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on Labour Economics |
| By: | Bergemann, Annette; Mertens, Antje |
| Abstract: | This Paper studies the evolution of job stability in West Germany. Using data from the German Socio-Economic Panel, we first show that the median elapsed tenure declined for men between 1984 and 1999. Second, estimating proportional Cox hazard models with competing risks and controls for stock sampling, we are able to distinguish the reasons for job separation and different transition states. We show that the decline in the stability of men’s jobs can be attributed partly to an increase in layoffs and partly to an increase in transitions to unemployment. These two developments are not significantly related to each other, however. Some evidence is presented that downsizing of large firms might be responsible for part of the decline in job stability. |
| Keywords: | duration analysis; job stability; labour mobility; layoffs |
| JEL: | C41 J63 |
| Date: | 2004–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:4792&r=lab |
| By: | Altig, David E; Christiano, Lawrence; Eichenbaum, Martin; Lindé, Jesper |
| Abstract: | Macroeconomic and microeconomic data paint conflicting pictures of price behaviour. Macroeconomic data suggest that inflation is inertial. Microeconomic data indicate that firms change prices frequently. We formulate and estimate a model that resolves this apparent micro/macro conflict. Our model is consistent with post-war US evidence on inflation inertia even though firms re-optimize prices on average once every 1.5 quarters. The key feature of our model is that capital is firm-specific and pre-determined within a period. |
| JEL: | E30 E40 E50 |
| Date: | 2005–01 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:4858&r=lab |
| By: | Conde-Ruiz, José Ignacio; Galasso, Vincenzo; Profeta, Paola |
| Abstract: | We provide a long-term perspective on the individual retirement behaviour and on the future of early retirement. In a cross-country sample, we find that total pension spending depends positively on the degree of early retirement and on the share of elderly in the population, which increase the proportion of retirees, but has hardly any effect on the per capita pension benefits. We show that in a Markovian political economic theoretical framework, in which incentives to retire early are embedded, a political equilibrium is characterized by an increasing sequence of social security contribution rates converging to a steady state and early retirement. Comparative statistics suggest that aging and productivity slow-downs lead to higher taxes and more early retirement. However, when income effects are factored in, the model suggests that periods of stagnation – characterized by decreasing labour income – may lead middle-aged individuals to postpone retirement. |
| Keywords: | lifetime income effect; pensions; politico-economic Markovian equilibrium; tax burden |
| JEL: | D72 H53 H55 |
| Date: | 2005–01 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:4863&r=lab |
| By: | Michelacci, Claudio; Quadrini, Vincenzo |
| Abstract: | We study a labour market equilibrium model in which firms sign optimal long-term contracts with workers. Firms that are financially constrained offer an increasing wage profile: they pay lower wages today in exchange of higher wages once they become unconstrained and operate at a larger scale. In equilibrium, constrained firms are on average smaller and pay lower wages. In this way the model generates a positive relation between firm size and wages. Using data from the National Longitudinal Survey of Youth (NLSY) we show that the key dynamic properties of the model are supported by the data. |
| Keywords: | investment financing; long-term contracts; wages |
| JEL: | E24 G31 J31 |
| Date: | 2005–01 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:4867&r=lab |
| By: | Gersbach, Hans; Schmutzler, Armin |
| Abstract: | We examine how globalization affects firms’ incentives to provide general worker training. We consider a three-stage game. In stage 1, firms invest in productivity-enhancing training. In stage 2, they can make wage offers for each others’ workers. Finally, Cournot competition takes place. When two product markets become integrated, that is, replaced by a market with greater demand and more firms, training by each firm increases, provided the two markets are sufficiently small. When barriers between large markets are eliminated, training is reduced. Integration increases welfare if it does not reduce training. However, for large parameter regions, welfare falls if integration reduces training. We also show that opening markets to countries with publicly funded training or cheap, low-skilled labour can threaten apprenticeship systems. |
| Keywords: | general worker training; globalization; human capital; oligopoly; turnover |
| JEL: | D42 L22 L43 L92 |
| Date: | 2005–01 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:4879&r=lab |
| By: | Bottazzi, Renata; Jappelli, Tullio; Padula, Mario |
