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on Labour Economics |
| By: | Silke Anger |
| Abstract: | Using individual based micro-data from the German Socio-Economic Panel Study (SOEP), I analyze the cyclicality of real wages for male workers within employer-employee matches over the period 1984-2004, and compare different wage measures: the standard hourly wage rate, hourly wage earnings including overtime and bonus payments, and the effective wage, which takes into account not only paid overtime, but also unpaid working hours. None of the hourly wage measures is shown to exhibit cyclicality except for the group of salaried workers with unpaid overtime. Their effective wages react strongly to changes in unemployment in a procyclical way. Despite acyclical wage rates, salaried workers without unpaid hours but with income from extra payments, such as bonuses, experienced procyclical earnings movements. Monthly earnings were also procyclical for hourly paid workers who received overtime payments. The procyclicality of earnings revealed for Germany is of comparable size with the one in the U.S. |
| Keywords: | Wage cyclicality, effective wages, unpaid overtime, bonus payments, firm stayers |
| JEL: | E32 J31 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp719&r=lab |
| By: | Thomas Dohmen; Hartmut Lehmann; Mark E. Schaffer |
| Abstract: | We use personnel data from a Russian firm for the years 1997 to 2002 to study the determinants of wages during transition. Our findings indicate that remuneration is not predetermined by formal rules and a stable institutionalized structure of wages, but rather that local labor market conditions have a strong impact on wage setting at the firm level. In particular, we document that real wages fall substantially during a period of high inflation and worsening local labor market conditions. Relative wage decreases are most pronounced for employees who initially earned the highest rents. The process of rent extraction leads to a strong compression of real wages and real compensation at the firm. |
| Keywords: | personnel economics, wage determination, Russia, transition |
| JEL: | J31 P31 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:hwe:certdp:0704&r=lab |
| By: | Andrén, Daniela (Department of Economics, School of Business, Economics and Law, Göteborg University); Andrén, Thomas (Department of Economics, School of Business, Economics and Law, Göteborg University) |
| Abstract: | In Romania, the communist regime promoted an official policy of gender equality for more than 40 years, providing equal access to education and employment, and restricting pay differentiation based on gender. After its fall in December 1989, the promotion of equal opportunities and treatment for women and men did not constitute a priority for any of the governments of the 1990s. Given that both the economic mechanisms and the institutional settings changed radically, the question is if this affected gender equality. This paper analyzes both gender and occupational wage gaps in Romania before and during the first years of transition from a planned to a market economy. The results suggest that the communist institutions did succeed in eliminating the gender wage differences in female- and male-dominated occupations, but not in gender-integrated occupations, for which the gender wage gap was about 31.6%. During the transitions years, this gap decreased to 20-24%, while the gender wag gap in maleand female-dominated occupations increased to 10-14.5%.<p> |
| Keywords: | Occupational segregation; gender wage gap; occupational wage gap; transition |
| JEL: | J24 J31 J71 J78 P26 P27 |
| Date: | 2007–08–31 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunwpe:0261&r=lab |
| By: | David M. Blau (Ohio State University and IZA); Tetyana Shvydko (University of North Carolina at Chapel Hill) |
| Abstract: | The labor market is often asserted to be characterized by rigidities that make it difficult for older workers to carry out their desired trajectory from work to retirement. An important source of rigidity is restrictions on hours of work imposed by firms that use team production or face high fixed costs of employment. Such rigidities are difficult to measure directly. We develop a model of the labor market in which technological rigidity affects the age structure of a firm’s work force in equilibrium. Firms using relatively flexible technology care only about total hours of labor input, but not hours of work per worker. Older workers with a desire for short or flexible hours of work are attracted to such firms. Firms using a more rigid technology involving team production impose a minimum hours constraint, and as a result tend to have a younger age structure. A testable hypothesis of the model is that the hazard of separation of older workers is lower in firms with an older age structure. We use matched worker-firm data to test this hypothesis, and find support for it. Specification tests and alternative proxies for labor market rigidity support our interpretation of the effect of firm age structure on the separation propensity. These results provide indirect but suggestive evidence of the importance of labor market rigidities. |
