nep-lab New Economics Papers
on Labour Economics
Issue of 2006‒07‒15
twenty-one papers chosen by
Stephanie Lluis
University of Minesota
  1. Dismissal Protection or Wage Flexibility By Jens Rubart
  2. Employment Fluctuations with Downward Wage Rigidity By James Costain; Marcel Jansen
  3. Skill Wage Premia, Employment, and Cohort Effects: Are Workers in Germany All of the Same Type? By Bernd Fitzenberger; Karsten Kohn
  4. Wage Dispersion, Markets and Institutions: The Effects of the Boom in Education on the Wage Structure By Erling Barth; Claudio Lucifora
  5. Analysing Welfare Reform in a Microsimulation-AGE Model By Melanie Arntz; Stefan Boeters
  6. Changes in the Labor Supply Behavior of Married Women: 1980-2000 By Francine D. Blau; Lawrence M. Kahn
  7. Wages, Employment, and Capital in Capitalist and Worker-Owned Firms By John Pencavel; Luigi Pistaferri; Fabiano Schivardi
  8. Value of Work: Bargaining, job-satisfaction, and taxation in a simple GE model By Felix Fitzroy; Michael Nolan
  9. Non-protected Labour in one West African Capital: Characteristics of Jobs and Occupational Mobility in Abidjan, Cote d'Ivoire By Yvan Guichaoua (CRISE/QEH)
  10. The Erosion of Union Membership in Germany: Determinants, Densities, Decompositions By Bernd Fitzenberger; Karsten Kohn; Qingwei Wang
  11. Policies Against Poverty: an Evalution By Dalit Contini
  12. Worker Morale in Russia: An Exploratory Study By Susan J. linz; Linda K. Good; Patricia Huddleston
  13. Labour market screening with intermediaries By Paul Schweinzer
  14. Returns to Education in Bangladesh By Mohammad Niaz Asadullah (SKOPE, Department of Economics)
  15. Linking job motivating potential to frontline employee attitudes and performance: testing the mediating role of psychological empowerment By Dewettinck, K.; Buyens, D.
  16. Labor Market Institutions and Aggregate Fluctuations in a Search and Matching Model By Francesco Zanetti
  17. Labor Taxation, Matching and Shocks in the New Keynesian Model By Juuso Vanhala; University of Helsinki
  18. A Search Model of Unemployment and Inflation By Etienne Lehmann
  19. On Artificial Structural Unemployment By Maciej K. Dudek; Szkoła Główna Handlowa
  20. Educational attainment and intergenerational social mobility in South Africa By Megan Louw; Servaas van der Berg; Derek Yu
  21. The Quest for Status and Endogenous Labor Supply: The Relative Wealth Framework By Walter H. Fisher
  1. By: Jens Rubart (Institute of Economics Darmstadt University of Technology)
    Keywords: DGE Model, Heterogeneous Labor, Skill Biased Technological Change, Search Unemployment, Employment Protection, Minimum Wages
    JEL: E32 J21 J31 J41
    Date: 2006–07–04
    URL: http://d.repec.org/n?u=RePEc:sce:scecfa:406&r=lab
  2. By: James Costain (Bank of Spain); Marcel Jansen (Economics Universidad Carlos III de Madrid)
    Keywords: Job matching, wage rigidity, efficiency wages, contractual fragility
    JEL: C78 E24 E32 J64
    Date: 2006–07–04
    URL: http://d.repec.org/n?u=RePEc:sce:scecfa:204&r=lab
  3. By: Bernd Fitzenberger (Goethe University Frankfurt, IFS, ZEW and IZA Bonn); Karsten Kohn (Goethe University Frankfurt and IZA Bonn)
    Abstract: This paper studies the relationship between employment and wage structures in West Germany based on the IAB employment subsample 1975{1997. It extends the analytical framework of Card and Lemieux (2001) which simultaneously includes skill and age as important dimensions of heterogeneity. After having identified cohort effects in skill wage premia and in the evolution of relative employment measures, we estimate elasticities of substitution between employees in three different skill groups and between those of different age, taking account of the endogeneity of wages and employment. Compared to estimates in the related literature, we find a rather high degree of substitutability. Drawing on the estimated parameters, we simulate the magnitude of wage changes within the respective skill groups that would have been necessary to halve skill-specific unemployment rates in 1997. The required nominal wage reductions range from 8.8 to 12.2% and are the higher the lower the employees' skill level.
