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on Labour Economics |
| By: | Joseph F. Quinn (Boston College) |
| Date: | 2010–06–15 |
| URL: | http://d.repec.org/n?u=RePEc:boc:bocoec:743&r=lab |
| By: | Liam Delaney (UCD Geary Institute, University College Dublin; School of Economics, University College Dublin; School of Public Health and Population Science, University College Dublin); Colm Harmon (UCD Geary Institute, University College Dublin; School of Economics, University College Dublin; IZA, Bonn); Cathy Redmond (UCD Geary Institute, University College Dublin) |
| Abstract: | While there is an extensive literature on intergenerational transmission of economic outcomes (education, health and income for example), many of the pathways through which these outcomes are transmitted are not as well understood. We address this deficit by analysing the relationship between socio-economic status and child outcomes in university, based on a rich and unique dataset of university students. While large socio-economic differences in academic performance exist at the point of entry into university, these differences are substantially narrowed during the period of study. Importantly, the differences across socio-economic backgrounds in university grade attainment for female students is explained by intermediating variables such as personality, risk attitudes and time preferences, and subject/college choices. However, for male students, we explain less than half of the socio-economic gradient through these same pathways. Despite the weakening socio-economic effect in grade attainment, a key finding is that large socio-economic differentials in the earnings expectations of university students persist, even when controlling for grades in addition to our rich set of controls. Our findings pose a sizable challenge for policy in this area as they suggest that equalising educational outcomes may not translate into equal labour market outcomes. |
| Keywords: | Socio-Economic Status, Education, Inequality, Discrimination |
| Date: | 2010–08–11 |
| URL: | http://d.repec.org/n?u=RePEc:ucd:wpaper:201035&r=lab |
| By: | Picchio, M.; Ours, J.C. van (Tilburg University, Center for Economic Research) |
| Abstract: | Recent human capital theories predict that labor market frictions and product market competition influence firm-sponsored training. Using matched worker-firm data from Dutch manufacturing, our paper empirically assesses the validity of these predictions. We find that a decrease in labor market frictions significantly reduces firms’ training expenditures. Instead, product market competition does not have an effect on firm-sponsored training. We conclude that increasing competition through international integration and globalization does not pose a threat to investments in on-the-job training. An increase in labor market flexibility may reduce incentives of firms to invest in training, but the magnitude of this effect is small. |
| Keywords: | firm-sponsored training;labor market frictions;product market competition;matched worker-firm data. |
| JEL: | D43 J24 J42 L22 M53 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubcen:201057&r=lab |
| By: | Eva Sierminska; Yelena Takhtamanova |
| Abstract: | The recession the United States economy entered in December of 2007 is considered to be the most severe downturn the country has experienced since the Great Depression. The unemployment rate reached as high as 10.1 percent in October 2009 - the highest we have seen since the 1982 recession. In this paper we examine the severity of this recession compared to those in the past by examining worker flows into and out of unemployment taking into account changes in the demographic structure of the population. We identify the most vulnerable groups of this recession by dissagregating the workforce by age, gender and race. We find that adjusting for the aging of the U.S. labor force increases the severity of this recession. Our results indicate that the increase in the unemployment rate is driven to a larger extent by the lack of hiring (low outflows), but flows into unemployment are still important for understanding unemployment rate dynamics (they are not as acyclical as some literature suggests) and differences in unemployment rates across demographic groups. We find that this is indeed a "mancession," as men face higher job separation probabilities, lower job finding probabilities and, as a result, higher unemployment rates than women. Lastly, there is some evidence that blacks suffered more than whites (again, this difference is particularly pronounced for men). |
| Keywords: | Unemployment, Worker flows, Job Finding Rate, Separation Rate, Demographics, Gender |
| JEL: | J1 J6 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1042&r=lab |
| By: | Thomas Astebro (HEC Paris); Jing Chen (Department of Economics, Florida International University); Peter Thompson (Department of Economics, Florida International University) |
| Abstract: | Recent evidence has shown that entrants into self-employment are disproportionately drawn from the tails of the earnings and ability distributions. This observation is explained by a multi-task model of occupational choice in which frictions in the labor market induces mismatches between firms and workers, and mis-assignment of workers to tasks. The model also yields distinctive predictions relating prior work histories to earnings and to the probability of entry into self-employment. These predictions are tested with the Korean Labor and Income Panel Study, from which we find considerable support for the model. |
