New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2006‒05‒13
eight papers chosen by

  1. Job characteristics as determinants of job satisfaction and labour mobility By Cornelißen, Thomas
  2. Trade Liberalization and Wage Inequality: Empirical Evidence from Bangladesh By Durevall, Dick; Munshi, Farzana
  3. Labor Market Assimilation of Recent Immigrants in Spain By Catalina Amuedo-Dorantes; Sara de la Rica
  4. Unemployment Accounts and Employment Incentives By Alessio J. G. Brown; J. Michael Orszag; Dennis J. Snower
  5. Career Consequences of Hyperbolic Time Preferences By Francesco Drago
  6. Testing for Restricted Stochastic Dominance By Russell Davidson; Jean-Yves Duclos
  7. Chronic and Transient Poverty: Measurement and Estimation, with Evidence from China By Jean-Yves Duclos; Abdelkrim Araar; John Giles
  8. Educational Qualification, Work Status and Entrepreneurship in Italy: an Exploratory Analysis By Fabio Sabatini

  1. By: Cornelißen, Thomas
    Abstract: This paper investigates the effects of detailed job characteristics on job satisfaction, job search and quits using data from the German Socio-Economic Panel (GSOEP) in a fixed effects framework. Using a factor analysis, seventeen job characteristics are reduced to seven factors that describe different aspects of a job, which are qualified as status, physical strain, autonomy, advancement opportunities, social relations at the work place, work time and job security. The effects of these factors on job satisfaction, job search and quits differ. For example, job insecurity reduces job satisfaction, increases the subjective probability of job search but it decreases quits. In circumstances of higher job insecurity it seems to be hard to find a job to quit into. Regressing job satisfaction, job search and quits on the detailed job characteristics shows that, when judging from the number of statistically significant coefficients, the job characteristics explain satisfaction best, while it is harder to explain job search and quits by these characteristics. Job satisfaction, however, is confirmed as a strong predictor of job search and quits after controling for both, individual fixed effects and a set of detailed job characteristics.
    Keywords: job satisfaction, job mobility, quits, job search, fixed effects
    JEL: J28 J62 C23
    Date: 2006–04
  2. By: Durevall, Dick (Department of Economics, School of Business, Economics and Law, Göteborg University); Munshi, Farzana (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: This paper explores the relationship between trade liberalization and skilled-unskilled wage inequality in the Bangladesh cotton textile industry. A dynamic two-equation model is estimated for wages of skilled and unskilled workers over the period 1973-2002, using four different openness measures. In no case does opening up affect unskilled wages differently than skilled wages, implying that openness per se has not contributed to changes in wage inequality. Our findings also suggest that openness increased real wages for both skilled and unskilled workers. <p>
    Keywords: Bangladesh; cotton textile industry; openness; relative wages; trade liberalization; wage inequality
    JEL: F13 F14 F15 O15 O24
    Date: 2006–04–28
  3. By: Catalina Amuedo-Dorantes (San Diego State University and IZA Bonn); Sara de la Rica (Universidad del País Vasco and IZA Bonn)
    Abstract: This paper provides a preliminary analysis of the employment and occupational assimilation of recent immigrant waves to the Spanish labor market as their residencies lengthen. Using Spanish data from the 2001 Population Census and the 2002 Earnings Structure Survey, we find evidence of immigrant employment and occupational assimilation significantly varying by gender, origin and educational attainment. For instance, EU15 immigrants do not display an employment or occupational gap with respect to natives, whereas immigrants originating from non-EU15, African or Latin American countries do. Yet, among the latter, non-EU15 and Latin American immigrants assimilate employment and occupation-wise, while there is limited evidence of labor market assimilation among African immigrants.
    Keywords: immigrant assimilation, employment, occupational attainment and mobility, Spain
    JEL: J61
    Date: 2006–04
  4. By: Alessio J. G. Brown (Kiel Institute for World Economics and University of Kiel); J. Michael Orszag (Watson Wyatt Worldwide and IZA Bonn); Dennis J. Snower (Kiel Institute for World Economics, University of Kiel, CEPR and IZA Bonn)
    Abstract: We explore the far-reaching implications of replacing current unemployment benefit (UB) systems by an unemployment accounts (UA) system. Under the UA system, employed people are required to make ongoing contributions to their UAs and the balances in these accounts are available to them during periods of unemployment. The government is able to undertake balanced-budget interpersonal redistributions among the UAs. At the end of their working lives, people could transfer the remaining balances on their UAs into their pensions. We present an analytical framework to analyse the incentive effects of UAs and calibrate our model for the high unemployment countries of Europe. Our results suggest that this policy reform would significantly change people’s employment incentives and could achieve reductions in unemployment without reducing the level of support to the unemployed.