| Abstract: | We estimate the effect of pension reforms on households’ expectations of retirement outcomes and private wealth accumulation decisions exploiting a decade of Italian pension reforms as a source of exogenous variation in expected pension wealth. Two parameters are crucial to estimate pension wealth: the age at which workers expect to retire and the expected ratio of pension benefits to pre-retirement income. The Survey of Household Income and Wealth, a large random sample of the Italian population, elicits these expectations during a period of intense pension reforms between 1989 and 2002. These reforms had different consequences for different cohorts and employment groups, providing a quasi-experimental framework to study the effect of social security arrangements on expectations of retirement outcomes and household saving decisions. Our main findings are that workers have revised expectations in the direction suggested by the reform and that there is substantial offset between private wealth and perceived pension wealth. |
| Keywords: | expectations; pension reform |
| JEL: | E21 H55 |
| Date: | 2005–01 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:4882&r=lab |
| By: | Head, Keith; Mayer, Thierry |
| Abstract: | Recent theoretical work on economic geography emphasizes the interplay of transport costs and plant-level increasing returns. In these models, the spatial distribution of demand is a key determinant of economic outcomes. In one strand, it is argued that higher demand gives rise to a more than proportionate increase in production, a result known as the home market effect. Another strand emphasizes the effects of market sizes on factor prices. In this paper we highlight the theoretical connection between these two strands. We use data on 57 European regions to show how wages and employment respond to differentials in what we call real market potential, a discounted sum of demands derived from the theory. |
| Keywords: | gravity equation; home market effects; new economic geography; wage equation |
| JEL: | F12 F15 R11 R12 |
| Date: | 2005–02 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:4908&r=lab |
| By: | Galí, Jordi |
| Abstract: | The present paper revisits a property embedded in most dynamic macroeconomic models: the stationarity of hours worked. First, I argue that, contrary to what is often believed, there are many reasons why hours could be non-stationary in those models, while preserving the property of balanced growth. Second, I show that the post-war evidence for most industrialized economies is clearly at odds with the assumption of stationary hours per capita. Third, I examine the implications of that evidence for the role of technology as a source of economic fluctuations in the G7 countries. |
| Keywords: | non-stationary hours; real business cycles; technology shocks |
| JEL: | E32 |
| Date: | 2005–02 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:4915&r=lab |
| By: | Selod, Harris; Zenou, Yves |
| Abstract: | We consider a search-matching model in which black workers are discriminated against and the job arrival rates of all workers depend on social networks as well as distance to jobs. Location choices are mainly driven by the racial preferences of households. There are two possible urban equilibrium and we show that, under some reasonable conditions, all workers are better off in the equilibrium where blacks are close to jobs. We then consider two policies: affirmative action and employment subsidies to the firms that hire black workers. We show that, in cities where black workers reside far away from jobs, the optimal policy is to impose higher quotas or employment subsidies than in cities where they live close to jobs. |
| Keywords: | Affirmative Action; employment subsidies; racial preferences; social networks; spatial mismatch |
| JEL: | J15 J41 R14 |
| Date: | 2005–02 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:4926&r=lab |
| By: | Clark, Andrew E; Postel-Vinay, Fabien |
| Abstract: | We construct indicators of the perception of job security for various types of jobs in 12 European countries using individual data from the European Community Household Panel (ECHP). We then consider the relation between reported job security and OECD summary measures of Employment Protection Legislation (EPL) strictness on one hand, and Unemployment Insurance Benefit (UIB) generosity on the other. We find that, after controlling for selection into job types, workers feel most secure in permanent public sector jobs, least secure in temporary jobs, with permanent private sector jobs occupying an intermediate position. We also find that perceived job security in both permanent private and temporary jobs is positively correlated with UIB generosity, while the relationship with EPL strictness is negative: workers feel less secure in countries where jobs are more protected. These correlations are absent for permanent public jobs, suggesting that such jobs are perceived, by and large, to be insulated from labour market fluctuations. |
| Keywords: | employment protection legislation; perceived job security; unemployment insurance benefits |
| JEL: | I31 J28 J65 |
| Date: | 2005–02 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:4927&r=lab |
| By: | Falk, Armin; Zweimüller, Josef |