| Keywords: | entreprenuership; self-employment; jack-of-all trades; skill complementarity |
| JEL: | J24 L26 |
| Date: | 2010–03 |
| URL: | http://d.repec.org/n?u=RePEc:fiu:wpaper:1003&r=lab |
| By: | Deb Kusum Das; Gunajit Kalita |
| Abstract: | This study attempts to address the issue of declining labour intensity in India’s organized manufacturing in order to understand the constraints on employment generation in the labour intensive sectors. Using primary survey data covering 252 labour intensive manufacturing-exporting firms across five sectors—apparel, leather, gems and jewellery, sports goods, and bicycles for 2005-06 an attempt is made to find out the factors which constrain employment generation in labour intensive firms. The study shows several constraints in the path of employment generation in labour intensive sectors—non-availability of trained skilled workers, infrastructure bottlenecks, low levels of investment, labour rules and regulations, and a noncompetitive export orientation. The study suggests a set of policy initiatives to improve the employment potential of these sectors. [Working Paper No. 237] |
| Keywords: | Indian Organized Manufacturing, Labor Intensity, Employment Growth, Skilled workforce, Wage structure, Export status, Machinery Usage, Labor laws, South Asia |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2770&r=lab |
| By: | Schneck, Stefan |
| Abstract: | Because rational individuals know that they cannot always get what they want, they are assumed to make appropriate adjustments. However, little is known about trade-off reasoning in labor market mobility decision making. The objective of this paper is to analyze the effect of commuting on the decision to voluntarily accept wage cuts. Application of German household data reveals that workers are more likely to accept lower wages when daily commuting expenses can be reduced. In other words, workers trade off amenities and monetary rewards when changing employers. -- |
| Keywords: | Mobility,wage cut,quit |
| JEL: | J24 J30 J62 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwedp:201021&r=lab |
| By: | Ruist, Joakim (Department of Economics, School of Business, Economics and Law, Göteborg University); Bigsten, Arne (Department of Economics, School of Business, Economics and Law, Göteborg University) |
| Abstract: | Wage effects of immigration are investigated in a setting with international capital mobility, which eliminates two-thirds of the native wage-effects of immigration. Without international capital mobility, overall gains from migration in the immigration region are only a small fraction of total losses to native workers, but with perfect international capital adjustment, overall gains are larger than total losses to native workers. Two alternative tax policies to eliminate the negative wage-effects of immigration on low skilled native workers are evaluated.<p> |
| Keywords: | International labor migration; wage effects |
| JEL: | F21 J61 |
| Date: | 2010–08–10 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:gunwpe:0464&r=lab |
| By: | Niknami, Susan (Stockholm University Linnaeus Center for Integration Studies - SULCIS) |
| Abstract: | This study uses extensive Swedish register data to analyze the intergenerational transmission of education between immigrant mothers and their daughters. The results show that the transmission is only slightly lower among daughters of immigrant mothers compared to native daughters. The educational relationship between mothers and daughters is further found to be nonlinear. For both groups, the intergenerational link is weaker among daughters of poorly educated mothers. Moreover, the average transmission differs across immigrant groups but these differences can be explained partly by dissimilar maternal educational backgrounds. In addition, the differences between women with an immigrant background and native women have decreased across the two generations. Finally, the educational attainment of an immigrant group has a positive but weak impact on daughters’ educational outcomes. |
| Keywords: | Immigrants; Education; Intergenerational transmission |
| JEL: | I20 J15 J62 |
| Date: | 2010–08–14 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sulcis:2010_010&r=lab |
| By: | Steven J. Davis; R. Jason Faberman; John C. Haltiwanger |
| Abstract: | This paper is the first to study vacancies, hires, and vacancy yields at the establishment level in the Job Openings and Labor Turnover Survey, a large sample of U.S. employers. To interpret the data, we develop a simple model that identifies the flow of new vacancies and the job-filling rate for vacant positions. The job-filling rate moves counter to aggregate employment but rises steeply with employer growth rates in the cross section. It falls with employer size, rises with worker turnover rates, and varies by a factor of four across major industry groups. We show that (a) employers rely heavily on other instruments, in addition to vacancy numbers, as they vary hires, (b) the hiring technology exhibits strong increasing returns to vacancies at the establishment level, or both. We also develop evidence that effective recruiting intensity per vacancy varies over time, accounting for about 35% of movements in aggregate hires. Our evidence and analysis provide useful inputs for assessing, developing and calibrating theoretical models of search, matching and hiring in the labor market. |
