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on Labour Economics |
| By: | Arellano-Bover, Jaime (Yale University) |
| Abstract: | One of the largest population displacement episodes in the U.S. took place in 1942, when over 110,000 persons of Japanese origin living on the West Coast were forcibly sent away to ten internment camps for one to three years. Having lost jobs and assets, after internment they had to reassess labor market and location choices. This paper studies how internees' careers were affected in the long run. Combining Census data, camp records, and survey data I develop a predictor of a person's internment status based on Census observables. Using a difference-in-differences framework I find that internment had a positive average effect on earnings in the long run. Chiefly due to strong pre- WWII anti-Asian discrimination, the comparison group is composed of non-interned Japanese and Chinese Americans. The evidence is consistent with mechanisms related to increased occupational and geographic mobility, possibly facilitated by the camps' high economic diversity. I find no evidence of other potential drivers such as increased labor supply, or changes in cultural preferences. These findings provide evidence of labor market frictions preventing people from accessing their most productive occupations and locations, and shed light on the resilience of internees who overcame a very adverse initial shock. |
| Keywords: | labor mobility, displacement, Japanese American Internment, WorldWar II, diversity |
| JEL: | J61 J62 N32 O15 |
| Date: | 2019–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12554&r=all |
| By: | Gabriella Berloffa; Eleonora Matteazzi; Alina Şandor; Paola Villa |
| Abstract: | This paper presents a comparative analysis using EU-SILC data of the correlation between mothers’ employment during adolescence and their children’s probability of being workless (i.e. either unemployed or inactive) at about 30 years of age in 19 European countries. By estimating various multilevel logit models, the paper shows that, on average, having had a working mother is associated with a reduction in the probability of being workless of about 25 to 35 percent for daughters and 20 to 25 percent for sons. Cross-country differences in these correlations are much larger for daughters than for sons, in particular for daughters with children, and do not reflect the usual country groupings. Our results suggest that mothers’ employment not only influences preferences for labor market participation, but also some attitudes or skills that favor their children’s successful integration into the labor market. Moreover, the observed correlation between mothers’ employment and their daughters’ labor market outcomes is lower in contexts where the burden of childcare falls more on women, highlighting that the presence of constraints on women’s choices may conceal mothers’ influence on daughters’ preferences. |
| Keywords: | young adults’ worklessness, mothers’ employment, intergenerational correlation, gender norms, Europe |
| JEL: | J16 J62 D19 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:trn:utwprg:2019/14&r=all |
| By: | Kozo Kiyota (Keio Economic Observatory, Keio University); Toshiyuki Matsuura (Keio Economic Observatory, Keio University); Yoshio Higuchi (Faculty of Business and Commerce, Keio University) |
| Abstract: | This paper examines the theoretically ambiguous relationship between the volatility of employment growth and the foreign exposure of firms. We employ unique Japanese firm-level data over the period 1994-2012. This allows us to investigate any differences in this relationship across multinational firms and trading and nontrading firms, manufacturing and wholesale trade, and intrafirm and interfirm trade. One major finding is that in manufacturing, employment volatility increases as the share of intrafirm exports to total sales increases. In contrast, in wholesale trade, employment volatility declines as the share of intrafirm imports to total imports increases. One possible interpretation of these results is that the transmission of foreign supply and demand shocks could be through not only manufacturing, but also wholesale trade firms. Further, a higher share of intrafirm trade could magnify foreign demand shocks in manufacturing, and could mitigate foreign supply shocks in wholesale trade. |
| Keywords: | Employment volatility, Multinational firm, Intrafirm trade, Wholesale trade |
| JEL: | F1 F16 L25 |
| Date: | 2019–08–09 |
| URL: | http://d.repec.org/n?u=RePEc:keo:dpaper:2019-017&r=all |
| By: | Daunfeldt, Sven-Olov (Institute of Retail Economics (Handelns Forskningsinstitut)); Westerberg, Hans (Institute of Retail Economics (Handelns Forskningsinstitut)) |
| Abstract: | The number of refugees in Europe has increased dramatically in recent years, and many countries are facing great challenges to integrating these refugees into their societies. A small group of high-growth firms have at the same time attracted attention because they create the most new jobs at any given point in time. Using matched employer-employee data from Statistics Sweden, we find that these high-growth firms in general are more likely to recruit first-generation immigrants that are unemployed. This provides support for the hypothesis that managers in high-growth firms, to greater extents, recruit marginalized individuals because they want to take advantage of their growth opportunities and therefore do not wait for the best match. Rapidly growing firms are thus less selective in their hiring decisions, and policies that are focused on increasing the number of high-growth firms might also help immigrants who face difficulties entering the labor market. |
