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on Labor Markets - Supply, Demand, and Wages |
| By: | McGuinness, Seamus (Economic and Social Research Institute, Dublin); Staffa, Elisa (Economic and Social Research Institute, Dublin) |
| Abstract: | In this paper, we examine the incidence of skill gaps among European employees. We identify the worker and firm level characteristics most commonly associated with skill gaps and investigate the extent to which this particular form of skill mismatch is associated with wage penalties. In 2021, we find that 16.2% of EU employees had essential and non-essential general skill gaps. The incidences for competency specific skill gaps were 29.5% for numeracy skills, 39.7% for technical skills and 49.4% for social skills. Among employees we find that general skill gaps were highly correlated with numeracy, social and technical skills gaps. The more complex the job, the higher the probability for workers to report having a general skill gap or a domain specific skill gap. We find no evidence that skill gaps are associated with negative productivity impacts (proxied by wages). We find that, where skill gaps exist, they are likely to be driven by workers motivated to keep pace with evolving requirements in more complex jobs. This is very different from the usual view of skill gaps as being concentrated among poorly educated workers in low value-added employment lacking essential skills. |
| Keywords: | job complexity, wages, skill gaps, measurement, policy |
| JEL: | J20 J24 J31 J38 |
| Date: | 2025–07 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17993 |
| By: | Nicolás González-Pampillón (Centre for Economic Performance (CEP) - LSE & IEB); Javier Vázquez-Grenno; Universitat de Barcelona & IEB |
| Abstract: | This paper examines the impact of a substantial minimum wage increase in Uruguay—a middle-income developing economy—on wages and employment. Using administrative data and a difference-in-differences approach, we analyze the consequences of a 2005 policy reform that raised the real minimum wage by 80% within a year. Our findings show that the reform led to significant wage gains for low-wage earners, with at most minimal negative effects on employment. Survey data further reveal no significant changes in unemployment or informality, suggesting the reform did not distort labor market dynamics. To contextualize these results, we investigate compliance with minimum wage laws and document a post-reform decline in compliance, particularly among low-wage workers. This pattern aligns with firms’ cost-benefit trade-offs under weak enforcement of wage regulations. Our study contributes to the literature by providing causal evidence on the labor market effects of minimum wage policies in a developing economy, underscoring the pivotal role of enforcement in shaping policy outcomes. |
| Keywords: | Minimum wage, labour market, compliance with the law. |
| JEL: | J23 J38 J88 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:ieb:wpaper:doc2025-06 |
| By: | García-Suaza, Andrés; Caiza-Guamán, Pamela; Sarango-Iturralde, Alexander; Romero-Torres, Bernardo; Buitrago, Catalina |
| Abstract: | The green transition represents one of the most significant transformational forces in the labor market in the coming years. This paper analyzes the incidence of green jobs in four Latin American countries using information from job vacancy data. The results reveal a low incidence of demand for jobs with green potential or for new and emerging occupations related to the green transition. Such occupations are characterized by requiring high levels of education and offer a significant wage premium. These results highlight the main challenge of the green transition, which lies in the need to implement training processes, while revealing opportunities for the creation of high-quality jobs in the region. |
| Keywords: | Labor demand, green jobs, green transition, climate change, skills |
| JEL: | J24 J62 Q52 Q58 |
| Date: | 2025–07 |
| URL: | https://d.repec.org/n?u=RePEc:rie:riecdt:118 |
| By: | Angelica Bertucci; Emilio Colombo; Patrizio Tirelli |
| Abstract: | We investigate the response of posted job vacancies to increased broadband connectivity with a specific focus on their requirements for digital and cognitive skills, and distinguishing the effects between digital and non-digital occupations. We utilise a large dataset of online job advertisements, which encompasses approximately 55, 000 observations between 2013 and 2019. Broadband shocks unambiguously increase vacancy postings, but do not significantly impact their skill composition. By contrast, fast broadband shocks induce heterogeneous responses, where vacancies posted for non-digital occupations increase their digital/cognitive skill contents, whereas we obtain opposite results for digital occupations. |
