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on Labour Economics |
| By: | Cederlöf, Jonas (School of Economics, The University of Edinburgh,) |
| Abstract: | Previous studies estimating the effect of generosity of unemployment insurance (UI) on unemployment duration has found that as job seekers approach benefit exhaustion the probability of leaving unemployment increases sharply. Such “spikes” in the hazard rate has generally been interpreted as job seekers timing their employment to coincide with benefit exhaustion. Card, Chetty and Weber (2007b) argue that such spikes rather reflect flight out of the labor force as benefits run out. This paper revisits this debate by studying a 30 week UI benefit extension in Sweden and its effects on unemployment duration, duration on UI, as well as the timing of employment. As the UI extension is predicated upon a job seeker having a child below the age of 18 at the time of regular UI exhaustion this provides quasi-experimental variation which I exploit using a regression discontinuity design. I find that although increasing potential UI duration by 30 weeks increases actual take up by about 2.5 weeks, overall duration in unemployment and the probability of employment is largely unaffected. Moreover, I find no evidence of job seekers manipulating the hazard to employment such that it coincides with UI benefit exhaustion. This result is attributed to generous replacement rates offered in other assistance programs available to job seekers who exhaust their benefits. |
| Keywords: | Unemployment benefits; Unemployment duration; Hazard spike |
| JEL: | J64 J65 |
| Date: | 2020–12–18 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2020_025&r=all |
| By: | Giulia Martina Tanzi (Bank of Italy) |
| Abstract: | In this paper I analyse whether non-employment periods at the initial stages of an individual’s career may increase workers’ propensity to experience non-employment also in subsequent years. The study is based on data on young individuals in Italy. The paper uses an instrumental variables approach to separate the effect of early non-employment from any residual unobserved heterogeneity. The results provide strong evidence of negative effects induced by early non-employment, but the size of these effects depends on individual and regional labour market characteristics. The negative repercussions of early non-employment are smaller during economic downturns or in regions with high unemployment rates. |
| Keywords: | non-employment, labor market conditions, instrumental variables |
| JEL: | J64 C26 C34 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:bdi:wptemi:td_1312_20&r=all |
| By: | Maggie R. Jones; Emilia Simeonova; Randall Akee |
| Abstract: | We study how the largest federal tax-based policy intended to promote work and increase incomes among the poor—the Earned Income Tax Credit (EITC)—affects the socioeconomic standing of children who grew up in households affected by the policy. Using the universe of tax filer records for children linked to their parents, matched with demographic and household information from the decennial Census and American Community Survey data, we exploit exogenous differences by children’s ages in the births and “aging out” of siblings to assess the effect of EITC generosity on child outcomes. We focus on assessing mobility in the child income distribution, conditional on the parents’ position in the parental income distribution. Our findings suggest significant and mostly positive effects of more generous EITC refunds on the next generation that vary substantially depending on the child’s household type (single-mother or married family) and by the child’s gender. All children except White children from single-mother households experience increases in cohort-specific income rank, own family income, and the probability of working at ages 25–26 in response to greater EITC generosity. Children from married households show a considerably stronger response on these measures than do children from single-mother households. Because of the concentration of family types within race groups, the more positive response among children from married households suggests the EITC might lead to higher within-generation racial income inequality. Finally, we examine how the impact of EITC generosity varies by the age at which children are exposed to higher benefits. These results suggest that children who first receive the more generous two-child treatment at later ages have a stronger positive response in terms of rank and family income than children exposed at younger ages. |
| Keywords: | Earned Income Tax Credit, Intergenerational Mobility, Administrative Data, Census, Earnings. |
| JEL: | H24 I38 J62 |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:20-35&r=all |