| Keywords: | labor demand, retirement, labor market institutions |
| JEL: | J26 J23 |
| Date: | 2007–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2996&r=lab |
| By: | María A. Davia (Universidad de Castilla- La Mancha); Óscar D. Marcenaro-Gutiérrez (Universidad de Málaga) |
| Abstract: | In our piece of work we are facing a two-fold problem: on the one hand, we study the behaviour of job seekers and the extent to which reservation wages and unemployment benefits play a relevant role in the transition into working life. On the other hand, we intend to find out whether the determinants of the job search process may also affect subsequent wages. |
| Keywords: | transiciones laborales, prestaciones por desempleo, salarios de reserva, ganancias,earnings, transitions into work, unemployment benefits, reservation wages. |
| JEL: | J31 J64 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:cea:doctra:e2007_13&r=lab |
| By: | Smirnova , Natalia V. (BOFIT) |
| Abstract: | This paper explores the determinants of job search behavior, search intensity and choices of search methods of the unemployed workers in transitional Russia. We use pooled data from rounds 5-9 of the Russia Longitudinal Monitoring Survey (RLMS) to estimate the effects of socio-economic factors on the choices workers make while looking for a job. The results show that women are significantly less likely than men to engage in job searches, lag significantly behind men in search intensity, and significantly differ from men in their search strategies. The job search behavior of workers living in metropolitan areas of Moscow and St. Petersburg differs substantially from the behavior of workers living elsewhere in Russia. The most frequently used search strategy in Russia, as in other countries, is contacting friends and relatives for job leads. |
| Keywords: | Russia; transition; job search; search intensity; iogit |
| JEL: | J64 P23 |
| Date: | 2007–09–06 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:bofitp:2003_013&r=lab |
| By: | Alan Barrett (Economic and Social Research Institute and IZA); Yvonne McCarthy (Central Bank and Financial Services Authority of Ireland, formerly of the Economic and Social Research Institute) |
| Abstract: | This paper has three objectives. First, a review of the developing body of work on the economics of immigration in Ireland is provided. Second, the analysis undertaken by Barrett and McCarthy (forthcoming) of earnings of immigrants in Ireland is updated. Third, the earnings of immigrant women are assessed to see if they experience a "double disadvantage". Among other findings, the review of the emerging literature points to immigrants faring less well in the Irish labour market relative to native employees. As regards the analysis conducted in this paper, we find that immigrants were earning 15 percent less than comparable natives employees in 2005. For immigrants from non-English speaking countries, the wage disadvantage was 20 percent. The corresponding figure for immigrants from the EU’s New Member States was 31 percent. A double disadvantage is found for immigrant women, with the earnings of female immigrants found to be 14 percent less than those of comparable native female employees. This double disadvantage is concentrated among female immigrants with third level degrees. |
| Keywords: | immigrants’ earnings, Ireland |
| JEL: | J61 |
| Date: | 2007–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2990&r=lab |
| By: | Raquel Fernandez |
| Abstract: | Married women's labor force participation has increased dramatically over the last century. Why this has occurred has been the subject of much debate. This paper investigates the role of culture as learning in this change. To do so, it develops a dynamic model of culture in which individuals hold heterogeneous beliefs regarding the relative long-run payoffs for women who work in the market versus the home. These beliefs evolve rationally via an intergenerational learning process. Women are assumed to learn about the long-term payoffs of working by observing (noisy) private and public signals. They then make a work decision. This process generically generates an S-shaped figure for female labor force participation, which is what is found in the data. The S shape results from the dynamics of learning. I calibrate the model to several key statistics and show that it does a good job in replicating the quantitative evolution of female LFP in the US over the last 120 years. The model highlights a new dynamic role for changes in wages via their effect on intergenerational learning. The calibration shows that this role was quantitatively important in several decades. |
| JEL: | E2 J21 Z1 |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13373&r=lab |
| By: | T. BERGER; G. EVERAERT |
