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on Labor Markets - Supply, Demand, and Wages |
| By: | Berg, Peter B. (Michigan State University); Hamman, Mary K. (University of Wisconsin, La Crosse); Piszczek, Matthew (University of Wisconsin, Oshkosh); Ruhm, Christopher J. (University of Virginia) |
| Abstract: | In the coming years, a substantial portion of Germany's workforce will retire, making it difficult for businesses to meet human capital needs. Training older workers may be a successful strategy for managing this demographic transition. This study examines relationships between establishment training programs, wages, and retirement among older men and women. Using unique matched establishment-employee data from Germany, the authors find that when establishments offer special training programs targeted at older workers, women – and especially lower wage women – are less likely to retire. Results suggest this relationship may be due to greater wage growth. For men, findings suggest establishment offer of inclusion in standard training programs may improve retention of low wage men, but analysis of pre-existing differences in establishment retirement patterns suggests this relationship may not be causal. Our research suggests targeted training programs likely play an important role in retaining and advancing careers of low wage older women. |
| Keywords: | workforce training, retirement, establishment training |
| JEL: | J20 J24 J26 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9508&r=lma |
| By: | Coelli, Michael (University of Melbourne); Tabasso, Domenico (University of Geneva) |
| Abstract: | We investigate the labour market determinants and outcomes of adult participation in formal education (lifelong learning) in Australia, a country with high levels of adult education. Employing longitudinal data and fixed effects methods allows identification of effects on outcomes free of ability bias. Different trends in outcomes across groups are also allowed for. The impacts of adult education differ by gender and level of study, with small or zero labour market returns in many cases. Wage rates only increase for males undertaking university studies. For men, vocational education and training (VET) lead to higher job satisfaction and fewer weekly hours. For women, VET is linked to higher levels of satisfaction with employment opportunities and higher employment probabilities. |
| Keywords: | adult education, lifelong learning, vocational studies, returns to education |
| JEL: | J24 J28 I23 I28 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9509&r=lma |
| By: | Kabátek, Jan (University of Melbourne) |
| Abstract: | This paper investigates the effects of the age-dependent minimum wage on youth employment flows in the Netherlands. The Dutch minimum wage for workers aged 15-23 is defined as a step-wise increasing function of a worker's calendar age. At the age of 23, workers become eligible for the "adult" minimum wage which does not increase further. This creates an incentive for firms to discriminate against employees on the basis of their age, substituting more expensive older workers with younger ones. In or- der to grasp the size of these effects, I analyze monthly flows in and out of employment using administrative records for the entire youth population of the Netherlands. I account for the time remaining until workers' next birthdays, exploiting the fact that firms are facing a sharp discontinuity in labor costs in the month when a worker turns one year older. The results show a significant increase in job separation around the time of this discontinuity: the probability of job separation increases by 1.1% in the three calendar months which are closest to a worker's next birthday. This effect exhibits substantial heterogeneity with respect to a worker's age, showing that young and inexperienced workers are more likely to be affected by the discontinuities. The size of the effect also varies by the sector of employment, being particularly large for supermarket employees. Job accession peaks just after workers' birthdays, representing both entry of the workers with higher reservation wages and re-employment of the workers whose jobs are dissolved around the time of the discontinuity. |
| Keywords: | minimum wage, age-dependency, labor market flows |
| JEL: | J23 J31 J38 M51 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9528&r=lma |
| By: | Neumark, David (University of California, Irvine) |
| Abstract: | The depth of the Great Recession, the slow recovery of job creation, the downward trend in labor force participation, high long-term unemployment, stagnant or declining wages for low-to-medium skill jobs owing to adverse labor demand shifts, and a greater rebound in low-wage than mid- or higher-wage jobs, raised concerns that the normal business cycle dynamics of recovery from the recession will be insufficient to offset the diminished labor market prospects of many workers. These concerns have spurred serious consideration of policies to encourage job creation and higher income from work beyond the more immediate countercyclical policies that were adopted in response to Great Recession. Among the policies generating continuing or renewed interest are hiring credits, higher (sometimes much higher) minimum wages, and a more substantial Earned Income Tax Credit (EITC) for childless individuals. This paper discusses these policy options, what we know about their likely effects and tradeoffs, and what the unanswered questions are; the focus is on U.S. evidence. |