| Keywords: | Firm growth; Gazelles; High-growth firms; Immigration; Integration; Labor market; Matching models; Resource based theory; Interaction effects; Logit; Odds ratio |
| JEL: | D22 J15 L25 L26 |
| Date: | 2019–08–30 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:hfiwps:0002&r=all |
| By: | Li, Chunyun |
| Abstract: | This paper provides a new analysis of Chinese labor politics. Most scholars suggest that there is no labor movement in China because Chinese labor protests are apolitical, cellular, and short-lived, and thus inconsistent with the properties of social movements identified in the political process model. In contrast, the author draws on Gramsci’s ideas regarding counterhegemonic movements and on ethnographic and archival research to demonstrate that the activities of movement-oriented labor NGOs (MLNGOs) coupled with associated labor protests since 2011 constituted the embryo of a counterhegemonic labor movement. MLNGOs have reworked the hegemonic labor law system to undermine the regime’s legal atomization of workers, nurtured worker leaders as organic intellectuals of migrant workers to temporarily substitute for impotent workplace unions, and developed alternative organizational networks of labor organizing that challenged monopolistic union bureaucracy. This incipient counterhegemonic movement persisted several years after state repression in late 2015 but was curtailed by another wave of repression in January 2019. The very severity of state repression suggests that a counterhegemonic movement has been formed. |
| JEL: | N0 R14 J01 |
| Date: | 2019–08–27 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:101456&r=all |
| By: | Bendicta Marzinotto; Ladislacv Wintr |
| Abstract: | This paper finds that employment protection legislation (EPL) had a significant impact on employment adjustment in Europe over 2001-2013, once we account for firm-size related exemptions to EPL. We construct a novel coverage-adjusted EPL indicator and find that EPL hinders employment growth at the firm level and increases the share of firms that remain in the same size class. This suggests that stricter EPL restrains job creation because firms fear the costs of shedding jobs during downturns. We do not find evidence that EPL has positive effects on employment by limiting job losses after adverse shocks. In addition to standard controls for the share of credit-constrained firms and the position in the business cycle, we also control for sizerelated corporate tax exemptions and find that these also significantly constrain job creation among incumbent firms. |
| Keywords: | employment protection; firm growth; job reallocation.; Employment protection; firm growth; job reallocation |
| JEL: | J08 D22 |
| Date: | 2019–07 |
| URL: | http://d.repec.org/n?u=RePEc:bcl:bclwop:bclwp131&r=all |
| By: | Mörk, Eva (Uppsala University); Sjögren, Anna (IFAU); Svaleryd, Helena (Uppsala University) |
| Abstract: | We study the consequences of mothers' and fathers' job loss for parents, families, and children. Rich Swedish register data allow us to identify plant closures and account for non-random selection of workers to closing plants by using propensity score matching and controlling for pre-displacement outcomes. Our overall conclusion is positive: childhood health, educational and early adult outcomes are not adversely affected by parental job loss. Parents and families are however negatively affected in terms of parental health, labor market outcomes and separations. Limited effects on family disposable income suggest that generous unemployment insurance and a dual-earner norm shield families from financial distress, which together with universal health care and free education is likely to be protective for children. |
| Keywords: | parental unemployment, workplace closure, family environment, child health, human capital formation |
| JEL: | I12 J1 |
| Date: | 2019–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12559&r=all |
| By: | Albæk, Karsten (Danish National Centre for Social Research (SFI)); Asplund, Rita; Barth, Erling (Institute for Social Research, Oslo); Lindahl, Lena (SOFI, Stockholm University); Strom, Marte (Institute for Social Research, Oslo); Vanhala, Pekka (ETLA - The Research Institute of the Finnish Economy) |
| Abstract: | Across the OECD countries, dropouts from upper secondary schooling fare worse in the labor market, with higher NEET rates more spells of unemployment and lower earnings. Among the dropouts, there are however significant shares who complete at a later age. In this paper, we thus ask the question: Does it pay for young adults who do not complete upper secondary schooling by the age of 21, to do so at some point during the subsequent 7 years, that is, before turning 28? In all four Nordic countries under scrutiny, we find that late completion lowers the probability of being outside employment, education or training (NEET) at age 28. Moreover, the exact age of completion does not seem to matter. Our estimates are robust to the inclusion of extensive controls for socioeconomic background and early schooling paths, and similar to the ones produced by event history analysis with individual fixed effects. This indicates that late completion of upper secondary schooling plays an important role for the labor market inclusion of young dropouts. |
