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on Labour Economics |
| By: | Peter Diamond |
| Abstract: | Whenever unemployment stays high for an extended period, it is common to see analyses, statements, and rebuttals about the extent to which the high unemployment is structural, not cyclical. This essay views the Beveridge curve pattern of unemployment and vacancy rates and the related matching function as proxies for the functioning of the labor market and explores issues in that proxy relationship that complicate such analyses. Also discussed is the concept of mismatch. |
| Keywords: | Unemployment ; Structural unemployment |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbwp:13-5&r=lab |
| By: | Nicolas Petrosky-Nadeau; Lu Zhang |
| Abstract: | A search and matching model, when calibrated to the mean and volatility of unemployment in the postwar sample, can potentially explain the large unemployment dynamics in the Great Depression. The limited response of wages to labor market conditions from credible bargaining and the congestion externality from matching frictions cause the unemployment rate to rise sharply in recessions but decline gradually in booms. The frequency, severity, and persistence of unemployment crises in the model are quantitatively consistent with U.S. historical time series. |
| JEL: | E24 E32 G01 G12 |
| Date: | 2013–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:19207&r=lab |
| By: | David Neumark; Patrick Button |
| Abstract: | We examine whether stronger age discrimination laws at the state level moderated the impact of the Great Recession on older workers. We use a difference-in-difference-in-differences strategy to compare older workers in states with stronger and weaker laws, to their prime-age counterparts, both before, during, and after the Great Recession. We find very little evidence that stronger age discrimination protections helped older workers weather the Great Recession, relative to younger workers. The evidence sometimes points in the opposite direction, with stronger state age discrimination protections associated with more adverse effects of the Great Recession on older workers. We suggest that this may be because stronger age discrimination laws protect older workers in normal times, but during an experience like the Great Recession severe labor market disruptions make it difficult to discern discrimination, weakening the effects of stronger state age discrimination protections. |
| JEL: | J14 J26 J71 J78 |
| Date: | 2013–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:19216&r=lab |
| By: | Craig Garthwaite; Tal Gross; Matthew J. Notowidigdo |
| Abstract: | We study the effect of public health insurance eligibility on labor supply by exploiting the largest public health insurance disenrollment in the history of the United States. In 2005, approximately 170,000 Tennessee residents abruptly lost public health insurance coverage. Using both across- and within-state variation in exposure to the disenrollment, we estimate large increases in labor supply, primarily along the extensive margin. The increased employment is concentrated among individuals working at least 20 hours per week and receiving private, employer-provided health insurance. We explore the dynamic effects of the disenrollment and find an immediate increase in job search behavior and a steady rise in both employment and health insurance coverage following the disenrollment. Our results suggest a significant degree of “employment lock” – workers employed primarily in order to secure private health insurance coverage. The results also suggest that the Affordable Care Act – which similarly affects adults not traditionally eligible for public health insurance – may cause large reductions in the labor supply of low-income adults. |
| JEL: | J20 |
| Date: | 2013–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:19220&r=lab |
| By: | Hensvik, Lena (IFAU - Institute for Evaluation of Labour Market and Education Policy); Nordström Skans, Oskar (IFAU - Institute for Evaluation of Labour Market and Education Policy) |
| Abstract: | The paper studies how social job finding networks affect firms' selection of employees and the setting of entry wages. Our point of departure is the Montgomery (1991) model of employee referrals which suggests that it is optimal for firms to hire new workers through referrals from their most productive existing employees, as these employees are more likely to know others with high unobserved productivity. Empirically, we identify the networks through coworker links within a rich matched employer-employee data set with cognitive and non-cognitive test scores serving as predetermined indicators of individual productivity. The results corroborate the Montgomery model's key predictions regarding employee selection patterns and entry wages into skill intensive jobs. Incumbent workers of high aptitude are more likely to be linked to entering workers. Firms also acquire entrants with higher ability scores but lower schooling when hiring linked workers supporting the notion that firms use referrals of productive employees in order to attract workers with better qualities in dimensions that would be difficult to observe at the formal market. Furthermore, the abilities of incumbent workers are reflected in the starting wages of linked entrants, suggesting that firms use the ability-density of social networks when setting entry wages. Overall the results suggest that firms use social networks as a signal of worker productivity, and that workers therefore benefit from the quality of their social ties. |