| JEL: | D21 E24 J63 |
| Date: | 2010–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:16265&r=lab |
| By: | Jordi Galí; Thijs van Rens |
| Abstract: | We document three changes in postwar US macroeconomic dynamics: (i) the procyclicality of labor productivity has vanished, (ii) the relative volatility of employment has risen, and (iii) the relative (and absolute) volatility of the real wage has risen. We propose an explanation for all three changes that is based on a common source: a decline in labor market frictions. We develop a simple model with labor market frictions, variable effort, and endogenous wage rigidities to illustrate the mechanisms underlying our explanation. We show that the reduction in frictions may also have contributed to the observed decline in output volatility |
| Keywords: | labor hoarding, labor market frictions, wage rigidities, effort choice |
| JEL: | E24 E32 |
| Date: | 2010–08 |
| URL: | http://d.repec.org/n?u=RePEc:kie:kieliw:1641&r=lab |
| By: | Katja Rost |
| Abstract: | The rise in executive compensation has triggered a great amount of public controversy and academic research. Critics have referred to the salaries paid to managers as 'pay without performance', while defenders have countered that the large salaries can be explained by a 'war for talents'. This research tests whether a war for talent provides an explanation. The rise in executive compensation in recent years is explained by the assumption that, over the past decades, general managerial skills have become more important relative to firm-specific knowledge for the production of managers. A shift toward transferable managerial skills requires higher compensation, particularly in large firms, to attract and retain managerial talents. Relying on an internationalized and deregulated managerial labor market, i.e. the Swiss banking sector, the empirical findings confirm that a shift toward transferable managerial skills in large firms is indeed an explanation for the rise in executive compensation. However, the shift towards transferable managerial skills in large firms does not improve firm performance, giving no supporting evidence for a war for talent. It is discussed how transferable managerial skills may used to legitimize higher compensation at the top, e.g. by promulgating definitions of talent in elite labour markets. |
| Keywords: | Executive compensation, efficient labor market view, transferable skills, outside options |
| Date: | 2010–08 |
| URL: | http://d.repec.org/n?u=RePEc:cra:wpaper:2010-14&r=lab |
| By: | Gregory, Christian (University of North Carolina at Greensboro, Department of Economics) |
| Abstract: | Previous research generally finds that obesity negatively affects wages for women and does not affect wages for men. But this literature has for the most part focused on young workers and has not examined whether the effect of obesity might change as people age. In this essay, I examine the effect of obesity -- and body mass more generally -- on wages across the age distribution, using conventional parametric and flexible semiparametric fixed effect models. The model results suggest two contributions to previous literature. First, the parametric results indicate that, in failing to stratify by age, the literature may overstate the effect of BMI and obesity on wages for women and almost certainly understates any negative association for men. Secondly, the semiparametric models indicate that the wage function isn't really changing as either men or women age: the differences that we observe in the linear specifications are almost all due to the change in the distribution of BMI, rather than a change in the effect of BMI itself on wages. |
| Keywords: | Wages; BMI; Semiparametric; Appearance |
| JEL: | C14 I00 J30 |
| Date: | 2010–08–10 |
| URL: | http://d.repec.org/n?u=RePEc:ris:uncgec:2010_002&r=lab |
| By: | Avouyi-Dovi, S.; Fougère, D.; Gautier, E. |
| Abstract: | We highlight different stylized facts concerning wage stickiness. First, in France, the typical duration of a wage agreement is one year. Consequently, a Taylor (1980) -type model appears to reproduce appropriately the distribution of agreement durations. Some 30 percent of settlements stipulate several predetermined wage changes during the year following the date of signature of the agreement. The frequency of wage agreements is highly seasonal, but the dates at which agreements take effect are more staggered. The date at which the national minimum wage level is revised each year has a significant impact on the timetable of wage agreements, both at the firm- and at the industry-levels. Wage increases negotiated at these two levels mainly depend on the inflation regime, the firm profitability and the proportion of minimum-wage workers in the same industry. |
| Keywords: | Wage Stickiness, Wage Bargaining, Minimum Wage, Downward nominal Wage Rigidity. |
| JEL: | J31 J50 E30 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:bfr:banfra:287&r=lab |
| By: | Nadia Karamcheva; Geoffrey Sanzenbacher |