| By: | Troeger, Vera E. (University of Warwick and Universitat Hamburg); Di Leo, Riccardo (University of Warwick); Scotto, Thomas J. (University of Glasgow); Epifanio, Mariaelisa (University of Liverpool) |
| Abstract: | Legislation over the past two decades enhanced the availability and quantity of statutory maternity leave in the United Kingdom. In high-skilled sectors, many employers top up this maternity leave in an effort to retain and develop the careers of women. As leave provision became more generous, debates emerged as to the role, if any, these enhanced benefits have in retaining women in high status occupation and facilitating their career growth. Further, individual situations and employment status may prevent women from taking advantage of enhanced benefits. This paper presents findings from a comprehensive survey of thousands of women in the UK Higher Education sector and documents how the lives of academic mothers changed over the past quarter century. Contract status and the partner’s participation in parenting has significant effects on the types of maternity leave taken. We reflect on these findings and discuss future research in the area of labour market equity and productivity the availability of this comprehensive quantitative survey of academic women can facilitate. |
| Keywords: | motherhood, gender gap, maternity leaves, academia JEL Classification: |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:cge:wacage:518&r=all |
| By: | Priyanka Chakraborty (Allegheny College, Department of Economics); Danila Serra (Texas A&M University, Department of Economics) |
| Abstract: | Managerial decisions, such as promotions and demotions, please some employees and upset others. We examine whether having to communicate such decisions to employees, and knowing that employees may react badly, have a differential impact on men's and women's self-selection into leadership roles and their performance if they become leaders. In a novel laboratory experiment that simulates corporate decision-making, we find that women are significantly less likely to self-select into a managerial position when employees can send them angry messages. Once in the manager role, there is some evidence of gender differences in decision-making, but no difference in final outcomes, i.e., overall profits. Male and female managers use different language to motivate their employees, yet differences in communication styles emerge only when workers can send angry messages to managers. Finally, low-rank employees send more angry messages to female managers, and are more likely to question their decisions. |
| Keywords: | Gender Differences, Leadership, Backlash, Experiment. |
| JEL: | C92 D91 J16 |
| Date: | 2021–01–04 |
| URL: | http://d.repec.org/n?u=RePEc:txm:wpaper:20210104-001&r=all |
| By: | Den Haan, W.; Freund, L. B.; Rendahl, P. |
| Abstract: | In search-and-matching models, the nonlinear nature of search frictions increases average unemployment rates during periods with higher volatility. These frictions are not, however, by themselves sufficient to raise unemployment following an increase in perceived uncertainty; though they may do so in conjunction with the common assumption of wages being determined by Nash bargaining. Importantly, option-value considerations play no role in the standard model with free entry. In contrast, when the mass of entrepreneurs is finite and there is heterogeneity in firm-specific productivity, a rise in perceived uncertainty robustly increases the option value of waiting and reduces job creation. |
| Keywords: | Uncertainty, search frictions, unemployment, option value |
| JEL: | E24 E32 J64 |
| Date: | 2020–12–18 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:20125&r=all |
| By: | Lombardi, Stefano (VATT); van den Berg, Gerard J. (University of Groningen); Vikström, Johan (IFAU - Institute for Evaluation of Labour Market and Education Policy) |
| Abstract: | This paper builds on the Empirical Monte Carlo simulation approach developed by Huber et al. (2013) to study the estimation of Timing-of-Events (ToE) models. We exploit rich Swedish data of unemployed job-seekers with information on participation in a training program to simulate placebo treatment durations. We first use these simulations to examine which covariates are key confounders to be included inselection models. The joint inclusion of specific short-term employment history indicators (notably, the share of time spent in employment), together with baseline socio-economic characteristics, regional and inflow timing information,is important to deal with selection bias. Next, we omit subsets of explanatory variables and estimate ToE models with discrete distributions for the ensuing systematic unobserved heterogeneity. In many cases the ToE approach provides accurate effect estimates, especially if time-varying variation in the unemployment rate of the local labor market is taken into account. However, assuming too many or too few support points for unobserved heterogeneity may lead to large biases. Information criteria, in particular those penalizing parameter abundance, are useful to select the number of support points. |
