nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2017‒09‒24
seven papers chosen by
Maximo Rossi
Universidad de la República

  1. Inefficient Short-Time Work By Cahuc, Pierre; Nevoux, Sandra
  2. Poverty and Material Deprivation among the Self-Employed in Europe: An Exploration of a Relatively Uncharted Landscape By Horemans, Jeroen; Marx, Ive
  3. Is There Still Son Preference in the United States? By Blau, Francine D.; Kahn, Lawrence M.; Brummund, Peter; Cook, Jason; Larson-Koester, Miriam
  4. How uncertainty and ambiguity in tournaments affect gender differences in competitive behavior By Loukas Balafoutas; Brent J. Davis; Matthias Sutter
  5. Should Robots be Taxed? By Joao Guerreiro; Sergio Rebelo; Pedro Teles
  6. Mortality and Morbidity in the 21st Century By Anne Case; Angus Deaton
  7. Access to Long-Term Care After a Wealth Shock: Evidence from the Housing Bubble and Burst By Joan Costa Font; Richard Frank; Katherine Swartz

  1. By: Cahuc, Pierre; Nevoux, Sandra
    Abstract: This paper shows that the reforms which expanded short-time work in France after the great 2008-2009 recession were largely to the benefit of large firms which are recurrent short-time work users. We argue that this expansion of short-time work is an inefficient way to provide insurance to workers, as it entails cross-subsidies which reduce aggregate production. An efficient policy should provide unemployment insurance benefits funded by experience rated employers' contributions instead of short-time work benefits. We find that short-time work entails significant production losses compared to an unemployment insurance scheme with experience rating.
    Keywords: experience rating; Short-time work; Unemployment insurance
    JEL: J63 J65
    Date: 2017–09
    URL: http://d.repec.org/n?u=RePEc:cpr:ceprdp:12269&r=ltv
  2. By: Horemans, Jeroen (University of Antwerp); Marx, Ive (University of Antwerp)
    Abstract: In work-poverty has become a pressing social issue in Europe. The self-employed remain relatively uncharted terrain in this context. With about 15 percent of European workers in self-employment this group can no longer be ignored, especially since self-employment is on the rise in many countries, particularly own-account self-employment. Drawing on EU-SILC data this paper provides a systematic mapping exercise of poverty and living standards among the self-employed in the European Union. We find that the self-employed in Europe generally face significantly higher income poverty risks than contracted workers. Looking in more detail at the drivers of income poverty among the self-employed we find that in addition to lower reported earnings, lower overall work-intensity at the household level appears to be an important driver. However, while income poverty levels are quite significant among the self-employed, material deprivation rates are generally much lower. The discrepancy between income poverty measures and material deprivation measures is much larger for the self-employed than it is for employees. One possible explanation is that the self-employed can more often draw on assets accumulated over the life cycle or on business assets they control. The self-employed constitute a very mixed segment of the workforce and within-group inequality is quite significant. One group emerges as being particularly at-risk of poverty are own-account workers, substantiating worries about the rise of this form of self-employment. While the paper offers extensive descriptive analysis and some tentative explanations, an important and sizable research agenda remains.
    Keywords: in-work poverty, material deprivation, self-employment, Europe
    JEL: I32 I38 J21 J22 L26
    Date: 2017–09
    URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp11007&r=ltv
  3. By: Blau, Francine D. (Cornell University); Kahn, Lawrence M. (Cornell University); Brummund, Peter (University of Alabama); Cook, Jason (University of Pittsburgh); Larson-Koester, Miriam (Cornell University)
    Abstract: In this paper, we use 2008-2013 American Community Survey data to update and further probe Dahl and Moretti's (2008) son preference results, which found evidence that having a female first child increased the probability of single female headship and raised fertility. In light of the substantial increase in immigration, we examine this question separately for immigrants and natives. Among the population in the aggregate, as well as among the native-born separately, consistent with Dahl and Moretti (2008), we find that having a female first child raises the likelihood that the mother is a single parent. However, in sharp contrast to Dahl and Moretti (2008), we find that having a female first child is actually associated with lower fertility. Thus, by the 2008-2013 period, any apparent son preference among natives in their fertility decisions appears to be outweighed by factors such as cost concerns in raising girls. This change may be plausible in light of the reversal of the gender gap in college attendance beginning in the 1980s (Goldin, Katz and Kuziemko 2006), making girls more costly. For immigrants, we also find evidence that having a female first child contributes to female headship, with an effect that has the same magnitude as that for natives although is not statistically significant. However, in contrast to natives, we do find a positive fertility effect, suggesting son preference in fertility among this group. This interpretation is further supported by evidence that, for both first and second generation immigrants (second generation immigrants were examined using the Current Population Surveys) having a girl has a more positive effect on fertility for those whose source countries have lower values of the World Economic Forum's Gender Equity Index, or lower female labor force participation rates and higher sex (boy-to-girl) ratios among births. We also examine sex selection and find no evidence that sex selection has spread beyond the race groups identified in previous work (e.g., Almond and Edlund 2008).