| Abstract: | In 2008, the Obama campaign proposed a “Plan to Strengthen Retirement Security.” This plan consisted of items ranging from increasing the threshold of the Social Security payroll tax to expanding the Saver’s Credit for families earning under $75,000. One of the more far-reaching proposals would require employers with 10 or more employees to automatically enroll their employees in Individual Retirement Accounts (IRAs). As a default, 3 percent of each worker’s earnings would be invested in a low-risk portfolio, but workers could choose to change the defaults or opt out of the plan. Employers would not be required to make a matching contribution, but employees who participate would be eligible for the expanded Saver’s Credit.1 The purpose of the “Auto-IRA” is to increase the pension participation of all workers, but particularly low-income workers. Yet, it is unclear how many of these workers would participate. Our own research using the Survey of Income and Program Participation indicates that 60 percent of low-income workers currently eligible for voluntary 401(k) plans, similar to IRAs, choose to participate in those plans. And other research suggests that when workers are automatically enrolled in a 401(k) plan, they are even more likely to participate.2 However, these numbers are based on individuals who have a 401(k) available to them. It seems likely that these individuals may have sought out jobs offering such plans with an intention of participating. If so, workers who did not seek employment offering pensions may be less likely to participate in the IRA plan, limiting the program’s success in expanding pension participation. This brief explores the participation issue and estimates how many workers would participate if 401(k)-type coverage were extended to those who currently lack it. The first section summarizes trends in pension coverage. The second section describes the data and methodology used for estimating participation, while the third discusses the results. The final section concludes that, while offering convenient savings options to low-income workers should help improve their retirement security, fewer individuals may take advantage of the opportunity than policymakers hope. |
| Keywords: | private pensions |
| Date: | 2010–08 |
| URL: | http://d.repec.org/n?u=RePEc:crr:issbrf:ib2010-14&r=lab |
| By: | Avram, S; Dronkers, Jaap |
| Abstract: | Denominational schooling makes up an important part of European educational systems. Given its specificity, denominational schooling can be expected to place a greater weight on values teaching and moral education. As such, it may be more effective in bringing about certain attitudes and opinions. It also may be more successful in creating a warm and caring atmosphere, thus helping students to better emotionally connect to the school community. This paper set out to empirically test some of these hypotheses by making use of three waves of data collected in the framework of the Program for International Student Assessment study. We compare public and publicly supported private (as a proxy to denominational) schools on two dimensions, namely the emotional integration with the rest of the school community, and the concern and feelings of responsibility towards the environment. But for Austria, Belgium and Spain, no evidence could be found that the type of the school has any impact on the reported psychological adaptation to the school. In these three countries, publicly supported private schools tend to be more successful in integrating their students. Also students in public and private dependent schools were equally environment oriented, taking into account several student and school characteristics. The lack of schooling sector differences in attaining non-cognitive aims may have at least three causes. First, ecological issues could be salient enough not to necessitate any special religious or moral reinforcement in order to gain traction. Second, public schools may use religious education or ethics just as fruitfully and consequently, they are just as successful in values and norms transmission. Third, it is possible that schools play a minor role in introducing students to environmental dilemmas and concerns, this role being taken over by the family or the media. |
| Keywords: | public schools; private schools; non-cognitive; value teaching; psychological integration; PISA data |
| JEL: | H4 I21 L33 |
| Date: | 2010–01–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:24295&r=lab |
| By: | Olga Nottmeyer |
| Abstract: | Taking advantage of the panel structure of the data, the impact of intermarriage on labor market productivity as measured by earnings is examined. Contrarily to previous studies which rely on instrumental variable techniques, selection issues are addressed within a fixed effects framework. The model accounts for short and long term effects as well as general differences between those who intermarry and those who do not. Once unobserved heterogeneity is incorporated, advantageous effects from intermarriage vanish and do not differ from premiums from marriage between immigrants. However, immigrants who eventually intermarry receive greater returns to experience indicating better labor market integration. |
| Keywords: | intermarriage, integration, labor market, migration |
| JEL: | J1 J12 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1044&r=lab |
| By: | Klaauw, B. van der; Ours, J.C. van (Tilburg University, Center for Economic Research) |