| JEL: | J24 J63 L96 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:dis:wpaper:dis2506 |
| By: | Bernhard, Sarah; Bohmann, Sandra; Fiedler, Susann; Kasy, Maximilian; Schupp, Jürgen; Schwerter, Frederik |
| Abstract: | How does basic income (a regular, unconditional, guaranteed cash transfer) impact labor supply? We show that in search models of the labor market with income effects, this impact is theoretically ambiguous: Employment and job durations might increase or decrease, match surplus might be shifted to workers or employers, and worker surplus might be reallocated between wages and job amenities. We thus turn to empirical evidence to study this impact. We conducted a pre-registered RCT in Germany, starting 2021, where recipients received 1200 Euro/month for three years. We draw on both administrative and survey data, and find no extensive margin (employment) response, and no impact on job transitions from either non-employment or employment. We do find a small statistically insignificant intensive margin shift to part-time employment, which implies an excess burden (reduction of government revenues) of ca 7.5% of the transfer. We furthermore observe a small increase of enrollment in training or education. (Stone Center on Socio-Economic Inequality Working Paper) |
| Date: | 2025–06–21 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:xe8zh_v1 |
| By: | Modestino, Alicia Sasser (Northeastern University); Finn, Zachary (Northeastern University); Ladge, Jamie (Boston College); Lincoln, Alisa (Northeastern University) |
| Abstract: | Conducting a nationally representative survey of 2, 500 working parents between Mother's and Father's Day of 2020, we examine gender differences in the childcare shock during the COVID-19 pandemic. Drawing on demographic, household, and labor market factors, we document gender differences in time use, work status, mental health, job satisfaction, and employer benefits. Using variation in pre-pandemic characteristics to measure exposure to the childcare shock, we find mothers in the more vulnerable group were 15 percentage points more likely to experience a reduction in hours due to childcare than similarly situated fathers. Although paid family leave helped narrow the gap in hours between mothers and fathers in the affected group, newer COVID-19 workplace practices such as working from home and childcare subsidies had no effect. |
| Keywords: | household decision-making, gender differences, childcare, paid leave, COVID-19 |
| JEL: | D13 D91 I30 J22 J28 J71 |
| Date: | 2025–07 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18004 |
| By: | Ketter, Laura (University of Queensland); Morris, Todd (University of Queensland); Yu, Lizi (University of Queensland) |
| Abstract: | This paper documents a robust link between COVID-19 lockdowns and the uptake and persistence of working from home (WFH) practices. Exploiting rich longitudinal data, we use a difference-in-differences strategy to compare office workers in three heavily locked-down Australian states to similar workers in less affected states. Locked-down workers sustain 43% higher WFH levels through 2023 — 0.5 days per week — with a monotonic dose–response relationship. Persistence is driven by adjustments on both sides of the labor market: employers downsize office space and open remote/hybrid positions, while employees relocate away from city centers and invest in home offices and technology. |
| Keywords: | COVID-19, persistence, WFH, work from home, lockdowns, habit formation |
| JEL: | I18 J22 M54 |
| Date: | 2025–06 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17975 |
| By: | Alexandra V. Schubert; Jenny M. Wang |
| Abstract: | Across many cultures, resting instead of working is viewed as a barrier to higher earnings. This belief is also reflected in many canonical economic models. Recent empirical evidence highlighting the productivity benefits of rest challenges this belief. Yet, existing work tends to ignore individuals’ demand for restful activities and whether it aligns with their returns. In the context of an online labor market experiment in South Africa, we explore whether workers capitalize on the returns to short rest periods. After eliciting demand for rest, we estimate returns to rest for the same individuals and find that mandated rest boosts productivity by 0.3 standard deviations, thus making up for forgone earnings from resting. At the same time, only 19% of workers voluntarily choose to rest. Contrary to the notion of selection on returns, workers with high financial returns to rest do not select into rest. We provide suggestive evidence that misperceived financial returns are driving the disconnect between demand for and returns to rest. Our results provide proof-of-concept evidence that individuals may be misallocating effort between resting and working and could reach higher overall utility by working less. This highlights the importance of understanding misperceptions around rest, especially in light of the economic burden of long-term costs of overworking such as burnout. |