| Keywords: | duration analysis; unemployment; propensity score; matching; training; employment |
| JEL: | C14 C15 C41 J64 |
| Date: | 2020–12–29 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2020_026&r=all |
| By: | Troeger, Vera E. (University of Warwick and Universitat Hamburg); Di Leo, Riccardo (University of Warwick); Scotto, Thomas J. (University of Glasgow); Epifanio, Mariaelisa (University of Liverpool) |
| Abstract: | We use an original survey of academic women in the UK to investigate different dimensions of the motherhood penalty. Being a mother has no effect on salaries, but still slows down career progression even in such a high-skilled sector. Motherhood has an ambivalent impact on women’s perception of their working environment: improving satisfaction, but reducing perception of salary fairness relative to men. Our paper also explores how different policies can mitigate the motherhood penalties. We find that more generous maternity provisions are associated with higher salary, potentially because generosity reduces the crowding out of research activity. Better availability of childcare and an even distribution of responsibilities within the household correlate positively with earnings. Our findings also highlight the importance of a supportive work environment for mothers’ career and well-being at the workplace. Taken together, these findings suggest the necessity of a multi-faceted policy response to the motherhood penalties. |
| Keywords: | satisfaction, salary, career, exclusion, gender pay gap, academia JEL Classification: |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:cge:wacage:519&r=all |
| By: | Sebastian Königs; Michael Förster |
| Abstract: | While income inequality in Austria is relatively low compared to many other OECD countries, social mobility lags behind. Socio-economic outcomes carry over strongly from one generation to the next: more than elsewhere, fathers’ earnings are a strong predictor of the earnings of their prime-age children. This reflects strong persistence across generations in occupational and educational outcomes, particularly for women and migrants. Relative income positions also tend to strongly persist over people’s lives, in particular at the top and bottom. Meanwhile, the middle-income group is polarising, with downward risks rising for the lower middle. Longer-term earnings trajectories (over 15 years) display marked gender differences, with women facing weaker chances of moving up and greater risks of sliding down.This paper identifies policies that promote or hamper social mobility in four domains. First, good-quality early childhood education and care can be a catalyst for upward mobility. Participation rates have significantly risen over the last decade, but still lag those in many OECD countries. Further investment is needed to improve quality and status of formal childcare. Second, tackling low educational mobility in Austria requires ensuring a successful school-to-work transition. Austria provides targeted support for those who struggle, but it could improve funding for disadvantaged schools and consider the appropriateness of "tracking" students at such a young age. Third, reducing gender inequality in the labour market would greatly improve social mobility. This requires raising incentives for a more equal sharing of family and work responsibilities in the areas of tax policy, parental leave and family and care benefits. Fourth, the Austrian tax and benefit system provides comparatively adequate protection against income shocks. The high concentration of household wealth, combined with the absence of inheritance taxation, however implies that inequalities of opportunity remain large. |
| JEL: | D31 I38 J62 |
| Date: | 2020–12–22 |
| URL: | http://d.repec.org/n?u=RePEc:oec:elsaab:251-en&r=all |
| By: | Amuedo-Dorantes, Catalina (University of California, Merced); Lofstrom, Magnus (Public Policy Institute of California); Wang, Chunbei (University of Oklahoma) |