| Abstract: | To increase their transition from welfare to work, benefit recipients in the municipality of Rotterdam were exposed to various financial incentives, including both carrots to sticks. Once their benefit spell exceeded one year, welfare recipients were entitled to a reemployment bonus if they found a job that lasted at least six months. However, they could also be punished for noncompliance with eligibility requirements and face a sanction, i.e. a temporary reducing of their benefits. In this paper we investigate how benefit sanctions and reemployment bonuses affect job finding rates of welfare recipients. We find that benefit sanctions were effective in bringing unemployed from welfare to work more quickly while reemployment bonuses were not. |
| Keywords: | welfare to work;financial incentives;timing-of-events;dynamic selection. |
| JEL: | J64 C21 C41 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubcen:201066&r=lab |
| By: | Chinhui Juhn; Kristin McCue |
| Abstract: | In Celik, Juhn, McCue, and Thompson (2009), we found that estimated levels of earnings instability based on data from the Current Population Survey (CPS) and the Survey of Income and Program Participation (SIPP) were reasonably close to each other and to others’ estimates from the Panel Study of Income Dynamics (PSID), but estimates from unemployment insurance (UI) earnings were much larger. Given that the UI data are from administrative records which are often posited to be more accurate than survey reports, this raises concerns that measures based on survey data understate true earnings instability. To address this, we use links between survey samples from the SIPP and UI earnings records in the LEHD database to identify sources of differences in work history and earnings information. Substantial work has been done comparing earnings levels from administrative records to those collected in the SIPP and CPS, but our understanding of earnings instability would benefit from further examination of differences across sources in the properties of changes in earnings. We first compare characteristics of the overall and matched samples to address issues of selection in the matching process. We then compare earnings levels and jobs in the SIPP and LEHD data to identify differences between them. Finally we begin to examine how such differences affect estimates of earnings instability. Our preliminary findings suggest that differences in earnings changes for those in the lower tail of the earnings distribution account for much of the difference in instability estimates. |
| Date: | 2010–08 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:10-15&r=lab |
| By: | Christopher Reicher |
| Abstract: | The Diamond-Mortensen-Pissarides search and matching model is the workhorse of labor macro, but it has difficulty in simultaneously matching the cyclical behavior of job loss and vacancies when taken to the data. By completely ignoring frictions in job creation and focusing instead on firm-level heterogeneity, one can match the cyclical behavior of job flows and vacancies relatively well. In particular, one can generate a Beveridge Curve which looks much like the real Beveridge Curve, and one can replicate the approximately equal contributions of job creation and destruction to the cycle. Focusing on heterogeneity rather than on hiring costs seems to give an improved picture of hiring activity over the cycle |
| JEL: | J61 J21 |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:kie:kieliw:1636&r=lab |
| By: | Jenny C Aker; Christopher Ksoll; Travis J Lybbert |
| Abstract: | We report the short-term results from a randomized evaluation of a mobile phone literacy and numeracy program (Project ABC) in Niger, in which adult literacy students learned how to use mobile phones as part of a literacy and numeracy class. Students in ABC villages showed substantial gains in numeracy exam scores. There is also evidence of heterogeneity in program effects across regions, suggesting the impact is context dependent. These results were stronger in one region, for women and for participants younger than 45. There was also evidence of persistent impacts: six months after the end of the first year of classes, students in ABC villages retained what they had learned better than the non-ABC students. These effects do not appear to be driven by differences in teacher quality and motivation, nor student attendance. |
| Keywords: | Education; literacy; information technology; program evaluation; Nigeria |
| JEL: | D1 I2 O1 O3 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:csa:wpaper:2010-22&r=lab |
| By: | Rania Antonopoulos; Kijong Kim; Tom Masterson; Ajit Zacharias |
| Abstract: | Massive job losses in the United States, over eight million since the onset of the “Great Recession,” call for job creation measures through fiscal expansion. In this paper we analyze the job creation potential of social service–delivery sectors-early childhood development and home-based health care-as compared to other proposed alternatives in infrastructure construction and energy. Our microsimulation results suggest that investing in the care sector creates more jobs in total, at double the rate of infrastructure investment. The second finding is that these jobs are more effective in reaching disadvantaged workers-those from poor households and with lower levels of educational attainment. Job creation in these sectors can easily be rolled out. States already have mechanisms and implementation capacity in place. All that is required is policy recalibration to allow funds to be channeled into sectors that deliver jobs both more efficiently and more equitably. |
| Keywords: | Social Care; Job Creation; Fiscal Expansion; Distribution; Infrastructure |
| JEL: | D30 E62 J48 |
| Date: | 2010–08 |
| URL: | http://d.repec.org/n?u=RePEc:lev:wrkpap:wp_610&r=lab |
