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on Labour Economics |
| By: | Joaquin Garcia-Cabo; Anna Lipinska; Gaston Navarro |
| Abstract: | Unemployment insurance and wage subsidies are key tools to support labor markets in recessions. We develop a multi-sector search and matching model with on-the-job human capital accumulation to study labor market policy responses to sector-specific shocks. Our calibration accounts for structural differences in labor markets between the United States and the euro area, including a lower job-finding rate in the latter. We use the model to evaluate unemployment insurance and wage subsidy policies in recessions of different duration. We find that, after a temporary sector-specific shock, unemployment insurance improves both productivity and reallocation toward productive sectors at the cost of initially higher unemployment and, thus, human capital destruction. In the United States, unemployment insurance is preferred to wage subsidies when it does not distort job creation for too long. By contrast, wage subsidies reduce unemployment and preserve human capital, at the cost of limiting reallocation. In the euro area, where the job-finding rate is lower, subsidies are preferred. |
| Keywords: | labor market policies; reallocation; search and matching |
| JEL: | E24 J68 J64 |
| Date: | 2022–12 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgif:1361&r=lab |
| By: | Luc Behaghel; Sofia Dromundo; Marc Gurgand; Yagan Hazard; Thomas Zuber |
| Abstract: | We analyze the employment effects of directing job seekers' applications towards establishments likely to recruit, building upon an existing Internet platform developed by the French public employment service. Our two-sided randomization design, with about 1.2 million job seekers and 100, 000 establishments, allows us to measure precisely the effects of the recommender system at hand. Our randomized encouragement to use the system induces a 2% increase in job finding rates among women. This effect is due to an activation effect (increased search effort, stronger for women than men), but also to a targeting effect by which treated men and women were more likely to be hired by the firms that were specifically recommended to them. In a second step, we analyze whether these partial equilibrium effects translate into positive effects on aggregate employment. Drawing on the recent literature on the econometrics of interference effects, we estimate that by redirecting the search effort of some job seekers outside their initial job market, we reduced congestion in slack markets. Estimates suggest that this effect is only partly offset by the increased competition in initially tight markets, so that the intervention increases aggregate job finding rates. |
| Keywords: | Search and Matching, Occupational Mobility, Displacement Effects |
| JEL: | E24 J60 J62 J64 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:bfr:banfra:900&r=lab |
| By: | Teodora Boneva; Marta Colin; Katja Kaufmann; Christopher Rauh; Katja Maria Kaufmann |
| Abstract: | This paper provides representative evidence on the perceived returns to maternal labor supply. We design a novel survey to elicit subjective expectations, and show that a mother’s decision to work is perceived to have sizable impacts on child skills, family outcomes, and the future labor market outcomes of the mother. Examining the channels through which the impacts are perceived to operate, we document that beliefs about the impact of additional household income can account for some, but not all, of the perceived positive effects. Beliefs about returns substantially vary across the population and are predictive of labor supply intentions under different policy scenarios related to childcare availability and quality, two factors that are also perceived as important. Consistent with socialization playing a role in the formation of beliefs, we show that respondents whose own mother worked perceive the returns to maternal labor supply as higher. |
| Keywords: | subjective expectations, maternal labor supply, childcare, child penalties |
| JEL: | J22 J13 I26 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_10148&r=lab |
| By: | Hannah Illing; Johannes Schmieder; Simon Trenkle |
| Abstract: | study design combined with propensity score matching and reweighting to administrative data from Germany. After a mass layoff, women's earnings losses are about 35% higher than men's, with the gap persisting five years after displacement. This is partly explained by women taking up more part-time employment, but even women's full-time wage losses are almost 50% higher than men's. Parenthood magnifies the gender gap sharply. Finally, displaced women spend less time on job search and apply for lower-paid jobs, highlighting the importance of labor supply decisions. |
| Keywords: | Labor Supply, Labor Demand, Economics of Gender |
| JEL: | J22 J23 J16 |
| URL: | http://d.repec.org/n?u=RePEc:bon:boncrc:crctr224_2022_381&r=lab |
| By: | Coskun, Sena (Institute for Employment Research (IAB), Nuremberg, Germany ; FAU); Dalgic, Husnu (Univ. Mannheim) |
