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on Labour Economics |
| By: | Gaillard, Alexandre; Kankanamge, Sumudu |
| Abstract: | We evaluate the effects of unemployment insurance variations in a general equilibrium occupational choice model of entrepreneurship. We establish that the occupational flow from unemployment to entrepreneurship is remarkably sensitive to unemployment insurance generosity, corroborating our empirical findings. Beyond direct effects on unemployment, we find large reallocations between employment and entrepreneurship relative to changes in generosity. They contribute to an empirically consistent stable aggregate employment rate, despite increasing unemployment. We show that an insurance coverage effect, i.e. a change in the relative riskiness between occupations with respect to generosity, is a key driver of our results. |
| Keywords: | Entrepreneurship; Unemployment Insurance; Labor Market Mobility |
| JEL: | E24 J65 E61 |
| Date: | 2021–02–08 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:125253&r=all |
| By: | Eugenia Canessa; Gianna Claudia Giannelli |
| Abstract: | We employ georeferenced data and longitudinal household panel survey data to investigate the impact of the dramatic flooding that hit Bangladesh from August-September 2014 on women's employment and empowerment. Development economics models suggest an increase in household members' labour supply as a shock-coping strategy. Our difference-in-differences estimates confirm this assumption: women's employment probability increases by approximately 13 percentage points. Correcting for selection bias due to the initial employment status of women, we also find significant increases in the probability of non-employed women entering employment, in the average monthly income of employed women and in the probability of women engaging in autonomous wage-earning activities. Finally, we show that the greater earning capacity of employed women - instrumented by the intensity of flooding in the villages where women live - contributes to raising their bargaining power within the household as measured by the Women's Empowerment in Agriculture Index and by economic decision-making indicators. |
| Keywords: | Bangladesh; Flood; Shock-coping strategy; Women's employment; Intrahousehold bargaining |
| JEL: | F66 J16 Q12 Q54 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:frz:wpaper:wp2021_01.rdf&r=all |
| By: | Jesús Fernández-Villaverde; Federico Mandelman; Yang Yu; Francesco Zanetti |
| Abstract: | This paper develops a dynamic general equilibrium model with heterogeneous firms that face search complementarities in the formation of vendor contracts. Search complementarities amplify small differences in productivity among firms. Market concentration fosters monopsony power in the labor market, magnifying profits and further enhancing high-productivity firms' output share. Firms want to get bigger and hire more workers, in stark contrast with the classic monopsony model, where a firm aims to reduce the amount of labor it hires. The combination of search complementarities and monopsony power induces a strong “Matthew effect” that endogenously generates superstar firms out of uniform idiosyncratic productivity distributions. Reductions in search costs increase market concentration, lower the labor income share, and increase wage inequality. |
| JEL: | C63 C68 E32 |
| Date: | 2021–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28495&r=all |
| By: | Marta Fana (European Commission – JRC); Davide Villani (The Open University); Martina Bisello (Eurofound, Dublin) |
| Abstract: | This article investigates gender differences in tasks performed at the workplace over a period of 25 years, from 1991 and 2016 in France. We exploit data from the Enquête Complémentaire Emploi: Conditions de travail, the oldest survey at the worker level among European countries on a wide range of work attributes and working conditions measures. In our study, we focus both on the content of work form a material perspective, looking concretely at what job tasks are performed by men and women, and on work organisational practices, to capture gender disparities in authority and power relations at the workplace. Our findings reveal that women tend to perform different tasks compared to their male colleagues within the same job also after controlling for supply-side factors, like education, age and seniority. While in line with previous studies we find that women still tend to perform fewer physical tasks than men, despite significant increase in such activities in female dominated jobs, there is no strong evidence supporting the "brain" hypothesis. On the contrary, women appear to be less involved in intellectual tasks and, especially, social tasks such as managing and coordinating. Furthermore, social interactions with clients or customers do not significantly characterise feminised jobs, challenging the idea according to which gender segregation between jobs is explained by the predominance of this type of tasks. Additionally, and more importantly, our analysis shows that gender matters also in terms of work organisation and distribution of power, highlighting strong asymmetries in the way authority and autonomy are distributed between male and female workers, unbalanced in favor of men. Finally, our study shows that these gender effects often exacerbate within male dominated jobs, although they do not necessarily disappear as the share of female workers increases at the job level. We conclude that power and authority are structurally a prerogative of men, regardless of individual and job characteristics, even within female dominated jobs. |