| Abstract: | Right-wing extremism is a serious problem in many societies. A prominent hypothesis states that unemployment plays a crucial role for the occurrence of right-wing extremist crime. In this paper we empirically test this hypothesis. We use a previously unused dataset that includes all officially recorded right-wing criminal acts in Germany. These data are recorded by the German Federal Criminal Police Office on a monthly state-level basis. Our main finding is that there is in fact a significant positive relation between unemployment and right-wing criminal activities. We show further that the big difference in right-wing crime between East and West German states can mostly be attributed to differences in unemployment. This finding reinforces the importance of unemployment as an explanatory factor for right-wing crime and questions explanations based solely on the different socialization in former communist East Germany and the liberal West German states. Our data further allow us to separate violent from non-violent right-wing crimes. We show that unemployment is closely related to both types of crimes, but that the association with non-violent crimes is much stronger. Since right-wing crime is committed particularly by relatively young males, we also explore whether the youth unemployment rate is a better predictor for right-wing crime than total unemployment. This hypothesis can be rejected: given total unemployment, a higher share of youth unemployment does not affect right-wing extremist crime rates. |
| Keywords: | cost of unemployment; hate crime; right-wing extremism; unemployment |
| Date: | 2005–04 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:4997&r=lab |
| By: | Hornstein, Andreas; Krusell, Per; Violante, Giovanni L |
| Abstract: | In this chapter we inspect economic mechanisms through which technological progress shapes the degree of inequality among workers in the labour market. A key focus is on the rise of US wage inequality over the past 30 years. However, we also pay attention to how Europe did not experience changes in wage inequality but instead saw a sharp increase in unemployment and an increased labour share of income, variables that remained stable in the US We hypothesize that these changes in labour market inequalities can be accounted for by the wave of capital-embodied technological change, which we also document. We propose a variety of mechanisms based on how technology increases the returns to education, ability, experience, and ‘luck’ in the labour market. We also discuss how the wage distribution may have been indirectly influenced by technical change through changes in certain aspects of the organization of work, such as the hierarchical structure of firms, the extent of unionization, and the degree of centralization of bargaining. To account for the US-Europe differences, we use a theory based on institutional differences between the United States and Europe, along with a common acceleration of technical change. Finally, we briefly comment on the implications of labour market inequalities for welfare and for economic policy. |
| Keywords: | inequality; institutions; labour market; skills; technological change |
| JEL: | D30 J30 O30 |
| Date: | 2005–04 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5025&r=lab |
| By: | Audretsch, David B; Carree, Martin A; Thurik, A R Roy; van Stel, A J |
| Abstract: | This paper investigates the dynamic interrelationship between self-employment and unemployment rates. On the one hand, unemployment rates may stimulate start-up activity of self-employed. On the other hand, higher rates of self-employment may indicate increased entrepreneurial activity reducing unemployment in subsequent periods. These two effects have resulted in considerable ambiguities about the interrelationship between unemployment and entrepreneurial activity. This paper introduces a two equation vector autoregression model capable of reconciling these ambiguities and tests it for data of 23 OECD countries over the period 1974-2002. The empirical results confirm the two distinct relationships between unemployment and self-employment, i.e. ‘refugee’ and ‘entrepreneurial’ effects. We also find that the ‘entrepreneurial’ effects are considerably stronger than the ‘refugee’ effects. |
| Keywords: | entreprenuership; Gibrat's Law |
| JEL: | L11 M13 |
| Date: | 2005–05 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5057&r=lab |
| By: | Fidrmuc, Jan |
| Abstract: | In this paper, I analyse the development of inter-regional mobility in the Czech Republic during the transition from central planning to a market economy. I show that while the intensity of migration is low and has even fallen during the transition, regional disparities in unemployment rates and earnings have increased. More importantly, labour mobility has little effect in facilitating labour market adjustment to employment shocks. Using aggregate inter-regional migration data and survey data on past and prospective migration and the willingness to move, I find that economic factosr play little role in explaining migration patterns. There is, nonetheless, some tentative evidence of the greater importance of economic considerations in explaining future migration intentions and the willingness to move. Thus, while at present migration appears more of a social or demographic rather than economic phenomenon, its economic role may strengthen in the future. |
| Keywords: | labour market adjustment; migration; mobility; regional shocks; survey data |
| JEL: | F22 J61 P23 |
| Date: | 2005–05 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5069&r=lab |
| By: | Desmet, Raphael; Jousten, Alain; Perelman, Sergio |