| Keywords: | Referrals; wage inequality; employer learning; cognitive skills |
| JEL: | J24 J31 J64 M51 Z13 |
| Date: | 2013–06–26 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2013_015&r=lab |
| By: | Jan Kleibrink |
| Abstract: | This paper analyzes the effect of educational mismatch on wages in Germany, using data from the German Socio-Economic Panel. Educational mismatch has been discussed extensively, mostly by applying OLS wage regressions which are prone to an unobserved heterogeneity bias. This problem is approached by using FE and IV models. As a stability check, the regressions are rerun using data from the International Adult Literacy Survey, allowing for an explicit control of skills as proxy of abilities. Results show that unobserved heterogeneity does not explain the wage differences between actual years of education and years of required education. This rejects the hypothesis that mismatched workers compensate for heterogeneity in innate abilities. The results suggest a structural problem in the German educational system as skill demand and supply are not in long-term equilibrium. |
| Keywords: | Wages; educational mismatch |
| JEL: | I14 I21 J31 |
| Date: | 2013–07 |
| URL: | http://d.repec.org/n?u=RePEc:rwi:repape:0421&r=lab |
| By: | Lars Kunze; Nicolai Suppa |
| Abstract: | We document the importance of non-pecuniary aspects in employment relationships by showing that labour supply elasticities differ significantly among individuals’ job characteristics. Factor analysis indicates the relevance of four characteristics: autonomy, workload, variety and job security. Using a discrete choice model of family labour supply on the basis of Australian data, we show that income elasticities are significantly higher among individuals with “good” characteristics (e.g. a securer job) whereas wage elasticities are significantly lower. This result holds for both men and women. Our main hypothesis are derived within the ‘new approach to consumer theory proposed by Lancaster. |
| Keywords: | Labour supply; Discrete choice model; Job characteristics |
| JEL: | J22 J28 J32 C25 |
| Date: | 2013–06 |
| URL: | http://d.repec.org/n?u=RePEc:rwi:repape:0418&r=lab |
| By: | Tamar Khitarishvili |
| Abstract: | This paper evaluates the gender wage gap among wage workers along the wage distribution in Georgia between 2004 and 2011, based on the recentered influence function (RIF) decomposition approach developed in Firpo, Fortin, and Lemieux (2009). We find that the gender wage gap decreases along the wage distribution, from 0.64 log points to 0.54 log points. Endowment differences explain between 22 percent and 61 percent of the observed gender wage gap, with the explained proportion declining as we move to the top of the distribution. The primary contributors are the differences in the work hours, industrial composition, and employment in the state sector. A substantial portion of the gap, however, remains unexplained, and can be attributed to the differences in returns, especially in the industrial premia. The gender wage gap consistently declined between 2004 and 2011. However, the gap remains large, with women earning 45 percent less than men in 2011. The reduction in the gender wage gap between 2004 and 2007, and the switch from a glass-ceiling shape for the gender gap distribution to a sticky-floor shape, was driven by the rising returns in the state sector for men at the bottom, and by women at the top of the wage distribution. Between 2009 and 2011, the decline in the gender wage gap can be explained by the decrease in men's working hours, which was larger than the decrease in women's working hours. We assess the robustness of our findings using the statistical matching decomposition method developed in Nopo (2008) in order to address the possibility that the high degree of industrial segregation may bias our results. The Nopo decomposition results enrich our understanding of the factors that underlie the gender wage gap but do not alter our key findings, and in fact support their robustness. |
| Keywords: | Gender Wage Gap, Decomposition Methods, Wage Distribution, Transition Economies, Georgia, Glass Ceiling Effect, Sticky Floor Effect |
| JEL: | J16 J31 P2 |
| Date: | 2013–07 |
| URL: | http://d.repec.org/n?u=RePEc:lev:wrkpap:wp_768&r=lab |
| By: | Fuest, Clemens; Peichl, Andreas; Siegloch, Sebastian |
| Abstract: | Because of endogeneity problems very few studies have been able to identify the incidence of corporate taxes on wages. We circumvent these problems by using an 11-year panel of data on 11,441 German municipalities' tax rates, 8 percent of which change each year, linked to administrative matched employer-employee data. Consistent with our theoretical model, we find a negative effect of corporate taxation on wages: a 1 euro increase in tax liabilities yields a 77 cent decrease in the wage bill. The direct wage effect, arising in a collective bargaining context, dominates, while the conventional indirect wage effect through reduced investment is empirically small due to regional labor mobility. High and medium-skilled workers, who arguably extract higher rents in collective agreements, bear a larger share of the corporate tax burden. -- |