| Keywords: | employment, working conditions, tasks, gender differences |
| JEL: | J01 J21 J81 |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:laedte:202103&r=all |
| By: | Brad M. Barber; Wei Jiang; Adair Morse; Manju Puri; Heather Tookes; Ingrid M. Werner |
| Abstract: | Using a survey of AFA members, we analyze how demographics, time allocation, production mechanisms, and institutional factors affect research production during the pandemic. Consistent with the literature, research productivity falls more for women and faculty with young children. Independently and novel, extra time spent teaching (much more likely for women) negatively affects research productivity. Also novel are the results that concerns about feedback, isolation, and health have large negative research effects, disproportionately affecting junior faculty and PhD students. Finally, faculty facing greater concerns about employers’ finances report larger negative research effects and more concerns about feedback, isolation and health. |
| JEL: | G0 G01 |
| Date: | 2021–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28493&r=all |
| By: | Zheng, Guanyu; Duy, Hoang Minh; Pacheco, Gail |
| Abstract: | New Zealand has experienced poor productivity performance over the last two decades. Factors often cited as reasons behind this are the small size of the domestic market and distance to international partners and markets. While the distance reason is one that is fairly insurmountable, there are a number of other small advanced economies that also face similar domestic market constraints. This study compares the relative performance of New Zealand's firms to those economies using novel cross-country microdata from CompNet. We present stylised facts for New Zealand relative to the economies of Belgium, Denmark, Finland, Netherlands and Sweden based on average productivity levels, as well as benchmarking laggard, median and frontier firms. This research also employs an analytical framework of technology diffusion to evaluate the extent of productivity convergence, and the impact of the productivity frontier on non-frontier firm performance. Additionally, both labour and capital resource allocation are compared between New Zealand and the other small advanced economies. Results show that New Zealand's firms have comparatively low productivity levels and that its frontier firms are not benefiting from the diffusion of best technologies outside the nation. Furthermore, there is evidence of labour misallocation in New Zealand based on less labour-productive firms having disproportionally larger employment shares than their more productive counterparts. Counter-factual analysis illustrates that improving both technology diffusion from abroad toward New Zealand's frontier firms, and labour allocation across firms within New Zealand will see sizable productivity gains in New Zealand. |
| Keywords: | labour productivity,productivity convergence,resource allocation |
| JEL: | L25 O33 O47 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:iwhcom:12021&r=all |
| By: | Sari Pekkala Kerr; William R. Kerr |
| Abstract: | We explore co-ethnic hiring among new ventures using U.S. administrative data. Co-ethnic hiring is ubiquitous among immigrant groups, averaging about 22.5% and ranging from 40%. Co-ethnic hiring grows with the size of the local ethnic workforce, greater linguistic distance to English, lower cultural/genetic similarity to U.S. natives, and in harsher policy environments for immigrants. Co-ethnic hiring is remarkably persistent for ventures and for individuals. Co-ethnic hiring is associated with greater venture survival and growth when thick local ethnic employment surrounds the business. Our results are consistent with a blend of hiring due to information advantages within ethnic groups with some taste-based hiring. |
| JEL: | F22 J15 J44 J61 J62 J71 L26 M13 M51 R23 |
| Date: | 2021–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28509&r=all |
| By: | Leila Bengali; Mary C. Daly; Olivia Lofton; Robert G. Valletta |
| Abstract: | People with disabilities face substantial barriers to sustained employment and stable, adequate income. We assess how they and their families fared during the long economic expansion that followed the Great Recession of 2007-09, using data from the monthly Current Population Survey (CPS) and the March CPS annual income supplement. We find that the expansion bolstered the well-being of people with disabilities and in particular their relative labor market engagement. We also find that applications and awards for federal disability benefits fell during the expansion. On balance, our results suggest that sustained economic growth can bolster the labor market engagement of people with disabilities and potentially reduce their reliance on disability benefits. |