| Abstract: | The pool of early retirees is characterized by a large heterogeneity along several criteria. The present paper focuses on the key distinction between those in forced early retirement and those who retire early by individual choice. We start by estimating a retirement probit model for older workers in Belgium. Based on these estimates, we then perform micro-simulations relating to a hypothetical actuarial reform of a pension system, i.e., a reform imposing on average actuarial neutrality with respect to the time of retirement. We explore two scenarios, one where the entire population is subjected to the actuarial system, and one where a duly screened sub-sample of the unemployed is shielded against these actuarial adjustment factors, a group we call the truly unemployed. We evaluate the impact on the average retirement age, the pension budgets as well as indicators of redistribution within the group of the elderly. We find that the extra budgetary gain of exposing this subgroup to the full-blown reform is modest, while the distributional cost is rather high. Our results thus comfort the idea that the budgetary cost of a focused unemployment system are moderate, and that returning the unemployment insurance to its primary role might be a desirable strategy. |
| Keywords: | inequality; older worker; retirement |
| JEL: | H31 I30 J14 |
| Date: | 2005–05 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:5077&r=lab |
| By: | John T. Addison (University of South Carolina, Universidade de Coimbra and IZA Bonn) |
| Abstract: | Drawing on evidence from the United States and Germany, this paper offers a survey of the effects of worker representation (in unions and works councils) and innovative work practices on firm performance. The focus is on the growing links between these two historically separate literatures. The interaction between worker representation and high performance work practices provides a practical means of peering inside the black box of collective voice, even if there is as yet no well-determined hierarchy for productivity performance and certainly no blue-print for the future of unions. |
| Keywords: | worker representation, employee involvement mechanisms, innovative work practices, training, firm/establishment performance |
| JEL: | J51 J53 M54 |
| Date: | 2005–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1620&r=lab |
| By: | Marcello Estevão (International Monetary Fund); Nigar Nargis (University of Dhaka and IZA Bonn) |
| Abstract: | France posted remarkable gains in employment in the second half of the 1990s, suggesting that, beyond cyclical factors, structural unemployment may have changed in the period. We provide a novel methodology to separate structural from cyclical labor market changes and apply it to French household level data from 1990 to 2000. We show that the equilibrium relationship between real wages and unemployment has improved significantly in France in the second half of the 1990s. Further calculations suggest that long-term unemployment will decline substantially in France with respect to its average level in the 1990s if this improved trade-off is not undone. |
| Keywords: | employment, wages, bargaining, structural change, labor market |
| JEL: | D2 E2 J23 |
| Date: | 2005–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1621&r=lab |
| By: | Armin Falk (IZA Bonn and University of Bonn); Ernst Fehr (University of Zurich and IZA Bonn); Christian Zehnder (University of Zurich and IZA Bonn) |
| Abstract: | The prevailing labor market models assume that minimum wages do not affect the labor supply schedule. We challenge this view in this paper by showing experimentally that minimum wages have significant and lasting effects on subjects’ reservation wages. The temporary introduction of a minimum wage leads to a rise in subjects’ reservation wages which persists even after the minimum wage has been removed. Firms are therefore forced to pay higher wages after the removal of the minimum wage than before its introduction. As a consequence, the employment effects of removing the minimum wage are significantly smaller than are the effects of its introduction. The impact of minimum wages on reservation wages may also explain the anomalously low utilization of subminimum wages if employers are given the opportunity of paying less than a minimum wage previously introduced. It may further explain why employers often increase workers' wages after an increase in the minimum wage by an amount exceeding that necessary for compliance with the higher minimum. At a more general level, our results suggest that economic policy may affect people’s behavior by shaping the perception of what is a fair transaction and by creating entitlement effects. |
| Keywords: | minimum wages, labor market, monopsony, fairness, reservation wages, entitlement |
| JEL: | C91 D63 E64 J38 J42 J58 J68 |
| Date: | 2005–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1625&r=lab |
| By: | Ian Walker (University of Warwick, Institute for Fiscal Studies and IZA Bonn); Yu Zhu (University of Kent and Centre for the Economics of Education) |
