nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2014‒08‒25
fourteen papers chosen by

  1. Face of Poverty in Madagascar : Poverty, Gender, and Inequality Assessment By World Bank
  2. Long-Term Neighborhood Effects on Low-Income Families: Evidence from Moving to Opportunity By Ludwig, Jens; Duncan, Greg J; Gennetian, Lisa A; Katz, Lawrence F.; Kessler, Ronald; Kling, Jeffrey R; Sanbonmatsu, Lisa
  3. When Job Earnings Are Behind Poverty Reduction By Gabriela Inchauste; João Pedro Azevedo; Sergio Olivieri; Jaime Saavedra; Hernan Winkler
  4. Employment and Wage Insurance within firms - Worldwide Evidence By Andrew Ellul; Marco Pagano; Fabiano Schivardi
  5. Sectoral Shift, Job Mobility and Wage Inequality By Shouyong Shi; Florian Hoffmann
  6. Explaining Cross-country Differences in Labor Market Gaps between Immigrants and Natives in the OECD By Bergh, Andreas
  7. Social Mobility and the Importance of Networks: Evidence for Britain By Marcenaro Gutierrez, Oscar; Micklewright, John; Vignoles, Anna
  8. “The Gustibus Errari (pot)Est”: Utility Misprediction, Preferences for Well-being and Life Satisfaction By Leonardo Becchetti; Pierluigi Conzo
  9. Fair Weather Avoidance: Unpacking Costs and Benefits in Replication of 'Avoiding the Ask' By Hannah Trachtman; Andrew Steinkruger; Mackenzie Wood; Adam Wooster; James Andreoni; James J. Murphy; Justin M. Rao
  10. Youth Unemployment in the Caribbean By Monica Parra-Torrado
  11. Peer Discipline and Incentives Within Groups By David K Levine; Salvatore Modica
  12. Personality Characteristics, Educational Attainment and Wages: An Economic Analysis Using the British Cohort Study By Pamela Lenton
  13. Gender Equality and Economic Growth in Brazil By Pierre-Richard Agénor; Otaviano Canuto
  14. Inherited wealth over the path of development: Sweden, 1810–2010 By Ohlsson, Henry; Roine, Jesper; Waldenström, Daniel

  1. By: World Bank
    Keywords: Poverty Reduction - Rural Poverty Reduction Macroeconomics and Economic Growth - Regional Economic Development Poverty Reduction - Poverty Reduction Strategies Poverty Reduction - Achieving Shared Growth
    Date: 2014–03
  2. By: Ludwig, Jens; Duncan, Greg J; Gennetian, Lisa A; Katz, Lawrence F.; Kessler, Ronald; Kling, Jeffrey R; Sanbonmatsu, Lisa
    Abstract: We examine long-term neighborhood effects on low-income families using data from the Moving to Opportunity (MTO) randomized housing-mobility experiment. This experiment offered to some public-housing families but not to others the chance to move to less-disadvantaged neighborhoods. We show that ten to 15 years after baseline, MTO: (i) improves adult physical and mental health; (ii) has no detectable effect on economic outcomes or youth schooling or physical health; and (iii) has mixed results by gender on other youth outcomes, with girls doing better on some measures and boys doing worse. Despite the somewhat mixed pattern of impacts on traditional behavioral outcomes, MTO moves substantially improve adult subjective well-being.
    Date: 2013
  3. By: Gabriela Inchauste; João Pedro Azevedo; Sergio Olivieri; Jaime Saavedra; Hernan Winkler
    Keywords: Services and Transfers to Poor Poverty Reduction - Rural Poverty Reduction Macroeconomics and Economic Growth - Regional Economic Development Poverty Reduction - Achieving Shared Growth Poverty Monitoring and Analysis
    Date: 2012–11
  4. By: Andrew Ellul (Kelley School of Business, Indiana University, CSEF and ECGI); Marco Pagano (University of Naples "Federico II", CSEF, EIEF, CEPR and ECGI); Fabiano Schivardi (LUISS, EIEF and CEPR)
    Abstract: We investigate the determinants of firms’ implicit employment and wage insurance to employees against industry-level and idiosyncratic shocks. We rely on differences between family and nonfamily firms to identify the supply of insurance, and between national public insurance programs to gauge workers’ demand for insurance. Using firm-level data from 41 countries, we find that family firms provide greater employment protection but less wage stability. Employment protection comes at a price: family firms pay 5 percent lower wages, controlling for country, industry and time effects. The additional protection afforded by family firms is greater, and the wage discount larger, the less generous the public unemployment insurance program, indicating that firm and government employment insurance are substitutes. The cross-country evidence is broadly confirmed by Italian employee-employer matched data, which also show that in family firms the adjustment to shocks occurs mostly through the hiring margin, while separations are not responsive to shocks.