| Keywords: | Disability; employment; income; program participation |
| JEL: | J14 J11 J18 |
| Date: | 2021–02–25 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedfwp:90112&r=all |
| By: | Julien Benistant (Univ Lyon, CNRS, ISC Marc Jeannerod, UMR 5229, Bron, France); Fabio Galeotti (Univ Lyon, CNRS, GATE, UMR 5824, F-69130 Ecully, France); Marie Claire Villeval (Univ Lyon, CNRS, GATE, UMR 5824, F-69130 Ecully, France; IZA, Bonn, Germany) |
| Abstract: | We study a dynamic variant of the die-under-the-cup task where players can repeatedly misreport the outcomes of consecutive die rolls to earn more money, either under a noncompetitive piece rate scheme or in a two-player competitive tournament. In this dynamic setting we test (i) whether giving continuous feedback (vs. final ex post feedback) on the opponent’s reported outcome to both players encourages cheating behavior, and (ii) to what extent this influence depends on the incentive scheme in use (piece rate vs. tournament). We also vary whether the opponent is able to cheat or not. We find that people lie more when placed in a competitive rather than a non-competitive setting, but only if both players can cheat in the tournament. Continuous feedback on the counterpart’s reports increases cheating under the piece-rate scheme but not in a competitive setting. Our results provide new insights on the role that feedback plays on cheating behavior in dynamic settings under different payment schemes, and shed liht on the origins of the effect of competition on dishonesty. |
| Keywords: | Dishonesty, feedback, peer effects, competitive incentives, experiment |
| JEL: | C92 M52 D83 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:gat:wpaper:2101&r=all |
| By: | Caria, Stefano (Department of Economics, University of Warwick); Gordon, Grant; Kasy, Maximilian (Department of Economics, University of Oxford, M); Quinn, Simon; Shami, Soha; Teytelboym, Alexander |
| Abstract: | We introduce an adaptive targeted treatment assignment methodology for field experiments. Our Tempered Thompson Algorithm balances the goals of maximizing the precision of treatment effect estimates and maximizing the welfare of experimental participants. A hierarchical Bayesian model allows us to adaptively target treatments. We implement our methodology in Jordan, testing policies to help Syrian refugees and local jobseekers to find work. The immediate employment impacts of a small cash grant, information and psychological support are small, but targeting raises employment by 1 percentage-point (20%). After four months, cash has a sizable effect on employment and earnings of Syrians. JEL Classification: C93 ; J6 ; O15 Creation date: 2021 |
| URL: | http://d.repec.org/n?u=RePEc:wrk:warwec:1335&r=all |
| By: | Morris A. Davis; Jesse M. Gregory; Daniel A. Hartley; Kegon T.K. Tan |
| Abstract: | Researchers and policy-makers have explored the possibility of restricting the use of housing vouchers to neighborhoods that may positively affect the outcomes of children. Using the framework of a dynamic model of optimal location choice, we estimate preferences over neighborhoods of likely recipients of housing vouchers in Los Angeles. We combine simulations of the model with estimates of how locations affect adult earnings of children to understand how a voucher policy that restricts neighborhoods in which voucher-recipients may live affects both the location decisions of households and the adult earnings of children. We show the model can nearly replicate the impact of the Moving to Opportunity experiment on the adult wages of children. Simulations suggest a policy that restricts housing vouchers to the top 20% of neighborhoods maximizes expected aggregate adult earnings of children of households offered these vouchers. |
| JEL: | I24 I31 I38 J13 R23 R38 |
| Date: | 2021–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28508&r=all |
| By: | Vandenberghe, Vincent |
| Abstract: | This paper contributes to the literature on old employment barriers by exploring empirically the relative importance of mental v.s. physical health in determining work. It combines regression and variance decomposition analyses to quantify the respective role of mental v.s. physical health. The data used are from SHARE and inform in great detail on the health but also work status (i.e. employment and hours) of individuals aged 50+, interviewed between 2004 and 2017 in 21 European countries. The main result of the paper is that of the rather limited role of mental health | in comparison to physical health | in accounting for older individuals' work. The paper also shows that health (physical or mental) is much better at predicting old people's propensity to be in employment than the number of hours they work. Finally, the paper reveals that, in comparison to women, men's work is more driven by their health status. |
| Keywords: | Ageing,Work,Mental v.s. Physical Health,Regressions and Variance Decomposition |
| JEL: | J22 I10 J26 J14 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:796&r=all |
| By: | Mitman, Kurt (Stockholm University); Rabinovich, Stanislav (University of North Carolina, Chapel Hill) |
