|
on Labour Economics |
| By: | Ayuso, Mercedes (University of Barcelona); Bravo, Jorge Miguel (Universidade Nova de Lisboa); Holzmann, Robert (University of New South Wales) |
| Abstract: | This paper demonstrates that the link between heterogeneity in longevity and lifetime income across countries is mostly high and often increasing; that it translates into an implicit tax/subsidy, with rates reaching 20 percent and higher in some countries; that such rates risk perverting redistributive objectives of pension schemes and distorting individual lifecycle labor supply and savings decisions; and that this in turn risks invalidating current reform approaches of a closer contribution-benefit link and life expectancy-indexed retirement age. All of this calls for mechanisms that neutralize or at least significantly reduce the effects of heterogeneity in longevity through changes in pension design. The paper suggests and explores a number of interventions in the accumulation, benefit determination, and disbursement stages. Among the explored approaches, a two-tier contribution structure seems promising, as a moderate social contribution rate that is already proportionally allocated to the average contribution base is able to broadly compensate for empirically established heterogeneity in the life expectancy/lifetime income relationship. |
| Keywords: | defined contribution scheme, two-tier contribution structure, proxied life expectancy, tax/subsidy structure |
| JEL: | D9 G22 H55 J13 J14 J16 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10378&r=lab |
| By: | Sekou KEITA; Jérome VALETTE |
| Abstract: | Which factors determine the performance of immigrants in the destination country labor market? Evidence in the literature suggests that discrimination may be a barrier to the economic assimilation of immigrants. However, depending on their country of origin, immigrants are heterogeneous with respect to the discrimination they face. This paper investigates how the attitude of natives affects immigrants’ unemployment duration in Germany. Using individual level panel data from the German Socio Economic Panel from 1984 to 2012, we employ survival analysis methods to model immigrants’ unemployment duration. We find that lower trust levels of natives towards the citizens of a given country, measured using Eurobarometer surveys, positively influence the unemployment duration of immigrants originating from this country. We show that this result is not driven by origin-specific unobserved heterogeneity, and that it is robust to different definitions of unemployment and different specifications. The results of our paper highlight the fact that immigrants face different obstacles depending on their origin when it comes to integrating destination country labor markets. |
| Keywords: | Immigrant workers, Unemployment duration, Discrimination. |
| JEL: | J71 J64 J61 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:cdi:wpaper:1836&r=lab |
| By: | Lepinteur, Anthony (Paris School of Economics); Flèche, Sarah (CEP, London School of Economics); Powdthavee, Nattavudh (University of Warwick) |
| Abstract: | The current study argues that women's decision to leave the labor force at the point where their income exceeds their husbands' income may have less to do with gender identity norm (Bertrand et al., 2015) and more to do with what women think is a fair distribution of relative working hours within the household. Using three nationally-representative data, we show that life satisfaction is significantly lower among women whose work hours exceed their partners, holding the share of wife's income constant. Men, by contrast, are not affected by working longer or fewer hours than their wives. |
| Keywords: | fairness, gender identity, life satisfaction, relative income, working hours, labor supply |
| JEL: | I31 J12 J22 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10382&r=lab |
| By: | Arai, Mahmood (Stockholm University); Gartell, Marie (Swedish public employment services (Arbetsförmedlingen)); Rödin, Magnus (Swedish public employment services (Arbetsförmedlingen)); Özcan, Gülay (Swedish public employment services (Arbetsförmedlingen)) |
| Abstract: | Using an experimental setup involving 436 case workers at the Swedish Public Employment Service (SPES) as subjects and the profile photographs and recorded voices of 75 jobseekers as treatments, we report results indicating that male case workers tend to favor jobseekers perceived as having a stereotypical Swedish appearance when they select candidates to be recommended for labor market programs (LMP). This bias represents a roughly 50-percent greater chance of being selected if you compare the candidate with the highest score with regard to stereotypical Swedish looks (8/10) with the candidate with the lowest score (3/10) in our sample. |
| Keywords: | discrimination; ethnic discrimination; racial discrimination; stereotypes; noncognitive attributes |
| JEL: | J15 J70 |
| Date: | 2016–11–22 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2016_020&r=lab |
| By: | Kahanec, Martin (Central European University); Pytlikova, Mariola (CERGE-EI) |