| Keywords: | business tax,wage incidence,administrative data,local taxation |
| JEL: | H2 H7 J3 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:13039&r=lab |
| By: | Pelek, Selin (Galatasaray University Economic Research Center) |
| Abstract: | In this paper, we investigate the effect of the minimum wage on the entire wage distribution. More specifically, we address the issue of wage inequality by taking into account the potential distributional outcomes of the minimum wage legislation. We decompose the wage differences and the changes in the wage inequality before and after the sizeable minimum wage increase in 2004 following the methodology introduced by DiNardo, Fortin and Lemieux (1996). We use a non-parametric reweighting approach to decompose the effects of the minimum wage increase as well as other factors that may have changed the wage distribution. Our main findings confirm that the minimum wage has played the pivotal role in reducing wage inequality for both men and women wage earners between 2003 and 2005. |
| Keywords: | Minimum wage; wage inequality; counterfactual distributions |
| JEL: | J31 J38 |
| Date: | 2013–07–09 |
| URL: | http://d.repec.org/n?u=RePEc:ris:giamwp:2013_008&r=lab |
| By: | John P. Haisken-DeNew; Jan Kleibrink |
| Abstract: | Using data from the SOEP, we analyze the wellbeing impact of underemployment through overeducation to examine a broader definition of employment loss. Persons leaving a job through exogenous reasons but entering directly into immediate employment may not find a perfect employment match and cannot use their skills fully in the new job. We demonstrate that a „downchange“, although welfare reducing, may be more desirable than suffering the large welfare losses associated with unemployment whilst searching for a more suitable job match. Nonetheless, underemployed persons do not enter into the official job statistics, whilst their welfare loss due to „downchange“ is approximately 50% of the welfare loss of entry into unemployment. |
| Keywords: | Life satisfaction; skill mismatch; job change |
| JEL: | C23 J24 J62 |
| Date: | 2013–07 |
| URL: | http://d.repec.org/n?u=RePEc:rwi:repape:0423&r=lab |
| By: | Balleer, Almut (IIES, Stockholm University); Gehrke, Britta (University of Erlangen-Nuremberg); Lechthaler, Wolfgang (Kiel Institute for the World Economy); Merkl, Christian (University of Erlangen-Nuremberg) |
| Abstract: | In the Great Recession most OECD countries used short-time work (publicly subsidized working time reductions) to counteract a steep increase in unemployment. We show that short-time work can actually save jobs. However, there is an important distinction to be made: While the rule-based component of short-time work is a cost-efficient job saver, the discretionary component appears to be completely ineffective. In a case study for Germany, we use the rich data available to combine micro- and macroeconomic evidence with macroeconomic modeling in order to identify, quantify and interpret these two components of short-time work. |
| Keywords: | short-time work, fiscal policy, business cycles, search-and-matching, SVAR |
| JEL: | E24 E32 E62 J08 J63 |
| Date: | 2013–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7475&r=lab |
| By: | Kambayashi, Ryo; Kato, Takao |
| Abstract: | This paper provides novel evidence on the long-term effect of the Great Recession on the quality of jobs, in particular whether the Great Recession results in the replacement of “good jobs” (characterized by high wage/benefit, job security, and opportunity for training and development) with “bad jobs” (characterized by the lack of such attributes). Unfortunately there is not yet sufficiently long data from the recent Great Recession that enable researchers to study fully its long-term consequences for the labor market structure. To this end, we examine Japan’s Lost Decade, the original Great Recession that occurred two decades ago. First, we find no evidence for a shift of male employment toward “bad jobs” during the Lost Decade. Second, for women we find a compositional change from self-employment to nonstandard employment which is, however, found to be a shift from “bad jobs” to “bad jobs” rather than “good jobs” to “bad jobs”. As such, our findings cast doubt on the popular narrative of the long-term negative effect on job quality of the Great Recession. However, for one particular group of Japanese workers-youth, we find compelling evidence in support of the popular narrative. Especially all progresses that young women made in enhancing their share of standard employment during Japan’s high growth decade in the 1980s are found to be entirely undone during the Lost Decade. The Great Recession affects the quantity of jobs and policy makers ought to pay immediate attention to such quantity effects. However, the Great Recession may also have more long-term structural effects on the quality of jobs, and such long-term effects may be heterogeneous, concentrating on a specific group of workers such as youth. |
| Keywords: | job quality, good jobs and bad jobs, the Great Recession, Lost Decade, Japan |
| JEL: | J63 J64 J41 |
| Date: | 2013–06 |
| URL: | http://d.repec.org/n?u=RePEc:hit:hitcei:2013-01&r=lab |
| By: | Ambra Poggi |