| Abstract: | This paper estimates the impact of labour taxes on unemployment using a panel of yearly observations (1970-2001) for 16 OECD countries. Possible heterogeneity of the unemployment incidence of taxes is taken into account by grouping countries according to their wage-setting institutions. Panel data unit root and cointegration tests show that unemployment and labour tax rates are non-stationary but not cointegrated. As this finding may be induced by missing non-stationary variables we set up a panel unobserved component model. Labour taxes are found to have a positive impact on unemployment only in countries characterised by strong but decentralised unions. |
| Date: | 2007–08 |
| URL: | http://d.repec.org/n?u=RePEc:rug:rugwps:07/478&r=lab |
| By: | Elhanan Helpman; Oleg Itskhoki |
| Abstract: | We study a two-country two-sector model of international trade in which one sector produces homogeneous products while the other produces differentiated products. The differentiated-product industry has firm heterogeneity, monopolistic competition, search and matching in its labor market, and wage bargaining. Some of the workers searching for jobs end up being unemployed. Countries are similar except for frictions in their labor markets. We study the interaction of labor market rigidities and trade impediments in shaping welfare, trade flows, productivity, price levels and unemployment rates. We show that both countries gain from trade but that the flexible country -- which has lower labor market frictions -- gains proportionately more. A flexible labor market confers comparative advantage; the flexible country exports differentiated products on net. A country benefits by lowering frictions in its labor market, but this harms the country's trade partner. And the simultaneous proportional lowering of labor market frictions in both countries benefits both of them. The model generates rich patterns of unemployment. Specifically, trade integration -- which benefits both countries -- may raise their rates of unemployment. Moreover, differences in rates of unemployment do not necessarily reflect differences in labor market rigidities; the rate of unemployment can be higher or lower in the flexible country. Finally, we show that the flexible country has both higher total factor productivity and a lower price level, which operates against the standard Balassa-Samuelson effect. |
| JEL: | F12 F16 J64 |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13365&r=lab |
| By: | Gopi Shah Goda; John B. Shoven; Sita Nataraj Slavov |
| Abstract: | Social Security provides spousal benefits in retirement to secondary workers in married couples based on the primary worker's earnings record. In addition, Social Security pays spousal benefits to divorced secondary workers whose marriages lasted at least ten years. However, if a marriage failed in less than ten years, no spousal benefits are paid. The spousal benefit is particularly valuable to secondary workers in couples where there is a large disparity in earnings between the primary worker and the secondary worker. We examine whether these couples, who have more to gain from extending their marriage to ten years, are more likely to delay marriage to the tenth year relative to a control group. We find that vulnerable couples are slightly more likely to delay divorce from year nine to year ten; however, the effect is statistically insignificant and small in magnitude. While the "cliff"-vesting of retirement benefits for divorced spouses raises equity concerns, it does not appear to distort incentives for divorce. |
| JEL: | H55 J12 |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13382&r=lab |
| By: | Christian Proaño Acosta (IMK at the Hans Boeckler Foundation) |
| Abstract: | Contrary to the assumption of perfectly flexible labour markets commonly used in mainstream macroeconomic models, in the real world the existence of structural imperfections such as search and trading costs hinder the frictionless functioning of these markets, generally leading to outcomes of Non-Walrasian type with involuntary unemployment and open vacancies in "equilibrium". In this paper the author models the existence of labour market frictions into a Keynesian (Disequilibrium) AS-AD framework in the line of Asada, Chen, Chiarella and Flaschel (2006) through a labour search and matching function. By means of dynamic shock simulations, the author finds that the extent of the labour market rigidity has a great importance for the dynamics not only of employment and output, but also of wage and price inflation, and consequently also for the conduction of monetary policy. |
| Keywords: | Labour market frictions, staggered wage and price dynamics, (D)AS- AD, monetary policy |
| JEL: | E31 E52 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:imk:wpaper:09-2007&r=lab |
| By: | A. Coad; R. Rao |
