|
on Labour Economics |
| By: | Weichselbaumer, Doris (University of Linz) |
| Abstract: | Germany is currently experiencing a high influx of Muslim migrants. From a policy perspective, integration of migrants into the labor market is crucial. Hence, a field experiment was conducted that examined the employment chances of females with backgrounds of migration from Muslim countries, and especially of those wearing headscarves. It focused on Turkish migrants, who have constituted a large demographic group in Germany since the 1970s. In the field experiment presented here, job applications for three fictitious female characters with identical qualifications were sent out in response to job advertisements: one applicant had a German name, one a Turkish name, and one had a Turkish name and was wearing a headscarf in the photograph included in the application material. Germany was the ideal location for the experiment as job seekers typically attach their picture to their résumé. High levels of discrimination were found particularly against the migrant wearing a headscarf. |
| Keywords: | discrimination, Muslim religion, headscarf, hiring, experiment |
| JEL: | C93 J15 J71 |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10217&r=lab |
| By: | Hamzeh Arabzadeh (Paris School of Economics, Université Paris 1 Panthéon-Sorbonne, CES and UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES)) |
| Abstract: | This paper contributes to the literature on current account imbalances. Econometric analysis of the paper finds evidence that wage centralization, in a cross-section of industrialized economies, significantly improve current accounts through reducing budget deficits. To explain this empirical finding, the paper provides a political economy framework in which the government follows preferences of N-sector workers (majority rule). An increase in public and so, current account deficits by issuing external public debt leads to real appreciation of the currency. As between-sector mobility is constrained by friction in the labor market, wages in N-sector rises. The opposite happens if the government improves the two balances by rising its saving. Thus, N-sector workers relatively support (oppose) more a rise (reform) in the two deficits. Centralization of wage bargaining moderates the benefit and costs from such twin-deficit policies by reducing the responsiveness of sectoral wage with respect to sectoral prices. Thus, the more centralized is the wage determination, the less N-sector workers support (oppose) a rise (reform) in the two deficits. Correspondingly, more centralized wage bargaining reduces the government's political incentive (cost) to deteriorate (reform) the external balance through the fiscal balance. |
| Keywords: | Twin deficits, Current account imbalances, Dutch disease, Search and Match, Wage bargaining Centralization, Real Exchange rate |
| JEL: | F32 E62 J31 J51 J6 F41 |
| Date: | 2016–08–27 |
| URL: | http://d.repec.org/n?u=RePEc:ctl:louvir:2016017&r=lab |
| By: | Chen, Daniel L.; Sethi, Jasmin |
| Abstract: | Sexual harassment is perceived to be a major impediment to female labor force participation. We use the random assignment of U.S. federal judges setting geographically-local precedent, and the fact that judges’ biographies predict decisions in sexual harassment cases, to document the causal impact of forbidding sexual harassment. Consistent with an insider-outsider theory of involuntary unemployment, but in contrast to a mandated benefits theory of employment protections, pro-plaintiff sexual harassment precedent spurred the adoption of sexual harassment human resources policies, encouraged entry of outsiders, and reduced gender inequality in labor supply and wages among the population. These effects were comparable to the effects of the Equal Employment Opportunity Act and greatest in the construction industry, which was heavily affected by sexual harassment litigation. |
| Keywords: | Gender discrimination, microaggression, trauma, safe spaces, prejudice |
| JEL: | J31 J71 J81 J83 K31 |
| Date: | 2016–08 |
| URL: | http://d.repec.org/n?u=RePEc:tse:iastwp:30833&r=lab |
| By: | Jaison R. Abel; Richard Deitz |
| Abstract: | Though labor market conditions steadily improved following the Great Recession, underemployment among recent college graduates continued to climb, reaching highs not seen since the early 1990s. In this paper, we take a closer look at the jobs held by underemployed college graduates in the early stages of their careers during the first few years after the Great Recession. Contrary to popular perception, we show that relatively few recent graduates were working in low-skilled service jobs, and that many of the underemployed worked in fairly well paid non-college jobs requiring some degree of knowledge and skill. We also find that the likelihood of being underemployed was lower for those with more quantitatively oriented and occupation-specific majors than it was for those with degrees in general fields. Moreover, our analysis suggests that underemployment is a temporary phase for many recent college graduates as they transition to better jobs after spending some time in the labor market, particularly those who start their careers in low-skilled service jobs. |
| JEL: | I23 J23 J24 J62 |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22654&r=lab |
| By: | Stillman, Steven (Free University of Bozen/Bolzano); Velamuri, Malathi |
| Abstract: | A number of recent papers have found that non-cognitive skills and in particular, locus of control (LoC), are important predictors of success in life in terms of both traditional labor market and socioeconomic outcomes, and measures of subjective wellbeing. Specifically, the literature has found a strong correlation between having an internal locus of control and standard measures of success and happiness. In this paper, we examine whether having an internal LoC also helps people manage the consequences of two mainly unanticipated negative shocks, being a crime victim and experiencing a serious illness or injury. We find that these events have large negative consequences on both subjective wellbeing and objective economic outcomes. For men, these shocks have smaller effects on subjective wellbeing when they are more internal but that the long-run effects on income are no smaller. On the other hand, for women with an internal LoC, we find some evidence that these shocks have larger impacts. We draw on the psychology literature to discuss the results. |