| Abstract: | In the recent discussion on productivity and how to foster it, the role of wage dispersion as determinant of workers productivity attracted much attention. But, what are the determinant of wage dispersion? In this paper, we analyze a very specific determinant of wage dispersion: job-to-job labor mobility. We focus on a geographically limited labor market and we represent the firms operating in such context as a “labor mobility network”. The latter can be formally defined as a binary directed graph where vertices indicate firms and links represent transfers of workers between firms. Some firms will be connected to each others, others will be disconnected. Since the firm’s position in the network (more or less central and close to other firms) is strictly connected with opportunities of knowledge transfers and good quality matches, its position could also be associated to intra-firm wage dispersion. Using 1990-2001 Veneto (a region of Italy) matched firm-worker data, we empirically test the existence of this association. We find the central positions in the network structure are positively associated with intra-firm wage dispersion. |
| Keywords: | wage dispersion, labor mobility, network |
| JEL: | J31 J62 L14 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:cca:wplabo:133&r=lab |
| By: | David Fuller (Concordia University and CIREQ); Stephane Auray (CREST-ENSAI); Damba Lkhagvasuren (Concordia University and CIREQ) |
| Abstract: | In the US unemployment insurance (UI) system, only a fraction of those eligible for benefits actually collect them. We estimate this fraction using CPS data and detailed state-level eligibility criteria. We find that the fraction of eligible unemployed collecting benefits has been persistently below one, and is countercyclical. We show these empirical facts can be explained in an equilibrium search model where firms finance UI benefits via a payroll tax, and are heterogeneous with respect to their specific tax rate, which is experience rated. In equilibrium, low tax firms effectively offer workers an alternative UI scheme featuring a faster job arrival rate and a higher wage offer. Some eligible workers prefer the ``market'' scheme and thus do not collect UI. Quantitatively, the model does well matching key moments in the data. In addition, if all eligible unemployed collect, benefit expenditures increase by 29% and welfare increases by 0.43%. Average search effort decreases, but the unemployment rate and duration decrease as vacancy creation increases. |
| Keywords: | unemployment insurance, take-up, matching frictions, search |
| JEL: | E61 J32 J64 J65 |
| Date: | 2013–06–26 |
| URL: | http://d.repec.org/n?u=RePEc:crd:wpaper:13001&r=lab |
| By: | Cortés Aguilar Alexandra (Escuela de Economía y Administración, Universidad Industrial de Santander.); Teresa Garcia-Muñoz (Globe and Universidad de Granada.); Ana I. Moro Egido (Department of Economic Theory and Economic History, University of Granada.) |
| Abstract: | This paper analyzes the relationship between labor status and individual satisfaction in Latin America. Existing evidence for developed countries shows that the self-employed report higher job satisfaction than the employed. The evidence, however, is less conclusive in terms of lifesatisfaction. Moreover, for Latin American countries, the evidence shows that self-employed individuals report lower life-satisfaction than employed individuals do. To clarify the effect of selfemployment on satisfaction, we use the Latinobarómetro survey 2007 for eighteen Latin American and Caribbean countries, considering the category self-employment as a heterogeneous category. Additionally, we control for the distinction between necessity and opportunity self-employed. Contrary to existing evidence, we find that not all self-employed individuals are more satisfied than employed individuals. Specifically, we find evidence revealing that, compared to workers in paid employment (i) precarious self-employed workers are as satisfied as the employed with their life but less with job and household income; (ii) self-employed professionals are more satisfied than the employed only with their incomes; (iii) business owners are more satisfied with their lives, income and job; and (iv) self-employed famers and fisherman are less satisfied with their jobs and income. |
| Keywords: | Labor informality, voluntary vs. involuntary self-employment,life and job satisfaction |
| JEL: | C25 I31 J24 J28 O17 |
| Date: | 2013–06–25 |
| URL: | http://d.repec.org/n?u=RePEc:gra:wpaper:13/05&r=lab |
| By: | Cappellari, Lorenzo; Jenkins, Stephen P. |
| Abstract: | We provide new evidence about earnings and labour market volatility in Britain over the period 19922008, and for women as well as men. (Most research about volatility refers to earnings volatility for US men.) We show that earnings volatility declined slightly for both men and women over the period but the changes are not statistically significant. When we look at labour market volatility, i.e. including in the calculations individuals with zero earnings as well as employees with positive earnings, there is a marked and statistically significant decline for both women and men, with the fall greater for men. Using variance decompositions, we show that the fall in labour market volatility is largely accounted for by changes in employment attachment rates. Labour market volatility trends in Britain, and what contributes to them, differ from their US counterparts in several respects. |