| Abstract: | This study contributes to the literature on destination‐country consequences of international migration with investigations on the effects of immigration from new EU member states and Eastern Partnership countries on the economies of old EU member states over the years 1995‐2010. Using a rich international migration dataset and an empirical model accounting for the endogeneity of migration flows we find positive and significant effects of post‐enlargement migration flows from new EU member states on old member states' GDP, GDP per capita, and employment rate and a negative effect on output per worker. We also find small, but statistically significant negative effects of migration from Eastern Partnership countries on receiving countries' GDP, GDP per capita, employment rate, and capital stock, but a positive significant effect on capital‐to‐labor ratio. These results mark an economic success of the EU enlargements and EU's free movement of workers. |
| Keywords: | EU enlargement, free mobility of workers, migration impacts, European Single Market, east‐west migration, Eastern Partnership |
| JEL: | J15 J61 J68 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10381&r=lab |
| By: | Hornstein, Andreas (Federal Reserve Bank of Richmond); Kudlyak, Marianna (Federal Reserve Bank of San Francisco) |
| Abstract: | We introduce a simple representation of endogenous search effort into the standard matching function with job-seeker heterogeneity. Using the estimated augmented matching function, we study the sources of changes in the average employment transition rate. In the standard matching function, the contribution of market tightness (matching efficiency) is increasing (decreasing) in the matching function elasticity. For our augmented matching function, search effort is procyclical for small matching elasticity and accounts for most of the transition rate volatility, with small contributions from market tightness and matching efficiency. For a large matching elasticity search effort is strongly countercyclical and large movements in matching efficiency compensate for that. Regardless of the matching elasticity, we find a substantial decline of the matching efficiency after 2007 |
| JEL: | E24 J63 J64 |
| Date: | 2016–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedrwp:16-13&r=lab |
| By: | Parkhomenko, Andrii |
| Abstract: | The unemployment insurance system in the U.S. does not provide incentives to look for jobs outside local labor markets. In this paper I introduce relocation subsidies as a supplement to unemployment benefits, and study their effects on unemployment, productivity and welfare. I build a job search model with heterogeneous workers and multiple locations, in which migration is impeded by moving expenses, cross-location search frictions, borrowing constraints, and utility costs. I calibrate the model to the U.S. economy, and then introduce a subsidy that reimburses a part of the moving expenses to the unemployed and is financed by labor income taxes. During the Great Recession, a relocation subsidy that pays half of the moving expenses would lower unemployment rate by 0.36 percentage points (or 4.8%) and increase productivity by 1%. Importantly, the subsidies cost nothing to the taxpayer: the additional spending on the subsidies is offset by the reduction in spending on unemployment benefits. Unemployment insurance which combines unemployment benefits with relocation subsidies appears to be more effective than the insurance based on the benefits only. |
| Keywords: | unemployment insurance, relocation subsidies and vouchers, local labor markets, moving costs, geographic mobility, internal migration |
| JEL: | E24 J61 J64 J65 R23 |
| Date: | 2016–11–24 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:75256&r=lab |
| By: | Nguyen, Ha; Connelly, Luke B. |
| Abstract: | This study contributes to a small literature on the dynamics of informal care by examining the informal care provision choices of working age Australians. We focus on the impact of previous work characteristics (including work security and flexibility) on subsequent care provision decisions and distinguish between care that is provided to people who cohabit and people who reside elsewhere, as well as between the provision of care as the primary caregiver, or in a secondary caring role. Our dynamic framework of informal care provision accounts for state-dependence, unobserved heterogeneity and initial conditions. For both males and females, we find the existence of positive state-dependence in all care states in both the short- and medium-term. Furthermore, the inertia in care provision appears to be stronger for more intensive care. We also find previous employment status has a significant deterrent effect on current care provision decisions. The effects on employment, however, differ according to the type of previous work, the type of care currently provided, and the gender of the caregiver. We also find that workers with perceptions of greater job security are nevertheless less likely to provide subsequent care. Our results also suggest that workers’ perceptions about work flexibility and their stated overall satisfaction with work actually have no impact on their subsequent decisions to provide care in any capacity. |