| Keywords: | upper secondary schooling, dropouts, NEET rates |
| JEL: | I21 J24 J64 |
| Date: | 2019–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12560&r=all |
| By: | Steven Jacob Bosworth (Department of Economics, University of Reading); Simon Bartke (M. M. Warburg & CO (AG & Co.) KGaA) |
| Abstract: | We study an experimental setting designed to measure non-strategic behavioural spillovers and elucidate their mechanisms. In our setup a principal can observe the individual efforts of two agents in one task but can only observe team effort in another. We vary the availability of piece rate, tournament, team piece rate, and fixed wage contracts for the individually observable task while holding fixed the use of a team pay contract for the task where only team output is observable. We find tournament incentives unexpectedly induce high voluntary effort in the unobservable task, but that this is exclusively driven by cross-task advantageous learning overriding its deleterious effects on pro-social motivation. We therefore see our study as integrating diverse findings into a coherent explanation: Competitive incentives crowd out pro-social motivation, team incentives promote pro-social motivation, but setting a high effort precedent may be more important when employees perceive tasks as related. |
| Keywords: | motivation, learning, multi-tasking, cooperation |
| JEL: | C92 D83 M52 |
| Date: | 2019–08–31 |
| URL: | http://d.repec.org/n?u=RePEc:rdg:emxxdp:em-dp2019-15&r=all |
| By: | Lara Minkus |
| Abstract: | The gender pay gap (GPG) remains a persistent phenomenon in contemporary labor markets. Despite a vast body of research examining its causes, as of today, unequal labor market power resources between men and women have remained an underappreciated factor in the literature. Drawing on the German Socio-economic Panel and the Microcensus, the association between the GPG and labor market closure – a crucial determinant of unequal power resources in labor markets – is followed from 1993-2011. Employing JMP decomposition, unionization, tertiary credentialing and part-time employment are found to exacerbate the overall wage differential by 41 percent. Part-time employment has been the only indictor that enlarged the gender pay gap (17 percent) between 1993 and 2011, while the remaining covariates contributed toward its convergence. These results advance our understanding of stalling GPGs by highlighting the so far widely neglected importance of power resources on the GPG. |
| Keywords: | gender pay gap; labor market closure; stalled gender revolution; JMP decomposition; dualism |
| JEL: | J2 J5 L1 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp1049&r=all |
| By: | Lucie Schmidt; Lara Shore-Sheppard; Tara Watson |
| Abstract: | The Affordable Care Act (ACA) expanded the availability of public health insurance, decreasing the relative benefit of participating in disability programs but also lowering the cost of exiting the labor market to apply for disability program benefits. In this paper, we explore the impact of expanded access to Medicaid through the ACA on applications to the Supplemental Security Income (SSI) and Social Security Disability Income (SSDI) programs. Using the fact that the Supreme Court decision of June 2012 made the Medicaid expansion optional for the states, we compare changes in county-level SSI and SSDI caseloads in contiguous county pairs across a state border. We find no significant effects of the Medicaid expansion on applications or awards to either SSI or SSDI, and can reject economically meaningful impacts of Medicaid expansions on applications to disability programs. |
| JEL: | I10 I13 |
| Date: | 2019–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:26192&r=all |
| By: | Emilia Filippi; Sandro Trento |
| Abstract: | There is a rising concern for technological unemployment due to the current digital revolution. In order to estimate the probability of automation of occupations we applied two methods: occupation-based approach [Frey and Osborne (2017]) and task-based approach [Nedelkoska and Quintini (2018)]. We found that occupations with a high risk of automation require many routine activities, whereas occupations at low risk require abilities like perception, manipulation, creative intelligence and social intelligence. In Italy, based on the occupation-based approach, 33.2% of workers face a high risk of replacement; this percentage decrease at 18.1% if we apply the task-based approach. Male workers appear to face a higher risk of replacement than female ones. Actual automation may be lower than expected as it depends on many factors, such as technical feasibility, economic benefits that can be obtained and job creation thanks to technology itself. Finally, we stress the importance to adopt some policies; education and training of employees seems to be the most effective one. |
| Keywords: | technological change and unemployment; automation of occupations; skills and human capital |
| JEL: | E24 J24 J62 J64 O33 O39 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:trn:utwprg:2019/17&r=all |
| By: | Murayama, Koji; Nagayasu, Jun |
