nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2015‒03‒13
seven papers chosen by
Maximo Rossi
Universidad de la República

  1. Breaking the Glass Ceiling By Bertrand, Marianne; Black, Sandra; Jensen, Sissel; Lleras-Muney, Adriana
  2. Do Earnings Really Decline for Older Workers? By Stephen Bazen; Kadija Charni
  3. The Polarization of Employment in German Local Labor Markets By Charlotte Senftleben-König; Hanna Wielandt
  4. Spatial Wage Inequality and Technological Change By Charlotte Senftleben-König; Hanna Wielandt
  5. Is the Erosion Thesis Overblown? Alignment from Without in Germany By John T. Addison; Paulino Teixeira; Katalin Evers; Lutz Bellmann
  6. Measuring the Shadow Economy: Endogenous Switching Regression with Unobserved Separation By Filer, Randall K; Hanousek, Jan; Lichard, Tomáš
  7. Reference groups and the poverty line: An axiomatic approach with an empirical illustration By Chakravarty, Satya R.; Chattopadhyay, Nachiketa; Nissanov, Zoya; Silber, Jacques

  1. By: Bertrand, Marianne; Black, Sandra; Jensen, Sissel; Lleras-Muney, Adriana
    Abstract: In late 2003, Norway passed a law mandating 40 percent of each gender on the board of publicly limited liability companies. The primary objective of this reform was to increase representation of women in top positions in the corporate sector and decrease gender disparity in earning within that sector. We document that the newly (post-reform) appointed female board members were observably more qualified than their female predecessors, and that the gender gap in earnings within boards fell substantially. While the reform may have improved representation of female employees at the very top of the earnings distribution(top 5 highest earners)within firms that were mandated to increase female participation on their board, there is no evidence that these gains at the very top trickled-down. Moreover the reform had no obvious impact on highly qualified women whose qualifications mirror those of the board members but who were not appointed to boards. We observe no statistically significant change in the gender wage gaps or in the female representation in top positions, although standard errors are large enough that we cannot rule economically meaningful gains. Finally, there is little evidence that the reform affected the decisions of women more generally;it was not accompanied by any change in female enrollment in business education programs, or a convergence in earnings trajectories between recent male and female graduates of such programs. While young women preparing for a career in business report being aware of the reform and expect their earnings and promotion chances to benefit from it, the reform did not affect their fertility and marital plans. Overall, in the short run the reform had very little discernable impact on women in business beyond its direct effect on the newly appointed female board members.
    Keywords: affirmative action; boards; gender gap
    JEL: G38 J31 J7
    Date: 2015–03
  2. By: Stephen Bazen (Aix-Marseille University (Aix-Marseille School of Economics), CNRS and EHESS); Kadija Charni (Aix-Marseille University (Aix-Marseille School of Economics), CNRS and EHESS)
    Abstract: Cross section data suggest that the relationship between age and hourly earnings is an inverted-U shape. Evidence from panel data does not necessarily confirm this finding suggesting that older workers may not experience a reduction in earnings at the end of their working life. In this paper we use panel data on males for Great Britain in order to examine why the two types of data provide conflicting conclusions. Concentrating on the over 50s, several hypotheses are examined: overlapping cohorts, job tenure, job-changing, labour supply behaviour and selectivity bias. Cohort and individual fixed effects partly explain the divergent conclusions. However, for fully, year-on-year employed individuals, there is no evidence of earnings decline at the end of working life. We find no role for selectivity due to retirement, although shorter working hours or partial retirement along with job-changing late in life do provide an explanation for why hourly earnings decline for certain older workers. We find no evidence that the process of ageing itself leads to lower earnings as suggested by the cross section profile.
    Keywords: age-earnings profile, older workers, Labour supply, cohort effects
    JEL: J3 J14 J24
    Date: 2015–02
  3. By: Charlotte Senftleben-König (Humboldt-Universitaet zu Berlin); Hanna Wielandt (Humboldt-Universitaet zu Berlin)