| Keywords: | informal care, labour supply, dynamic multinomial choice models, panel data |
| JEL: | C23 J14 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:75331&r=lab |
| By: | Tomas Frejka (Max Planck Institute for Demographic Research, Rostock, Germany) |
| Abstract: | The principal focus of this paper is to analyze the fertility transition of the 19 th to early 21 st centuries with cohort fertility measures, and a discussion of key societal conditions shaping the transition. This new approach and procedure reveals that there were four different fertility transition pathways. Arguably equally important is the finding that thus far the demographic transition has not resulted in an equilibrium of relatively stable low mortality and stable low fertility. Early in the 21 st century mortality is continuing to decline steadily, fertility is generally below replacement, and fertility trends are in a flux with a tendency towards further declines. The four types of fertility transition patterns were: a. The “Western” distinguished by major cohort total fertility rate (CTFR) fluctuations; b. The Central and East European characterized by a stable CTFR band around 2.0 births per woman in the 1920s to 1950s birth cohorts; c. The Southern European characterized by a relatively stable secular CTFR decline; d. The East and South-East Asian characterized by rapidly declining CTFRs starting as late as in the middle of the 20 th century. In all four fertility transition pathways almost all CTFRs were below replacement in the youngest cohorts born in the 1960s and early 1970s ending their childbearing early in the 21 st century. The higher CTFRs, mostly between 1.7 and 2.0 births per woman, were in the “Western” populations, the lowest of 1.2 to 1.6 in East and South-East Asia. The exploration of societal conditions shaping mortality and fertility trends confirm Notestein’s conclusions formulated 70 years ago (Notestein 1945 and 1953). This investigation has shown that it was a complex combination of “technological, social, economic, and political developments,” and also of cultural and ideational effects – revealed by subsequent research, especially of Coale (1973) as well as of Lesthaeghe and van de Kaa (1986) – which shape mortality and fertility trends. Furthermore, Notestein observed that it is “impossible to be precise about the various causal factors” generating mortality and fertility trends. Primary causal factors alternated between economic, social, political, policy and other factors. Keywords : Demographic transition – Pathways of the fertility transition – International comparative analysis – Cohort fertility – Causes of the demographic transition |
| Keywords: | cohort fertility, comparative analysis, demographic transition |
| JEL: | J1 Z0 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:dem:wpaper:wp-2016-012&r=lab |
| By: | Pérez-Cervantes Fernando |
| Abstract: | I slightly modify the model of Monte et al. (2015) to estimate how workers in Mexican municipalities choose the location of their workplace based on the income gains from commuting to another municipality. Estimates are in line with the intuition: Static estimates for both 2010 and 2015 suggest that those who commute earn an average 30 percent more than their non-commuting counterparts, and that commutes tend to be to municipalities located close to the place of residence. Comparing both years suggests that a reduction in local productivity both decreases the number of workers that come from other municipalities and increases the number of local residents that decide to work somewhere else, mitigating the negative effect of the reduction in local wages with higher earnings from the new work destinations. I find that some municipalities were not able to mitigate the negative productivity shocks on their income. |
| Keywords: | Commuting;Economic Geography;Mexico |
| JEL: | F1 R1 J6 O2 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:bdm:wpaper:2016-19&r=lab |
| By: | Cortes, Kristle Romero (Federal Reserve Bank of Cleveland); Glover, Andrew (University of Texas at Austin); Tasci, Murat (Federal Reserve Bank of Cleveland) |
| Abstract: | Lenders have traditionally used credit reports to measure a borrower’s riskiness, but credit agencies also market reports to employers for use in hiring. Since the onset of the Great Recession, eleven state legislatures have restricted the use of credit reports in the labor market. We document that county-level unemployment rose faster in states that restricted employer credit checks. Furthermore, counties with high subprime populations experienced larger increases in the unemployment rate than average. Underlying the increase in unemployment rates post-restriction is a higher separation rate in those states, which we interpret as evidence that employer credit checks are an ex-ante screening device that improves the matching process. We provide further evidence of deteriorating credit market outcomes. Using a credit panel, we find that access to credit declines and delinquencies increase significantly after the state-level policy changes. |