| Abstract: | The issue of technological unemployment receives perennial popular attention. Although there are previous empirical investigations that have focused on the relationship between innovation and employment, the originality of our approach lies in our choice of method. We focus on four 2-digit manufacturing industries that are known for their high patenting activity. We then use Principal Components Analysis to generate a firm- and year-specific 'innovativeness' index by extracting the common variance in a firm’s patenting and R&D expenditure histories. To begin with, we explore the heterogeneity of firms by using semi-parametric quantile regression. Whilst some firms may reduce employment levels after innovating, others increase employment. We then move on to a weighted least squares (WLS) analysis, which explicitly takes into account the different job-creating potential of firms of different sizes. As a result, we focus on the effect of innovation on total number of jobs, whereas previous studies have focused on the effect of innovation on firm behavior. Indeed, previous studies have typically taken the firm as the unit of analysis, implicitly weighting each firm equally according to the principle of 'one firm equals one observation'. Our results suggest that firm-level innovative activity leads to employment creation that may have been underestimated in previous studies. |
| Keywords: | Length 29 pages |
| Date: | 2007–08 |
| URL: | http://d.repec.org/n?u=RePEc:esi:evopap:2007-05&r=lab |
| By: | Tali Regev |
| Abstract: | This paper explores how the steady trends in increasing tuition costs, college enrollment, and the college wage gap might be related to the quality of college graduates. The model shows that the signaling role of education might be an important yet largely neglected ingredient in these recent changes. I develop a special signaling model in which workers of heterogeneous abilities face the same costs, yet a larger proportion of able individuals self-select to attend college since they are more likely to get higher returns. With imperfect information, the skill premium is an outcome which depends on the equilibrium quality of college attendees and nonattendees. Incorporating a production function of college education, I discuss the properties of the college market equilibrium. A skill-biased technical change directly decreases self-selection into college, but the general equilibrium effect may overturn the direct decline, since increased enrollment and rising tuition costs increase self-selection. Higher initial human capital has an external effect on subsequent investment in school: All agents increase their education, and the higher equilibrium tuition costs increase self-selection and the college premium. |
| Keywords: | College costs ; Education, Higher - Economic aspects |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedfwp:2007-18&r=lab |
| By: | Hanming Fang; Alessandro Gavazza |
| Abstract: | We investigate how the employment-based health insurance system in the U.S. affects individuals' life-cycle health-care decisions. We take the viewpoint that health is a form of human capital that affects workers' productivities on the job, and derive implications of employees' turnover on the incentives to undertake health investment. Our model suggests that employee turnovers lead to dynamic inefficiencies in health investment, and particularly, it suggests that employment-based health insurance system in the U.S. might lead to an inefficient low level of individual health during individuals' working ages. Moreover, we show that under-investment in health is positively related to the turnover rate of the workers' industry and increases medical expenditure in retirement. We provide empirical evidence for the predictions of the model using two data sets, the Medical Expenditure Panel Survey (MEPS) and the Health and Retirement Study (HRS). In MEPS, we find that employers in industries with high turnover rates are much less likely to offer health insurance to their workers. When employers offer health insurance, the contracts have higher deductibles and employers' contribution to the insurance premium is lower in high turnover industries. Moreover, workers in high turnover industries have lower medical expenditure and undertake less preventive care. In HRS, instead we find that individuals who were employed in high turnover industries have higher medical expenditure when retired. The magnitude of our estimates suggests significant degree of intertemporal inefficiencies in health investment in the U.S. as a result of the employment-based health insurance system. We also evaluate and cast doubt on alternative explanations. |
| JEL: | D91 D92 I1 I12 |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13371&r=lab |
| By: | Neugart, Michael |
| Abstract: | I develop an agent-based computational economics (ACE) model with which I evaluate the aggregate impact of labor market policies. The findings are that government-financed training measures increase the outflow rate from unemployment to employment. Although the overall effect is positive this effect is achieved by reducing the outflow rate for those who do not receive subsidies. Furthermore, the outflow rate would have been downward-biased had one supposed a matching function that is exogenous to policies. |
| Keywords: | Labor market policy evaluation; agent-based computational model; endogenous matching function; job displacement |
| JEL: | J60 C63 J68 |
| Date: | 2006–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:4726&r=lab |
| By: | Haraldsson, Mattias (VTI) |