    Date: 2014
  5. By: Shouyong Shi (University of Toronto); Florian Hoffmann (University of British Columbia)
    Abstract: In the last few decades there is a clear shift of the U.S. economy from the non-service sector to the service sector. We document the patterns of changes in the employment share in services, the transition rates of workers between the two sectors and between different employment status, the relative wage income between the sectors, and wage inequality. To understand these changes jointly, we construct a dynamic equilibrium model of a two-sector economy where workers search both on the job and in unemployment. Assuming that the value-added per labor has been increasing in services relative to non-services, we estimate the model and make inferences on how the sectoral shift interacts with skill accumulation and labor market frictions.
    Date: 2014
  6. By: Bergh, Andreas (Research Institute of Industrial Economics (IFN))
    Abstract: In most OECD-countries, immigrants have lower employment and higher unemployment than natives. This paper compares nine potential explanations of these gaps. Results are obtained for 21–28 countries using bivariate correlations, OLS-regressions and Bayesian model averaging over all 512 theoretically possible model specifications. Two robust patterns are found. The unemployment gap is bigger in countries where collective bargaining agreements cover a larger share of the labor market. The employment gap is bigger in countries with more generous social safety nets. Five variables have explanatory value in some specifications: Xenophobia, employment protection laws, social expenditure, asylum applications, and the share of immigrants in the population. The education of immigrants and migrant integration policies have no explanatory value. A trade-off seems to exist such that countries with smaller labor market gaps have higher income inequality.
    Keywords: Labor market segregation; Immigration; Insider-outside hypothesis
    JEL: E24 J51 J60 J71
    Date: 2014–08–12
  7. By: Marcenaro Gutierrez, Oscar (University of Malaga); Micklewright, John (Institute of Education, University of London); Vignoles, Anna (University of Cambridge)
    Abstract: Greater levels of social mobility are widely seen as desirable on grounds of both equity and efficiency. Debate on social mobility in Britain and elsewhere has recently focused on specific factors that might hinder social mobility, including the role of internships and similar employment opportunities that parents can sometimes secure for their children. We address the help that parents give their children in the job market using data from the new age 42 wave of the 1970 British Cohort Study. We consider help given to people from all family backgrounds and not just to graduates and those in higher level occupations who have tended to be the focus in the debate in Britain. Specifically, our data measure whether respondents had ever had help to get a job from (i) parents and (ii) other relatives and friends and the form of that help. We first assess the extent and type of help. We then determine whether people from higher socio-economic status families are more or less likely to have such help and whether the help is associated with higher wages and higher occupations. Our paper provides insight into whether the strong link between parental socio-economic background and the individual's own economic success can be explained in part by the parents assisting their children to get jobs. We find parental help to have a strong social gradient. But we are unable to identify a clear link between any particular type of help – advice, help through contacts etc. – and individuals' wages or occupations.
    Keywords: social mobility, networks, family, wages
    JEL: J62
    Date: 2014–08
  8. By: Leonardo Becchetti (DEDI and CEIS, Università di Roma "Tor Vergata"); Pierluigi Conzo (Dept. of Economics and Statistics, University of Turin)
    Abstract: The life satisfaction literature generally focuses on how life events affect subjective well-being. Through a contingent valuation survey we test whether well-being preferences have significant impact on life satisfaction. A sample of respondents is asked to simulate a policymaker decision consisting in allocating scarce financial resources among 11 well-being domains. Consistently with the utility misprediction hypothesis, we find that the willingness to invest more in the economic well-being domain is negatively correlated with life satisfaction. Our findings are shown to be robust when we account for unobservables related to economic fragility and non-random sample selection. Reverse causality and omitted variable bias are controlled for with instrumental variables and a sensitivity analysis on departures from exogeneity assumptions. Subsample estimates document that the less educated are more affected by the problem.
