nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2010‒01‒30
eight papers chosen by
Maximo Rossi
University of the Republic

  1. Benefit Duration, Unemployment Duration and Job Match Quality: A Regression-Discontinuity Approach By Marco Caliendo; Konstantinos Tatsiramos; Arne Uhlendorff
  2. Cultural Integration in Europe By Amelie F. Constant; Olga Nottmeyer; Klaus F. Zimmermann
  3. The German Socio-Economic Panel (SOEP) in the Nineties: An Example of Incremental Innovations in an Ongoing Longitudinal Study By Gert G. Wagner
  4. The Economic Crisis through the Lens of Economic Wellbeing By Andrew Sharpe; Jean-François Arsenault
  7. Family Violence and Football: The Effect of Unexpected Emotional Cues on Violent Behavior By David Card; Gordon Dahl

  1. By: Marco Caliendo; Konstantinos Tatsiramos; Arne Uhlendorff
    Abstract: The generosity of the Unemployment Insurance system (UI) plays a central role for the job search behavior of unemployed individuals. Standard search theory predicts that an increase in UI benefit generosity, either in terms of benefit duration or entitlement, has a negative impact on the job search activities of the unemployed increasing their unemployment duration. Despite the disincentive effect of UI on unemployment duration, UI benefit generosity may also increase job match quality by allowing individuals to wait for better job offers. In this paper we use a sharp discontinuity in the maximum duration of unemployment benefits in Germany, which increases from 12 months to 18 months at the age of 45, to identify the effect of extended benefit duration on unemployment duration and post-unemployment outcomes. We find a spike in the re-employment hazard for the unemployed workers with 12 months benefit duration, which occurs around benefit exhaustion. This leads to lower unemployment duration compared to their counterparts with 18 months benefit duration. However, we also show that those unemployed who obtain jobs close to and after the time when benefits are exhausted are significantly more likely to exit subsequent employment and receive lower wages compared to their counterparts with extended benefit duration.
    Keywords: Unemployment benefits, unemployment duration, employment probability, job match quality, regression discontinuity
    JEL: C41 J64
    Date: 2009
  2. By: Amelie F. Constant; Olga Nottmeyer; Klaus F. Zimmermann
    Abstract: This chapter investigates the integration processes of immigrants in Germany by comparing certain immigrant groups to natives differentiating by gender and immigrant generation. Indicators which are supposed to capture cultural integration of immigrants are differences in marital behavior as well as language abilities, ethnic identification and religious distribution. A special feature of the available data is information about overall life satisfaction, risk aversion and political interest. These indicators are also presented. All of these indicators are depicted in comparison between natives and immigrants differentiated by ethnic origin, gender and generation. This allows visualization of differences by ethnic groups and development over time. Statements about the cultural integration processes of immigrants are thus possible. Furthermore, economic integration in terms of female labor force participation is presented as an additional feature. Empirical findings suggest that differences among immigrants and between immigrants and Germans do exist and differ significantly by ethnic origin, gender and generation. But differences seem to diminish when we consider the second generations. This indicates greater adaption to German norms and habits, and thus better cultural, socio-economic and political integration of second generation immigrants in Germany.
    Date: 2009
  3. By: Gert G. Wagner
    Abstract: The main aim of the present paper is to historically reappraise the development of the German Socio-Economic Panel Study (SOEP) in the 1990s after the first six waves had been collected. This development was closely connected to the opening of the Iron Curtain in Eastern Europe and the fall of the Wall separating the two German states. In addition to its relevance for the SOEP, this study is also of interest in relation to the contemporary history of science.
    Keywords: SOEP, German unification, immigration studies, research governance, survey methods
    JEL: B23 C89 Y50
    Date: 2009
  4. By: Andrew Sharpe; Jean-François Arsenault
    Abstract: This report looks at how the economic crisis has unfolded in Canada and what will be the impacts on economic wellbeing. The shortfall is estimated to be approximately $12,000 ($2007) per capita. In other words, given no economic crisis, GDP per capita in Canada would have likely been $1,736 higher on average each year over the 2008-2014 period. Between October 2008 – the month at which employment peaked in Canada – and May 2009, net employment fell by 362,500 persons. The negative effects of unemployment go well beyond loss of income. Roughly 60 per cent of the newly unemployed, compared to about 40 per cent in recent years, receive regular EI benefits, reflecting the concentration of employment losses among long term full-time employees (e.g. auto workers). Based on the experience of the recession of the early 1990s, we should expect an increase of about 4 percentage points in the after-tax poverty rate, which would reach 13.2 per cent in 2010.
    Keywords: Living standards, quality of life, income, housing affordability, wealth, inequality, poverty, net worth, income, disposable income, low income, labour market, economic security, employment, unemployment, economics crisis