| Abstract: | We investigate the optimal response of unemployment insurance to economic shocks, both with and without commitment. The optimal policy with commitment follows a modified Baily-Chetty formula that accounts for job search responses to future UI benefit changes. As a result, the optimal policy with commitment tends to front-load UI, unlike the optimal discretionary policy. In response to shocks intended to mimic those that induced the COVID-19 recession, we find that a large and transitory increase in UI is optimal; and that a policy rule contingent on the change in unemployment, rather than its level, is a good approximation to the optimal policy. |
| Keywords: | unemployment insurance, unemployment, optimal policy, COVID-19 |
| JEL: | J65 E6 H1 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14085&r=all |
| By: | Isaac Ehrlich; Yun Pei |
| Abstract: | We evaluate the economic consequences of immigration in a two-country, two-skill, overlapping-generations framework, where immigration, population, human and physical capital formation, and economic growth are endogenous variables. We go beyond extant literature by integrating physical capital in our model. This enables the derivation of new insights about the induced-immigration effects of exogenous triggers, including pull and push factors and policy variables, on the dynamic evolution of the “immigration surplus” in the short run versus the long run, in destination vs. source countries and in the global economy. The policy shifts we analyze include the easing of constraints on potential migrants’ labor and physical capital mobility, and the role of physical capital endowments. We also discuss the policy implications of asymmetries in the net benefits from immigration across destination and source countries. |
| JEL: | F22 F43 J11 J24 O15 |
| Date: | 2021–02 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28504&r=all |
| By: | Michael Landesmann (The Vienna Institute for International Economic Studies, wiiw); Isilda Mara (The Vienna Institute for International Economic Studies, wiiw) |
| Abstract: | The high outward mobility that has characterised the countries in the Western Balkan (WB) region over the past three decades is often seen as tightly linked to severe labour market imbalances and persistently low utilisation of human capital over time. To shed light on these issues, we estimate a system of equations that accounts for the effects of labour market determinants and human capital on migration and vice versa. The period under analysis is 2005-2019 and considers mobility from five of the WB countries to the EU15. The empirical results confirm the importance of wage gaps and their changes as an important pull factor for driving outward mobility from the WB region that can be persistent over time. Also, gaps in human capital emerge as a powerful determinant for explaining mobility into countries where returns on human capital are higher. |
| Keywords: | Migration, Labour Markets, Southeast Europe, Balkans, pVAR modelling, European integration |
| JEL: | F22 J60 J61 O15 C32 C13 P20 P27 |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:wii:wpaper:196&r=all |
| By: | Reio Tanji (Graduate School of Economics, Osaka University) |
| Abstract: | This paper discusses what determines the reference point in decision making,using an empirical dataset of performance stats in professional baseball.Previous literature has argued that some round-numbers may work as such points,and as a result,bunching occurs around these numbers in the distribution of the target outcomes.On the other hand,in the setting of workplace, the outcomes are observable both for the worker(players) and the evaluator(managers). This paper shows that this bunching do NOT occur from the structure of the contracts,or how the managers evaluate the players.Bunching seems to stem from the reference-point dependence of the workers themselves,and so to avoid this economically inefficient behavior,we have to design contracts that incentivize players to do so. |
| Keywords: | referencedependence,round-numbereffect,bunching,monetaryincentive,sports |
| JEL: | D91 J01 |
| URL: | http://d.repec.org/n?u=RePEc:osk:wpaper:2023&r=all |
| By: | Lustenhouwer, Joep; Makarewicz, Tomasz; Peña, Juan Carlos; Proaño Acosta, Christian |
| Abstract: | We investigate the effects of group identity and income inequality on social preferences and polarization by means of a laboratory experiment. We split our subjects into two populations: in-group (representing "natives") and out-group ("migrants"). In-group subjects repeatedly vote whether an unemployment insurance should cover all, some, or no members of their group. By means of a two-by-two design we disentangle the effect of group identity from those of income inequality. Among others, our experiment yields the following findings: (1) subjects tend to vote for less inclusive insurance schemes when they sample a higher chance of employment; however, (2) in-group subjects with an ex ante more beneficial distribution of employment chances - relative to the out-group - are less selfish and vote for more inclusive insurance schemes; (3) ex ante more beneficial relative employment chances of in-group subjects also leads to less polarization; and (4) revelation and priming of group identity does not lead to discrimination against out-group "migrants" but, on the contrary, can lead to more compassionate and inclusive attitudes. |