| Keywords: | unemployment rate; credit score; credit check; |
| JEL: | G18 J6 |
| Date: | 2016–11–28 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedcwp:1625&r=lab |
| By: | Andrew Goodman-Bacon |
| Abstract: | This paper exploits the original introduction of Medicaid (1966-1970) and the federal mandate that states cover all cash welfare recipients to estimate the effect of childhood Medicaid eligibility on adult health, labor supply, program participation, and income. Cohorts born closer to Medicaid implementation and in states with higher pre-existing welfare-based eligibility accumulated more Medicaid eligibility in childhood but did not differ on a range of other health, socioeconomic, and policy characteristics. Early childhood Medicaid eligibility reduces mortality and disability and, for whites, increases extensive margin labor supply, and reduces receipt of disability transfer programs and public health insurance up to 50 years later. Total income does not change because earnings replace disability benefits. The government earns a discounted annual return of between 2 and 7 percent on the original cost of childhood coverage for these cohorts, most of which comes from lower cash transfer payments. |
| JEL: | I13 J10 N32 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:22899&r=lab |
| By: | Neidhöfer, Guido; Stockhausen, Maximilian |
| Abstract: | Using harmonized household survey data, we analyse long run social mobility in the US, the UK, and Germany and test recent theories of multigenerational persistence of socio-economic status. In this country comparison setting we find evidence against Gregory Clark's "universal law of social mobility". In general, our results show that the long run persistence of socio-economic status tends to vary with the institutional context. Our findings on the existence of a direct and independent effect of grandparents' social status on grandchildren's status are mixed. |
| Keywords: | dynastic inequality,intergenerational mobility,multigenerational persistence,three generations,grandparental effect |
| JEL: | D63 I24 J62 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:fubsbe:201622&r=lab |
| By: | Damian Clarke (Universidad de Santiago de Chile); Sonia Oreffice (University of Surrey); Climent Quintana-Domeque (University of Oxford and St Edmund Hall) |
| Abstract: | We study the determinants of season of birth, for white married women aged 20-45 in the US, using birth certificate and Census data. We also elicit the willingness to pay for season of birth through discrete choice experiments implemented on the Amazon Mechanical Turk platform. We document that the probability of a spring first birth is significantly related to mother's age, education, smoking status during pregnancy, and the mother working in "education, training, and library" occupations, whereas a summer first birth does not depend on socio-demographic characteristics. We find consistent but stronger correlates when focusing on second births, while all our findings are muted among unmarried women. We estimate the average willingness to pay for a spring birth to be 600 USD, which is about 18% of the most valued birth in our Amazon Mechanical Turk experimental sample or 15% of the mean charges for a normal birth in 2013 according to the Agency for Healthcare Research and Quality. |
| Keywords: | quarter of birth, willingness to pay, NVSS, ACS-IPUMS, Amazon Mechanical Turk, discrete choice experiments, fertility timing |
| JEL: | I10 J01 J13 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:hka:wpaper:2016-031&r=lab |
| By: | Mehrotra, Neil; Sergeyev, Dmitriy |
| Abstract: | We argue that the creation and destruction margins of employment (job flows) at the aggregate level and disaggregated across firm age and size can be used to measure the employment effects of disruptions to firm credit. Using a firm dynamics model, we establish that a tightening of credit to firms reduces employment primarily by reducing gross job creation, exhibiting stronger effects at new/young firms and middle-sized firms (20-99 employees). We find that 18% of the decline in US employment during the Great Recession is due to the firm credit channel. Using MSA-level job flows data, we show that the behavior of job flows overall and across firm size and age categories in response to identified credit shocks is consistent with our model's predictions and hold within tradable and non-tradable industries. |
| Keywords: | Financial Frictions; Job flows |
| JEL: | E44 J60 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:11677&r=lab |
| By: | Campus, Daniela (University of Florence); Giannelli, Gianna Claudia (University of Florence) |
