nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2011‒10‒22
six papers chosen by
Maximo Rossi
University of the Republic

  1. Lifetime Earnings Inequality in Germany By Timm Bönke; Giacomo Corneo; Holger Lüthen
  2. Occupational change and mobility among employed and unemployed job seekers By Longhi, Simonetta; Taylor, Mark P.
  3. Pro-poor trade policy in Sub-Saharan Africa By Nicita, Alessandro; Olarreaga, Marcelo; Porto, Guido
  4. The Disappearing Gender Gap: The Impact of Divorce, Wages, and Preferences on Education Choices and Women's Work By Raquel Fernández; Joyce Cheng Wong
  5. General Education, Vocational Education, and Labor-Market Outcomes over the Life-Cycle By Eric A. Hanushek; Ludger Woessmann; Lei Zhang
  6. Teaching Practices and Social Capital By Yann Algan; Pierre Cahuc; Andrei Shleifer

  1. By: Timm Bönke; Giacomo Corneo; Holger Lüthen
    Abstract: This paper documents the magnitude, pattern, and evolution of lifetime earnings inequality in Germany. Based on a large sample of earning biographies from social security records, we show that the intra-generational distribution of lifetime earnings of male workers has a Gini coefficient around .2 for cohorts born in the late 1930s and early 1940s; this amounts to about 2/3 of the value of the Gini coefficient of annual earnings. Within cohorts, mobility in the distribution of yearly earnings is substantial at the beginning of the lifecycle, decreases after-wards and virtually vanishes after age forty. Earnings data for thirty-one cohorts reveals striking evidence of a secular rise of intra-generational inequality in lifetime earnings: West-German men born in the early 1960s are likely to experience about 80 % more lifetime inequality than their fathers. In contrast, both short-term and long-term intra-generational mobility have been rather stable. Longer unemployment spells of workers at the bottom of the distribution of younger cohorts contribute to explain 30 to 40 % of the overall increase in life-time earnings inequality.
    Keywords: Lifetime Earnings, Earnings Distribution, Inequality, Mobility, Germany
    JEL: D31 D33 H24
    Date: 2011
    URL: http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1160&r=ltv
  2. By: Longhi, Simonetta; Taylor, Mark P.
    Abstract: We use data from the Labour Force Survey to show that employed and unemployed job seekers in Great Britain originate from different occupations and find jobs in different occupations. We find substantial differences in occupational mobility between job seekers: employed job seekers are most likely to move to occupations paying higher average wages relative to their previous occupation, while unemployed job seekers are most likely to move to lower paying occupations. Employed and unemployed job seekers exhibit different patterns of occupational mobility and, therefore, do not accept the same types of jobs.
    Date: 2011–10–10
    URL: http://d.repec.org/n?u=RePEc:ese:iserwp:2011-25&r=ltv
  3. By: Nicita, Alessandro; Olarreaga, Marcelo; Porto, Guido
    Abstract: The objective of this paper is to estimate the potential pro-poor bias in the existing structure of protection in six countries in Sub-Saharan Africa (SSA) (i.e., whether it redistributes income from rich to poor households). We also explore the extent to which the barriers faced by SSA exporters to the rest of the world are biased in favor of poor or rich households. To this end, we start with a simple agricultural household production model and propose an extension to include adjustments in labor income associated with changes in unskilled and skilled wages. We then build indicators that capture the differences in welfare changes across income levels associated with the elimination of SSA's own trade protection, as well as trade protection on SSA's export bundle by the rest of the world. Results suggest that SSA's own trade policy is biased in favor of poor households. In contrast, the trade policies of SSA's trading partners tend to be biased in favor of SSA's rich households, especially when ad-valorem equivalents of non tariff measures (NTMs) are taken into account.
    Keywords: Poverty; Sub-Saharan Africa; Trade policy; Wage elasticities
    JEL: F13 F16
    Date: 2011–10
    URL: http://d.repec.org/n?u=RePEc:cpr:ceprdp:8594&r=ltv
  4. By: Raquel Fernández; Joyce Cheng Wong
    Abstract: Women born in 1935 went to college significantly less than their male counterparts and married women’s labor force participation (LFP) averaged 40% between the ages of thirty and forty. The cohort born twenty years later behaved very differently. The education gender gap was eliminated and married women’s LFP averaged 70% over the same ages. In order to evaluate the quantitative contributions of the many significant changes in the economic environment, family structure, and social norms that occurred over this period, this paper develops a dynamic life-cycle model calibrated to data relevant to the 1935 cohort. We find that the higher probability of divorce and the changes in wage structure faced by the 1955 cohort are each able to explain, in isolation, a large proportion (about 60%) of the observed changes in female LFP. After combining all economic and family structure changes, we find that a simple change in preferences towards work can account for the remaining change in LFP. To eliminate the education gender gap requires, on the other hand, for the psychic cost of obtaining higher education to change asymmetrically for women versus men.
    JEL: D91 E2 J12 J16 J22 Z1
    Date: 2011–10
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:17508&r=ltv
  5. By: Eric A. Hanushek; Ludger Woessmann; Lei Zhang
    Abstract: Policy debates about the balance of vocational and general education programs focus on the school-to-work transition. But with rapid technological change, gains in youth employment from vocational education may be offset by less adaptability and thus diminished employment later in life. To test our main hypothesis that any relative labor-market advantage of vocational education decreases with age, we employ a difference-in-differences approach that compares employment rates across different ages for people with general and vocational education. Using micro data for 18 countries from the International Adult Literacy Survey, we find strong support for the existence of such a trade-off, which is most pronounced in countries emphasizing apprenticeship programs. Results are robust to accounting for ability patterns and to propensity-score matching.
    JEL: I20 J24 J31 J64
    Date: 2011–10
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:17504&r=ltv
  6. By: Yann Algan; Pierre Cahuc; Andrei Shleifer
    Abstract: We use several data sets to consider the effect of teaching practices on student beliefs, as well as on organization of firms and institutions. In cross-country data, we show that teaching practices (such as copying from the board versus working on projects together) are strongly related to various dimensions of social capital, from beliefs in cooperation to institutional outcomes. We then use micro-data to investigate the influence of teaching practices on student beliefs about cooperation both with each other and with teachers, and students’ involvement in civic life. A two-stage least square strategy provides evidence that teaching practices have an independent sizeable effect on student social capital. The relationship between teaching practices and student test performance is nonlinear. The evidence supports the idea that progressive education promotes social capital.
    JEL: I2 Z1
    Date: 2011–10
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:17527&r=ltv

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