| Keywords: | hiring credits, income, jobs, minimum wage |
| JEL: | J2 J3 J6 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9529&r=lma |
| By: | Hall, Robert (Stanford University); Mueller, Andreas I. (Columbia University) |
| Abstract: | We use a rich new body of data on the experiences of unemployed job-seekers to determine the sources of wage dispersion and to create a search model consistent with the acceptance decisions the job-seekers made. From the data and the model, we identify the distributions of four key variables: offered wages, offered non-wage job values, the value of the job-seeker's non-work alternative, and the job-seeker's personal productivity. We find that, conditional on personal productivity, the dispersion of offered wages is moderate, accounting for 21 percent of the total variation in observed offered wages, whereas the dispersion of the non-wage component of offered job values is substantially larger. We relate our findings to an influential recent paper by Hornstein, Krusell, and Violante who called attention to the tension between the fairly high dispersion of the values job-seekers assign to their job offers – which suggest a high value to sampling from multiple offers – and the fact that the job-seekers often accept the first offer they receive. |
| Keywords: | wage dispersion, reservation wages, search frictions, unemployment |
| JEL: | J31 J32 J64 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9527&r=lma |
| By: | Chen, Xuan (Renmin University of China); Flores, Carlos A. (California Polytechnic State University); Flores-Lagunes, Alfonso (Syracuse University) |
| Abstract: | We derive nonparametric sharp bounds on average treatment effects with an instrumental variable (IV) and use them to evaluate the effectiveness of the Job Corps (JC) training program for disadvantaged youth. We concentrate on the population average treatment effect (ATE) and the average treatment effect on the treated (ATT), which are parameters not point identified with an IV under heterogeneous treatment effects. The main assumptions employed to bound the ATE and ATT are monotonicity in the treatment of the average outcomes of specified subpopulations, and mean dominance assumptions across the potential outcomes of these subpopulations. Importantly, the direction of the mean dominance assumptions can be informed from data, and some of our bounds do not require an outcome with bounded support. We employ these bounds to assess the effectiveness of the JC program using data from a randomized social experiment with non-compliance (a common feature of social experiments). Our empirical results indicate that the effect of JC on eligible applicants (the target population) four years after randomization is to increase weekly earnings and employment by at least $24.61 and 4.3 percentage points, respectively, and to decrease yearly dependence on public welfare benefits by at least $84.29. Furthermore, the effect of JC on participants (the treated population) is to increase weekly earnings by between $28.67 and $43.47, increase employment by between 4.9 and 9.3 percentage points, and decrease public benefits received by between $108.72 and $140.29. Our results also point to positive average effects of JC on the labor market outcomes of those individuals who decide not to enroll in JC regardless of their treatment assignment (the so-called never takers), suggesting that these individuals would indeed benefit from participating in JC. |
| Keywords: | training programs, program evaluation, average treatment effects, bounds, instrumental variables |
| JEL: | J30 C13 C21 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9511&r=lma |
| By: | Elizabeth Jane CASABIANCA (Universit… Politecnica delle Marche, Dipartimento di Scienze Economiche e Sociali); Alessia LO TURCO (Universit… Politecnica delle Marche, Dipartimento di Scienze Economiche e Sociali); Claudia PIGINI (Universit… Politecnica delle Marche, Dipartimento di Scienze Economiche e Sociali) |
| Abstract: | We provide a task-based analysis of the gender wage gap. We apply multivariate factor analysis on the O*NET database and show that three main tasks describe an occupation: manual, managerial-interpersonal and cognitive-professional. Matching our task measures with U.S. CPS data from 2003 to 2010 we find that the gender wage gap narrows as the manual and cognitive-professional intensity of tasks increases, whereas it widens in managerial-interpersonal intensive jobs. Non-cognitive skills, then, importantly characterize jobs and translate into heterogenous returns across genders. Our empirical strategy simultaneously accounts for endogenous selection into employment and occupations according to the latter's task intensity. |
| Keywords: | Employment participation, Gender disparities, Occupational choices, Roy model, Task approach |
| JEL: | J24 J31 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:anc:wpaper:412&r=lma |
| By: | Matteo PICCHIO (Universit… Politecnica delle Marche, Dipartimento di Scienze Economiche e Sociali); Jan C. VAN OURS (Department of Economics, Tilburg University, The Netherlands) |
| Keywords: | Part-time employment, firm-sponsored training, gender, human capital, working hours |
| JEL: | C33 C35 J24 M51 M53 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:anc:wpaper:413&r=lma |
| By: | Raquel Fonseca Benito; Simon Lord |