| Abstract: | Over the past two decades, the U.S. has seen a drastic growth in self-employment among Mexican immigrants, the largest immigrant population in the country. This is an interesting yet puzzling trend, in stark contrast to the stagnated growth of self-employment among other disadvantaged minority groups such as blacks and even a significant decline among whites. Little is known of what drives that growth. We propose that the expansion of interior immigration enforcement, a characteristic of the U.S. immigration policy during that time span, might have contributed to this unique trend by pushing Mexican immigrants into self-employment as an alternative livelihood. Exploiting temporal and geographic variation in immigration enforcement measures from 2005 to 2017, we show that tougher enforcement has been responsible for 10 to 20 percent of the rise in Mexican self-employment. The impact mainly concentrates among likely undocumented immigrants. It is mainly driven by police-based enforcement measures responsible for most deportations, as opposed to employment-based enforcement. Our results suggest that apprehension fear, instead of lack of employment opportunities, is the main push factor. |
| Keywords: | state and local immigration enforcement, undocumented immigrants, Mexican immigrants, self-employment, United States |
| JEL: | J15 J23 K37 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp13930&r=all |
| By: | Domenico Delli Gatti; Severin Reissl |
| Abstract: | We employ a new macro-epidemiological agent based model to evaluate the “lives vs livelihoods” trade-off brought to the fore by Covid-19. The disease spreads across the networks of agents’ social and economic contacts and feeds back on the economic dimension of the model through various channels such as employment and consumption demand. We show that under a lockdown scenario the model is able to closely reproduce the epidemiological dynamics of the first wave of the coronavirus epidemic in Lombardy. We then explore the efficacy of the fiscal response to Covid-19 which may take different routes: income support, liquidity provision, credit guarantees. In an agent based setting we gain additional insights on the way in which fiscal measures impact not only on GDP but also on the defaults of firms and the allocation of inputs. We find that liquidity support for firms, a short-time working scheme with compensation for workers, and direct transfer payments to households are effective policy tools to alleviate the economic impact of the epidemic and the lockdown. |
| Keywords: | agent-based models, epidemic, Covid, fiscal policy |
| JEL: | E21 E22 E24 E27 E62 E65 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_8763&r=all |
| By: | Silva Goncalves, Juliana (University of Sydney, Australia); van Veldhuizen, Roel (Department of Economics, Lund University) |
| Abstract: | Better understanding and reducing gender gaps in the labor market remains an important policy goal. We study the role of advice in sustaining these gender gaps using a laboratory experiment. In the experiment, “advisers” advise “workers” to choose between a more ambitious and a less ambitious task based on the worker’s subjective self-assessment. We expected female workers to be less confident and advisers to hold gender stereotypes, leading to a gender bias in advice. However, we find no evidence that women are less confident or that advice is gender-biased. Our results contribute to our understanding of the mechanisms driving gender differences in the labor market. They also call for caution when making general interpretations of research findings pointing to a gender bias in specific settings. |
| Keywords: | Advice; Subjective judgment; Gender bias |
| JEL: | C91 D91 J16 |
| Date: | 2020–12–14 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:lunewp:2020_027&r=all |
| By: | Molina, Teresa (University of Hawaii at Manoa); Tanaka, Mari (Hitotsubashi University) |
| Abstract: | This paper examines whether globalization promotes female empowerment by improving the jobs available to women. Previous work has documented that exporting causally improved working conditions at predominantly female garment factories in Myanmar. In this study, restricting to garment factory neighborhoods, we find that women living near exporting factories are significantly more likely to be working, have lower tolerance of domestic violence, and are less likely to be victims of domestic violence. Using distance to the international airport as an instrument for proximity to an exporting factory, we find similar results: higher employment rates, lower tolerance of domestic violence, and a decrease in the experience of physical violence. |
| Keywords: | female empowerment, domestic violence, globalization, trade, Myanmar |
| JEL: | J12 F66 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp13957&r=all |
| By: | Dahlberg, Matz (IFAU - Institute for Evaluation of Labour Market and Education Policy); Egebark, Johan (Arbetsförmedlingen (Swedish PES)); Vikman, Ulrika (IFAU - Institute for Evaluation of Labour Market and Education Policy); Özcan, Gülay (Arbetsförmedlingen (Swedish PES)) |