| Keywords: | locus of control, crime, illness, wellbeing, HILDA |
| JEL: | I31 J16 |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10210&r=lab |
| By: | Ivlevs, Artjoms (University of the West of England, Bristol) |
| Abstract: | This paper studies the effects of remittances on informal employment in the migrants' countries of origin, looking both at the remittance-receiving and non-migrant households. Using data from the Social Exclusion Survey, conducted in six transition economies in 2009, I find that receiving remittances increases the likelihood of working informally. At the regional level, high prevalence of remittances is associated with a higher likelihood of informal work among non-migrant households. Migration and remittances may thus be contributing to informal employment in migration-sending countries. |
| Keywords: | remittances, migration, informal work, non-migrant households, transition economies, two stage residual inclusion |
| JEL: | F24 J46 J61 R23 O17 |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10196&r=lab |
| By: | Chen, Daniel L. |
| Abstract: | Scholars since Hume and Smith have debated possible causal connections between market experiences and moral beliefs. Of particular interest today are questions related to incentive designs: for example, could the structure of employment affect moral attitudes? Here, I study the impact of employment structure on three normative issues: utilitarian versus deontological values, other-regarding preferences, and charitable donations. Through a labor market intermediary, I randomly assigned workers to competitive or piece-rate work conditions. The groups were given a moral question posing a conflict between utilitarian and deontological values, and offered a choice to make a charitable donation. The moral question was accompanied by an illustration that made salient outgroup considerations. Four results emerge: Competitively structured work experiences increased deontological value choices, deontological commitments towards outgroup members, and donations by productive workers relative to non-productive workers; and the effects on deontological value choices differ over economic development. I reconcile these results with a formal model based on experimental findings in affective moral psychology. When competition is perceived as unfair or unfamiliar, negative affect triggers deontological value choices, but when it is perceived as familiar or even fun, positive affect increases utilitarian attitudes. If utilitarian attitudes lead to market-oriented policies, multiple steady states arise where some countries sustain high utilitarianism, market-orientation, and economic growth, and vice versa. This perspective helps explain the intellectual history of the doux commerce thesis. |
| Keywords: | Normative commitments, deontological value choices, other-regarding preferences, charitable donations, moral trolley problem |
| JEL: | B51 C93 D63 D64 J15 K00 |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:tse:iastwp:30834&r=lab |
| By: | Goel, Deepti (Delhi School of Economics); Deshpande, Ashwini (Delhi School of Economics) |
| Abstract: | Using data from two rounds of the Employment-Unemployment Survey of the National Sample Survey for 2004-5 and 2009-10, we investigate the relationship between social identity, specifically caste identity in India, and perceptions of self-worth as measured by the amounts that individuals consider as remunerative earnings from self-employment. We also investigate if institutional change (e.g. a policy intervention such as an employment guarantee program, or change in the ruling party in power) mitigates this relationship. Finally, we examine the relationship between caste identity and actual earnings, and how institutional change can influence it. Our main finding is that caste identity in contemporary India does shape perceptions of self-worth. Among the fully self-employed, we find that controlling for other characteristics, lower-ranked groups earn lower amounts and perceive lower amounts as being remunerative. Further, institutional factors alter self-perceptions differentially for different caste groups, but in more nuanced ways than our ex-ante beliefs. |
| Keywords: | caste discrimination, remunerative earnings, political economy |
| JEL: | J15 O15 P16 |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10198&r=lab |
| By: | Kehoe, Patrick J. (Federal Reserve Bank of Minneapolis); Midrigan, Virgiliu (New York University); Pastorino, Elena (Federal Reserve Bank of Minneapolis) |
| Abstract: | During the Great Recession, regions of the United States that experienced the largest declines in household debt also experienced the largest drops in consumption, employment, and wages. Employment declines were larger in the nontradable sector and for firms that were facing the worst credit conditions. Motivated by these findings, we develop a search and matching model with credit frictions that affect both consumers and firms. In the model, tighter debt constraints raise the cost of investing in new job vacancies and thus reduce worker job finding rates and employment. Two key features of our model, on-the-job human capital accumulation and consumer-side credit frictions, are critical to generating sizable drops in employment. On-the-job human capital accumulation makes the flows of benefits from posting vacancies long-lived and so greatly amplifies the sensitivity of such investments to credit frictions. Consumer-side credit frictions further magnify these effects by leading wages to fall only modestly. We show that the model reproduces well the salient cross-regional features of the U.S. data during the Great Recession. |
| Keywords: | Search and matching; Employment; Debt constraints; Human capital |
| JEL: | E21 E24 E32 J21 J64 |
| Date: | 2016–09–19 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedmsr:536&r=lab |
| By: | Synøve N. Andersen; Kjetil Telle (Statistics Norway) |