| Abstract: | This paper provides findings from the UK Labour Force Surveys from 1996 to 2003 on the financial private returns to a degree - the "college premium". The data covers a decade when the university participation rate doubled - yet we find no significant evidence that the mean return to a degree dropped in response to this large increase in the flow of graduates. However, we do find quite large falls in returns when we compare the cohorts that went to university before and after the recent rapid expansion of HE. The evidence is consistent with the notion that new graduates are a close substitute for recent graduates but poor substitutes for older graduates. There appears to have been a very recent increase in the number of graduates getting "non-graduate" jobs but, conditional on getting a graduate job the returns seem stable. Our results are consistent across almost all degree subjects - the exception being maths and engineering where we find that for men, and especially for women, there is a large increase in the proportion with maths and engineering degrees getting graduate jobs and that, conditional on this, the return is rising. |
| Keywords: | human capital, higher education, college premium |
| JEL: | I20 J30 |
| Date: | 2005–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1627&r=lab |
| By: | Massimiliano Bratti (University of Milan and IZA Bonn); Robin Naylor (University of Warwick); Jeremy Smith (University of Warwick) |
| Abstract: | As in many other countries, government policy in the UK has the objective of raising the participation rate of young people in higher education, while increasing the share of the costs of higher education paid by students themselves. A rationale for the latter element comes from evidence of a high private return to university undergraduate degrees. However, much of this evidence pre-dates the rapid expansion in the graduate population. In the current paper, we use evidence from a cohort of young people born in Britain in 1970 to update influential evidence on returns to a first degree based on a previous 1958 birth cohort. We also analyse variations in returns by degree subject and by class of degree. Our analysis incorporates proxying and matching, control function and propensity score matching methods. Among other results, we find (i) that the returns to a first degree for men changed very little across the two cohorts while the return for women declined substantially and (ii) evidence of differences in returns to a first degree according to subject area of study and class of degree awarded. Classification-JEL: J3, J4, I2 |
| Keywords: | degree, return, subject, class, UK, university |
| Date: | 2005–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1631&r=lab |
| By: | Thomas K. Bauer (RWI Essen, Ruhr University of Bochum, CEPR and IZA Bonn); Mathias Sinning (RWI Essen) |
| Abstract: | This paper examines the relative savings position of migrant households in West Germany, paying particular attention to differences between temporary and permanent migrants. Utilizing household level data from the German Socio-Economic Panel (GSOEP), our findings reveal significant differences in the savings rates between foreign-born and Germanborn individuals. These differences disappear, however, for temporary migrants, if their remittances are taken into account. Fixed effects estimations of the determinants of immigrants’ savings rates reveal that intended return migration does not only affect remittances, but also the savings rate of migrant households in the host country. The results of a decomposition analysis indicate that differences in the savings rate between Germans and foreigners can mainly be attributed to differences in observable characteristics. We do not find strong evidence for an adjustment of the savings rate between immigrants and natives over time, indicating deficits in the long-term integration of permanent migrants in Germany. |
| Keywords: | savings, migration |
| JEL: | F22 E21 C24 |
| Date: | 2005–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1632&r=lab |
| By: | Michael Rosholm (University of Aarhus, AKF and IZA Bonn); Ott Toomet (University of Aarhus and AKF) |
| Abstract: | Discouragement is a process occurring during an unemployment spell. As the spell prolongs, an individual gradually realises that the returns to search can no longer outweigh search costs, and hence she may eventually leave the labour force. This is analysed theoretically in a framework of unemployed search. We construct a search model, which is stationary from the point of view of the individual, but which has nonstationary features. Namely, the unemployed worker is occasionally hit by shocks leading to a decline in job offer arrival rates. These shocks can be due to stigmatisation or to psychological consequences of unemployement affecting search effectiveness. This model enables us to analyse the issue of discouragement, as the returns to search will gradually decline. Even so, the model is actually stationary from the point of view of the individual, which implies that many interesting theoretical results may be derived. Moreover, from the point of view of the researcher, the model exhibits negative duration dependence in the hazard rate into employment and positive duration dependence in the hazard rate into non-participation, features which correspond well to real data. We use the model to analyse theoretically the impact of changes in unemployment insurance and social assistance benefits, and we conduct some simulation exercises based on a calibrated model. |
| Keywords: | labour supply, search theory, discouragement |
