nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2021‒02‒01
four papers chosen by
Maximo Rossi
Universidad de la República

  1. The Value of Time in the United States: Estimates from Nationwide Natural Field Experiments By Ariel Goldszmidt; John A. List; Robert D. Metcalfe; Ian Muir; V. Kerry Smith; Jenny Wang
  2. Informality, labour transitions, and the livelihoods of workers in Latin America By Roxana Maurizio; Ana Paula Monsalvo
  3. Another brick on the Wall: On the Effects of Non-Contributory Pensions on Material and Subjective Well Being By Rosangela Bando; Sebastian Galiani; Paul Gertler
  4. The Career Evolution of the Sex Gap in Wages: Discrimination vs. Human Capital Investment By David Neumark; Giannina Vaccaro

  1. By: Ariel Goldszmidt; John A. List; Robert D. Metcalfe; Ian Muir; V. Kerry Smith; Jenny Wang
    Abstract: The value of time determines relative prices of goods and services, investments, productivity, economic growth, and measurements of income inequality. Economists in the 1960s began to focus on the value of non-work time, pioneering a deep literature exploring the optimal allocation and value of time. By leveraging key features of these classic time allocation theories, we use a novel approach to estimate the value of time (VOT) via two large-scale natural field experiments with the ridesharing company Lyft. We use random variation in both wait times and prices to estimate a consumer's VOT with a data set of more than 14 million observations across consumers in U.S. cities. We find that the VOT is roughly $19 per hour (or 75% (100%) of the after-tax mean (median) wage rate) and varies predictably with choice circumstances correlated with the opportunity cost of wait time. Our VOT estimate is larger than what is currently used by the U.S. Government, suggesting that society is under-valuing time improvements and subsequently under-investing public resources in time-saving infrastructure projects and technologies.
    JEL: D0 D1 R4
    Date: 2020–12
  2. By: Roxana Maurizio; Ana Paula Monsalvo
    Abstract: This paper studies the incidence and heterogeneity of labour informality in six Latin American countries?Argentina, Brazil, Ecuador, Mexico, Paraguay, and Peru. We divide workers into five work statuses: formal wage-employed, formal self-employed, upper-tier informal wage-employed, lower-tier informal wage-employed, and informal self-employed. We evaluate the patterns of the occupational turnover between these work statuses and assess their impact on wage dynamics. In all the countries, wages are highest for formal workers and lowest for lower-tier informal jobs.
    Keywords: Informality, Occupational turnover, Education, Wages, Latin America, Occupations, Occupational mobility, Occupational choice
    Date: 2021
  3. By: Rosangela Bando; Sebastian Galiani; Paul Gertler
    Abstract: Public expenditures on non-contributory pensions are equivalent to at least 1 percent of GDP in several countries in Latin America and is expected to increase. We explore the effect of non-contributory pensions on the well-being of the beneficiary population by studying the Pensiones Alimentarias program established by law in Paraguay, which targets older adults living in poverty. Households with a beneficiary increased their level of consumption by 44 percent. The program improved subjective well-being in 0.48 standard deviations. These effects are consistent with the findings of Bando, Galiani and Gertler (2020) and Galiani, Gertler and Bando (2016) in their studies on the non-contributory pension schemes in Peru and Mexico. Thus, we conclude that the effects of non-contributory pensions on well-being in Paraguay are comparable to those found for Peru and Mexico and add to the construction of external validity.
    JEL: I18 I3 I31
    Date: 2021–01
  4. By: David Neumark; Giannina Vaccaro
    Abstract: Several studies find that there is little sex gap in wages at labor market entry, and that the sex gap in wages emerges (and grows) with time in the labor market. This evidence is consistent with (i) there is little or no sex discrimination in wages at labor market entry, and (ii) the emergence of the sex gap in wages with time in the labor market reflects differences between men and women in human capital investment (and other decisions), with women investing less early in their careers. Indeed, some economists explicitly interpret the evidence this way. We show that this interpretation ignores two fundamental implications of the human capital model, and that differences in investment can complicate the interpretation of both the starting sex gap in wages (or absence of a gap), and the differences in “returns” to experience. We then estimate stylized structural models of human capital investment and wage growth to identify the effects of discrimination and differences in human capital investment, and find evidence more consistent with discrimination reducing women’s wages at labor market entry.
    JEL: J16 J24 J71
    Date: 2020–12

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