a quarter in the top 0.1% operate firms in professional services – a pattern mirroring the United States. From 1992 to 2019, Germany’s top 0.1% income concentration exceeded France’s and matched U.S. levels until the late 2000s. |
| Keywords: | Income distribution, labor income, capital income, top Incomes |
| JEL: | D31 E01 H2 H5 J3 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:diw:diwwpp:dp2102 |