| JEL: | J21 J64 J65 |
| Date: | 2005–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1633&r=lab |
| By: | Leslie S. Stratton (Virginia Commonwealth University, CIM and IZA Bonn); Dennis M. O’Toole (Virginia Commonwealth University); James N. Wetzel (Virginia Commonwealth University) |
| Abstract: | Studies of college attrition typically assume that all attrition is permanent. We use data from the 1990/94 Beginning Postsecondary Survey to distinguish between long-term dropout and short-term stopout behavior in order to test that assumption. We find significant differences between those who stop out and those who drop out in the first year. Failure to recognize these differences biases the results of standard attrition models and hence may cause policy makers to pursue inappropriate policy initiatives or incorrectly target at-risk populations. Furthermore, the type of financial aid received is found to have a differential impact on stopout versus dropout probabilities. |
| Keywords: | college persistence, college dropout |
| JEL: | I21 |
| Date: | 2005–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp1634&r=lab |
| By: | Richard B. Freeman |
| Abstract: | The Journal of Labor Research 20th anniversary symposium review of What Do Unions Do? offers a unique opportunity to examine how the claims made in the book have fared in ensuing research and to ponder what parts of the book I would change if I could. This paper responds to the 18 critical essays in the journal. It recognizes three major errors of omission: failure to take account of unionism outside the US; failure to analyze public sector unionism; and failure to analyze the effects of unionism on economic growth; and the problem of determining the "optimal level of unionism" on the basis of estimates of what unions do. Ensuing research has found that What Do Unions Do? correctly identified union effects on turnover, fringe benefits, earnings inequality, political action, profits, managerial flexibility and human resource management, and that wage effects vary widely. Estimates of the union effect on productivity tend to be positive but modest, ruling out negative effects on average, but not conclusively establishing positive effects. Critical comments from some of the symposium panelists notwithstanding, I believe that the bulk of the evidence supports the What Do Unions Do? claim that management opposition has been a major factor in the decline in union density in the US. |
| JEL: | J0 |
| Date: | 2005–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11410&r=lab |
| By: | John Cawley; Chad D. Meyerhoefer; David Newhouse |
| Abstract: | To combat childhood overweight, which has risen dramatically in the past three decades, many medical and public health organizations have called for students to spend more time in physical education (PE) classes. This paper is the first to exploit state PE requirements as quasi-natural experiments in order to estimate the causal impact of PE on student activity and weight. We study nationwide data from the YRBSS for 1999, 2001, and 2003 merged with data on state minimum PE requirements from the 1994 and 2000 School Health Policies and Programs Study and the 2001 Shape of the Nation Report. We find that certain state regulations are effective in raising the number of minutes during which students are active in PE. Our results also indicate that additional PE time raises the number of days per week that students report having exercised or engaged in strength-building activities, but lowers the number of days in which students report light physical activity. PE time has no detectable impact on youth BMI or the probability that a student is overweight. We conclude that while raising PE requirements may make students more active by some (but not all) measures, there is not yet the scientific base to declare raising PE requirements an anti-obesity initiative. |
| JEL: | I1 I2 |
| Date: | 2005–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11411&r=lab |
| By: | Gordon H. Hanson |
| Abstract: | In this paper, I examine changes in labor supply and earnings across regions of Mexico during the 1990s. I focus the analysis on individuals born in states with either high-exposure or low-exposure to emigration, as measured by historical data on state migration to the United States. During the 1990s, rates of external migration and interval migration were higher among individuals born in high-migration states. Consistent with positive selection of emigrants in terms of observable skill, emigration rates appear to be highest among individuals with earnings in the top half of the wage distribution. Controlling for regional differences in observable characteristics and for initial regional differences in earnings, the distribution of male earnings in high-migration states shifted to the right relative to low-migration states. Over the decade, average hourly earnings in high-migration states rose relative to low-migration states by 6-9%. |
| JEL: | F2 J6 |
| Date: | 2005–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:11412&r=lab |
| By: | Konstantinos Pouliakas (Centre for European Labour Market Research, University of Aberdeen Business School); Ioannis Theodossiou (Centre for European Labour Market Research, University of Aberdeen Business School) |
