nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2014‒11‒01
six papers chosen by
Maximo Rossi
Universidad de la República

  1. A new look at intergenerational mobility in Germany compared to the US By Schnitzlein, Daniel D.
  2. Family Structure and the Education Gender Gap: Evidence from Italian Provinces By Graziella Bertocchi; Monica Bozzano
  3. Labor Supply with Job Assignment under Balanced Growth By Claudio Michelacci; Joseph Pijoan-Mas
  5. Estimating the poverty reduction effect of tax and benefit policies in Finland 1993-2013 using a microsimulation method By Pasi Moisio; Kirsi-Marja Lehtelä; Susanna Mukkila
  6. Shocking Labor Supply: A Reassessment of the Role of World War II on Women's Labor Supply By Goldin, Claudia D.; Olivetti, Claudia

  1. By: Schnitzlein, Daniel D.
    Abstract: Motivated by contradictory evidence on intergenerational mobility in Germany, I present a cross-country comparison of Germany and the US, reassessing the question of whether intergenerational mobility is higher in Germany than the US. I can reproduce the standard result from the literature, which states that the German intergenerational elasticity estimates are lower than those for the US. However, based on highly comparable data, even a reasonable degree of variation in the sampling rules leads to similar estimates in both countries. I find no evidence for nonlinearities along the fathers’ earnings distribution. In contrast, the analysis shows that mobility is higher for the sons at the lowest quartile of the sons’ earnings distribution in both countries. In Germany this result is mainly driven by a high downward mobility of sons with fathers in the upper middle part of the earnings distribution. The corresponding pattern is clearly less pronounced in the US.
    Keywords: intergenerational mobility, SOEP, CNEF, Germany, US
    JEL: J62
    Date: 2014–09
  2. By: Graziella Bertocchi; Monica Bozzano
    Abstract: We investigate the determinants of the education gender gap in Italy in historical perspective with a focus on the influence of family structure. We capture the latter with two indicators: residential habits (nuclear vs. complex families) and inheritance rules (partition vs. primogeniture). After controlling for economic, institutional, religious, and cultural factors, we find that over the 1861-1901 period family structure is a driver of the education gender gap, with a higher female to male enrollment rate ratio in upper primary schools being associated with nuclear residential habits and equal partition of inheritance. We also find that only the effect of inheritance rules persists over the 1971-2001 period.
    Keywords: Education gender gap, Italian Unification, family types, inheritance, institutions, religion, convergence
    JEL: E02 H75 I25 J16 N33 O15
    Date: 2014–07
  3. By: Claudio Michelacci (EIEF); Joseph Pijoan-Mas (CEMFI and CEPR)
    Abstract: We consider a competitive equilibrium growth model where technological progress is embodied into new jobs which are assigned to workers of different skills. In every period workers decide whether to actively participate in the labor market and if so how many hours to work on the job. Balanced growth requires that the job technology is complementary with the worker's total labor input in the job, which is jointly determined by his skill and his working hours. Since lower skilled workers can supply longer hours, we show that the equilibrium features positive assortative matching (higher skilled workers are assigned to better jobs) only if differences in consumption are small relative to differences in worker skills. When the pace of technological progress accelerates, wage inequality increases and workers participate less often in the labor market but supply longer hours on the job. This mechanism can explain why, as male wage inequality has increased in the US, labor force participation of male workers of different skills has fallen while their working hours have increased.
    Date: 2014
  4. By: Erling Barth; Alex Bryson; James C. Davis; Richard Freeman
    Abstract: This paper links data on establishments and individuals to analyze the role of establishments in the increase in inequality that has become a central topic in economic analysis and policy debate. It decomposes changes in the variance of ln earnings among individuals into the part due to changes in earnings among establishments and the part due to changes in earnings within-establishments and finds that much of the 1970s-2010s increase in earnings inequality results from increased dispersion of the earnings among the establishments where individuals work. It also shows that the divergence of establishment earnings occurred within and across industries and was associated with increased variance of revenues per worker. Our results direct attention to the fundamental role of establishment-level pay setting and economic adjustments in earnings inequality.
    Keywords: earnings; earnings inequality; productivity
    JEL: J3 J31 D3
    Date: 2014–09
  5. By: Pasi Moisio; Kirsi-Marja Lehtelä; Susanna Mukkila
    Abstract: The poverty risk rate increased in Finland from 7 to 14 per cent between 1993 and 2010. We have estimated the counterfactual poverty rates for the year 2010 in order to evaluate the impact of changes in tax and benefit systems on the increase of the poverty risk rate. Household disposable incomes are simulated by using the same households of the year 2010 data, but varying the annual taxation and benefit legislation covering the years 1993-2013. The method used is inspired by the Shorrocks-Shapley decomposition method. The benefit cuts after the 1990s depression had a rather modest impact on poverty risk rates and the impact was nullified during 2000s by series of benefit raises. Changes in taxation had a considerably larger impact on the poverty risk rate. The poverty risk rate would be 2.5 percentage points lower if the tax legislation were the same in 2010 as it was in 1993. Furthermore, the level of benefits has decreased compared to the average income level. If the level of benefits would have remained at the same level compared to the average earnings in 2010 as in 1993, the poverty risk rate would be four percentage points lower in 2010. The policy of non-action with social transfers can have a major impact on the relative adequacy and on the poverty reduction effect of social transfers in the long-run.
    Keywords: tax-benefit policy, social policy, poverty, microsimulation, counterfactual, decomposition, Finland
    JEL: C81 D3 I3 H2 H31
    Date: 2014–10
  6. By: Goldin, Claudia D.; Olivetti, Claudia
    Abstract: The most prominent feature of the female labor force across the past hundred years is its enormous growth. But many believe that the increase was discontinuous. Our purpose is to identify the short- and long-run impacts of WWII on the labor supply of women who were currently married in 1950 and 1960. Using WWII mobilization rates by state, we find a wartime impact on weeks worked and the labor force participation of married white (non-farm) women in both 1950 and 1960. The impact, moreover, was experienced almost entirely by women in the top half of the education distribution.
    Date: 2013

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