| Abstract: | This paper studies the determinants of self-employment in Québec and in the rest of Canada by focusing on liquidity constraints, age and aggregate unemployment. We use a random effects probit model to analyse panel data from the Survey of Labour and Income Dynamics (SLID) for the period 1993-2010. The main results are as follows. The positive effect of investment income on the probability of being self employed confirms the existence of liquidity constraints. Being older increases the probability of choosing self-employment, rather than salaried work. This suggests that working for oneself may be a stepping stone towards retirement. High unemployment decreases the probability of being self-employed, suggesting that pull factors dominate push factors. Cet article analyse les déterminants du travail autonome au Québec et dans le reste du Canada en se concentrant sur les contraintes de liquidité, l’âge et le chômage agrégé. Nous utilisons les données en panel de l’Enquête sur la dynamique du travail et du revenu (EDTR) couvrant la période 1993-2010. Les résultats principaux tirés du modèle avec effets aléatoires sont les suivants : l’effet positif des revenus de placement sur la probabilité d’être travailleur autonome confirme la présence de contraintes financières; être plus âgé accroît la probabilité de choisir le travail autonome, suggérant que ce type d’emploi peut être un tremplin vers la retraite; un chômage élevé diminue la probabilité d’être à son compte ce qui suggère que les facteurs de pull dominent sur les facteurs de push. |
| Keywords: | , Travail autonome, contraintes financières, facteurs pull et push |
| JEL: | J21 J24 |
| Date: | 2015–11–16 |
| URL: | http://d.repec.org/n?u=RePEc:cir:cirwor:2015s-45&r=lma |
| By: | Cesarini, David (New York University); Lindqvist, Erik (Stockholm School of Economics); Notowidigdo, Matthew J. (Northwestern University); Östling, Robert (Institute for Interntional Economic Studies (IIES)) |
| Abstract: | We study the effect of wealth on labor supply using the randomized assignment of monetary prizes in a large sample of Swedish lottery players. We find winning a lottery prize modestly reduces labor earnings, with the reduction being immediate, persistent, and similar by age, education, and sex. A calibrated dynamic model of individual labor supply implies an average lifetime marginal propensity to earn out of unearned income of -0.11, and labor-supply elasticities in the lower range of previously reported estimates. The earnings response is stronger for winners than their spouses, which is inconsistent with unitary household labor supply models. |
| Keywords: | Labor supply; household labor supply; income effect; marginal propensity to earn; substitution effect; uncompensated elasticity; compensated elasticity; Frisch elasticity; household bargaining; unitary model of the household; self-employment; taxation |
| JEL: | H20 J12 J22 J24 J26 J62 |
| Date: | 2015–11–23 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:1094&r=lma |
| By: | Benson, Alan (University of Minnesota); Sojourner, Aaron J. (University of Minnesota); Umyarov, Akhmed (University of Minnesota) |
| Abstract: | In two experiments, we examine the effects of employer reputation in an online labor market (Amazon Mechanical Turk) in which employers may decline to pay workers while keeping their work product. First, in an audit study of employers by a blinded worker, we find that working only for good employers yields 40% higher wages. Second, in an experiment that varied reputation, we find that good-reputation employers attract work of the same quality but at twice the rate as bad-reputation employers. This is the first clean, field evidence on the value of employer reputation. It can serve as collateral against opportunism in the absence of contract enforcement. |
| Keywords: | labor, personnel, contracts, online labor markets, job search, screening, reputation, online ratings |
| JEL: | L14 M55 J41 J2 L86 D82 K12 K42 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9501&r=lma |
| By: | Ellen Marie Rossvoll; Victoria Sparrman (Statistics Norway) |
| Abstract: | In this paper we attempt to investigate the effect on income inequality of some recent trends in the labour market, changes in regulations of temporary positions and the surge in immigration in many EU-countries. The empirical results show that less strict regulations of temporary positions and higher immigration increase income inequality. The effects of other labour market institutions, such as tax and benefit replacement ratio, on wage inequality are mainly in line with previous literature, but our results are based on a larger sample size in both the time and country dimension. The empirical analysis is conducted on panel data for 20 OECD countries between 1973 and 2011. We perform two robustness checks to our results. First, we account for indirect effects of changes in labor market institutions on wage inequality via the unemployment rates. The indirect effects suggest that labour market institutions have a larger effect on wage inequality than before. Second, we account for cross-sectional dependence and the results point at lower but significant effects of most of the labour market institutions on wage inequality. |
| Keywords: | Inflation modelling; pattern wage bargaining; inflation targeting; dynamic econometrics; cointegration; small open economy |
| JEL: | E24 J08 J31 J51 |
| Date: | 2015–10 |
| URL: | http://d.repec.org/n?u=RePEc:ssb:dispap:826&r=lma |
| By: | Sémirat, S. |