    Keywords: labor demand, heterogeneity, age, skill, wage structure, employment, cohort effects, unemployment
    JEL: J21 J31 E24
    Date: 2006–06
    URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp2185&r=lab
  4. By: Erling Barth (Institute for Social Research, University of Oslo and IZA Bonn); Claudio Lucifora (Catholic University of Milan, ERMES and IZA Bonn)
    Abstract: In this paper, we investigate the effects of the boom in education on the wage structure in Europe. We use detailed information on the distribution of wages, estimated from microdata from 12 European countries from the beginning of the 1980’s to the present, to analyse the changes both between and within groups. We specify and estimate a model with supply and demand for different types of labour, as well as institutions affecting the bargained relative wage. Our results show that the boom in education closely matched the shifts in demand due to (skill biased) technological change, which in turn explains why the wage premia for education only rose moderately. We use the conditional wage spread within tertiary education, predicted from quantile log wage regressions, to investigate the hypothesis of skills erosion as a result of the large expansion in tertiary education. We find no evidence in favour of the hypothesis that the boom in higher education lead to an erosion of skills within the group of tertiary education, nor evidence of increasing “over-education” in Europe. Labour market institutions also matter: bargaining co-ordination and employment protection are shown to have a compressing effect on wages, but at different points of the wage distribution.
    Keywords: wage inequality, education, labour market institutions
    JEL: J3 J5 P5
    Date: 2006–06
    URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp2181&r=lab
  5. By: Melanie Arntz (International Economics CPB Den Haag); Stefan Boeters
    Keywords: applied general equilibrium, discrete working time choice, labour market, wage bargaining, labour market reform, logit model
    JEL: D58 J22 J51
    Date: 2006–07–04
    URL: http://d.repec.org/n?u=RePEc:sce:scecfa:109&r=lab
  6. By: Francine D. Blau (Cornell University, NBER, CESifo and IZA Bonn); Lawrence M. Kahn (Cornell University, CESifo and IZA Bonn)
    Abstract: Using March Current Population Survey (CPS) data, we investigate married women’s labor supply behavior from 1980 to 2000. We find that their labor supply function for annual hours shifted sharply to the right in the 1980s, with little shift in the 1990s. In an accounting sense, this is the major reason for the more rapid growth of female labor supply observed in the 1980s, with an additional factor being that husbands’ real wages fell slightly in the 1980s but rose in the 1990s. Moreover, a major new development was that, during both decades, there was a dramatic reduction in women’s own wage elasticity. And, continuing past trends, women’s labor supply also became less responsive to their husbands’ wages. Between 1980 and 2000, women’s own wage elasticity fell by 50 to 56 percent, while their cross wage elasticity fell by 38 to 47 percent in absolute value. These patterns hold up under virtually all alternative specifications correcting for: selectivity bias in observing wage offers; selection into marriage; income taxes and the earned income tax credit; measurement error in wages and work hours; and omitted variables that affect both wage offers and the propensity to work; as well as when age groups, education groups and mothers of small children are analyzed separately.
    Keywords: labor supply, married women, wages
    JEL: J16 J22
    Date: 2006–06
    URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp2180&r=lab
  7. By: John Pencavel (Stanford University and IZA Bonn); Luigi Pistaferri (Stanford University); Fabiano Schivardi (Bank of Italy and CEPR)
    Abstract: Differences in wages, employment, and capital between worker-owned and capitalist enterprises are computed from a matched employer-worker panel data set from Italy, the market economy with the greatest incidence of worker-owned and worker-managed firms. These differences are related to orthodox models of the capitalist firm and worker co-op. The estimates of the wage, employment, and capital equations largely corroborate the implications of the behavioral models of the two types of enterprise. Co-op wages are about 14 percent lower on average and they are more volatile (and employment less volatile) than those in capitalist enterprises. Given the breadth of the data set analyzed, the results can claim to constitute general findings about capitalist and co-op enterprises.
    Keywords: worker-owned firms, capitalist firms, wages, employment, capital
    JEL: J54 D21 L21
    Date: 2006–06
    URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp2188&r=lab
  8. By: Felix Fitzroy; Michael Nolan
    Keywords: Job-satisfaction, bargaining, unemployment, taxation.