| Abstract: | This paper estimates the long run effects of distance work on various aspects of the activity-travel pattern. Estimations are made using econometric matching on a data material from the Swedish travel survey, RES, a travel diary collected in the period 1999-2001. The activity-travel pattern of men seems to be irresponsive to distance work, while some aspects of the activity-travel pattern of women change due to distance work. For instance, it is found that distance-working women adopt a more “local” lifestyle where purchases and child care are moved closer to home. |
| Keywords: | Distance work; matching |
| JEL: | R40 |
| Date: | 2007–09–03 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:vtiwps:2007_006&r=lab |
| By: | Cahuc, Pierre; Laroque, Guy |
| Abstract: | We analyze optimal taxation in an economy with monopsonistic labour markets. The individuals, whose only decisions are whether to work, or not, have heterogeneous productivities and opportunity costs of work. Given its preferences for redistribution, the government, which does not observe the opportunity costs of work, chooses a tax scheme implementing the second best allocation. We compare the optima in the competitive and monopsonistic environments. We find that the government can always implement the second best allocation of the competitive economy in the monopsonistic environment. The optimal tax schedule comprises employment subsidies financed by taxes on profits. In this setup, there is no room for a minimum wage. |
| Keywords: | Minimum wage; Monopsony; Optimal taxation |
| JEL: | H31 J30 J42 |
| Date: | 2007–08 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:6416&r=lab |
| By: | Amelie Constant; Klaus F. Zimmermann |
| Abstract: | The economic literature has largely overlooked the importance of repeat and circular migration. The paper studies this behavior by analyzing the number of exits and the total number of years away from the host country using count data models and panel data from Germany. More than 60% of migrants from the guestworker countries are indeed repeat or circular migrants. Migrants from European Union member countries, those not owning a dwelling in Germany, the younger and the older (excluding the middle ages), are significantly more likely to engage in repeat migration and to stay out for longer. Males and those migrants with German passports exit more frequently, while those with higher education exit less; there are no differences with time spent out. Migrants with family in the home country remain out longer, and those closely attached to the labor market remain less; they are not leaving the country more frequently. |
| Keywords: | Repeat migration, circular migration, guestworkers, minorities, count data |
| JEL: | F22 J15 J61 C25 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp718&r=lab |
| By: | Levkov, Alexey; Levine, Ross; Beck, Thorsten |
| Abstract: | Policymakers and economists disagree about the impact of bank regulations on the distribution of income. Explo iting cross-state and cross-time variation, the authors test whether liberalizing restrictions on intra-state branching in the United States intensified, ameliorated, or had no effect on income distribution. The analysis finds that branch deregulation lowered income inequality by affecting labor market conditions, not by boosting the business income of the poor, nor by enhancing educational attainment. Reductions in the earnings gap between men and women and between skilled and unskilled workers account for the bulk of the explained drop in income inequality. |
| Keywords: | Emerging Markets,Economic Theory & Research,Inequality,,Fiscal & Monetary Policy |
| Date: | 2007–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:4330&r=lab |
| By: | Marc Gurgand; Eric Maurin |
| Abstract: | We evaluate the wage impact of the strong and rapid increase in schooling levels experienced by the cohorts born after WWII in France. In order to identify the causal effect of education, we exploit the fact that the small group of people graduating from elite education (Grandes Ecoles) remained stable, while the rest of the system experienced tremendous transformation. This provides a well defined control group. Using large scale labor force surveys for the 1990's, we find that the cohorts that received more education have a lower wage gap, relative to Grandes Ecoles. We show that such a large scale experiment measures a social return to schooling even in the presence of signaling, whereas strategies based on quasi-experiments are not necessarily robust to signaling. Our instrumental variable estimation finds returns to schooling very similar to the rest of the literature, which is a strong case against the signaling hypothesis. |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:pse:psecon:2007-21&r=lab |
| By: | Muehler, Grit; Beckmann, Michael; Schauenberg, Bernd |