| Abstract: | This paper engages in a novel comparison of differences in the perceived quality of high and low-paid jobs across six European labour markets. Utilizing data from six waves (1996-2001) of the European Community Household Panel (ECHP), and after correcting for the selectivity problem that is prevalent in the study of the effect of low pay status on job satisfaction, it is shown that, other things equal, low-paid employees are significantly less satisfied with their jobs compared to those who are high-paid in Greece, Spain, and Finland. In contrast, there appears to be an insignificant difference in the satisfaction of high and low wage workers in the United Kingdom, France and Denmark. The empirical evidence therefore suggests that low-paid jobs in the EU are not universally of low quality, though in some countries low wage workers have experienced the full brunt of both lower paid and bad quality jobs. For these countries policies that centre on the quality of jobs would be of equal importance to those that focus on the level of pay. A homogeneous policy of removing low wage employment through regulation, however, would not necessarily lead to improvement in the welfare of low-paid citizens across all European economies. |
| Keywords: | job quality, job satisfaction, low pay, dual labour markets |
| JEL: | J28 J42 |
| Date: | 2005–06–06 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpla:0506002&r=lab |
| By: | Donata Favaro (Università degli Studi di Padova, Dipartimento di Scienze Economiche 'Marco Fanno'); Stefano Magrini (Università degli Studi di Venezia 'Ca' Foscari', Dipartimento di Scienze Economiche) |
| Abstract: | We evaluate the gender wage gap and the unexplained gender wage differential for workers 15-29 year old during the period 1990-1997, using a particularly rich set of data from the Italian Social Security System covering all individuals in the labour markets of two Italian provinces. We estimate separate earnings functions for men and women correcting for endogeneity of education and we evaluate gender discrimination by studying the entire distribution of the unexplained wage gap as suggested by Jenkins (1994). We evaluate discrimination against females by means of bivariate density functions. This innovation makes it possible to condition the density distribution on the marginal distribution of any characteristic and to evaluate more precisely the existence of group and individual discrimination. Our analysis suggests that discrimination is not evenly distributed among women, in relation to their characteristics; in particular, there is evidence of lower discrimination against highly educated females. Moreover in 1997, compared to 1990, discrimination increased in a appreciable way, affecting human capital rich females more significantly. While our work is based in a very local context the richness of the data and the methodological innovation give the results a wider application. |
| Keywords: | wage differentials, wage discrimination, gender |
| JEL: | J |
| Date: | 2005–06–07 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpla:0506003&r=lab |
| By: | W. Robert Reed (University of Oklahoma) |
| Abstract: | I examine the wage effects of Right-To-Work (RTW). Using state-level data, I estimate that, ceteris paribus, RTW states have average wages that are significantly higher than non-RTW states. This result is robust is across a wide variety of specifications. An important distinctive of this study is that it controls for state economic conditions at the time states adopted RTW. States that adopted RTW were generally poorer than other states. Failure to control for these initial conditions may be the reason that previous studies have not identified a positive wage impact for RTW. |
| Keywords: | Right-to-Work |
| JEL: | J |
| Date: | 2005–06–08 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpla:0506005&r=lab |
| By: | Pedro Rey Biel (University College London); Steffen Huck (University College London) |
| Abstract: | In this paper we study the mechanics of ``leading by example'' in teams. Leadership is beneficial for the entire team when agents are conformists, i.e., dislike effort differentials. We also show how leadership can arise endogenously and discuss what type of leader benefits a team most. |
| Keywords: | team production; conformism; leadership; leading by example; endogenous timing |
| JEL: | C72 D23 D63 J31 L23 |
| Date: | 2005–06–08 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpmi:0506004&r=lab |
| By: | W. Robert Reed (University of Oklahoma); Cynthia L. Rogers (University of Oklahoma) |
| Abstract: | The Whitman Administration’s 30 percent reduction in New Jersey’s personal income taxes from 1994-96 is prominently cited as a role model for state fiscal policy. We investigate whether the growth benefits attributed to the Whitman tax cuts are warranted. Panel data methods are applied to annual observations of county-level employment growth from New Jersey and the surrounding economic region. Our analysis does not support the hypothesis that tax cuts stimulated employment growth in New Jersey. While New Jersey did experience substantial employment growth subsequent to the tax cuts, most of this growth was shared by the nearby Economic Areas. |
| Keywords: | Tax cuts, economics growth |
| JEL: | R58 H71 H24 |
| Date: | 2005–06–08 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpur:0506010&r=lab |
