nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2014‒12‒08
nine papers chosen by
Maximo Rossi
Universidad de la República

  1. Boss Competence and Worker Well-being By Artz, Benjamin; Goodall, Amanda H.; Oswald, Andrew J.
  2. On the empirics of social mobility: A macroeconomic approach By Berthold, Norbert; Gründler, Klaus
  3. Does the Choice of Well-Being Measure Matter Empirically? An Illustration with German Data By Decancq, Koen; Neumann, Dirk
  4. The Labor Supply of Self-Employed Workers: The Choice of Working Hours in Worker Co-ops By Pencavel, John
  5. More on Recent Evidence on the Effects of Minimum Wages in the United States By David Neumark; J.M. Ian Salas; William Wascher
  6. Why is Infant Mortality Higher in the US than in Europe? By Alice Chen; Emily Oster; Heidi Williams
  7. Long Workweeks and Strange Hours By Daniel S. Hamermesh; Elena Stancanelli
  8. Growth, Trade, and Inequality By Gene M. Grossman; Elhanan Helpman
  9. Gender Differences in Honesty: Groups Versus Individuals By Muehlheusser, Gerd; Roider, Andreas; Wallmeier, Niklas

  1. By: Artz, Benjamin (University of Wisconsin, Oshkosh); Goodall, Amanda H. (Cass Business School); Oswald, Andrew J. (University of Warwick)
    Abstract: Nearly all workers have a supervisor or 'boss'. Yet there is almost no published research by economists into how bosses affect the quality of employees' lives. This study offers some of the first formal evidence. First, it is shown that a boss's technical competence is the single strongest predictor of a worker's well-being. Second, we examine equivalent instrumental-variable results. Third, we demonstrate longitudinally that even if a worker stays in the same job and workplace then a newly competent supervisor greatly improves the worker's well-being. Finally, we discuss analytical possibilities, and consider necessary future research.
    Keywords: bosses, expert leaders, leadership, job satisfaction, happiness
    JEL: I31 J28 M54
    Date: 2014–10
  2. By: Berthold, Norbert; Gründler, Klaus
    Abstract: What are the causes of social mobility in a society? Whereas this question is of great interest for both researchers and policymakers, empirical studies concerning cross-country evidence usually suffer from small sample biases as intergenerational income elasticities are only available for a small number of countries. In this paper, we provide two measures based on widely available macro data enabling the estimation of social mobility for a large number of countries. Based on these measures we empirically explore the determinants of cross-country differences in mobility. It turns out that particularly less segregation, a good family environment, inspiring cognitive brain stimulation in early childhood education, high rates of employment, good opportunities to catch up to the average human capital endowment, low variations in school quality and a high amount of social capital foster social mobility. We further find that the "Great Gatsby Curve" is much less pronounced when analyzing the relationship between inequality and mobility in a large sample of countries.
    Date: 2014
  3. By: Decancq, Koen (University of Antwerp); Neumann, Dirk (Université catholique de Louvain)
    Abstract: We discuss and compare five measures of individual well-being, namely income, an objective composite well-being index, a measure of subjective well-being, equivalent income, and a well-being measure based on the von Neumann-Morgenstern utilities of the individuals. After examining the information requirements of these measures, we illustrate their implementation using data from the German Socio-Economic Panel (SOEP) for 2010. We find sizeable differences in the characteristics of the individuals identified as worst off according to the different well-being measures. Less than 1% of the individuals belong to the bottom decile according to all five measures. Moreover, the measures lead to considerably different well-being rankings of the individuals. These findings highlight the importance of the choice of well-being measure for policy making.
    Keywords: von Neumann-Morgenstern utility function, equivalent income, life satisfaction, composite well-being index, income, worst off, Germany
    JEL: D31 D63 I30
    Date: 2014–10
  4. By: Pencavel, John (Stanford University)
    Abstract: Workers in cooperatives are self-employed workers and, if they resemble employees in conventional workplaces, they care about the length of their working hours. In this paper, their choice of hours is characterized as a conventional labor supply decision and a familiar hours-wage relationship is derived. This is estimated using mill-year observations on the plywood co-ops in the Pacific Northwest. The results are compared with those from the work behavior of other self-employed workers and with working hours in capitalist plywood mills.