| Keywords: | Labor-leisure trade-off, rest, productivity, demand, misperceptions, production functions, gig economy |
| Date: | 2025–06 |
| URL: | https://d.repec.org/n?u=RePEc:zur:econwp:472 |
| By: | Evan K. Rose; Yotam Shem-Tov |
| Abstract: | This paper studies the earnings and employment penalties associated with a criminal record. Using a large-scale dataset linking criminal justice and employer-employee wage records, we estimate two-way fixed effects models that decompose earnings into worker’s portable earnings potential and firm pay premia, both of which are allowed to shift after a worker acquires a record. We find that firm pay premia explain a small share of earnings gaps between workers with and without a record. There is little evidence of variable within-firm premia gaps either. Instead, components of workers’ earnings potential that persist across firms explain the bulk of gaps. Conditional on earnings potential, workers with a record are also substantially less likely to be employed. Difference-in-differences estimates comparing workers’ first conviction to workers charged but not convicted or charged later support these findings. The results suggest that criminal record penalties operate primarily by changing whether workers are employed and their earnings potential at every firm rather than increasing sorting into lower-paying jobs, although the bulk of gaps can be attributed to differences that existed prior to acquiring a record. |
| Date: | 2025–06 |
| URL: | https://d.repec.org/n?u=RePEc:cen:wpaper:25-39 |
| By: | Carroni, Elias (University of Bologna); Della Giusta, Marina (University of Turin); Dragone, Davide (University of Bologna) |
| Abstract: | We develop a rational choice model of sexual exchange that unifies marriage and paid sex, explaining two key facts: the gendered segregation of sex markets and the decline in sexual activity and fertility. Individuals choose whether to engage in paid or unpaid sex based on income, human capital, and social norms. Gendered patterns emerge en- dogenously from the asymmetric distributions of these traits. The model also shows how the rise of digital sex reduces the cost of supplying sex, increases market participation, and reallocates time away from unpaid intimacy—leading to lower fertility even without biological constraints. |
| Keywords: | sex work, sex buyer, human capital, gender norms, fertility, sexual exchanges |
| JEL: | J10 J12 J16 J22 J24 |
| Date: | 2025–07 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18002 |
| By: | Kendzia, Michael Jan (Zurich University of Applied Sciences (ZHAW)); Neville, Tomas (Zurich University of Applied Sciences (ZHAW)); Gadgil, Maya (Zurich University of Applied Sciences (ZHAW)) |
| Abstract: | This study investigates the key drivers behind the wealth accumulation of America’s 100 richest self-made billionaires, using data from the Forbes 400 list. Focusing on five individual and contextual factors—education, innovation, networks, inheritance, and geographic origins—the research applies regression analysis to evaluate the statistical significance and predictive power of each. The results show that education, especially from elite institutions, is a strong and consistent predictor of wealth. Innovation, measured by patents and entrepreneurial activity, shows the strongest correlation, emphasizing its centrality in modern wealth creation. Networks—both personal and professional—also play a crucial role, though they interact with other variables. In contrast, inheritance and geographic origins, while influential, exhibit weaker statistical associations. Notably, 89% of the cohort received little or no family funding, underscoring the importance of individual agency and external investment. The findings challenge assumptions about inherited wealth and highlight the role of human capital, innovation ecosystems, and urban opportunity structures in financial success. |
| Keywords: | wealth accumulation, entrepreneurship, education and innovation, social mobility, economic mobility |
| JEL: | J24 D31 L26 O31 |
| Date: | 2025–07 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17994 |
| By: | Marta Curull-Sentís; Laia Maynou; Lídia Farré; Libertad González |