| Abstract: | We study the effect of immediate working environment structures on discriminatory practices in the workplace. Taking into account a variable complementarity level between employees' productions, we exhibit equilibria where a manager has incentive to discriminate in favor of one of her employee. We are able to associate the level of complementarity of the employees' productions to the level of discrimination considered, from the perfectly substituable case to complementarity. We show that such a discrimination is exacerbated with complementarity between employees' productions. We furthermore establish that discrimination is efficient within a complementary working environment, while it is not when tasks are perfect substitutes. High level of discrimination that arises with complementarity allows us to identify the discrimination considered as a way to mitigate the impact of assignment of tasks on employees' perception of their ability. |
| Keywords: | DISCRIMINATION;FACTOR SUBSTITUTION;CONFIDENCE MANAGEMENT;BAYESIAN GAMES |
| JEL: | D24 D82 J71 M51 M54 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:gbl:wpaper:2015-12&r=lma |
| By: | Megalokonomou, Rigissa (Department of Economics University of Warwick); Goulas, Sofoklis (University of North Carolina at Chapel Hill) |
| Abstract: | We study the effect of disclosing relative performance information (feedback) on students' performance in high-school and on subsequent university enrolment. We exploit a large scale natural experiment where students in some cohorts are provided with their national and school relative performance. Using unique primary collected data, we find an asymmetric response to the relative performance information - high achieving students improve their last-year performance by 0.15 standard deviations whereas the last-year performance of low achieving students drops by 0.3 standard deviations. The results are more pronounced for females indicating greater sensitivity to feedback. We also document the long term effect of feedback provision - high achieving students reduce their repetition rate of the national exams, enrol into 0.15 standard deviations more popular University Departments and their expected annual earnings increase by 0.17 standard deviations. Results are opposite for low achieving students. We find suggestive evidence that feedback encourages more students from low-income neighborhoods to enrol in university and to study in higher-quality programs indicating a potential decrease in income inequality |
| Keywords: | feedback ; relative performance ; university admission ; rank ; gender differences ; income inequality |
| JEL: | I23 J21 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:wrk:warwec:1075&r=lma |
| By: | Bartel, Ann P. (Columbia University); Rossin-Slater, Maya (University of California, Santa Barbara); Ruhm, Christopher J. (University of Virginia); Stearns, Jenna (University of California, Santa Barbara); Waldfogel, Jane (Columbia University) |
| Abstract: | This paper provides quasi-experimental evidence on the impact of paid leave legislation on fathers' leave-taking, as well as on the division of leave between mothers and fathers in dual-earner households. Using difference-in-difference and difference-in-difference-in-difference designs, we study California's Paid Family Leave (CA-PFL) program, which is the first source of government-provided paid parental leave available to fathers in the United States. Our results show that fathers in California are 0.9 percentage points – or 46 percent relative to the pre-treatment mean – more likely to take leave in the first year of their children's lives when CA-PFL is available. We also examine how parents allocate leave in households where both parents work. We find that CA-PFL increases father-only leave-taking (i.e., father on leave while mother is at work) by 50 percent and joint leave-taking (i.e., both parents on leave at the same time) by 28 percent. These effects are much larger for fathers of sons than for fathers of daughters, and almost entirely driven by fathers of first-born children and fathers in occupations with a high share of female workers. |
| Keywords: | parental leave, father's leave-taking, leave-sharing |
| JEL: | J2 J13 J18 |
| Date: | 2015–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9530&r=lma |
| By: | Daniela Piazzalunga (University of Turin, Italy); Maria Laura Di Tommaso (University of Turin, Italy) |
| Abstract: | The paper examines the gender wage gap in Italy during the 2008-2012 economic crisis, using cross-sectional EU-SILC data. The gender wage gap increased from 4\% in 2008 to 8\% in 2012, while for most European countries the gap decreased over the same period. After 2010 the growth of the Italian gender wage gap (and its unexplained component) was particularly high in the upper part of the wage distribution. In 2010-2011 a wage freeze in the public sector was introduced as an austerity measure, and the average public sector premium dropped from 15\% to 11\%. Using counterfactual analyses, we show that the wage freeze has been one of the major causes of the growth of the gender wage gap, disproportionately affecting women, who are more likely to be employed in the public sector. This `policy effect' accounts for more than 100\% of the increase between 2009 and 2011, while other changes, if anything, would have reduced the gender gap. |
| Keywords: | Gender wage gap, Great Recession, public sector premium, decomposition, counterfactual analysis. |
| JEL: | J31 J71 J16 J45 |
| Date: | 2015–10 |
| URL: | http://d.repec.org/n?u=RePEc:inq:inqwps:ecineq2015-381&r=lma |