    JEL: J28 J52 J65
    URL: http://d.repec.org/n?u=RePEc:san:wpecon:0515&r=lab
  9. By: Yvan Guichaoua (CRISE/QEH)
    Abstract: The microeconomic analysis of labour mobilisation and labour relationships in developing countries, though diverse in its hypotheses, methods and results, still nurtures the idea of dualistically segmented labour markets. This binary rural/urban segmentation leaves in the dark an important stratum of developing countries' labour markets, namely the urban informal sector. How does this huge group of unprotected workers gain access to jobs? Do labour relations comprise a social security dimension? We focus on the contractual forms that unregistered employment relationships take. We successively explore the content of employment relationships and compare it to existing classifications. We also assess the role of friends and families in accessing jobs and the changing social embeddedness over time of labour arrangements to highlight the crucial importance of interpersonal ties for informal work trajectories.
    URL: http://d.repec.org/n?u=RePEc:qeh:qehwps:qehwps132&r=lab
  10. By: Bernd Fitzenberger (Goethe University Frankfurt, IFS, ZEW and IZA Bonn); Karsten Kohn (Goethe University Frankfurt and IZA Bonn); Qingwei Wang (Goethe University Frankfurt and ZEW)
    Abstract: Union density in Germany has declined remarkably during the last two decades. We estimate socio-economic and workplace-related determinants of union membership in East and West Germany using data from the German Socio-Economic Panel by means of Chamberlain- Mundlack correlated random effects probit models. Drawing on the estimates, we project net union densities (NUD) and analyze the differences between East and West Germany as well as the corresponding changes in NUD over time. Blinder-Oaxaca decompositions show that changes in the composition of the work force have only played a minor role for the deunionization trends in East and West Germany. In East-West comparison, differences in the characteristics of the work force reflect a lower quality of membership matches in East Germany right after German unification.
    Keywords: union membership, union density, correlated random effects probit model, decomposition analysis, East Germany, West Germany
    JEL: J51
    Date: 2006–07
    URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp2193&r=lab
  11. By: Dalit Contini (University of Torino)
    Keywords: Unemployment, Poverty, Assistance, Agent-Based Model, Simulation, Genetic Algorithm
    JEL: J22 J24 J64
    Date: 2006–07–04
    URL: http://d.repec.org/n?u=RePEc:sce:scecfa:232&r=lab
  12. By: Susan J. linz; Linda K. Good; Patricia Huddleston
    Abstract: Despite unanimous agreement in the existing literature that morale influences employee performance, no well-defined measure of morale exists. Our study develops a robust measure of morale and focuses on the factors that influence morale among Russian workers. Survey data were collected from Russian employees at two different points in time, 1995 and 2002, in five Russian cities. Among the workers participating in our study, expectation of receiving a desired reward contributes to high morale, with expected monetary rewards having a larger influence than expected non-monetary rewards, but praise for a job well done and a feeling of accomplishment also contribute positively to employee morale. There is a significant correlation between positive attitudes toward work and morale, and a positive correlation between performance assessment and morale. Demographic characteristics (age and gender) have no discernable influence on morale when controls are included for work experience.
    Keywords: Morale, Russia, Expected rewards, Motivation, Performance
    JEL: P23 J28 J33
    Date: 2006–01–01
    URL: http://d.repec.org/n?u=RePEc:wdi:papers:2006-816&r=lab
  13. By: Paul Schweinzer (Department of Economics, University of Bonn Lennéstraße 37, 53113 Bonn, Germany Paul.Schweinzer@uni-bonn.de)
    Abstract: We consider a Rothschild-Stiglitz-Spence labour market screening model and employ a centralised mechanism to coordinate the efficient matching of workers to firms. This mechanism can be thought of as operated by a recruitment agency, an employment office or head hunter. In a centralised descending-bid, multi-item procurement auction, workers submitwage-bids for each job and are assigned stable jobs as equilibrium outcome. We compare this outcome to independent, sequential hiring by firms and conclude that, in general, a stable assignment can only be implemented if firms coordinate to some extent.