| Keywords: | Income Inequality,Political Polarization,Migration,Economic Voting Behavior,Group Identity |
| JEL: | C92 D72 J15 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:bamber:168&r=all |
| By: | Barbara Biasi; Chao Fu; John Stromme |
| Abstract: | We study the equity-efficiency implication of giving school districts control over teacher pay using an equilibrium model of the market for public-school teachers. Teachers differ in their comparative advantages in teaching low- or high-achieving students. School districts, which serve different student bodies, use both wage and hiring strategies to compete for their preferred teachers. We estimate the model using data from Wisconsin, where districts gained control over teacher pay in 2011. We find that, all else equal, giving districts control over teacher pay would lead to more efficient teacher-district sorting but larger educational inequality. Teacher bonus programs that incentivize comparative advantage-based sorting, combined with bonus rates favoring districts with more low-achieving students, could improve both efficiency and equity. |
| JEL: | I20 J31 J45 J51 J61 J63 |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28530&r=all |
| By: | Marcin Hitczenko |
| Abstract: | This paper uses individuals' self-assessments of their contribution to four household activities to study how mixed-gender couples divide household responsibility. Household responsibility dynamics are characterized according to a three-point ordinal variable, whose distribution is linked to a variety of household demographics via a proportional odds model fit using survey data from both members of 327 couples. The data reveal that household tendencies depend on household demographics, albeit differently across the four activities. For household shopping, gender is the primary determinant of dynamics, with females consistently shouldering more responsibility than males. For activities more closely linked to financial decision making, however, greater responsibility aligns more with higher income and educational standing within the household. In addition, there is evidence that gender links less with role assignments in more highly educated households, but not in younger households. |
| Keywords: | gender roles; household finance; proportional odds model; Survey of Consumer Payment Choice |
| JEL: | A14 C51 D13 J16 |
| Date: | 2021–02–03 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedawp:90078&r=all |
| By: | Michele Belot (Cornell University); Philipp Kircher (Cornell University); Paul Muller (Vrije Universiteit Amsterdam) |
| Abstract: | We propose a simple method for eliciting individual time preferences without estimating utility functions even in settings where background consumption changes over time. It relies on lottery tickets with high rewards. In a standard intertemporal choice model high rewards decouple lottery choices from variation in background consumption. We validate our elicitation method experimentally on two student samples: one asked in December when their current budget is reduced by extraordinary expenditures for Christmas gifts; the other asked in February when no such extra constraints exist. We illustrate an application of our method with unemployed job seekers which naturally have income/consumption variation. |
| Keywords: | time preferences, experimental elicitation, job search, hyperbolic discounting |
| JEL: | J64 D90 |
| Date: | 2021–02–05 |
| URL: | http://d.repec.org/n?u=RePEc:tin:wpaper:20210013&r=all |
| By: | Aghion, Philippe (Birkbeck College, University of London); Bergeaud, Antonin (CEP, London School of Economics); Van Reenen, John (MIT Sloan School of Management) |
| Abstract: | Does regulation affect the pace and nature of innovation and if so, by how much? We build a tractable and quantifiable endogenous growth model with size-contingent regulations. We apply this to population administrative firm panel data from France, where many labor regulations apply to firms with 50 or more employees. Nonparametrically, we find that there is a sharp fall in the fraction of innovating firms just to the left of the regulatory threshold. Further, a dynamic analysis shows a sharp reduction in the firm's innovation response to exogenous demand shocks for firms just below the regulatory threshold. We then quantitatively fit the parameters of the model to the data, finding that innovation at the macro level is about 5.4% lower due to the regulation, a 2.2% consumption equivalent welfare loss. Four-fifths of this loss is due to lower innovation intensity per firm rather than just a misallocation towards smaller firms and lower entry. We generalize the theory to allow for changes in the direction of R&D, and find that regulation's negative effects only matter for incremental innovation (as measured by citations and text-based measures of novelty). A more regulated economy may have less innovation, but when firms do innovate they tend to "swing for the fence" with more radical (and labor saving) breakthroughs. |
| Keywords: | innovation, regulation, patents, firm size |
| JEL: | O31 L11 L51 J8 L25 |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp14082&r=all |