    Keywords: unemployment benefits, unemployment accounts, redistribution, employment, unemployment
    JEL: I38 J22 J32 J38 J64 J65 J68
    Date: 2006–04
  5. By: Francesco Drago (University of Naples, Parthenope, University of Siena and IZA Bonn)
    Abstract: In this paper I address theoretically and assess empirically the effect of impatience on workers’ on-the-job behavior. Theoretically, short-run impatience explains several empirical regularities concerning job mobility and account for different on-the-job behaviors. On-the-job search on one hand and "collaborative behaviors" such as low absence rate and high effort on the other, strongly affect mobility and individual wage growth. On-the-job search results in higher wages with the new employer while collaboration leads to permanent wage increases with the same employer, mainly through promotion or position change. I provide a model that shows that, for identically productive individuals, heterogeneity in hyperbolic time preferences accounts for different mobility and career patterns. Patient workers undertake behaviors that lead to promotions. Impatient workers are more likely to be movers and to experience wage increases by switching jobs. The model rests on the empirical findings that the long term wage increases of stayers are in general larger than those of the movers, and the benefits resulting from collaboration are not as immediate as the rewards from search conditional on the arrival of a better job offer. I use a large longitudinal data set (NLSY 79) to test the predictions of the model. Various measures of impatience are positively correlated to the job arrival rate and negatively correlated to collaboration. Finally, using some theoretical predictions I am able to show empirically that the results are driven by variation in short-run impatience within the hyperbolic model rather than by variation in long-run impatience within the exponential model.
    Keywords: job mobility, hyperbolic discounting, wage growth
    JEL: C23 C70 J63
    Date: 2006–05
  6. By: Russell Davidson; Jean-Yves Duclos
    Abstract: Asymptotic and bootstrap tests are studied for testing whether there is a relation of stochastic dominance between two distributions. These tests have a null hypothesis of nondominance, with the advantage that, if this null is rejected, then all that is left is dominance. This also leads us to define and focus on restricted stochastic dominance, the only empirically useful form of dominance relation that we can seek to infer in many settings. One testing procedure that we consider is based on an empirical likelihood ratio. The computations necessary for obtaining a test statistic also provide estimates of the distributions under study that satisfy the null hypothesis, on the frontier between dominance and nondominance. These estimates can be used to perform bootstrap tests that can turn out to provide much improved reliability of inference compared with the asymptotic tests so far proposed in the literature.
    Keywords: Stochastic dominance, empirical likelihood, bootstrap test
    JEL: C10 C12 C15 I32
    Date: 2006
  7. By: Jean-Yves Duclos; Abdelkrim Araar; John Giles
    Abstract: The paper contributes to the measurement of poverty and vulnerability in three ways. First, we propose a new approach to separating poverty into chronic and transient components. Second, we provide corrections for the statistical biases introduced when using a small number of periods to estimate the importance of vulnerability and transient poverty. Third, we apply these tools to the measurement of chronic and transient poverty in China using a rich panel data set that extends over approximately 17 years. We find that alternative measurement techniques yield significantly different estimates of the relative importance of chronic and transient poverty, and that precision of estimates is enhanced with simple statistical corrections.
    Keywords: Poverty dynamics, Transient poverty, Chronic poverty, Permanent poverty, China
    JEL: C15 D31 D63 I32
    Date: 2006
  8. By: Fabio Sabatini
    Abstract: This paper provides an exploratory analysis on the relationship between educational qualification and work status in Italy, with a particular focus on entrepreneurs and self-employed workers. Rough data are drawn from four waves (1995, 1998, 2002, and 2004) of the Survey of Household Income and Wealth (SHIW) carried out by the Bank of Italy. Stylised facts emerging from the empirical evidence are the surprisingly low level of educational qualification exhibited by employers and the tendency of workers holding higher levels of educational qualification not to chose to undertake an entrepreneurial activity. Such workers generally become members of the arts and professions, or take up a career as high-level employees.
    Keywords: Education, Work status, Employment, Self-employment, Entrepreneurship, Human capital
    JEL: I21 J23 J24 M13
    Date: 2006–05

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