| Abstract: | The present paper examines the wage effects of continuous training programs using individual-level data from the German Socio Economic Panel (GSOEP). In order to account for selectivity in training participation we estimate average treatment effects (ATE and ATT) of general and firm-specific continuous training programs using several state-of-the-art propensity score matching (PSM) estimators. Additionally, we also apply a combined matching difference-indifferences (MDiD) estimator to account for unobserved individual characteristics (e.g. motivation, ability). While the estimated ATE and ATT for general training are significant ranging between about 4 and 7.5 %, the corresponding wage effects of firm-specific training are mostly insignificant. Using the more appropriate MDiD estimator, however, we find a more precise and highly significant wage effect of about 5 to 6 %, though only for general training and not for firm-specific training. These results are consistent with standard human capital theory insofar as general training is associated with larger wage increases than firm-specific training. Furthermore, we conclude that firms may intend to use specific training to adjust to new job requirements, while career-relevant changes may be conditioned to general training. |
| Keywords: | Continuous training, wage effect, average treatment effect, selectivity bias, propensity score matching estimators |
| JEL: | C21 J24 J31 M53 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:5874&r=lab |
| By: | Yavuz, Elif; Ragatz, Andy; Fengler, Wolfgang; Arze del Granado, F. Javier |
| Abstract: | What are the current trends and main characteristics of public education spending in Indonesia? Is education spending insufficient? Are expenditures in education efficient and equitable? This study reports the first account of Indonesia ' s aggregated (national and sub-national) spending on education, as well as the economic composition of education spending and its breakdown by programs. It presents estimations of the expected (average) level of education spending for a country with its economic and social characteristics. This analysis sheds light on the efficiency and equity of education spending by presenting social rates of return by level of education, by assessing the adequacy of current teacher earnings relative to other paid workers and the distribution of teachers across urban, rural, and remote regions, and by identifying the main determinants of education enrollment. It concludes that the current challenges in Indonesia are no longer defined by the need of additional spending, but rather the need to improve the quality of education services, and to improve the efficiency of education expenditures by re-allocating teachers to undersupplied regions and re-adjusting the spending mix within and between education programs for future additional spending in the sector. The study finds that poverty and student-aged labor are also significant constraints to education enrollment, stressing the importance of policies aimed at addressing demand-side factors. |
| Keywords: | Education For All,Primary Education,Tertiary Educat ion,Teaching and Learning, |
| Date: | 2007–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:4329&r=lab |
| By: | Abbas, Qaisar; Foreman-Peck, James (Cardiff Business School) |
| Abstract: | This paper estimates and interprets returns to education for three sub-sectors of labour market by gender in Pakistan, using the most recent data set of Pakistan Social and Living Standards Measurement (PSLM) Survey 2004-05. The results show two distinctive features of Pakistani education, the high apparent returns to female education outside agriculture, and the remarkable increase of returns with successive levels of education, are to be explained primarily by two departures from the basic Mincer model; generally poor quality primary schooling and family unwillingness to invest in female education because of lack of earning opportunities. There is some signaling in Pakistani education investment but mainly the education is productivity-enhancing investment in human capital, according to a comparison of self-employed and paid employed earnings equations. Returns to public spending of education are extremely high, suggesting very considerable state underinvestment. The policy challenge is in the low wages and high education in the female paid employment sector, and the low participation rate. |
| Keywords: | Rates of return; gender; occupation; Pakistan |
| JEL: | J16 J18 J24 |
| Date: | 2007–08 |
| URL: | http://d.repec.org/n?u=RePEc:cdf:wpaper:2007/24&r=lab |
| By: | Gopi Shah Goda; John B. Shoven; Sita Nataraj Slavov |
| Abstract: | Medicare as a Secondary Payer (MSP) legislation requires employer-sponsored health insurance to be a primary payer for Medicare-eligible workers at firms with 20 or more employees. While the legislation was developed to better target Medicare services to individuals without access to employer-sponsored insurance, MSP creates a significant implicit tax on working beyond age 65. This implicit tax is approximately 15-20 percent at age 65 and increases to 45-70 percent by age 80. Eliminating this implicit tax by making Medicare a primary payer for all Medicare-eligible individuals could significantly increase lifetime labor supply due to the high labor supply elasticities of older workers. The extra income tax receipts from such a policy would likely offset a large percentage of the estimated costs of making Medicare a primary payer. |