| Abstract: | We conduct a survey experiment to examine gender differences in preferences for job attributes, including flexibility, commuting distance, and workplace climate. Both men and women are willing to trade 20–30% of their current wage to avoid inflexible jobs and long commutes. However, a notable gender difference emerges in the willingness-to-pay (WTP) to avoid sexual harassment. Women are willing to trade 50% of their wage for a secure workplace, 14 percentage points more than men. Among recent female victims, this aversion increases to 87%. These findings under-score the detrimental impact of sexual harassment on gender equality and talent allocation in the labor market. |
| Keywords: | compensating wage differentials, gender gaps, sexual harassment, survey experiments, working conditions, working flexibility |
| JEL: | J16 J31 J28 J81 C93 |
| Date: | 2025–07 |
| URL: | https://d.repec.org/n?u=RePEc:bge:wpaper:1500 |
| By: | Kohei Takahashi (Institute for Well-being and Productivity Studies, Waseda University) |
| Abstract: | This study examines the optimal organizational composition of specialists and generalists theoretically and empirically, using a model based on Dessein and Santos (2006). It assumes that specialists excel in adaptation given their deep knowledge in specific areas but face coordination challenges given limited knowledge of other areas. In contrast, generalists benefit from broad task experience, making them superior in coordination but less effective in adaptation than specialists. The model predicts the following monotonicity: the optimal organizational structure shifts from one with many specialists to one with many generalists as the importance of coordination (relative to adaptation) increases or as market uncertainty increases under the condition that the importance of coordination is sufficiently high. These predictions are tested using employee assignment history data from a large Japanese trading company. The dataset includes employees who joined the company in fiscal year 1984 or later and their records up to fiscal year 2023. As predicted, divisions in commodity trading, where adaptation to their market condition is relatively crucial, have more specialists than divisions in business investment, where coordination is key. Among the business investment divisions, the proportion of generalists is higher in those with higher market uncertainty. |
| Keywords: | Human capital development, Career, Specialists and generalists, Training, Job assignment |
| JEL: | J24 M50 M53 M54 |
| Date: | 2025–07 |
| URL: | https://d.repec.org/n?u=RePEc:wap:wpaper:2517 |
| By: | Leonardo Ridolfi; Michelangelo Vasta |
| Abstract: | This paper presents the first long-run homogeneous series of real wages, working days, and skill premiums for building workers in Florence from 1326 to the Italian Unification in 1861. In doing so, we build upon new archival data drawn from the archives of the Opera del Duomo in Florence and the Badia Fiesolana in Fiesole, which span more than 20, 000 wage observations. By combining daily wages with annual working days, we provide a more precise estimate of labor input and living standards, while assessing the impact of the common assumption of 250 working days on real wage calculations. We also reconstruct the long-term evolution of the skill premium, shedding new light on the structure of labour markets in preindustrial Southern Europe. Our findings allow us to revisit the interaction between wages, demographic cycles, and living standards, placing Florence more firmly in both the Italian and international contexts of the Little Divergence debate. |
| Keywords: | Real wages, labour markets, living standards, Little Divergence Jel Classification:N13, N33, N94 |
| Date: | 2025–07 |
| URL: | https://d.repec.org/n?u=RePEc:usi:wpaper:928 |
| By: | Feuillade, Mylène (Paris School of Economics); Goux, Dominique (CREST-INSEE); Maurin, Eric (Paris School of Economics) |
| Abstract: | This article explores how an employee’s choice to work from home (WFH) influences his or her spouse’s outcomes. Drawing on the specific features of the French institutions, we show that a spouse’s switch to WFH leads to a sharp increase in the probability that his or her partner will also switch to WFH, as well as in the number of hours worked by the partner. These cross-effects are particularly strong on the better-paid partner within the couple (whether the man or the woman) who appears to condition his or her decision to work from home on that of his or her (less-paid) partner. The effects of WFH on the volume of hours worked are greatly underestimated when spillovers within couples are neglected. On the other hand, we detect no significant effect on partners’ commuting distance, nor on the type of urban unit they choose to live in. |
| Keywords: | hours worked, social interactions, work from home |
| JEL: | J22 J16 |
| Date: | 2025–07 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17997 |