| Abstract: | This study empirically analyzes the determinants of regional labor migration in Japan, where small towns are disappearing due to the shortage of labor. Using spatial models of origin-destination flows and considering network effects of labor and economic structures, we obtain results more consistent with the standard migration theory than previous studies. First, unlike previous studies, we find that migration decisions in Japan are based on economic motivations consistent with economic theories. Particularly, unemployment rates in origins and destinations and income in origins are found to be the determinants of labor migration. Second, we report that network effects, which help reduce migration costs, have encouraged relocation of labor. Third, considering spatial weights based on distance, goods flow, and economic structures, we show that neighbors can be most appropriately defined with economic structures; migration patterns are alike in regions with similar economic structures. |
| Keywords: | labor migration; spatial models; regional economy; economic structures; network effects |
| JEL: | J61 R23 |
| Date: | 2019–08 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:95691&r=all |
| By: | Dohmen, Thomas (University of Bonn and IZA); van Landeghem, Bert (University of Sheffield) |
| Abstract: | Governments are showing an increasing interest in quantitative models that give insights into the determinants of unemployment duration. Yet, these models oftentimes do not explicitly take into account that unemployment prospects are influenced by personality characteristics that are not being fully captured by variables in administrative data. Using German survey data linked with administrative data, we show that numeracy skills are strongly related to unemployment duration, while at the same time we confirm well-established patterns documented in the literature. Low numeracy is strongly related to a longer unemployment duration of workers below median age (33) in our sample, even after including a rich set of controls. We find that unrealistic reservation wages are not the main driver, nor do results seem to be driven by locking-in effects caused by programme participation. On the other hand, the absence of a relationship between numeracy and unemployment duration for older workers might well be driven by a locking-in effect for those with high numeracy, as they tend to commit more often to intensive training programmes. Another tentative explanation, which is supported by the data, is that younger people have fewer signals to send such that their cognitive abilities may have a higher relative signalling value. |
| Keywords: | cognitive and noncognitive skills, unemployment duration, numeracy |
| JEL: | D04 D61 J64 J68 |
| Date: | 2019–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12531&r=all |
| By: | Wang, Chunbei (University of Oklahoma); Lofstrom, Magnus (Public Policy Institute of California) |
| Abstract: | Since the September 11 attacks (9/11), the U.S. has seen a tightening of immigration policies. Previous studies find that stricter immigration enforcement has the unintended effect of pushing undocumented immigrants into self-employment. This paper builds on the literature to better understand the changes in the types of self-employment among Mexican immigrants triggered by the tightened immigration enforcement after 9/11. Using a difference-in-differences approach, and the recently developed measures by Fairlie and Fossen [2018] to distinguish between necessity and opportunity self-employment, we find that both necessity and opportunity self-employment increased among Mexican immigrants after 9/11. However, the effect is most prominent on necessity self-employment, consistent with the hypothesis that they are pushed into self-employment as a survival alternative. |
| Keywords: | mexican immigrants, self-employment, 9/11, tightened immigration policies, necessity |
| JEL: | J15 L26 |
| Date: | 2019–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12555&r=all |
| By: | De Cao, Elisabetta (London School of Economics); McCormick, Barry (Nuffield College, Oxford); Nicodemo, Catia (University of Oxford) |
| Abstract: | We study the effect of unemployment on birth outcomes by exploiting geographical variation in the unemployment rate across local areas in England, and comparing siblings born to the same mother via family fixed effects. Using rich individual data from hospital administrative records between 2003 and 2012, babies' health is found to be strongly pro-cyclical. A one-percentage point increase in the unemployment rate leads to an increase in low birth weight and preterm babies of respectively 1.3 and 1.4%, and a 0.1% decrease in foetal growth. We find heterogenous responses: unemployment has an effect on babies' health which varies from strongly adverse in the most deprived areas, to mildly favourable in the most prosperous areas. We provide evidence of three channels that can explain the overall negative effect of unemployment on new-born health: maternal stress; unhealthy behaviours - namely excessive alcohol consumption and smoking; and delays in the take-up of prenatal services. While the heterogenous effects of unemployment by area of deprivation seem to be explained by maternal behaviour. Most importantly, we also show for the first time that selection into fertility is the main driver for the previously observed, opposite counter-cyclical results, e.g., Dehejia and Lleras-Muney (2004). Our results are robust to internal migration, different geographical aggregation of the unemployment rate, the use of gender-specific unemployment rates, and potential endogeneity of the unemployment rate which we control for by using a shift-share instrumental variable approach. |
| Keywords: | unemployment rate, birth outcomes, birth weight, fertility, England |
| JEL: | E24 I10 I12 J13 |
| Date: | 2019–08 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12568&r=all |