| Date: | 2013–07–10 |
| URL: | http://d.repec.org/n?u=RePEc:ese:iserwp:2013-10&r=lab |
| By: | Pushkar Maitra (Monash University); Subha Mani (Fordham University) |
| Abstract: | This paper estimates the short-and-medium-run effects of participating in a subsidized vocational training program aimed at improving labor market outcomes of women residing in low-income households in a developing country. We combine pre-intervention data with two rounds of post-intervention data from a field experiment to quantify the short-and-medium-run effects of the program. In the short-run, we find that program participants are significantly more likely to be employed, work additional hours, and earn more. These short-run impact estimates are all sustained in the medium-run. We also identify credit constraints, local access, and lack of proper child care support as important barriers to program participation and completion. We are able to rule out two alternative mechanisms -- signalling and change in behavior that can drive these findings. Finally, a simple cost-benefit analysis suggests that the program is highly cost effective. |
| Keywords: | Vocational training, Field Experiment, Panel data, India |
| JEL: | I21 J19 J24 O15 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:frd:wpaper:dp2013-02&r=lab |
| By: | Baert, Stijn; Balcaen, Pieter |
| Abstract: | This study directly assesses the impact of military work experience compared with civilian work experience in similar jobs on the subsequent chances of being hired in the civilian labour market. It does so through a field experiment in the Belgian labour market. A statistical examination of our experimental dataset shows that in general we cannot reject that employers are indifferent to whether job candidates gained their experience in a civilian or a military environment. -- |
| Keywords: | field experiments,hiring discrimination,economics of defence |
| JEL: | C93 J45 J24 J71 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwedp:201334&r=lab |
| By: | Eichhorst, Werner (IZA); Hinte, Holger (IZA); Rinne, Ulf (IZA) |
| Abstract: | Youth unemployment has become a severe economic and societal problem in many European countries. This paper gives an overview of the current situation and assesses different policy options. It emphasizes the role of stronger intra-EU mobility of young workers, policies to make vocational training systems more effective and to adjust employment protection as well as activating labor market policies. However, short-term remedies are not available, despite the fact that the EU has announced massive European initiatives. Rather, European countries should take the opportunity of the crisis to implement forward-looking structural reforms. |
| Keywords: | youth unemployment, vocational training, Europe, fixed-term contracts |
| JEL: | J24 J64 J13 |
| Date: | 2013–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izapps:pp65&r=lab |
| By: | Addison, John T. (University of South Carolina); Teixeira, Paulino (University of Coimbra); Evers, Katalin (Institute for Employment Research (IAB), Nuremberg); Bellmann, Lutz (Institute for Employment Research (IAB), Nuremberg) |
| Abstract: | This study provides updated evidence on the union contract differential in Germany using establishment-wide wage data and two estimation strategies. It provides pairwise estimates of the union differential based on separate samples of collective bargaining leavers and joiners vis-à-vis the corresponding counterfactual groups. It is reported that average wages increase by 3 to 3.5 percent after entering into a collective agreement and decrease by 3 to 4 percent after abandoning a collective agreement. Excluding establishments that experience mass layoffs little influences these net findings, although such establishments record wage losses – statistically insignificant for joiners but up to 10 percent in the case of leavers, as compared with the counterfactuals. The backdrop to these new indicative estimates, which are properly conditioned on establishment size and industry affiliation, inter al., is one of wage stagnation and continuing union decline. |
| Keywords: | average wages, union contract premium, collective bargaining transitions, difference-in-differences, matching, Germany |
| JEL: | J31 J51 |
| Date: | 2013–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp7474&r=lab |
| By: | Pille Motsmees; Jaan Masso; Raul Eamets |
| Abstract: | The existing literature on return migration has resulted in several studies analysing the impact of foreign work experience on the returnees' earnings or their decision to become self-employed; however, in this paper we analyse the less studied effect on occupational mobility - how the job in the home country after returning compares to the job held before migration. The effect of temporary migration on occupational mobility is analysed using unique data from an Estonian online job search portal covering approximately 10-15% of the total workforce, including thousands of employees with temporary migration experience. The focus on data from a Central and Eastern European country is motivated given that the opening of labour markets in old EU countries to the workforce of the new member states has led to massive East-West migration. We did not find any positive effect of temporary migration on upward occupational mobility and in some groups, such as females, the effect was negative. These results could be related to the typically short-term nature of migration and occupational downshifting abroad as well as the functioning of the home country labour market. |