    Keywords: life satisfaction, well-being preferences, utility misprediction, subjective well-being
    JEL: A13 D64 H50 I31
    Date: 2014–08–08
  9. By: Hannah Trachtman; Andrew Steinkruger; Mackenzie Wood; Adam Wooster; James Andreoni; James J. Murphy; Justin M. Rao
    Abstract: If being asked to give to charity stimulates an emotional response, like empathy, that makes giving difficult to resist, a natural self-control mechanism might be to avoid being asked in the first place. We replicate a result from a field experiment that points to the role of empathy in giving. We conduct an experiment in a large superstore in which we solicit donations to charity and randomly allow shoppers the opportunity to avoid solicitation by using the other door. We find the rate of avoidance by store entrants to be 4.5 percent. However, we also find that the avoidance effect disappears in very cold weather, suggesting that avoidance behavior is sensitive to its cost.
    JEL: D03 D64 H41
    Date: 2014–08
  10. By: Monica Parra-Torrado
    Keywords: Health Monitoring and Evaluation Governance - Youth and Governance Social Protections and Labor - Labor Policies Social Protections and Labor - Labor Markets Health, Nutrition and Population - Population Policies
    Date: 2014–04
  11. By: David K Levine; Salvatore Modica
    Date: 2014–08–16
  12. By: Pamela Lenton (Department of Economics, University of Sheffield, UK)
    Abstract: We look at the influence of personality traits and cognitive ability on both educational attainment and on the wages of individuals in the UK labour market at age 33 using the British Cohort Study. We control for a new cluster of nine personality characteristics, some of which we consider likely to influence labour market outcomes. We find that some personality characteristics have significant influence on the acquisition of educational qualifications, in particular internal and external locus of control, conscientiousness and extroversion. Our findings on the extrovert-introvert dimension of personality are paradoxical: we find that males with extrovert personalities have a significantly reduced probability of gaining degree level education, but within the labour market males are rewarded for this characteristic.
    Keywords: educational attainment; human capital; personality characteristics
    JEL: J24
    Date: 2014–08
  13. By: Pierre-Richard Agénor; Otaviano Canuto
    Keywords: Gender - Gender and Development Rural Development Knowledge and Information Systems Health, Nutrition and Population - Population Policies Gender - Gender and Law Gender - Gender and Health Rural Development
    Date: 2013–03
  14. By: Ohlsson, Henry (Uppsala Center for Labor Studies); Roine, Jesper (SITE, Stockholm School of Economics); Waldenström, Daniel (Uppsala Center for Labor Studies)
    Abstract: Inherited wealth has attracted much attention recently, much due to the research by Thomas Piketty (Piketty, 2011; 2014). The discussion has mainly revolved around a long-run contrast between Europe and the U.S., even though data on explicit historical inheritance flows are only really available for France and to some extent for the U.K. We study the long-run evolution of inherited wealth in Sweden over the past two hundred years. The trends in Sweden are similar to those in France and the U.K: beginning at a high level in the nineteenth century, falling sharply in the interwar era and staying low thereafter, but tending to increase in recent years. The levels, however, differ greatly. The Swedish flows were only half of those in France and the U.K. before 1900 and also much lower after 1980. The main reason for the low levels in the nineteenth century is that the capital-income ratio is much lower than in “Old Europe”. In fact, the Swedish capital-income ratio was similar to that in the U.S., but the savings and growth rates were much lower in Sweden than in the U.S. Rap-id income growth following industrialization and increasing savings rates were also important fac-tors behind the development of the capital-income ratio and the inheritance flow during the twenti-eth century. The recent differences in inheritance flows have several potential explanations related to the Swedish welfare state and pension system. Sweden was “un-European” during the nineteenth century because the country was so poor, Sweden is “un-European” today because so much wealth formation has taken place within the welfare state and the occupational pension systems.
    Keywords: inheritance; capital accumulation; inverse mortality multiplier
    JEL: D30 J10 N10
    Date: 2014–06–28

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