| Abstract: | Dramatic spikes in food prices, like those observed over the last years, represent a real threat to food security in developing countries with severe consequences for many aspects of human life. Price instability can also affect the intra-household allocation of time, thus changing the labour supply of women, who traditionally play the role of 'shock absorbers'. This paper explores the nature of time poverty by examining how changes in the prices of the two major staples consumed, matooke and cassava, have affected the paid and unpaid labour time allocation in Ugandan households. We exploit the panel nature of the Uganda National Household Survey by adopting a Tobit-hybrid model. Our results show that gender differentials in the intra-household allocation of labour actually occur in correspondence with changes in food prices. We find that, overall, women work significantly more, since the additional hours women work in the labour market are not counterbalanced by a relevant reduction in their other labour activities. For men, we do not find any significant effect of price changes on hours of work. |
| Keywords: | food prices, labour supply, gender, Uganda |
| JEL: | J16 J22 J43 Q11 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10376&r=lab |
| By: | Jong-Wha Lee |
| Abstract: | This study investigates the determinants of fertility in the long run, using a newly constructed panel data set consisting of fertility rates, measured as crude birth rates, infant mortality rates, per-capita income, and the educational attainment of men and women for 43 countries from 1890 to 2010 at five-year intervals. The regression results show the significant effects of per-capita income, infant mortality, educational attainment, and political development on fertility rates. A woman's educational attainment at the primary and secondary levels has a pronounced negative effect on fertility rates. On the contrary, an increase in a woman's tertiary educational attainment, with the level of a man's remaining constant, tends to raise fertility rates, indicating that highly educated women can have a better environment for childbearing and childrearing in a society with greater gender equality. The presented research thus identifies the important role of human capital accumulation, especially attained by women, in demographic transition through fertility decisions for over a century of human history. |
| Keywords: | Economic Development, Education, Female Education, Fertility, Gender Inequality |
| JEL: | J13 |
| Date: | 2016–12 |
| URL: | http://d.repec.org/n?u=RePEc:een:camaaa:2016-70&r=lab |
| By: | Joseph Gomes; Klaus Desmet; Ignacio Ortuño-Ortín |
| Abstract: | This paper theoretically analyzes and empirically investigates the importance of local interaction between individuals of different linguistic groups for the provision of public goods at the national level. Depending on whether local interaction mitigates or reinforces antagonism towards other groups, the micro-founded theory we develop predicts that a country's provision of public goods (i) decreases in its overall linguistic fractionalization, and (ii) either increases or decreases in how much individuals locally learn about other groups. After constructing a 5 km by 5 km geographic dataset on language use for 223 countries, we compute measures of overall fractionalization and local learning, and investigate their relation to public good provision at the country level. While overall fractionalization worsens outcomes, we find a positive causal relation between local learning and public goods. Local mixing therefore mitigates the negative impact of a country's overall linguistic fractionalization. An IV strategy shows that this result is not driven by the possible endogenous spatial distribution of language speakers within countries. |
| JEL: | H4 H5 J15 D7 D74 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:nva:unnvaa:wp07-2016&r=lab |
| By: | Chicoine, Luke E. (DePaul University) |
| Abstract: | This paper investigates the causal relationship between women's education and fertility by exploiting variation generated by the removal of school fees in Ethiopia. The increase in schooling caused by this reform is identified using both geographic variation in the intensity of the reform's impact and the temporal variation generated by the implementation of the reform. The model finds that the removal of school fees in Ethiopia led to an increase of over 1.5 years of schooling for women affected by the reform. A two-stage least squares approach is used to measure the impact of the exogenous increase in schooling on fertility. Each additional year of schooling led to a reduction in fertility, a delay in sexual activity, marriage, and the timing of at least their first, second, and third births. There is also evidence that the increase in schooling led to improved labor market outcomes, and a reduction in the desired number of children. Additionally, there is evidence of strategic use of hidden forms of contraception, only after family size becomes sufficiently large or after two sons have been born. |
| Keywords: | free primary education, Ethiopia, schooling, fertility |
| JEL: | O55 J13 I25 I26 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp10387&r=lab |