| By: | Rob Euwals |
| Abstract: | This paper tests the predictive value of subjective labour supply data for adjustments in working hours over time. The idea is that if subjective labour supply data help to predict next year’s working hours, such data must contain at least some information on individual labour supply preferences. This informational content can be crucial to identify models of labour supply. Furthermore, it can be crucial to investigate the need for, or, alternatively, the support for laws and collective agreements on working hours flexibility. In this paper I apply dynamic panel data models that allow for measurement error. I find evidence for the predictive power of subjective labour supply data concerning desired working hours in the German Socio- Economic Panel 1988-1996. [IZA Discussion Paper No. 400] |
| Keywords: | Labour supply, subjective data, measurement error, dynamic panel data models |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2762&r=lab |
| By: | Bjuggren, Carl Magnus (Linköping University); Johansson, Dan (The Ratio Institute); Stenkula, Mikael (Research Institute of Industrial Economics (IFN)) |
| Abstract: | Research on entrepreneurship has received an increased amount of interest in recent years, with self-employment being used as the most common proxy for “entrepreneurship” in empirical studies. However, there are various ways of defining self-employment, making it a somewhat dubious proxy. This may flaw the analysis, especially in cross-country studies, since the documentation of data often is insufficient and difficult to access due to language barriers. We present an analysis of Swedish self-employment data. We show that the measurement of self-employment has changed over time to noticeably affect the reported number of self-employed in the two major statistical sources on self-employment. The reported development of self-employment sometimes differs diametrically depending on source. Sweden is occasionally erroneously reported to show the largest increase in self-employment in cross-country studies. Our study mimics the results of other country-specific analyses and we conclude that well-grounded conclusions require that the advantages and disadvantages of different statistical sources are recognized. |
| Keywords: | Labor Force Survey; RAMS; Self-employed; Self-employment; Entrepreneurship |
| JEL: | C81 C82 L26 M13 |
| Date: | 2010–07–09 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0845&r=lab |
| By: | Abdelfatah Ichou |
| Abstract: | During the last decades, most developed countries have shown a remarcable increase in entrepreneurship rates. Recent research suggests that this increase is, for a considerable part, caused by an increase in the share of solo self-employed. Nowadays, for example, more than half of all Dutch business owners are solo self-employed. This raises the question which factors determine whether an entrepreneur becomes an employer or remains solo self-employed. A recent study by EIM investigates the decision of entrepreneurs whether or not to become an employer and the decision of employers to hire a certain number of employees. The first decision is examined by estimating duration models that model the duration of the time spent as solo entrepreneur before the transition to employer is made. The estimations are performed on a panel of Dutch start-ups in 1998, 1999 and 2000. We find that entrepreneurs who founded a firm to improve their work-life balance are less likely to make the transition to employership. The remaining factors that we found to influence the employer decision do this all in a positive way. These factors include whether or not the entrepreneur has the objective to maximize revenue, experience within the industry in which he operates, his entrepreneurial experience, selfefficacy, risk attitude and the time that is spent in the company. We also find that the likelihood of becoming a job creator is positively related to the business cycle. The second decision is examined by estimating count models that model the number of employees that are hired in the first year of employership. We find that higher levels of educational, entrepreneurial experience and self-efficacy of the entrepreneur lead to a greater firm size. Another factor that increases firm size is innovativeness. The moment in time at which the transition from soloentrepreneur to employer is made, also plays are role. For the first few years we find a negative relationship with firm age, indicating that the faster the switch is made, the more personnel will be employed. Also, for the employee decision we find a positive relation with the business cycle. |
| Date: | 2010–08–09 |
| URL: | http://d.repec.org/n?u=RePEc:eim:papers:h201018&r=lab |
| By: | Oesch, Daniel |
| Abstract: | This paper enquires into the causes of union growth and decline by analysing flows in and out of membership. It does so at the level of 70 Swiss union locals over the period 2006-08. Gross flows in union membership are found to be much larger than the resulting net changes: turnover of annually 10 per cent thus is a surprisingly constant feature across unions. Net changes in membership are primarily determined by inflows: successful union locals differ from languishing ones with respect to their entry rates, whereas exit rates are similar. There is large variance in union locals’ entry rates that is not accounted for by the labour market context. Rather, it seems attributable to differences in union organization and strategy. |
