nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2012‒06‒05
seven papers chosen by
Maximo Rossi
University of the Republic

  1. Establishment Turnover and the Evolution of Wage Inequality By Anabela Carneiro; José Varejão
  2. Human Capital, Economic Growth, and Inequality in China By James J. Heckman; Junjian Yi
  3. Parental Education and Offspring Outcomes: Evidence from the Swedish Compulsory Schooling Reform By Lundborg, Petter; Nilsson, Anton; Rooth, Dan-Olof
  4. The Effects of "Girl-Friendly" Schools: Evidence from the BRIGHT School Construction Program in Burkina Faso By Kazianga, Harounan; Levy, Dan; Linden, Leigh L.; Sloan, Matt
  5. Subjective Well-Being and Relative Poverty in Rural Bangladesh By Asadullah, Niaz; Chaudhury, Nazmul
  6. The Gender Pay Gap in the Australian Private Sector: Is Selection Relevant across the Wage Distribution? By Chzhen, Yekaterina; Mumford, Karen A.; Nicodemo, Catia
  7. Occupational Sex Segregation and Management-Level Wages in Germany: What Role Does Firm Size Play? By Busch, Anne; Holst, Elke

  1. By: Anabela Carneiro (Universidade do Porto and CEF.UP); José Varejão (Universidade do Porto and CEF.UP)
    Abstract: We consider the determinants of the evolution of wage inequality in the context of the literature on entry and exit of establishments. Using several measures of wage inequality (overall, within-group, and between-groups), we conclude that shutdowns reduce overall and within-group inequality because they eliminate low-pay jobs. Startups increase wage inequality between age and, especially, education groups, because newly-created establishments make staffing choices that are different from those made by continuously-operating establishments and establishments that shut down.
    Keywords: Wage Inequality; Labor Demand; Establishment Turnover.
    JEL: J23 J31
    Date: 2012–05
  2. By: James J. Heckman; Junjian Yi
    Abstract: China’s rapid growth was fueled by substantial physical capital investments applied to a large stock of medium skilled labor acquired before economic reforms began. As development proceeded, the demand for high skilled labor has grown, and, in the past decade, China has made substantial investments in producing it. The egalitarian access to medium skilled education characteristic of the pre-reform era has given rise to substantial inequality in access to higher levels of education. China’s growth will be fostered by expanding access to all levels of education, reducing impediments to labor mobility, and expanding the private sector.
    JEL: I25 J24 O15
    Date: 2012–05
  3. By: Lundborg, Petter (Lund University); Nilsson, Anton (Lund University); Rooth, Dan-Olof (Linnaeus University)
    Abstract: In this paper, we exploit the Swedish compulsory schooling reform in order to estimate the causal effect of parental education on son's outcomes. We use data from the Swedish enlistment register on the entire population of males and focus on outcomes such as cognitive skills, non-cognitive skills, and various dimensions of health at the age of 18. We find significant and positive effects of maternal education on sons' skills and health status. Although the reform had equally strong effects on father's education as on mother's education, we find little evidence that paternal education improves son's outcomes.
    Keywords: education, cognitive skills, non-cognitive skills, health, causality, schooling reforms
    JEL: I12 I28 J13
    Date: 2012–05
  4. By: Kazianga, Harounan (Oklahoma State University); Levy, Dan (Harvard Kennedy School); Linden, Leigh L. (University of Texas at Austin); Sloan, Matt (Mathematica Policy Research)
    Abstract: We evaluate the causal effects of a program that constructed high quality "girl-friendly" primary schools in Burkina Faso, using a regression discontinuity design 2.5 years after the program started. We find that the program increased enrollment of all children between the ages of 5 and 12 by 20 percentage points and increased their test scores by 0.45 standard deviations. The change in test scores for those children caused to attend school by the program is 2.2 standard deviations. We also find that the program was particularly effective for girls, increasing their enrollment rate by 5 percentage points more than boys', although this did not translate into a differential effect on test scores. Disentangling the effects of school access from the unique characteristics of the new schools, we find that the unique characteristics were responsible for a 13 percentage point increase in enrollment and 0.35 standard deviations in test scores, while simply providing a school increased enrollment by 26.5 percentage points and test scores by 0.323 standard deviations. The unique characteristics of the school account for the entire difference in the treatment effect by gender.
    Keywords: Africa, education, gender inequality, enrollment
    JEL: I24 I25 I28 O15
    Date: 2012–05
  5. By: Asadullah, Niaz (University of Reading); Chaudhury, Nazmul (World Bank)
    Abstract: This paper revisits the debate over the importance of absolute vs. relative income as a correlate of subjective well-being using data from Bangladesh, one of the poorest countries in the world with high levels of corruption and poor governance. We do so by combining household data with population census and village survey records. Our results show that conditional on own household income, respondents report higher satisfaction levels when they experience an increase in their income over the past years. More importantly, individuals who report their income to be lower than their neighbours in the village also report less satisfaction with life. At the same time, our evidence suggests that relative wealth effect is stronger for the rich. Similarly, in villages with higher inequality, individuals report less satisfaction with life. However, when compared to the effect of absolute income, these effects (i.e. relative income and local inequality) are modest. Amongst other factors, we study the influence of institutional quality. Institutional quality, measured in terms of confidence in police, matters for well-being: it enters with a positive and significant coefficient in the well-being function.
    Keywords: Bangladesh, institutions, well-being, poverty
    JEL: O12 I30 I31
    Date: 2012–05
  6. By: Chzhen, Yekaterina (University of Oxford); Mumford, Karen A. (University of York); Nicodemo, Catia (Universitat Autònoma de Barcelona)
    Abstract: We use quantile regression and counterfactual decomposition methods to explore gender gaps across the earning distribution for full-time employees in the Australian private sector. Significant evidence of a self selection effect for women into full-time employment (or of components of self selection related to observable or unobservable characteristics) is, interestingly, not found to be relevant in the Australian context. Substantial gender earnings gaps (and glass ceilings) are established, with these earnings gaps found to be predominantly related to women receiving lower returns to their observable characteristics than men.
    Keywords: gender, earnings, selection, quantile distribution
    JEL: J3 J7
    Date: 2012–05
  7. By: Busch, Anne (DIW Berlin); Holst, Elke (DIW Berlin)
    Abstract: The paper analyzes the gender pay gap in private-sector management positions based on German panel data and using fixed-effects models. It deals with the effect of occupational sex segregation on wages, and the extent to which wage penalties for managers in predominantly female occupations are moderated by firm size. Drawing on economic and organizational approaches and the devaluation of women's work, we find wage penalties for female occupations in management only in large firms. This indicates a pronounced devaluation of female occupations, which might be due to the longer existence, stronger formalization, or more established "old-boy networks" of large firms.
    Keywords: gender pay gap, managerial positions, occupational sex segregation, gendered organization, firm size
    JEL: B54 J16 J24 J31 J71 L2 M51
    Date: 2012–05

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