| By: | Karol Jan Borowiecki (University of Southern Denmark); Martin Hørlyk Kristensen (University of Southern Denmark); Marc T. Law (University of Vermont) |
| Abstract: | How does family background shape entry into elite professions, and how do changes in training regimes influence the allocation of talent? We study dynasties in Western classical composition, a setting where family ties historically influenced access, and where rich biographical data allow us to trace selection dynamics over multiple centuries. Using data on over 16, 000 composers from 450 CE to the present, we identify dynastic ties from Grove Music Online and measure prominence using the length of each composer’s biographical entry. Dynastic composers are between 14 and 21 percent less prominent than their non-dynastic peers, conditional on country and birth cohort. This discount is driven by descendants; founders are as prominent as non-dynasts, while descendants under-perform both. Similar results hold using archival manuscript data from R´epertoire International des Sources Musicales, suggesting the pattern is not an artifact of editorial selection. In the twentieth century, the pattern reverses: dynasts become more prominent, consistent with a shift from informal, family-based entry to standardized selection via conservatory training. Supporting this interpretation, we show that dynasts are less likely to have formal training mentioned in their biographies, and that the dynasty discount is smaller in regions and periods where conservatories were present. Our findings suggest that credentialing reforms may have influenced patterns of elite formation and talent allocation, offering broader insight into the relationship between human capital access and long-run economic performance. |
| Keywords: | talent allocation, dynasties, human capital transmission, conservatories, classical composers |
| JEL: | O15 J24 J62 I25 N30 Z11 |
| Date: | 2025–06 |
| URL: | https://d.repec.org/n?u=RePEc:cue:wpaper:awp-03-2025 |
| By: | Effrosyni Adamopoulou; Anne Hannusch; Karen A. Kopecky; Tim Obermeier |
| Abstract: | Why do US college-educated couples with children marry at higher rates than those without a college degree? We argue that investing in children is more valuable for college-educated couples, who are more likely to send their children to college. Marriage, which entails lower separation risk and more equal asset division if separation does occur, provides insurance to the lower-earning spouse, which facilitates child investment. Using an OLG model of marriage, cohabitation, wealth accumulation, and educational investments where college completion is risky, we find that insurance through marriage is particularly important when investing in children is costly and college costs are high. |
| Keywords: | cohabitation; marriage; child development; time and money investments; human capital accumulation; college costs |
| JEL: | D15 E24 J12 J22 J24 |
| Date: | 2025–07–17 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedcwq:101333 |
| By: | Wei, Zhiwu; Lee, Neil; Iddawela, Yohan |
| Abstract: | Mobile internet has become a fundamental component of modern infrastructure. In this paper, we consider the impact of mobile internet connectivity on household wealth in the Philippines. We construct a granular measure of local mobile internet connectivity using comprehensive information on approximately 0.27 million geocoded cell towers, and identify causal impact through a novel instrumental variable based on proximity to submarine cable landing points. Our results suggest that mobile internet connectivity significantly increases household wealth, with effects that persist across education levels and are more pronounced in urban areas compared to rural ones. Combining individual survey datasets with Points-of-Interest data, we investigate mechanisms and demonstrate that improved connectivity stimulates activities in several key economic sectors that create employment opportunities. Additionally, mobile internet connectivity enhances individual educational outcomes and promotes female labor force participation, though predominantly in occasional or seasonal roles. |
| Keywords: | mobile internet; cell tower; wealth inequality; Philippines |
| JEL: | F14 J24 J63 L86 O33 |
| Date: | 2025–06 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:128871 |
| By: | Hanol Lee; Jong-Wha Lee |