| Abstract: | The replacement of custodial with non-custodial sanctions holds the potential to reduce recidivism as well as other costs associated with imprisonment. However, the causal impacts on recidivism of noncustodial sanctions in general, and electronic monitoring (EM) programs in particular, remain unclear. We estimate the effect of EM on recidivism by exploiting an EM program that was gradually introduced in Norwegian counties from 2008, using difference-in-differences and instrumental variable designs. Results show that introducing EM reduced 2-year recidivism rates by about 10 percent, which corresponds to about 19 percent for those actually serving on EM. We find no effects on recidivism intensity or severity. Subsample analyses show that the effect estimates are strongest among offenders without previous imprisonment or recent unemployment spells, and although between-groups differences are statistically non-significant, this suggest that avoiding prison stigma and maintaining workplace relations can be important to reduce recidivism and promote desistance. The reliability of our results is somewhat challenged by unstable pre-implementation trends and signs that more people are convicted to EM-qualifying sentences when EM is introduced. |
| Keywords: | Electronic monitoring; non-custodial sanctions; recidivism; difference-in-differences; instrumental variable |
| JEL: | K49 J19 |
| Date: | 2016–08 |
| URL: | http://d.repec.org/n?u=RePEc:ssb:dispap:844&r=lab |
| By: | Christian Dudel (Max Planck Institute for Demographic Research, Rostock, Germany); María Andrée López Gómez; Fernando Benavides; Mikko Myrskylä (Max Planck Institute for Demographic Research, Rostock, Germany) |
| Keywords: | Spain, working life |
| JEL: | J1 Z0 |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:dem:wpaper:wp-2016-010&r=lab |
| By: | Bloom, David E.; Kuhn, Michael; Prettner, Klaus |
| Abstract: | We analyze the economic consequences for less developed countries of investing in female health. We do this through developing and calibrating a novel micro-founded dynamic general equilibrium model in which parents trade off the number of children against investments in their education and in which we allow for health-related gender differences in productivity. We show that better female health speeds up the demographic transition and thereby the take-off toward sustained economic growth. By contrast, male health improvements delay the transition and take-off because ceteris paribus they raise fertility. Investing in female health is therefore a potent lever for promoting development. |
| Keywords: | economic development,educational transition,female health,fertility transition,quality-quantity trade-off |
| JEL: | O11 I15 I25 J13 J16 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:hohdps:112016&r=lab |
| By: | Ruxanda Berlinschi |
| Abstract: | This paper investigates the effects of work experience abroad on political opinions using survey data from Moldova, a former soviet republic caught in an ideological battle between Russia and the West, with high emigration rates to both destinations. Contrarily to studies conducted in Africa or Latin America, we find no effect of past migration on democratic participation or on critical governance assessment. Likewise, no effect is found on domestic policy preferences. The one dimension strongly associated with migration experience is geopolitical preference, whereby return migrants from former Soviet countries are more likely to support closer ties with Russia, while return migrants from Western countries show higher support for EU integration, controlling for economic, demographic and ethnic confounding factors. For identification, we instrument individual migration with district level migrant networks. IV regressions show that only work experience in Western countries affects geopolitical preferences. |
| Keywords: | return migration, political opinions, Moldova, survey data. |
| JEL: | P3 J61 D72 D83 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:lic:licosd:38316&r=lab |
| By: | Florian, David (Banco Central de Reserva del Perú); Francis, Johanna L. (Fordham University) |
| Abstract: | The Great Recession of 2008-09 was characterized by high and prolonged unemployment and lack of bank lending. The recession was preceded by a housing crisis that quickly spread to the banking and broader financial sectors. In this paper, we attempt to account for the depth and persistence of unemployment during and after the crisis by considering the relationship between credit and firm hiring explicitly. We develop a New Keynesian model with nominal rigidities in wages and prices augmented by a banking sector characterized by search and matching frictions with endogenous credit destruction. In the model, financial shocks are propagated and amplified through significant variation over the business cycle in the endogenous component of the total factor productivity, the credit inefficiency gap, arising from the existence of search and matching frictions in the credit market. In response to a financial shock, the model economy produces large and persistent increases in credit destruction, declines in credit creation, and overall declines in excess reallocation among banks and firms. The tightening of the credit market results in a sharp rise in the average interest rate spread and the average loan rate. Due to the increase in credit inefficiency that arises from the reduction in firm-bank matches, total factor productivity declines and unemployment increases. Total factor productivity and unemployment take at least 12 quarters to return to baseline. This result is due to a combination of nominal and real frictions. Credit frictions not only amplify the effect of financial shocks by creating variation in the number of firms able to produce due to credit restrictions following a shock - an extensive margin effect - as well as in labor demand by each firm, but they also increase the persistence of the shock's effects. Nominal rigidities play an important role primarily increasing the amplitude of the responses of credit and output variables. These findings suggest that credit frictions are a plausible amplification mechanism for the impact of financial shocks and also provide a means for such shocks to impact the labor market in a number of important ways. |
| Keywords: | Unemployment, nancial crises, gross credit ows, productivity |
| JEL: | J64 E32 E44 E52 |
| Date: | 2016–09 |
| URL: | http://d.repec.org/n?u=RePEc:rbp:wpaper:2016-007&r=lab |