| Abstract: | "Fertility in the US exhibits an increasingly more procyclical pattern. We argue that women’s breadwinner status is behind procyclical fertility: (i) women’s relative income in the family has increased over time; and (ii) women are more likely to work in relatively stable and countercyclical industries whereas men tend to work in volatile and procyclical industries. This creates a countercyclical gender income gap as women become breadwinners in recessions, producing an insurance effect of women’s income. Our quantitative framework features a general equilibrium OLG model with endogenous fertility and human capital choice. We show that the change in gender employment cyclicality can explain 38 to 44 percent of the emergence of procyclical fertility. Our counterfactual analysis shows that in a world in which men become nurses and women become construction workers, we would observe “countercyclical fertility” but at the expense of lower human capital accumulation as families lean in more towards quantity in the quality-quantity trade-off." (Author's abstract, IAB-Doku) ((en)) |
| Keywords: | USA ; IAB-Open-Access-Publikation ; Auswirkungen ; Erwerbsbeteiligung ; erwerbstätige Frauen ; Familieneinkommen ; Frauen ; Fruchtbarkeit ; generatives Verhalten ; geschlechtsspezifische Faktoren ; geschlechtsspezifischer Arbeitsmarkt ; Konjunkturabhängigkeit ; Arbeitsmarktrisiko ; Arbeitsplatzgefährdung ; Wirtschaftszweige ; 1964-2018 |
| JEL: | E24 E32 J11 J13 J16 J21 J24 |
| Date: | 2022–12–21 |
| URL: | http://d.repec.org/n?u=RePEc:iab:iabdpa:202227&r=lab |
| By: | Giovanni Peri; Reem Zaiour |
| Abstract: | From the beginning of the Covid-19 pandemic to late 2021, international immigration flows to the US decreased significantly. We document the timing and the characteristics of these significant changes in flows, their evolution until late 2022 and their geographic and sector distribution. We consider, in a similar way, changes in internal native mobility in the US, before and after Covid-19. We then connect cross-state native mobility to foreign immigration, the emergence of remote-work options, and changes in labor demand, before and after Covid. In spite of the large changes in labor markets and international migration, we do not measure any significant changes in native internal mobility. Then, using a panel regression and a shift-share IV, we find that the post-Covid drop in immigration and differential increase in remote-work options across sectors and states were not associated with changes in natives' cross-state mobility. We discuss possible implications of the decline in immigration and low native mobility on unfilled jobs in local labor markets. |
| JEL: | J61 |
| Date: | 2022–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:30811&r=lab |
| By: | Pedro S. Martins; Jonathan P. Thomas |
| Abstract: | This paper studies firm-provided training in a context of potential worker mobility. We argue that such worker mobility may be reduced by employers’ associations (EAs) through no-poach agreements. First, we sketch a simple model to illustrate the impact of employer coordination on training. We then present supporting evidence from rich matched panel data, including firms’ EA affiliation and workers’ individual training levels. We find that workers’ mobility between firms in the same EA is considerably lower than mobility between equivalent firms not in the same EA. We also find that training provision by EA firms is considerably higher, even when drawing on within-employee variation and considering multiple dimensions of training. We argue that these results are consistent with a role played by EAs in reducing worker mobility. |
| Keywords: | Employers organisations, No-poach agreements, Worker mobility |
| JEL: | J53 J62 L40 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:unl:unlfep:wp653&r=lab |
| By: | Barsbai, Toman; Bartos, Vojtech; Licuanan, Victoria S.; Steinmayr, Andreas; Tiongson, Erwin R.; Yang, Dean |
| Abstract: | We experimentally study an intervention to reduce mistreatment of Filipino overseas domestic workers (DWs) by their employers. Encouraging DWs to show their employers a family photo while providing a small gift when starting employment reduced DW mistreatment, increased their job satisfaction, and increased the likelihood of contract extension. While generally unaware of the intervention, DWs' families staying behind become more positive about international labor migration. An online experiment with potential employers suggests that the effect operates through a reduction in employers' perceived social distance from their employees. A simple intervention can protect migrant workers without requiring destination country policy reforms. |
| Keywords: | temporary labor migration, working conditions, contract enforcement, dictator game |
| JEL: | D9 J61 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwkwp:2237&r=lab |
| By: | Martin Nybom (IFAU); Erik Plug (University of Amsterdam); Bas van der Klaauw (Vrije Universiteit Amsterdam); Lennart Ziegler (University of Vienna) |