| Abstract: | This study develops a novel cross-country measure of higher education quality by leveraging the robust relationship between institution-level indicators--such as faculty-to-student ratios and global university rankings--and the earnings of graduates employed overseas. Using U.S. microdata, it shows that global rankings are strongly correlated with key quality dimensions, including research performance, teaching environment, enrollment size, international outlook, and student selectivity. Building on this relationship, a country-level index of college education quality is constructed for 98 countries, capturing variations in institutional characteristics weighted by their estimated effects on graduate earnings. To examine macroeconomic impacts, the study estimates cross-country regressions of GDP per worker, resident patenting, and R&D expenditures. An instrumental variable strategy--exploiting geographic proximity to global academic hubs--is used to address potential endogeneity. The results show that tertiary education quality has a large and statistically significant effect on all three outcomes, underscoring its role in long-run economic development and innovation capacity. |
| Keywords: | education quality, human capital, economic development, innovation, college education, university rankings |
| JEL: | I23 I25 J24 O15 |
| Date: | 2025–07 |
| URL: | https://d.repec.org/n?u=RePEc:een:camaaa:2025-41 |
| By: | Pyka, Vinzenz |
| Abstract: | Using administrative data from Germany, this study provides first evidence on the wage effects of collective bargaining compliance laws. These laws require establishments receiving public contracts to pay wages set by a representative collective agreement, even if they are not formally bound by one. Leveraging variation in the timing of law implementation across federal states, and focusing on the public transport sector - where regulation is uniform and demand is driven solely by state-level needs - I estimate dynamic treatment effects using event-study designs. The results indicate that within five years of the law's implementation, wage increases were on average 2.9 to 4.6 per cent higher in federal states with such a law compared to those without one - but only in East Germany. These findings highlight the potential for securing collectively agreed wages in times of declining collective bargaining coverage. |
| Abstract: | Ich nutze administrative Daten aus Deutschland und liefere erstmals empirische Evidenz zu den Lohneffekten von Tariftreuegesetzen. Diese Gesetze verpflichten Unternehmen, die öffentliche Aufträge erhalten, ihre Beschäftigten nach einem repräsentativen Tarifvertrag zu entlohnen - auch wenn sie selbst nicht tarifgebunden sind. Auf Grundlage der Gesetzeseinführungen in den Bundesländern analysiere ich mithilfe von Event-Study-Modellen die Lohnentwicklung von Beschäftigten im öffentlichen Nahverkehr. Dieser Sektor eignet sich besonders gut zur Evaluation, da er bundesweit einheitlich reguliert ist und die Nachfrage ausschließlich durch den Staat bestimmt wird. Die Ergebnisse zeigen, dass in Bundesländern mit einem Tariftreuegesetz die Löhne ceteris paribus im Durchschnitt innerhalb von fünf Jahren nach der Einführung um 2, 9 bis 4, 6 Prozent stärker gestiegen sind als in Bundesländern ohne Tariftreuegesetz - allerdings nur in Ostdeutschland. Dies legt nahe, dass ein Bundestariftreuegesetz beitragen könnte, Tariflöhne angesichts einer sinkenden Tarifbindung zu sichern. |
| Keywords: | collective bargaining, pay clauses, public procurement, trade unions |
| JEL: | J31 J38 J51 J53 J58 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:faulre:321882 |
| By: | Paker, Meredith; Stephenson, Judy; Wallis, Patrick |
| Abstract: | Understanding long-run economic growth requires reliable historical data, yet the vast majority of long-run economic time series are drawn from incomplete records with significant temporal and geographic gaps. Conventional solutions to these gaps rely on linear regressions that risk bias or overfitting when data are scarce. We introduce “past predictive modeling, ” a framework that leverages machine learning and out-of-sample predictive modeling techniques to reconstruct representative historical time series from scarce data. Validating our approach using nominal wage data from England, 1300-1900, we show that this new method leads to more accurate and generalizable estimates, with bootstrapped standard errors 72% lower than benchmark linear regressions. Beyond just bettering accuracy, these improved wage estimates for England yield new insights into the impact of the Black Death on inequality, the economic geography of pre-industrial growth, and productivity over the long-run. |
| Keywords: | machine learning; predictive modeling; wages; black death; industrial revolution |
| JEL: | J31 C53 N33 N13 N63 |
| Date: | 2025–06–13 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:128852 |
| By: | Cortés, Darwin; Gallegos, Andrés; Pérez Pérez, Jorge |