    JEL: D63 D60 D30 D31 J30 R20
    Date: 2009–08
  5. By: Aronsson, Thomas (Department of Economics, Umeå University); Johansson-Stenman, Olof (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: This paper concerns optimal nonlinear taxation in an OLG model with two ability-types, where people care about their own consumption relative to (i) other people’s current consumption, (ii) own past consumption, and (iii) other people’s past consumption. We show that intertemporal consumption comparisons affect the marginal income tax structure in the same qualitative way as comparisons based on other people’s current consumption. Based on available empirical estimates, comparisons with other people’s current and previous consumption tend to substantially increase the optimal marginal labor income tax rates, while they may either increase or decrease the optimal marginal capital income tax rates.<p>
    Keywords: Optimal income taxation; asymmetric information; relative consumption; status; habit formation; positional goods
    JEL: D62 H21 H23 H41
    Date: 2010–01–22
  6. By: Thulin, Per (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology)
    Abstract: This paper investigates the relationship between inter-firm labor mobility and regional productivity growth. Previous studies have shown that density is positively correlated with growth. I claim that it is not density in itself, but rather the attributes associated with it that drives economic growth. One such attribute is the increased possibility for labor mobility and knowledge diffusion that follows when firms and individuals locate in close proximity to each other. This hypothesis is tested using a matched employer-employee dataset where regional labor mobility is instrumented with density. The result shows that labor mobility increases regional growth rates.
    Keywords: Labor mobility; regional growth; agglomeration economies
    JEL: J62 R11 R23
    Date: 2009–12–18
  7. By: David Card (University of California Berkeley); Gordon Dahl (University of California, San Diego)
    Abstract: Family violence is a pervasive and costly problem, yet there is no consensus on how to interpret the phenomenon of violence by one family member against another. Some analysts assume that violence has an instrumental role in intra-family incentives. Others argue that violent episodes represent a loss of control that the offender immediately regrets. In this paper we specify and test a behavioral model of the latter form in which the strength of an emotional cue depends on outcomes relative to expectations and individuals exhibit loss aversion. Our key hypothesis is that negative emotional cues -- benchmarked relative to a rationally expected reference point -- make a breakdown of control more likely. We test this hypothesis using data on police reports of family violence on Sundays during the professional football season. Controlling for location and time fixed effects, weather factors, the pre-game point spread, and the size of the local viewing audience, we find that upset losses by the home team (losses in games that the home team was predicted to win by more than 3 points) lead to an 8 percent increase in police reports of at-home male-on-female intimate partner violence. There is no corresponding effect on female-on-male violence. Consistent with the behavioral prediction that losses matter more than gains, upset victories by the home team have (at most) a small dampening effect on family violence. We also find that unexpected losses in highly salient or frustrating games have a 50% to 100% larger impact on rates of family violence. The evidence that payoff-irrelevant events affect the rate of family violence leads us to conclude that at least some fraction of family violence is better characterized as a breakdown of control than as an intra-family incentive system. More generally, the empirical findings suggest that gain-loss utility with a rational reference point could be a useful approach to modeling other cues and visceral influences.
    Date: 2009–10
  8. By: Richard J. Petts (Ball State University)
    Abstract: Previous research suggests that many men increase their religious involvement after the birth of a new child. This study extends this research by examining whether fathers maintain a higher rate of religious participation as children get older and how fathers’ religiosity may influence children’s behavior. Results suggest that many fathers maintain a higher level of religious participation during the early years of their child’s life. Although fathers’ religious involvement does not appear to directly influence children’s behavior, there is evidence that fathers’ religiosity moderates the influence of other family characteristics on children. Parental relationship quality and mothers’ religiosity are associated with fewer problem behaviors among children when fathers believe that religion is important to family life. Results also suggest that being raised by a non-religious father is associated with increased externalizing problem behavior among young children. Overall, this study suggests that religious communities may be a source of support that encourages fathers to be more active in their family life and promote positive development among children.
    Keywords: religion, behavior, religious attendance, fathers, mothers, children
    JEL: D10 D19 D69 H31 J12
    Date: 2009–11

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