    Keywords: Matching, Multi-item auctions, Sequential auctions, Screening
    JEL: C78 D44 E24 J41
    Date: 2006–06
    URL: http://d.repec.org/n?u=RePEc:trf:wpaper:138&r=lab
  14. By: Mohammad Niaz Asadullah (SKOPE, Department of Economics)
    Abstract: This paper reports labour market returns to education in Bangladesh using national level household survey data. Returns are estimated separately for rural and urban samples, males, females and private sector employees. Substantial heterogeneity in returns is observed; e.g. estimates are higher for urban (than rural sample) and female samples (compared to their male counterparts). Our ordinary least square estimates of returns to education are robust to control for types of schools attended by individuals and selection into wage work.
    URL: http://d.repec.org/n?u=RePEc:qeh:qehwps:qehwps130&r=lab
  15. By: Dewettinck, K.; Buyens, D.
    Abstract: In this study, we relate job motivating potential to frontline employee job satisfaction, affective commitment and performance levels and test the mediating role of psychological empowerment. Based on a sample of 1129 employee – supervisor dyads, we found that employee psychological empowerment fully mediates the relationship between job motivating potential and the outcome variables. Our findings confirm the importance of job design approaches to empowering employees. Next to proposing potential avenues for further research, we discuss some suggestions on how to put job redesign strategies into practice.
    Keywords: empowerment, job motivating potential, employee performance, mediation
    Date: 2006–07–07
    URL: http://d.repec.org/n?u=RePEc:vlg:vlgwps:2006-26&r=lab
  16. By: Francesco Zanetti (Bank of England)
    Date: 2006–07–04
    URL: http://d.repec.org/n?u=RePEc:sce:scecfa:445&r=lab
  17. By: Juuso Vanhala (Bank of Finland; Department of Economics University of Helsinki); University of Helsinki
    Keywords: Matching, Income taxation, Wage, Business cycles
    JEL: J64 E24 E32
    Date: 2006–07–04
    URL: http://d.repec.org/n?u=RePEc:sce:scecfa:346&r=lab
  18. By: Etienne Lehmann (ERMES (CNRS and University of Paris 2 Panthéon Assas) and IZA Bonn)
    Abstract: In this paper, I introduce money in the standard labor-matching model (Mortensen and Pissarides 1999, Pissarides 2000). A double coincidence problem makes Fiat Money necessary as a medium of exchange. In the long-run, a rise in the rate of money growth leads to higher inflation and higher unemployment, so the long-run Phillips curve is not vertical. The optimal monetary growth rate decreases with the workers’ bargaining power, the level of unemployment benefits and the payroll tax rate.
    Keywords: inflation, unemployment, search-matching, Friedman rule
    JEL: E24 E52 J64
    Date: 2006–06
    URL: http://d.repec.org/n?u=RePEc:iza:izadps:dp2194&r=lab
  19. By: Maciej K. Dudek; Szkoła Główna Handlowa
    Keywords: Unemployment, Coordination
    JEL: E24 D50
    Date: 2006–07–04
    URL: http://d.repec.org/n?u=RePEc:sce:scecfa:171&r=lab
  20. By: Megan Louw (Department of Economics, Stellenbosch University); Servaas van der Berg (Department of Economics, Stellenbosch University); Derek Yu (Department of Economics, Stellenbosch University)
    Abstract: To a large degree, the notoriously high levels of income inequality in South Africa have their roots in differential access to wage-earning opportunities in the labour market, which in turn are influenced by family background. This paper therefore investigates the role that parents’ education plays in children’s human capital accumulation. The study analyses patterns of educational attainment in South Africa during the period 1970-2001, asking whether intergenerational social mobility has improved. It tackles the issue in two ways, combining extensive descriptive analysis of progress in educational attainment with more a formal evaluation of intergenerational social mobility using indices constructed by Dahan and Gaviria (2001) and Behrman, Birdsall and Szekely (1998). Both types of analysis indicate that intergenerational social mobility within race groups improved over the period, with the indices suggesting that South African children are currently better able to take advantage of educational opportunities than the bulk of their peers in comparable countries. However, significant racial barriers remain in the quest to equalise educational opportunities across the board for South African children.
    Keywords: Analysis of education, intergenerational mobility
    JEL: I21
    Date: 2006
    URL: http://d.repec.org/n?u=RePEc:sza:wpaper:wpapers23&r=lab
  21. By: Walter H. Fisher
    Keywords: Status, Relative Consumption, Relative Wealth, Endogenous Labor Supply
    JEL: D62 D91 E21
    Date: 2006–07–04
    URL: http://d.repec.org/n?u=RePEc:sce:scecfa:60&r=lab
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