    Abstract: This paper analyzes the polarization of employment and wages in Germany between 1979 and 2006, focusing on the role of technological progress. We exploit spatial variation in the exposure to technological progress which arises due to initial regional specialization in routine task-intensive activities. We show that the occupational structure of labor markets that were particularly susceptible to computerization has polarized, as employment shifted from middle-skilled, routine clerical and production occupations to less-skilled non-routine manual and service occupations. We find this shift to be the main driver of employment polarization at the lower tail of the wage distribution. Occupational shifts are gender-specific, with gains in service employment being exclusively realized by female employees. We further show that technological change contributes to a dispersion of the wage structure, as employment gains in services are accompanied by significant wage losses. Creation Date: 2014-11
    Keywords: Job Tasks, Polarization, Technological Change, Service Occupations, Regional Labor Markets
    JEL: J24 J31 J62 O33 R23
  4. By: Charlotte Senftleben-König (Humboldt-Universitaet zu Berlin); Hanna Wielandt (Humboldt-Universitaet zu Berlin)
    Abstract: During the last decades, wage inequality in Germany has considerably increased both within and across regions. Building on concepts of the task-based approach, this paper studies whether and to what extent these developments are driven by technological change. We present novel evidence that technological change is positively related to intra-regional wage inequality. This is driven by increases in the compensation for non-routine cognitive tasks that are prevalent at upper percentiles of the wage distribution combined with decreases in the compensation for non-routine manual tasks, which are located at lower percentiles. Because there exists substantial variation in the degree of technology exposure across German regions, technological change can also explain part of the rise in inter-regional wage inequality. Creation Date: 2014-12
    Keywords: Spatial Changes, Wage Inequality, Job Tasks, Technological Change
    JEL: J31 O33 R23
  5. By: John T. Addison (Moore School of Business, University of South Carolina, U.S.A.; The Rimini Centre for Economic Analysis, Italy); Paulino Teixeira (University of Coimbra and GEMF, Portugal); Katalin Evers (Institut für Arbeitsmarkt- und Berufsforschung, Germany); Lutz Bellmann (Friedrich-Alexander-Universität Erlangen-Nürnberg and Institut für Arbeitsmarkt- und Berufsforschung, Germany)
    Abstract: It is sometimes alleged that collective bargaining coverage in Germany is understated because uncovered firms ‘orient’ themselves toward sectoral agreements. In fact, although orientation has grown as sectoral bargaining has declined, their joint frequency has fallen. Further, where orientation occurs at firms that leave a sectoral agreement, it provides only partial compensation. But the small deficits involved, in conjunction with some indirect evidence on joiners, suggest modest attenuation of the undoubted decline in collective bargaining.
    Date: 2015–02
  6. By: Filer, Randall K; Hanousek, Jan; Lichard, Tomáš
    Abstract: We develop an estimator of unreported income that relies on much more flexible identifying assumptions than those underlying previous estimators of the shadow economy using household-level data. Assuming only that evading households have a higher consumption-income gap than non-evaders in surveys, an endogenous switching model with unknown sample separation enables the estimation of both the probability of hiding income and the expected amount of unreported income for each household. Using data from Czech and Slovak household budget surveys, we find the size of the shadow economy to be substantially larger than estimated using other techniques. These results are robust under a number of alternative specifications.
    Keywords: consumption-income gap; tax evasion; underreporting
    JEL: H26 O17
    Date: 2015–03
  7. By: Chakravarty, Satya R.; Chattopadhyay, Nachiketa; Nissanov, Zoya; Silber, Jacques
    Abstract: A recent trend in the study of poverty is to consider a relative poverty line, one that is responsive to the nature of the income distribution. We develop an axiomatic approach to the determination of an amalgam poverty line. Given a reference income (e.g
    Keywords: absolute poverty, amalgam threshold, India, People.s Republic of China, poverty line, relative poverty
    Date: 2015

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