| Abstract: | This paper formulates a simple skill and education model to explain how better access to higher education leads to stronger assortative mating on skills of parents and more polarized skill and earnings distributions of children. Swedish data show that in the second half of the 20th century more skilled students increasingly enrolled in college and ended up with more skilled partners and more skilled children. Exploiting college expansions, we find that better college access increases both skill sorting in couples and skill and earnings inequality among their children. All findings support the notion that rising earnings inequality is, at least in part, supply driven by rising skill inequality. |
| Keywords: | Assortative mating, intergenerational mobility, education, earnings inequality |
| JEL: | J62 I24 J12 J11 |
| Date: | 2022–12–22 |
| URL: | http://d.repec.org/n?u=RePEc:tin:wpaper:20220098&r=lab |
| By: | Stephen B. Billings; Mark Hoekstra; Gabriel Pons Rotger |
| Abstract: | Recent research documents a causal impact of place on the long-run outcomes of children. However, little is known about which neighborhood characteristics are most important, and at what scale neighborhood effects operate. By using the random assignment of public housing along with administrative data from Denmark, we get inside the “black box” of neighborhood effects by defining neighborhoods using various characteristics and scales. Results indicate effects on mental health and especially education are large but local, while effects on drug possession operate on a much broader scale. Additionally, unemployment and education are better predictors of outcomes than neighborhood income. |
| JEL: | I38 K42 R23 |
| Date: | 2022–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:30764&r=lab |
| By: | Dhaval M. Dave; Yang Liang; Caterina Muratori; Joseph J. Sabia |
| Abstract: | Despite nearly 70 percent of the American public supporting legalization of recreational marijuana, opponents argue that increased marijuana use may diminish motivation, impede cognitive function, and harm health, each of which could adversely affect adults’ economic wellbeing. This study is the first to explore the impacts of recreational marijuana laws (RMLs) on employment and wages. Difference-in-differences estimates show little evidence that RMLs adversely affect labor market outcomes among most working-age individuals. Rather, our estimates show that RML adoption is associated with an increase in agricultural employment, consistent with the opening of a new licit market. A causal interpretation of our findings is supported by (1) event-study analyses using dynamic difference-in-differences estimates designed to expunge bias due to heterogeneous and dynamic treatment effects, and (2) alternative policy estimates generated using a synthetic control design. |
| JEL: | H71 I12 |
| Date: | 2022–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:30813&r=lab |
| By: | Prithwiraj Choudhury; Kirk Doran; Astrid Marinoni; Chungeun Yoon |
| Abstract: | We study how restrictive immigration policies and the unexpected loss of peers affect the performance of skilled migrants, exploiting the unexpected increased denials of H-1B visa extensions in the United States beginning in 2017. We find that employees who lost peers of the same ethnic background experience a substantial decrease in individual performance. To resolve the endogeneity surrounding visa denial decisions, we build an instrumental variable that exploits the fixed duration of the visas. Our mechanism tests suggest that ethnic ties boost individual performance through preferential channels of knowledge and information spillovers. |
| JEL: | J24 J61 L25 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_10152&r=lab |
| By: | Peter Blair (Harvard Graduate School of Education); Benjamin Posmanick (St. Bonaventure University) |
| Abstract: | During the 1980s, the wage gap between white women and white men in the US declined by approximately 1 percentage point per year. In the decades since, the rate of gender wage convergence has stalled to less than one-third of its previous value. An outstanding puzzle in economics is ``why did gender wage convergence in the US stall?'' Using an event study design that exploits the timing of state and federal family-leave policies, we show that the introduction of the policies can explain 94% of the reduction in the rate of gender wage convergence that is unaccounted for after controlling for changes in observable characteristics of workers. If gender wage convergence had continued at the pre-family leave rate, wage parity between white women and white men would have been achieved as early as 2017. |
| Keywords: | gender wage gap, Family and Medical Leave Act, family leave |
| JEL: | J16 J31 J32 |
| Date: | 2023–01 |
| URL: | http://d.repec.org/n?u=RePEc:hka:wpaper:2023-001&r=lab |
| By: | Gutmann, Jerg; Marchal, Léa; Simsek, Betül |
