nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2009‒03‒07
five papers chosen by
Maximo Rossi
University of the Republic

  1. Wage Dispersion and Firm Productivity in Different Working Environments By Benoît Mahy; François Rycx; Mélanie Volral
  2. The Demand of Part-time in European Companies: A Multilevel Modeling Approach By Anxo, Dominique; Shukur, Ghazi; Hussain, Shakir
  3. The Health Penalty of China's Rapid Urbanization By E. Van de Poel; O. O'Donnell; E. Van Doorslaer
  4. History without Evidence: Latin American Inequality since 1491 By Jeffrey G. Williamson
  5. Marriage Meets the Joneses: Relative Income, Identity, and Marital Status By Tara Watson; Sara McLanahan

  1. By: Benoît Mahy (Université Mons-Hainaut, WRC and DULBEA); François Rycx (Centre Emile Bernheim, DULBEA, Solvay Brussels School of Economics and Management, Université Libre de Bruxelles, Brussels and IZA-Bonn.); Mélanie Volral (Université Mons-Hainaut and WRC)
    Abstract: This paper investigates the impact of wage dispersion on firm productivity in different working environments. More precisely, it examines the interaction with: i) the skills of the workforce, using a more appropriate indicator than the standard distinction between white- and blue collar-workers, and ii) the uncertainty of the firm economic environment, which has, to our knowledge, never been explored on an empirical basis. Using detailed LEED for Belgium, we find a hump-shaped relationship between (conditional) wage dispersion and firm productivity. This result suggests that up to (beyond) a certain level of wage dispersion, the incentive effects of “tournaments” dominate (are dominated by) “fairness” considerations. Findings also show that the intensity of the relationship is stronger for highly skilled workers and in more stable environments. This might be explained by the fact that monitoring costs and production-effort elasticity are greater for highly skilled workers and that in the presence of high uncertainty workers have less control over their effort-output relation and associate higher uncertainty with more unfair environments.
    Keywords: Wage dispersion, labour productivity, working environments, personnel economics, linked employer-employee data.
    JEL: J31 J24 M52
    Date: 2009–02
    URL: http://d.repec.org/n?u=RePEc:sol:wpaper:09-012&r=ltv
  2. By: Anxo, Dominique (Centre for Labour Market Policy Research (CAFO)); Shukur, Ghazi (Centre for Labour Market Policy Research (CAFO)); Hussain, Shakir (University of Birmingham)
    Abstract: Part-time work is one of the most well-known <p> « atypical » working time arrangements in Europe, shaping working time regimes across countries and mapping work-life balance patterns. Comparative studies on part-time work across European countries have pointed to large differences in the development, extent and quality of part-time employment. To explain such differences, the focus has been mainly on labor supply consideration and on public policies and/or institutional arrangements pertaining to working-time combined with social practices in relation to gender conventions. In contrast to previous studies focusing on the supply side, the originality of our research is to investigate the demand-side of part-time work and to examine how and why companies use part-time work. The main objective of this paper is to analyze the impact of firms’ characteristics sector specificity and countries’ institutional arrangements on the use and intensity of part-time jobs at the establishment level. Based on a large and unique sample of European firms (more than 21 000 establishments) operating in 21 member states, we use multilevel multinomial modeling in a Bayesian environment. This approach has the advantage to identify and better disentangle the impact of institutional factors (country level), from industry specific factors (sector level) and firm specific factors (establishment level). Our results suggest that the observed variations in the extent of parttime workers at the establishment level is determined more by country-specific features, such as societal and institutional factors, than by industry specific factors. In other words, the institutional set-up or the overall working time regime seems to play a stronger role than organizational or productive constraints.
    Keywords: Part-time work; Laobur demand; Working time
    JEL: J23 J82
    Date: 2009–02–26
    URL: http://d.repec.org/n?u=RePEc:hhs:vxcafo:2009_008&r=ltv
  3. By: E. Van de Poel (Erasmus School of Economics, Erasmus University Rotterdam); O. O'Donnell (University of Macedonia, Thessaloniki, Greece); E. Van Doorslaer (Erasmus School of Economics, Erasmus University Rotterdam)
    Abstract: Rapid urbanization could have positive and negative health effects, such that the net impact on population health is not obvious. It is, however, highly pertinent to the human welfare consequences of development. This paper uses community and individual level longitudinal data from the China Health and Nutrition Survey to estimate the net health impact of China’s unprecedented urbanization. We construct an index of urbanicity from a broad set of community characteristics and define urbanization in terms of movements across the distribution of this index. We use difference-in-differences estimators to identify the treatment effect of urbanization on the self-assessed health of individuals. The results reveal important, and robust, negative causal effects of urbanization on health. Urbanization increases the probability of reporting fair or poor health by 5 to 15 percentage points, with a greater degree of urbanization having larger health effects. While people in more urbanized areas are, on average, in better health than their rural counterparts, the process of urbanization is damaging to health. Our measure of self-assessed health is highly correlated with subsequent mortality and the causal harmful effect of urbanization on health is confirmed using more objective (but also more specific) health indicators, such as physical impairments, disease symptoms and hypertension.
    Keywords: urbanization; health; China; treatment effects; difference-in-differences
    JEL: I12 I18 O18
    Date: 2009–02–19
    URL: http://d.repec.org/n?u=RePEc:dgr:uvatin:20090016&r=ltv
  4. By: Jeffrey G. Williamson
    Abstract: Most analysts of the modern Latin American economy hold to a pessimistic belief in historical persistence -- they believe that Latin America has always had very high levels of inequality, suggesting it will be hard for modern social policy to create a more egalitarian society. This paper argues that this conclusion is not supported by what little evidence we have. The persistence view is based on an historical literature which has made little or no effort to be comparative. Modern analysts see a more unequal Latin America compared with Asia and the rich post-industrial nations and then assume that this must always have been true. Indeed, some have argued that high inequality appeared very early in the post-conquest Americas, and that this fact supported rent-seeking and anti-growth institutions which help explain the disappointing growth performance we observe there even today. This paper argues to the contrary. Compared with the rest of the world, inequality was not high in pre-conquest 1491, nor was it high in the postconquest decades following 1492. Indeed, it was not even high in the mid-19th century just prior Latin America’s belle époque. It only became high thereafter. Historical persistence in Latin American inequality is a myth.
    JEL: D3 N16 N36 O15
    Date: 2009–03
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:14766&r=ltv
  5. By: Tara Watson; Sara McLanahan
    Abstract: In this paper we investigate the effect of relative income on marital status. We develop an identity model based on Akerlof and Kranton (2000) and apply it to the marriage decision. The empirical evidence is consistent with the idea that people are more likely to marry when their incomes approach a financial level associated with idealized norms of marriage. We hypothesize that the "marriage ideal" is determined by the median income in an individual's local reference group. After controlling flexibly for the absolute level of income and a number of other factors, the ratio between a man's income and the marriage ideal is a strong predictor of marital status – but only if he is below the ideal. For white men, relative income considerations jointly drive co-residence, marriage, and fatherhood decisions. For black men, relative income affects the marriage decision only, and relative income is tied to marital status even for those living with a partner and children. Relative income concerns explain 10-15 percent of the decline in marriage since 1970 for low income white men, and account for more than half of the persistent marriage gap between high- and low-income men.
    JEL: J12
    Date: 2009–03
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:14773&r=ltv

This nep-ltv issue is ©2009 by Maximo Rossi. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at http://nep.repec.org. For comments please write to the director of NEP, Marco Novarese at <director@nep.repec.org>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.