| Keywords: | occupational mobility, temporary migration, Central- and Eastern Europe |
| JEL: | F22 J62 |
| Date: | 2013–07–05 |
| URL: | http://d.repec.org/n?u=RePEc:cel:dpaper:14&r=lab |
| By: | Paul Gertler; James Heckman; Rodrigo Pinto; Arianna Zanolini; Christel Vermeersch; Susan Walker; Susan M. Chang; Sally Grantham-McGregor |
| Abstract: | We find large effects on the earnings of participants from a randomized intervention that gave psychosocial stimulation to stunted Jamaican toddlers living in poverty. The intervention consisted of one-hour weekly visits from community Jamaican health workers over a 2-year period that taught parenting skills and encouraged mothers to interact and play with their children in ways that would develop their children's cognitive and personality skills. We re-interviewed the study participants 20 years after the intervention. Stimulation increased the average earnings of participants by 42 percent. Treatment group earnings caught up to the earnings of a matched non-stunted comparison group. These findings show that psychosocial stimulation early in childhood in disadvantaged settings can have substantial effects on labor market outcomes and reduce later life inequality. |
| JEL: | I10 I20 I25 J20 O15 |
| Date: | 2013–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:19185&r=lab |
| By: | Siar, Sheila V. |
| Abstract: | Traditional immigration countries such as United States, Canada, Australia, and New Zealand give preference to migrants with higher education, skills, and professional training that they can transfer to their countries. However, it is not unusual for migrant professionals, especially those from less developed countries, to experience 'deskilling' or occupational downward mobility. Though admitted as professionals based on the immigration policies of the destination countries, many of them are relegated to lower status and lower paying jobs, owing to the nonrecognition of their foreign credentials and the bias for education acquired in the host country or in academic institutions in developed countries, local experience, cultural know-how, and English proficiency. Their foreign credentials and skills often fail to provide the expected occupational rewards and professional development gains which have been a significant part of their motivation to migrate overseas, especially to more developed countries. Deskilling may be viewed in several ways: as a host country`s way of filling up labor scarcities in the secondary market by exploiting cheap enclave labor, as a transitional phase for migrants to adjust to the 'standards' of the host country, or as a form of institutionalized discrimination. This paper reviews the deskilling phenomenon to highlight its deleterious effects on migrants` welfare. Some theoretical explanations of deskilling are also examined. Examples of deskilling experiences of different migrant groups show that it is a complex phenomenon that demonstrates the interplay of race, ethnicity, and gender. |
| Keywords: | skilled migration, migrant labor, deskilling, job devaluation, brain waste |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:phd:dpaper:dp_2013-30&r=lab |
| By: | Arceo-Gomez, Eva O.; Campos-Vázquez, Raymundo M. |
| Abstract: | In Mexico, as in most Latin American countries with indigenous populations, it is commonly believed that European phenotypes are preferred to mestizo or indigenous phenotypes. However, it is hard to test for such racial biases in the labor market using official statistics since race can only be inferred from native language. Moreover, employers may think that married females have lower productivity, and hence they may be more reluctant to hire them. We are interested in testing both hypotheses through a field experiment in the labor market. The experiment consisted on sending fictitious curriculums (CVs) responding to job advertisements with randomized information of the applicants. The CVs included photographs representing three distinct phenotypes: Caucasian, mestizo and indigenous. We also randomly vary marital status across gender and phenotype. Hence, our test consists on finding whether there are significant differences in the callback rates. We find that females have 40 percent more callbacks than males. We also find that indigenous looking females are discriminated against, but the effect is not present for males. Interestingly, married females are penalized in the labor market and this penalty is higher for indigenous-looking women. We did not find an effect of marital status on males. |
| Keywords: | Discrimination; Gender; Race; Marriage; Labor market; Mexico; Hiring; Correspondence study. |
| JEL: | J12 J15 J16 J7 J71 J83 O54 |
| Date: | 2013–06–30 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:48000&r=lab |
| By: | Kao-Lee Liaw; Lei Xu |