| By: | Victor Matheson (Department of Economics, College of the Holy Cross); Robert Hoffmann (Nottingham University Business School); Chew Ging Lee (University of Nottingham Malaysia Campus); Bala Ramasamy (University of Nottingham Malaysia Campus) |
| Abstract: | We compare the determinants of women's and men's international soccer performance and find that partially different variables are important in the two contexts. While economic and demographic influences hold for both, the particular political and cultural factors differ. These differences highlight the greatly different economic, political and social significance of the sport depending whether it is played by men or women. |
| Keywords: | women's football, soccer, FIFA World Ranking, amateur sports, gender inequality |
| JEL: | L83 I00 Z13 |
| Date: | 2005–06 |
| URL: | http://d.repec.org/n?u=RePEc:hcx:wpaper:0508&r=lab |
| By: | Pablo Brañas-Garza (Department of Economic Theory and Economic History, University of Granada); Miguel Angel Durán (Department of Economic Theory and Economic History, University of Granada); María Paz Espinosa (Universidad del País Vasco) |
| Abstract: | Ideally we would like subjects of experiments to be perfect strangers so that the situation they face at the lab is not just a part of a long run interaction. Unfortunately, it is not easy to reach those conditions and experimenters try to mitigate any effects coming form these out-of- the-lab relationships by, for instance, randomly matching subjects. However, even if this type of procedure is used, there is a positive probability that a subject faces a friend or an acquaintance. We find evidence that social proximity among subjects is irrelevant for experiments’ results in dictator games. Thus, although ideal conditions are not met, relations among subjects are not contaminating the experiments’ results. |
| Keywords: | experimental procedures, friendship effect, dictator game, fairness. |
| JEL: | C99 D63 D64 |
| Date: | 2005–06–08 |
| URL: | http://d.repec.org/n?u=RePEc:gra:wpaper:05/14&r=lab |
| By: | David Dickinson (Appalachian State University); Ronald Oaxaca |
| Abstract: | Statistical discrimination occurs when distinctions between demographic groups are made on the basis of real or imagined statistical distinctions between the groups. While such discrimination is legal in some cases (e.g., insurance markets), it is illegal and/or controversial in others (e.g., racial profiling and gender-based labor market discrimination). First moment statistical discrimination occurs when, for example, female workers are offered lower wages because females are perceived to be less productive, on average, than male workers. Second moment discrimination occurs when risk averse employers offer female workers lower wages based not on lower average productivity but on a higher variance in their productivity. Empirical work on statistical discrimination is hampered by the difficulty of obtaining suitable data from naturally-occurring labor markets. This article reports results from controlled laboratory experiments designed to study second moment statistical discrimination in a simulated labor marker setting. Since decision-makers may not view risk in the same way as economists or statisticians (i.e., risk=variance of distribution), we also examine two possible alternative measures of risk: the support of the distribution, and the probability of earning less than the expected (maximum) profits for the employer. Our results indicate that individuals do respond to these alternative measures of risk, and employers made statistically discriminatory wage offers consistent with loss-aversion in our full sample (though differences between male and female employers can be noted). If one can transfer these results outside of the laboratory, they indicate that labor market discrimination based only on first moment discrimination is biased downward. The public policy implication is that efforts and legislation aimed at reducing discrimination of various sorts face an additional challenge in trying to identify and limit relatively hidden, but significant, forms of statistical discrimination. |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:apl:wpaper:05-11&r=lab |
| By: | David Dickinson (Appalachian State University); Marie-Claire Villeval |
| Abstract: | Agency theory assumes that tighter monitoring by the principal should motivate the agent to raise his effort level. In contrast, the “crowding-out” literature suggests that tighter monitoring may reduce the overall work effort. These two assertions are not necessarily contradictory provided that the nature of the employment relationship is taken into account (Frey 1993). This paper reports on the results of a real-effort laboratory experiment designed to test the relative importance of the disciplining effect and the crowding-out effect of monitoring. We find no strong support for the crowding-out hypothesis and we show that the disciplining effect of monitoring dominates in abstract one-shot relationships as well as in somewhat more interpersonal multi-shot relationships. Principals are not trustful enough to refrain from using the monitoring opportunity and most agents react to a decrease in the monitoring intensity by decreasing their effort. |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:apl:wpaper:05-12&r=lab |