| Abstract: | We analyze the e ect of adverse health shocks on households' expenditure shares in different good categories using a xed-e ects approach and a structural approach based on microeconomic theory. We nd that, on average, households substitute health and food expenditure in response to adverse health shocks. Our estimates unveil substantial heterogeneity in this trade-o mediated by access to social protection, job contract type, and urban or rural location. Households from rural areas -where household heads are more likely to hold informal jobs and lack access to safety nets- engage in more substitution of food expenditure for health expenditure than others. Our ndings suggest that access to formal employment and a higher quality of local institutions can help mitigate the negative consequences of health shocks for households. |
| Keywords: | health shocks, household expenditure, informal labor, urban-rural |
| JEL: | D12 I15 J46 |
| Date: | 2025–06 |
| URL: | https://d.repec.org/n?u=RePEc:rie:riecdt:114 |
| By: | Lemos, Sara (University of Leicester) |
| Abstract: | No empirical evidence has ever been reported that the large inflow of accession immigrants – following the 2004 expansion of the European Union – led to a fall in wages or employment, or a rise in unemployment in the UK between 2004 and 2006. This immigration shock was unexpectedly larger and faster – as well as more concentrated into areas and occupations – than anticipated, seemingly more akin to an exogenous supply shock than most immigration shocks. Exploiting rich but underused individual level data from the Lifetime Labour Market Database (LLMDB) we estimate the effect of this immigration shock on wages, employment and unemployment of natives and previously existing immigrants in the UK. We confirm once again the finding of little evidence that the inflow of accession immigrants led to a fall in wages, a fall in employment, or a rise in unemployment of natives in the UK between 2004 and 2006. However, we uncover, for the first time, novel evidence of adverse employment and unemployment effects for low paid existing immigrants as a result of the accession immigration inflow. This is more severe for low paid immigrants and young low paid immigrants as well as for long term unemployed immigrants. |
| Keywords: | wages, employment, immigration, Central and Eastern Europe, UK |
| JEL: | J22 |
| Date: | 2025–07 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18000 |
| By: | Barigozzi, Francesca; Cremer, Helmuth; Canta, Chiara |
| Abstract: | This paper studies how firms’ ownership choices and workers’ intrinsic motivation jointly shape service quality and market outcomes in labor-intensive, mission-driven sectors. Two organizations first choose whether to operate as standard for-profit or as mission-oriented firms, and then compete in both the labor and the user markets. Mission-oriented firms have higher unit costs but attract better-motivated workers. Service quality is endogenously determined through the sorting of intrinsically motivated workers and depends on the firm’s ownership type. We show that all market structures—standard, mission-oriented, or mixed— can arise in equilibrium, and that mixed structures can be Pareto superior by efficiently allocating the most motivated workers to the mission-oriented firm while preserving the cost advantage of the other firm. While equilibrium outcomes generally diverge from the social optimum due to externalities and lack of coordination, they are both driven by the trade-off between cost-efficiency and motivation. The model helps explain the coexistence of heterogeneous ownership structures observed in some sectors—such as the nursing homes sector—and identifies conditions under which such diversity is welfare-enhancing. |
| Keywords: | mission-driven sectors; mission-oriented firms; workers’ motivation; endogenous; market structure; welfare. |
| JEL: | J21 L13 L31 |
| Date: | 2025–07–18 |
| URL: | https://d.repec.org/n?u=RePEc:tse:wpaper:130749 |
| By: | Alessandro Belmonte (Department of Economics and Social Sciences - Marche Polytechnic University, Italy; CAGE - University of Warwick, United Kingdom); Davide Ticchi (Department of Economics and Social Sciences - Marche Polytechnic University, Italy); Michele Ubaldi (Department of Economics and Social Sciences, Marche Polytechnic University) |
| Abstract: | This paper investigates whether and how affirmative action policies lead to backlash from the incumbent group. We exploit the unique historical context provided by the legacy of apartheid in democratic South Africa. Passing affirmative action legislation, intended to improve the conditions of the black community, increases support for far-right parties in national elections among low-educated white voters, who were most affected by the resulting labor market competition. This effect is larger in areas closer to the former homelands of the black community, where the threat of labor market competition was higher. We complement these findings using several survey datasets and find that this effect is associated with increased self-perceived economic insecurity. Our results indicate that, to design effective affirmative action policies, these should be accompanied by measures aimed at addressing the economic concerns of incumbent members. |