    Keywords: gender, son preference, family structure, fertility, sex selection, immigrants
    JEL: J1 J11 J12 J13 J15 J16
    Date: 2017–09
    URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp11003&r=ltv
  4. By: Loukas Balafoutas (University of Innsbruck); Brent J. Davis (University of Innsbruck); Matthias Sutter (Max Planck Institute for Research on Collective Goods, Bonn)
    Abstract: Tournament incentives prevail in labor markets, in particular with respect to promotions. Yet, it is often unclear to competitors how many winners there will be or how many applicants compete in the tournament. While it is hard to measure how this uncertainty affects work performance and willingness to compete in the field, it can be studied in a controlled lab experiment. We present a novel experiment where subjects can compete against each other, but where the number of winners is either uncertain (i.e., unknown numbers of winners, but known probabilities) or ambiguous (unknown probabilities for different numbers of winners). We compare these two conditions with a control treatment with a known number of winners. We find that ambiguity induces a significant increase in performance of men, while we observe no change for women. Both men and women increase their willingness to enter competition with uncertainty and ambiguity, but men react slightly more than women. Overall, both effects contribute to men winning the tournament significantly more often than women under uncertainty and ambiguity. Hence, previous experiments on gender differences in competition may have measured a lower bound of differences between men and women.
    Keywords: gender, competition, uncertainty, ambiguity, experiment
    JEL: C91 D03
    Date: 2017–09
    URL: http://d.repec.org/n?u=RePEc:mpg:wpaper:2017_18&r=ltv
  5. By: Joao Guerreiro; Sergio Rebelo; Pedro Teles
    Abstract: We use a model of automation to show that with the current U.S. tax system, a fall in automation costs could lead to a massive rise in income inequality. This inequality can be reduced by raising marginal income tax rates and taxing robots. But this solution involves a substantial efficiency loss for the reduced level of inequality. A Mirrleesian optimal income tax can reduce inequality at a smaller efficiency cost, but is difficult to implement. An alternative approach is to amend the current tax system to include a lump-sum rebate. In our model, with the rebate in place, it is optimal to tax robots only when there is partial automation.
    JEL: H21 O33
    Date: 2017–09
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:23806&r=ltv
  6. By: Anne Case (Princeton University); Angus Deaton (Princeton University)
    Abstract: Building on our earlier research (Case and Deaton 2015), we find that mortality and morbidity among white non-Hispanic Americans in midlife since the turn of the century continued to climb through 2015. Additional increases in drug overdoses, suicides, and alcohol-related liver mortality—particularly among those with a high school degree or less—are responsible for an overall increase in all-cause mortality among whites. We find marked differences in mortality by race and education, with mortality among white non-Hispanics (males and females) rising for those without a college degree, and falling for those with a college degree. In contrast, mortality rates among blacks and Hispanics have continued to fall, irrespective of educational attainment. Mortality rates in comparably rich countries have continued their premillennial fall at the rates that used to characterize the United States. Contemporaneous levels of resources—particularly slowly growing, stagnant, and even declining incomes—cannot provide a comprehensive explanation for poor mortality outcomes. We propose a preliminary but plausible story in which cumulative disadvantage from one birth cohort to the next—in the labor market, in marriage and child outcomes, and in health—is triggered by progressively worsening labor market opportunities at the time of entry for whites with low levels of education. This account, which fits much of the data, has the profoundly negative implication that policies—even ones that successfully improve earnings and jobs, or redistribute income—will take many years to reverse the increase in mortality and morbidity, and that those in midlife now are likely to do worse in old age than the current elderly. This is in contrast to accounts in which resources affect health contemporaneously, so that those in midlife now can expect to do better in old age as they receive Social Security and Medicare. None of this, however, implies that there are no policy levers to be pulled. For instance, reducing the overprescription of opioids should be an obvious target for policymakers.
    JEL: I12
    Date: 2017
    URL: http://d.repec.org/n?u=RePEc:pri:rpdevs:2017-spring&r=ltv
  7. By: Joan Costa Font; Richard Frank; Katherine Swartz
    Abstract: Home equity is the primary self-funding mechanism for long term services and supports (LTSS). Using data from the relevant waves of the Health and Retirement Study (1996-2010), we exploit the exogenous variation in the form of wealth shocks resulting from the value of housing assets, to examine the effect of wealth on use of home health, unpaid help and nursing home care by older adults. We find a significant increase in the use of paid home health care and unpaid informal care but no effect on nursing home care access. We conduct a placebo test on individuals who do not own property; their use of LTSS was not affected by the housing wealth changes. The findings suggest that a wealth shock exerts a positive and significant effect on the uptake of home health and some effect on unpaid care but no significant effect on nursing home care.
    JEL: I18 J14
    Date: 2017–09
    URL: http://d.repec.org/n?u=RePEc:nbr:nberwo:23781&r=ltv

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