Institute for the Study of Labor

About: Institute for the Study of Labor is a nonprofit organization based out in Bonn, Germany. It is known for research contribution in the topics: Wage & Unemployment. The organization has 2039 authors who have published 13475 publications receiving 439376 citations.

Exchange Rate Regimes and Fiscal Multipliers

Abstract: Does the fiscal multiplier depend on the exchange rate regime and, if so, how strongly? To address this question, we first estimate a panel vector autoregression (VAR) model on time-series data for OECD countries. We identify the effects of unanticipated government spending shocks in countries with fixed and floating exchange rates, while controlling for anticipated changes in government spending. In a second step, we interpret the evidence through the lens of a New Keynesian small open economy model. Three results stand out. First, while government spending multipliers are larger under fixed exchange rate regimes, the difference relative to floating exchange rates is smaller than what traditional Mundell-Fleming analysis suggests. Second, there is little evidence for the specific transmission channel which is at the heart of the Mundell-Fleming model. Third, the New Keynesian model provides a satisfactory account of the evidence.

Clean evidence on peer pressure

Abstract: While confounding factors typically jeopardize the possibility of using observational data to measure peer effects, field experiments over the potential for obtaining clean evidence. In this paper we measure the output of subjects who were asked to stuff letters into envelopes, with a remuneration completely independent of output. We study two treatments. In the 'pair' treatment two subjects work at the same time in the same room. Peer effects are possible in this situation and imply that outputs within pairs should be similar. In the 'single' treatment, which serves as a control, subjects work alone in a room and peer effects are ruled out by design. Our main results are as follows: First, we find clear and unambiguous evidence for the existence of peer effects in the pair treatment. The standard deviations of output are significantly smaller within pairs than between pairs. Second, average output in the pair treatment largely exceeds output in the single treatment, i.e., peer effects raise productivity. Third, low productivity workers are significantly more sensitive to the behavior of peers than are high productivity workers. Our findings yield important implications for the design of the workplace.

Welfare Reform and Health

Abstract: We investigate the relationship between welfare reform and health insurance, health care utilization, and self-reported measures of health status for women aged 20-45, using nationally representative data from the Behavioral Risk Factor Surveillance System. We present estimates from both difference-in-difference models (applied to single women and single women with children) and difference-in-difference-in-difference models (using married women and single women without children as comparison groups). We find that welfare reform is associated with reductions in health insurance coverage and specific measures of health care utilization, as well as an increase in the likelihood of needing care but finding it unaffordable. We find no statistically significant effects of reform on health status. Overall, effects are somewhat larger for Hispanics compared to blacks and low educated women.

The Effects of Individual and School Factors on University Students' Academic Performance

Abstract: This article examines the factors that influence university students' academic performance, focusing on the role of student background and school factors. Using data on the first-year students at the University of Western Australia in 2001, two methodologies are employed. The first is analogous to an input-output approach, and the second is a random coefficients model. A key finding is that high schools have an impact on the academic performance of students at university beyond students' own background characteristics. Both immersion and reinforcement effects are identified.

Population, Population Density, and Technological Change

Abstract: In a model on population and endogenous technological change, Kremer combines a short-run Malthusian scenario where income determines the population that can be sustained, with the Boserupian insight that greater population spurs technological change and can therefore lift a country out of its Malthusian trap. We show that a more realistic version of the model, which combines population and population density, allows deeper insights into these processes. The incorporation of population density also allows a superior interpretation of the empirical regularities between the level of population, population density, population growth, and economic development, both at aggregated and disaggregated levels.