| Abstract: | This research attempts to figure out whether the wage distributions of Canadian wage earners have been moving towards or away from the flowing three ideals in the early part of the 21th century. First, there be a pattern of wage increase that is shared by a large majority of wage earners. Second, the historical gender inequality in wage be reduced. Third, there be a decrease in wage inequality for both males and females. We use the long-form records of the 2001 and 2006 population censuses to carry out our investigation. A nice feature of these records is that the values of income variables are not top-coded so that the true averages will not be understated and good insights into the situations of those with extremely high incomes can be obtained. We are disappointed by finding that the Canadian economy mostly drifted away from our three ideals, with the main exception being that for female wage earners the improvement in wage was fortunately shared by a large majority. We believe that an important reason for our disappointing finding is the progressive entrenchment of market fundamentalism in Canada. Incidentally, we have discovered that Statistics Canada did a good job in designing the 2006 census questionnaire so that the annoying choppiness that occurred to the 2000 wage distributions vanished in the 2005 wage distributions. |
| Keywords: | male and female wage distributions, gender inequality, wage inequality, Canada, long-form census records, market fundamentalism |
| JEL: | D31 H31 H24 |
| Date: | 2013–06 |
| URL: | http://d.repec.org/n?u=RePEc:mcm:qseprr:451&r=lab |
| By: | Motkuri, Venkatanarayana; Veslawatha, Suresh Naik |
| Abstract: | Census 2011 brings new dimension to ongoing debate on the decline in the growth of employment from the last two decade. The census 2011 result gives better picture when compared with NSSO estimation of workforce. It is observed that there is a fast decelerating rate of growth in overall workforce, particularly that of females, between 2001 and 2011. But the work participation rate has not declined, if not increase, as the rate of growth in workforce is not less than that of population. Secondly, incremental workforce especially the male is getting reduced to marginal workers category whereas the high concentration of female in the category of marginal workers is slightly reduced. Occupational distribution of workforce shows that cultivators are declining such decline in agriculture is replaced by increasing agricultural labour. Growth of workforce in non-agriculture is higher than that of agriculture. Growth of female workers engaged in non-agriculture is higher than their male counterparts. |
| Keywords: | Workforce, Growth of Employment, Work Participation, Occupational Distribution and Workforce in Non-Agriculture |
| JEL: | J6 J62 Q1 |
| Date: | 2013–05–17 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:48003&r=lab |
| By: | Thomas Horvath; Peter Huber |
| Abstract: | We analyse the role of ethnic networks, segregation and diversity of a region on migrants’ success in integration into the host countries’ labour markets. We find a robust negative impact of ethnic networks on unemployment probabilities of the foreign born and a positive one on employment probabilities. In addition a similarly robust positive impact of ethnic diversity on the unemployment probabilities and a negative one on employment probabilities is found. With respect to over-education our results are less robust, but in their majority point to a negative impact of ethnic networks on the probability of over-educated employment and an insignificant or positive impact of diversity. Segregation at the country level, by contrast, remains an insignificant determinant of both the probability of unemployment and of overeducated employment in most specifications and all three variables seem to be only very weakly correlated to the probability of being detached from the labour market and to the probability of being in education. |
| Keywords: | Integration, networks, diversity |
| JEL: | D83 J71 R23 |
| Date: | 2013–07 |
| URL: | http://d.repec.org/n?u=RePEc:feu:wfewop:y:2013:m:7:d:0:i:22&r=lab |
| By: | Dessi, Roberta (IDEI, Toulouse School of Economics); Miquel-Florensa, Pepita (Toulouse School of Economics) |
| Abstract: | We study the role of status in an experimental Principal-Agent game.Status is awarded to subjects based on either talent or luck. In each randomly matched principal-agent pair, the principal chooses the agent's status-contingent piece rate for a task in which talent matters for performance (an IQ test). We perform the experiment in Cambridge (UK) and in HCMV (Vietnam). We find that in Cambridge piece rate others are significantly higher for high-status agents (only) when status signals talent. However, these higher offers are not payoff-maximizing for the principals.In contrast, Vietnam piece rate offers are significantly higher for high-status agents (only) when status is determined by luck. We explore possible explanations, and the implications for status and incentives. |
| Keywords: | , , incentives, status, identity, piece rate, principal-agent, signaling, culture. |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:ide:wpaper:27274&r=lab |
| By: | Joshua Congdon-Hohman (Department of Economics, College of the Holy Cross); Jonathan A. Lanning (Department of Economics, Bryn Mawr) |