| Abstract: | This is the first global study of how institutionally entrenched gender discrimination affects the gender migration gap (GMG) using data on 158 origin and 37 destination countries over the period 1961-2019. We estimate a gravity equation derived from a random utility maximization model of migration that accounts for migrants' gender. Instrumental variable estimates indicate that increasing gender equality in economic or political rights generally deepens the GMG, i.e., it reduces female emigration relative to that of men. In line with our theoretical model, this average effect is driven by higher-income countries. In contrast, increased gender equality in rights reduces the GMG in lower-income countries by facilitating female emigration. |
| Keywords: | Discrimination, Gender equality, Individual rights, Migration, RUM model |
| JEL: | F22 J16 J71 K38 O15 P48 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ilewps:67&r=lab |
| By: | Potter, Tristan (Drexel University) |
| Abstract: | Modern search technologies enable workers to monitor - and thus quickly apply to - newly posted jobs. I conceptualize search as a monitoring decision and study the implications for labor market dynamics. The central insight is that monitoring leads to a novel source of strategic complementarities in search decisions, which results in multiple equilibria that can exert a destabilizing force on the labor market. Strategic complementarities arise because workers who actively monitor new job postings are able to apply before those who do not. This leads to a rat race for jobs in which the belief that others are monitoring new postings necessitates doing the same in order to avoid falling to the back of the queue. I show that this mechanism leads to multiple equilibria in a stylized monitoring game and then embed the game in a quantitative macroeconomic model of the labor market. With a plausibly elastic job creation process (i.e., away from the free-entry limit), multiplicity arises in the quantitative model. The model provides (i) a theory of belief-driven fluctuations in labor supply that can permanently alter the path of the economy, (ii) a mechanism through which transitory demand shocks can permanently affect labor supply, and (iii) an account of the recovery from the Great Recession, during which a historically tight labor market coexisted with weak wage growth---observations difficult to reconcile with traditional models. I document two facts that are supportive of the model and its implications. |
| Keywords: | Search and matching; online job search; hysteresis |
| JEL: | E24 E71 J64 O33 |
| Date: | 2023–01–05 |
| URL: | http://d.repec.org/n?u=RePEc:ris:drxlwp:2023_002&r=lab |
| By: | Toman Barsbai; Vojtech Bartos; Victoria Licuanan; Andreas Steinmayr; Erwin Tiongson; Dean Yang |
| Abstract: | International migrant workers are vulnerable to abuses by their employers. We implemented a randomized controlled trial of an intervention to reduce mistreatment of Filipino women working as domestic workers (DWs) by their household employers in Hong Kong and Saudi Arabia. The intervention -- encouraging DWs to show their employers a photo of their family while providing a small gift when starting employment -- caused DWs to experience less mistreatment, have higher satisfaction with the employer, and be more likely to stay with the employer. DWs' families in the Philippines also come to view international labor migration more positively, while they generally remain unaware of the intervention. An online experiment with potential employers in Hong Kong and the Middle East suggests that a mechanism behind the treatment effect is a reduction in the employer's perceived social distance from the employee. |
| JEL: | J50 O15 |
| Date: | 2022–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:30804&r=lab |
| By: | Kleinhempel, Johannes; Klasing, Mariko; Beugelsdijk, Sjoerd |
| Abstract: | Does national culture influence entrepreneurship? Given that entrepreneurship and the economic, formal institutional, and cultural characteristics of nations are deeply intertwined and co-vary, it is difficult to isolate the effect of culture on entrepreneurship. In this study, we examine the self-employment choices of second-generation immigrants who were born, educated, and currently live in one country, but were raised by parents stemming from another country. We argue that entrepreneurship is influenced by durable, portable, and intergenerationally transmitted cultural imprints such that second-generation immigrants are more likely to become entrepreneurs if their parents originate from countries characterized by a strong entrepreneurial culture. Our multilevel analysis of two independent samples –65, 323 second-generation immigrants of 52 different ancestries who were born, raised, and live in the United States and 4, 165 second-generation immigrants of 31 ancestries in Europe– shows that entrepreneurial culture is positively associated with the likelihood that individuals are entrepreneurs. Our results are robust to alternative non-cultural explanations, such as differences in resource holdings, labor market discrimination, and direct parent-child linkages. Overall, our study highlights the durability, portability, and intergenerational transmission of entrepreneurial culture as well as the profound impact of national culture on entrepreneurship. |
| Keywords: | Entrepreneurship, National culture, Cross-Cultural Studies |
| JEL: | A13 J24 J61 L26 M13 M16 O57 Z10 Z13 |