| Abstract: | This paper evaluates an ambitious and newly designed program for increased integration in Sweden. The purpose of the program is to help newly arrived, low-educated refugees into employment. The program includes four main components: (1) intensive initial language training,(2)work practice under close supervision, (3) job search assistance, and (4) extended cooperation between the local public sector and firms. An important feature of the program is that the demand side of the labor market, represented by the largest real estate company in Gothenburg, is involved in designing the program. Our evaluation is based on a randomized controlled trial, where potential participants in one of the first waves were randomly assigned to treatment and control groups. The paper presents results from the first two years after randomization. Using inference based on Fisher's exact test, we show that the program has positive effects on employment: around 30 % of the individuals in the treatment group are employed each month during the first year following the end of the program, compared to an average of approximately 15 % in the control group. |
| Keywords: | Refugee immigration; Integration; Randomized experiment; Labor market program |
| JEL: | C93 J08 J15 J23 J61 |
| Date: | 2020–11–30 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2020_021&r=all |
| By: | Banerjee, Ritwik (Indian Institute of Management); Mustafi, Priyoma (University of Pittsburgh) |
| Abstract: | Research shows that women volunteer significantly more for tasks that people prefer others to complete. Such tasks carry little monetary incentives because of their very nature. We use a modified version of the volunteer's dilemma game to examine if non-monetary interventions, particularly, social recognition can be used to change the gender norms associated with such tasks. We design three treatments, where a) a volunteer receives positive social recognition, b) a non-volunteer receives negative social recognition, and c) a volunteer receives positive, but a non-volunteer receives negative social recognition. Our results indicate that competition for social recognition increases the overall likelihood that someone in a group has volunteered. Positive social recognition closes the gender gap observed in the baseline treatment, so does the combination of positive and negative social recognition. Our results, consistent with the prior literature on gender differences in competition, suggest that public recognition of volunteering can change the default gender norms in organizations and increase efficiency at the same time. |
| Keywords: | gender, social recognition, volunteering, low promotability tasks |
| JEL: | J16 J71 M12 D91 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp13956&r=all |
| By: | Matthias Krapf; Anja Roth; Michaela Slotwinski |
| Abstract: | We study the effect of institutional childcare on child penalties. Using Swiss administrative data, we exploit the staggered opening of childcare facilities across municipalities in the canton of Bern. We find that the presence of childcare facilities in the year of birth of the first child reduces the child penalty. The availability of childcare increases maternal earnings and decreases the compensating increase in fathers’ earnings in households with below median earnings, but not in households with above median earnings. Although childcare affects relative earnings contributions within the household, there is no effect on total household earnings. |
| Keywords: | child penalty, childcare, parental employment, gender wage gap |
| JEL: | D10 J00 J13 J16 H31 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_8764&r=all |
| By: | Forslund, Anders (IFAU - Institute for Evaluation of Labour Market and Education Policy); Laun, Lisa (IFAU - Institute for Evaluation of Labour Market and Education Policy); Vikström, Johan (IFAU - Institute for Evaluation of Labour Market and Education Policy); Egebark, Johan (Arbetsförmedlingen (Swedish PES)); Rödin, Magnus (Arbetsförmedlingen (Swedish PES)); Cheung, Maria (Arbetsförmedlingen (Swedish PES)) |
| Abstract: | In 2015, the Swedish Public Employment Service (PES), together with the Institute for Evaluation of Labour Market and Education Policy (IFAU), launched a large-scale randomized control trial to collect new evidence on direct and displacement effects of job search assistance (JSA). The JSA program introduced more frequent meetings between case workers and job seekers during the early phase of an unemployment spell, and involved three types of meetings: (1) individual face-to-face meetings, (2) individual distance meetings, and (3) group meetings. The purpose of this paper is to present details of the design of the experiment, as a background for the evaluation of the job search assistance program reported in a companion paper. |
| Keywords: | counseling; job search; randomized experiment |
| JEL: | C93 J68 |