| Abstract: | This study examines ways in which workers respond to implicit incentives. Specifically, we examine the extent to which workers shift their effort to activities that are measured and which have been previously rewarded in the labor market. To examine this question, we examine the changes in the performance measures of professional baseball players in the season prior to the opportunity to freely negotiate their contract (free agency). We will examine different eras in baseball to examine if we can identify changes in behavior in this pivotal year based on changes to the current premium outputs for each time period. |
| Keywords: | Agency theory, strategic performance, opportunistic behavior, baseball |
| JEL: | J24 J31 L83 |
| Date: | 2013–07 |
| URL: | http://d.repec.org/n?u=RePEc:hcx:wpaper:1304&r=lab |
| By: | Steinar Strøm; Alessandra Venturini; Claudia Villosio |
| Abstract: | The paper wants to understand the assimilation pattern of foreign migrants in Italy. Three novelties characterize this study. First, the research compares the wage assimilation of international migrants with both internal migrants and local natives in Italy, a country with substantial internal and international migration. This comparison, never exploited before, provides indirect evidence for the role played by language and knowledge of social capital in the assimilation of foreign migrants relative to both natives and internal migrants. Second, we inquired into the possible causes of under-assimilation by controlling for the date of entry and migrant sector concentration. Third, we model new corrections of the selection bias due to return migration. The correction for the selection bias is introduced in the wage equation through a duration extension of the traditional Heckman correction term and alternatively through a hazard rate correction. The empirical test uses the Italian administrative dataset on dependent employment (WHIP), to estimate a fixed effect model for the weekly wages of males aged 18-45 with controls for selection in return migration and unobserved heterogeneity. The three groups of workers start their careers at the same wage level. But, as experience increases, the wage profiles of foreign nationals and natives, both internal migrants and locals, diverges which seems to hint at the importance of language and social capital. However, sector-by-sector analysis shows that in “migrant intense sectors†internal migrants and locals have the same wage profile as foreign workers. Positive selection in returns reinforces the view that the best leave because they have few career options. Thus under assimilation is caused more by community and job segregation than by a lack of language and social capital: alternatively it is the result of their interrelations. |
| Keywords: | Migration, Assimilation, Wage differential, Return Migration |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:rsc:rsceui:2013/30&r=lab |
| By: | Nina Neubecker |
| Abstract: | This paper assesses a recent prediction of the theoretical migration literature, according to which migration may be driven by a desire to avoid social humiliation rising from occupational stigma. To this end, we study the residential mobility of workers in occupations with relatively low prestige using data from the German Socio-Economic Panel (SOEP). In order to capture low occupational prestige, we relate the prestige of a worker's current occupation to the average prestige of the occupations associated with the worker's vocational training. Our estimation results suggest a negative relationship between the incidence of low occupational prestige and the probability of internal migration in Germany and thus reject our working hypothesis. We discuss the role of specific migration costs and occupational cultures as possible explanations of this result. The absolute prestige level of a worker's occupation does not turn out to be a significant predictor of his propensity to migrate, whereas his absolute income level - but not his relative income level - is significantly positively related to this propensity. |
| Keywords: | Internal migration, Germany, occupational status, occupational prestige, income, vocational training |
| JEL: | J61 R23 Z13 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp562&r=lab |
| By: | Sommerfeld K.; Steffes S.; Fitzenberger B. (GSBE) |
| Abstract: | The effects of childbirth on future labor market outcomes are a key issue for policy discussion. This paper implements a dynamic treatment approach to estimate the effect of having the first child now versus later on future employment for the case of Germany, a country with a long maternity leave coverage. Effect heterogeneity is assessed by estimating ex post outcome regressions. Based on SOEP data, we provide estimates at a monthly frequency. The results show that there are very strong negative employment effects after childbirth. Although the employment loss is reduced over the first five years following childbirth, it does not level off to zero. The employment loss is lower for motherswith a university degree. It is especially high for medium-skilled mothers with long prebirthemployment experience. We find a significant reduction in the employment loss for more recent childbirths. |
| Keywords: | Semiparametric and Nonparametric Methods: General; Fertility; Family Planning; Child Care; Children; Youth; Time Allocation and Labor Supply; |
| JEL: | C14 J13 J22 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:umagsb:2013031&r=lab |