| Keywords: | trade unions; membership; strategic choice; turnover; recruitment |
| JEL: | J51 J63 J5 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:24358&r=lab |
| By: | Patricia Apps; Ray Rees |
| Abstract: | Historically, in virtually all developed economies there seems to be clear evidence of an inverse relationship between female labor supply and fertility. However, particularly in the last decade or so, the relationship across countries has been positive: for example countries like Germany, Italy and Spain with the lowest fertility rates also have the lowest female participation rates. They have accepted the hypothesis that the reason for this lies in the combined effects of a country’s tax system and system of child support, and we have sought to clarify this theoretically, using an extended version of the Galor-Weil model. The results suggest that countries with individual rather than joint taxation, and which support families through improved availability of alternatives to domestic child care, rather than through direct child payments, are likely to have both higher female labor supply and higher fertility. These results are strengthened when we take account of the heterogeneity among households that undoubtedly exists. [IZA Discussion Paper No. 409] |
| Keywords: | Fertility, taxation, labor supply |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2754&r=lab |
| By: | Tang, Chor Foon |
| Abstract: | This study is to empirically investigate the effect of real wages on productivity in Malaysia using monthly data from January 1983 to November 2009. The Johansen’s test suggests that wages and productivity are cointegrated. Moreover, productivity and real wages have a quadratic relationship in the long run (i.e., inverse-U shape curve) instead of linear relationship. Hence, the effect of real wages on productivity is not monotonic. Furthermore, the Granger causality test indicates that real wages and productivity is bilateral causality in nature. |
| Keywords: | Causality; Cointegration; Malaysia; Wages-Productivity |
| JEL: | J24 C22 J30 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:24355&r=lab |
| By: | Michael A. Shields; Stephen Wheatley Price |
| Abstract: | In this paper they study bilateral bargaining problems with interested third parties, the stakeholders that enjoy benefits upon a bilateral agreement. We explore the strategic implications of this third party involvement. The main finding is that the potential willingness of the stakeholder to make contributions to promote agreement may be the source of severe inefficiency. However, and more surprisingly, for a wide range of parameter values this outcome is better for the stakeholder than if he enters bargaining directly. The results lend support to the tendency towards decentralisation of pay bargaining in the public sector in Europe.[IZA DP No. 395] |
| Keywords: | Bargaining, public sector, stakeholders, strikes, labour relations |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2753&r=lab |
| By: | Miklos-Thal, Jeanine; Ullrich, Hannes |
| Abstract: | In most promotion and hiring situations several agents compete for a limited number of attractive positions, assigned on the basis of the agents' relative reputations. Economic theory predicts that agents' effort incentives in such contests depend non-monotonically on their anticipated winning chances, but empirical evidence is lacking. We use panel data to study soccer players' responses to the (informal) nomination contests for being on a national team participating in the 2008 Euro Cup. The control group consists of players who work for the same clubs but are nationals of countries that did not participate in the Euro Cup. We fi nd that nomination contest participation has substantial positive effects on the performances of players with intermediate chances of being nominated for their national team. Players whose nomination is close to certain perform worse than otherwise, particularly in duels that carry a high injury risk. For players without any recent national team appearances, we fi nd no signifi cant effects. |
| Keywords: | effort incentives; contests; reputations; tournaments |
| JEL: | J44 D83 M51 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:24340&r=lab |
| By: | Byström, Hans (Department of Economics, Lund University) |
| Abstract: | This paper describes how credit default swaps could be employed to create performance based executive compensation portfolios that reflect the value of a firm’s debt as well as equity; i.e. the total value of all a firm’s assets. So-called Asset Value Unit (AVU) compensation portfolios are defined and compared to ordinary (long-term incentive) stock compensation portfolios for a range of banks from the recent EU-wide stress testing exercise conducted by the Committee of European Banking Supervisors (CEBS). While our study is limited to bank executives, the suggested method of paying executives using credit default swaps in addition to stocks also works for non-financial firms as well as for non-executives. The empirical results suggest that executive/CEO compensation plans based on asset values behave more reasonably than traditional equity based plans. |
| Keywords: | executive pay; executive compensation; stock; credit default swap; bank; stress test |
| JEL: | G10 G21 G34 G38 |
| Date: | 2010–08–14 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:lunewp:2010_009&r=lab |