| Date: | 2020–12–04 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:ifauwp:2020_022&r=all |
| By: | José Ignacio Garcia-Pérez (Department of Economics, Universidad Pablo de Olavide & FEDEA ;); Antonio Villar (Department of Economics, Universidad Pablo de Olavide;) |
| Abstract: | We present an evaluation model that aims at developing a synthetic index of non-employment that combines incidence and severity. This index considers, besides conventional unemployment rates, unemployment duration, discouraged workers and workers with suspended jobs. We have applied this methodology to the analysis of the impact of the Covid-19 in the Spanish labour market. The impact of the epidemics on the job market has been very asymmetric by regions and types of workers. Compared to the situation in the third quarter of 2019 we find that one year later the non-working index arrived to more than 150 in regions in the south whereas it is below 75 in regions like Navarra, Catalunya or Madrid. The dynamics of this indicator, though, shows that the larger increments have occurred among the regions with lower initial values, so that the variability is now smaller. Regarding age and education, we find that the young (and among them the less educated) are the population subgroup that suffers more intensely the impact of this new economic crisis. On the contrary, older workers seem to improve for all education subgroups during 2020. The main reason behind this is the asymmetric concentration of temporary collective redundancy scheme measures among older workers, what is very much connected with the dual character of the Spanish labour market regarding contract types and job security. |
| Keywords: | Unemployment, Severity, Incidence, Unemployment Duration, Inequality, Covid-19. |
| JEL: | J01 J21 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:pab:wpaper:20.12&r=all |
| By: | Joan Monràs; Javier Vázquez-Grenno; Ferran Elias |
| Abstract: | This paper studies the legalization of 600,000 non-EU immigrants by the unexpectedly elected Spanish government following the terrorist attacks of 2004. By comparing non-EU to EU immigrants we first estimate that the policy did not lead to magnet effects. We then show that the policy change increased labor market opportunities for immigrants by allowing them to enter sectors of the economy with fewer informal employment. We rely on cross-province comparisons to document that payroll-tax revenues increased by around 4,000 euros per legalized immigrant, and the heterogeneous effect of the policy on various groups of workers. We provide a theoretical framework based on monopsonistic competition to guide our empirical work and interpret our findings. |
| Keywords: | immigration, undocumented immigrants, public policy evaluation |
| JEL: | F22 J31 J42 J J61 R11 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:bge:wpaper:1228&r=all |
| By: | Ben D'Exelle; Christine Gutekunst; Arno Riedl |
| Abstract: | Men and women negotiate differently, which might create gender inequality in access to resources as well as efficiency losses due to disagreement. We study the role of gender and gender pairing in bilateral bargaining, using a lab-in-the-filed experiment in which pairs of participants bargain over the division of a fixed amount of resources. We vary the gender composition of the bargaining pairs as well as the disclosure of the participants’ identities. We find gender differences in earnings, agreement and demands, but only when the identities are disclosed. Women in same-gender pairs obtain higher earnings than men and women in mixed-gender pairs. This is the result of the lower likelihood of disagreement among women-only pairs. Women leave more on the bargaining table, conditional on their beliefs, which contributes to the lower disagreement and higher earnings among women-only pairs. |
| Keywords: | bargaining, gender, gender pairing, beliefs, experiment |
| JEL: | C90 J16 O12 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_8750&r=all |
| By: | Alexander Ahammer; Dominik Grübl; Rudolf Winter-Ebmer |
| Abstract: | TWe show that downsizing has substantial externalities on the health of workers who remain in the firm. To this end, we study mass layoff (ML) survivors in Austria, using workers who survive a ML themselves, but a few years in the future, as a control group. Based on highquality administrative data, we find evidence that downsizing has persistent effects on mental and physical health, and that these effects can be explained by workers fearing for their own jobs. We also show that health externalities due to downsizing imply non-negligible cost for firms, and that wage cuts may have similar effects. |
| Keywords: | Downsizing, mass layoffs, health, job insecurity |
| JEL: | J63 I12 J23 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:jku:econwp:2020-26&r=all |