| Keywords: | Affirmative action, economic insecurity, labor markets, voting, South Africa. |
| JEL: | D72 J15 J78 K31 N37 |
| Date: | 2025–07 |
| URL: | https://d.repec.org/n?u=RePEc:anc:wpaper:496 |
| By: | Thomas Palley (Economics for Democratic and Opens Societies) |
| Abstract: | This paper presents a theory and model of long-run cycles in income inequality. The model explains the historical pattern of income distribution identified by Kuznets (1955) and Piketty (2014). It breaks with conventional marginal product theory which claims functional income distribution is determined by the technological conditions of production. Instead, it emphasizes the role of socio-political forces that shape and drive fluctuations in the level of popular political organizations, which then impact distribution. That impact includes assessment and attribution of productivity contributions. The model provides a framework for interpreting the historical evolution of income distribution and inequality, and for reflecting on current conditions and possible future developments. The core message is twofold. First, socio-political developments matter for income distribution. Second, if those developments are cyclical, income distribution will also exhibit cyclicality. |
| Keywords: | Income distribution, inequality, cycles, Kuznets curve, Piketty |
| JEL: | E3 J3 N3 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:imk:fmmpap:117-2025 |
| By: | Chilosi, David; Lecce, Giampaolo; Wallis, Patrick |
| Abstract: | Adam Smith’s claim that the division of labour is one of the major engines of economic growth is a foundational concept in economics. Despite this, we lack measures of the scale and growth of Smithian specialisation over the long run. This paper introduces a novel method based on job titles to measure specialisation. We apply this method to document patterns of Smithian specialisation in early modern Britain. National trends in specialisation were closely associated with economic growth. By 1800, the division of labour was over two and a half times as advanced as in the early sixteenth century, with particularly marked changes within English manufacturing, especially in the mechanical subsector, and, to a lesser extent, services. Specialisation was far less advanced in Wales and Scotland. We study several possible explanations for this change with an IV panel analysis. We find that this significant increase in the division of labour was mostly driven by the growth of the domestic market, in line with Adam Smith’s predictions. Intensive specialisation was concentrated in Middlesex and was helped by a supply factor, Marshallian externalities. Finally, we explore the connection between Smithian Growth and the Industrial Revolution. We find that early specialisation did not lead to later industrial success. Like Adam Smith himself, Smithian specialisation did not predict the Industrial Revolution. |
| Keywords: | economic growth; division of labour; specialisation; tasks; Adam Smith; Britain; productivity; industrial revolution; market potential |
| JEL: | N13 O47 J21 |
| Date: | 2025–07–04 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:128849 |
| By: | Hen Ya; Giulia La Mattina; Cristina Bellés Obrero |
| Abstract: | The prevalence and determinants of intimate partner violence (IPV) among older women are understudied. This paper documents that the incidence of IPV remains high at old ages and provides the first evidence of the impact of access to income on IPV for older women. We leverage a Mexican reform that lowered the eligibility age for a non-contributory pension and a difference-in-differences approach. Women's eligibility for the pension increases their probability of being subjected to economic, psychological, and physical/sexual IPV. In contrast, we show that IPV does not increase when men become eligible. Looking at potential mechanisms, we find suggestive evidence that men use violence as a tool to control women's resources. Additionally, women reduce paid employment after becoming eligible for the pension, which may indicate that they spend more time at home, leading to greater exposure to potentially violent partners. |
| Keywords: | Retirement, income, Non-contributory pension |
| JEL: | H55 I38 J12 J26 |
| Date: | 2025–05 |
| URL: | https://d.repec.org/n?u=RePEc:bge:wpaper:1491 |