    Keywords: labor supply, hours, worker co-ops
    JEL: J22 J54
    Date: 2014–10
  5. By: David Neumark; J.M. Ian Salas; William Wascher
    Abstract: A central issue in estimating the employment effects of minimum wages is the appropriate comparison group for states (or other regions) that adopt or increase the minimum wage. In recent research, Dube et al. (2010) and Allegretto et al. (2011) argue that past U.S. research is flawed because it does not restrict comparison areas to those that are geographically proximate and fails to control for changes in low-skill labor markets that are correlated with minimum wage increases. They argue that using "local controls" establishes that higher minimum wages do not reduce employment of less-skilled workers. In Neumark et al. (2014), we present evidence that their methods fail to isolate more reliable identifying information and lead to incorrect conclusions. Moreover, for subsets of treatment groups where the identifying variation they use is supported by the data, the evidence is consistent with past findings of disemployment effects. Allegretto et al. (2013) have challenged our conclusions, continuing the debate regarding some key issues regarding choosing comparison groups for estimating minimum wage effects. We explain these issues and evaluate the evidence. In general, we find little basis for their analyses and conclusions, and argue that the best evidence still points to job loss from minimum wages for very low-skilled workers - in particular, for teens.
    JEL: J23 J38 J88
    Date: 2014–10
  6. By: Alice Chen; Emily Oster; Heidi Williams
    Abstract: The US has a substantial - and poorly understood - infant mortality disadvantage relative to peer countries. We combine comprehensive micro-data on births and infant deaths in the US from 2000 to 2005 with comparable data from Austria and Finland to investigate this disadvantage. Differential reporting of births near the threshold of viability can explain up to 40% of the US infant mortality disadvantage. Worse conditions at birth account for 75% of the remaining gap relative to Finland, but only 30% relative to Austria. Most striking, the US has similar neonatal mortality but a substantial disadvantage in postneonatal mortality. This postneonatal mortality disadvantage is driven almost exclusively by excess inequality in the US: infants born to white, college-educated, married US mothers have similar mortality to advantaged women in Europe. Our results suggest that high mortality in less advantaged groups in the postneonatal period is an important contributor to the US infant mortality disadvantage.
    JEL: I0 I14
    Date: 2014–09
  7. By: Daniel S. Hamermesh; Elena Stancanelli
    Abstract: American workweeks are long compared to other rich countries'. Much less well-known is that Americans are more likely to work at night and on weekends. We examine the relationship between these two phenomena using the American Time Use Survey and time-diary data from 5 other countries. Adjusting for demographic differences, Americans' incidence of night and weekend work would drop by about 10 percent if European workweeks prevailed. Even if no Americans worked long hours, the incidence of unusual work times in the U.S. would far exceed those in continental Europe.
    JEL: J08 J22
    Date: 2014–09
  8. By: Gene M. Grossman; Elhanan Helpman
    Abstract: We introduce firm and worker heterogeneity into a model of innovation-driven endogenous growth. Individuals who differ in ability sort into either a research sector or a manufacturing sector that produces differentiated goods. Each research project generates a new variety of the differentiated product and a random technology for producing it. Technologies differ in complexity and productivity, and technological sophistication is complementary to worker ability. We study the co-determination of growth and income inequality in both the closed and open economy, as well as the spillover effects of policy and conditions in one country to outcomes in others.
    JEL: D33 F12 F16 O41
    Date: 2014–09
  9. By: Muehlheusser, Gerd (University of Hamburg); Roider, Andreas (University of Regensburg); Wallmeier, Niklas (University of Hamburg)
    Abstract: Extending the die rolling experiment of Fischbacher and Föllmi-Heusi (2013), we compare gender effects with respect to unethical behavior by individuals and by two-person groups. In contrast to individual decisions, gender matters strongly under group decisions. We find more lying in male groups and mixed groups than in female groups.
    Keywords: unethical behavior, lying, group decisions, gender effects, experiment
    JEL: C91 C92 J16
    Date: 2014–08

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