| Date: | 2022–12 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:115942&r=lab |
| By: | Ariel J. Binder; Caroline Walker; Jonathan Eggleston; Marta Murray-Close |
| Abstract: | We study racial-ethnic disparities in marital and economic status by linking American Community Survey respondents born in 1978-87 to their parents’ tax records. Conditional on childhood family income (CFI), we find that the average Black non-Hispanic woman obtains 60 percent less partner income than does the average White non-Hispanic woman, driven both by a lower propensity to be partnered and a lower partner CFI rank. These marriage market dynamics account for 85 percent of the observed—and large—gap in intergenerational family income mobility. We also show that mobility gaps are larger, and rates of intermarriage lower, in birth areas with greater CFI inequality and racial-ethnic segregation. We discuss a simple model in which these patterns originate from segmentation of the marriage market along racial-ethnic lines combined with imperfect assortative matching on economic status. We comment on the implications of our findings for policy. |
| Keywords: | marriage market, intergenerational mobility, family income, racial inequality, assortative matching, segregation, intermarriage, union formation, stratification economics |
| JEL: | D31 J12 J15 |
| Date: | 2022–12 |
| URL: | http://d.repec.org/n?u=RePEc:cen:wpaper:22-59&r=lab |
| By: | Lehner, Lukas; Kasy, Maximilian |
| Abstract: | We evaluate a guaranteed job program that was piloted, starting in October 2020, in the municipality of Gramatneusiedl in Austria. This program provided individually tailored, voluntary jobs to all long-term unemployed residents. Our evaluation is based on three estimation approaches. The first approach uses pairwise matched randomization of participants into waves for program adoption. The second approach uses a pre-registered synthetic control at the municipality level. The third approach compares program participants to observationally similar individuals in control municipalities. These different approaches allow us to separate out direct effects of program participation, anticipation effects of future participation, and municipality-level equilibrium effects. We find strong positive impacts of program participation on participants' economic (employment, income, security) and non-economic wellbeing (social recognition, time structure, social interactions, collective purpose). We do not find effects on physical health, or risk- and time-preferences. At the municipality level, we find a large reduction of long-term unemployment, and a slightly attenuated reduction of total unemployment. Comparing participants to similar individuals in control towns, we obtain estimates that are very close to the estimates from the experimental comparison. There is evidence of positive anticipation effects in terms of subjective wellbeing, status and social inclusion for future program participants, relative to ineligible control-town individuals. |
| JEL: | I38 J08 J45 |
| Date: | 2022–12 |
| URL: | http://d.repec.org/n?u=RePEc:amz:wpaper:2022-29&r=lab |
| By: | An Huang (Monash University); Paulo Santos (Monash University); Russell Smyth (Monash University) |
| Abstract: | This paper examines the role of agricultural technology, in the form of paddy rice cultivation, on contemporary levels of prejudice. Using environmental suitability for paddy as an instrumental variable, we find that people living in areas where paddy rice farming has been long practiced exhibit lower prejudice towards outgroup members. This relationship is mediated by greater exposure to markets and trade, itself derived from paddy’s higher land productivity, likely reflecting the opportunities for interpersonal contact created by markets. In contrast, the irrigation needs and high labour demands of paddy galvanize local cooperation, likely fostering prejudice directed to outsiders. |
| Keywords: | paddy rice, prejudice, market, contact hypothesis, group identity |
| JEL: | J15 N55 Z1 |
| Date: | 2023–01 |
| URL: | http://d.repec.org/n?u=RePEc:mos:moswps:2023-02&r=lab |
| By: | T. Terry Cheung (Institute of Economics, Academia Sinica, Taipei, Taiwan) |
| Abstract: | Demography and structural transformation are interrelated, and depend critically on education. At the turn of the twentieth century, U.S. parents began having fewer children while in-creasing educational investment per child. This quantity-quality tradeoff facilitated job reallocation from the low-skilled agricultural sector to the high-skilled nonagricultural sector. This transformation is examined in a heterogeneous agent model with a non-degenerate human capital distribution, focusing on how fertility and education decisions affect structural transformation. The result shows that the quantity-quality decisions account for up to approximately one-third of the decline in the agricultural employment share. |
| Keywords: | Quantity-Quality Tradeoff, Demographic Transition, Structural Transformation |
| JEL: | E24 J11 O11 O41 |
| Date: | 2022–12 |
| URL: | http://d.repec.org/n?u=RePEc:sin:wpaper:22-a006&r=lab |