| JEL: | H51 J14 J21 J26 |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13383&r=lab |
| By: | Maynard, Jean-Pierre |
| Abstract: | This study examines differences in gross domestic product (GDP) per capita between Canada and the United States from 1994 to 2005. The gap in GDP per capita between the two countries has narrowed slightly over this period. The study decomposed the gap into two components: one due to labour productivity and one due to labour market conditions, and shows that the relative importance of the two changed considerably after 2000. The output gap has narrowed slightly since 2000, primarily because Canada's labour market experienced a faster rate of job growth relative to its population than did the United States. |
| Keywords: | Economic accounts, Gross domestic product, Productivity accounts |
| Date: | 2007–08–31 |
| URL: | http://d.repec.org/n?u=RePEc:stc:stcp2e:2007016e&r=lab |
| By: | Engström, Per (IFAU - Institute for Labour Market Policy Evaluation); Hesselius, Patrik (IFAU - Institute for Labour Market Policy Evaluation); Persson, Malin (IFAU - Institute for Labour Market Policy Evaluation) |
| Abstract: | In this report we examine the excess use of Temporary Parental Benefit for parents who need to stay home from work when their children are sick. This study is based on a randomized experiment that took place during the spring 2006. The method used is rather new and more ambitious than those used in similar studies in the past. One advantage with this more elaborate technique is that a larger part of the veiled excessive use can be discovered. The result points to that as much as 22.5 percent of the costs for this social insurance are due to excess use. There are significant gender differences; women’s excess use amounts to 19 percent of their total use while the corresponding figure for men is 28 percent. |
| Keywords: | Temporary Parental Benefit; randomized experiment |
| JEL: | J32 |
| Date: | 2007–08–22 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2007_018&r=lab |
| By: | Cenesiz, Alper; Pierdzioch, Christian |
| Abstract: | We used a two-country optimizing “new-open-economy macroeconomics” model to analyze the implications of financial market integration for the fiscal multiplier. The fiscal multiplier measures the accumulated effect of fiscal policy on output. Our model features a labor-market friction in the form of labor-market search. The conventional wisdom derived from the classic Mundell-Fleming model has been that financial market integration diminishes the fiscal multiplier. We show that labor-market search model implies that financial market integration should increase rather than decrease the fiscal multiplier. |
| Keywords: | Open-economy macroeconomics; Financial market integration; Labor-market search; Fiscal policy |
| JEL: | F36 F41 E62 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:2687&r=lab |
| By: | Tim Callan (Economic and Social Research Institute (ESRI)); A. Van Soest (RAND, Tilburg University); John R. Walsh (Economic and Social Research Institute (ESRI)) |
| Abstract: | How great an effect does the structure of income taxes have on women’s labour market participation? This issue is investigated using a discrete choice static labour supply model for married couples in Ireland. The model incorporates fixed costs of working and simultaneously explains participation decisions and preferred hours of work. Details of the tax system are fully incorporated, and key elements of the welfare system are also taken into account. The model is estimated using data from the 1994 wave of the Living in Ireland Survey. The results are used to analyse the labour supply effects of a move to greater independence in the tax treatment of couples. The influence of tax structure on participation is reconsidered in the light of trends in women’s participation in the labour market and two key changes in the structure of taxation: a shift from a joint or aggregated basis of assessment to an “income-splitting” system in 1980 and a further substantial shift from income-splitting towards greater independence from 2000 onwards. |
| JEL: | H31 J22 |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:wp208&r=lab |
| By: | Arntz, Melanie; Lo, Simon M. S.; Wilke, Ralf A. |
| Abstract: | In this paper we derive nonparametric bounds for the cumulative incidence curve within a competing risks model with partly identified interval data. As an advantage over earlier attempts our approach also gives valid results in case of dependent competing risks. We apply our framework to empirically evaluate the effect of unemployment benefits on observed migration of unemployed workers in Germany. Our findings weakly indicate that reducing the entitlement length for unemployment benefits increases migration among high-skilled individuals. |
| Keywords: | cumulative incidence curve, partially missing data, bounds analysis, difference-in-differences |
| JEL: | C14 C41 J61 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:5875&r=lab |