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.

Self-Selection Among Undocumented Immigrants from Mexico

Abstract: This paper examines the effect of changes in migration determinants on the skill level of undocumented immigrants from Mexico. The authors focus on the effect of changes in economic conditions, migrant networks, and border enforcement on the educational attainment of Mexican-born men who cross the border illegally. Although previous research indicates that illegal aliens from Mexico tend to be unskilled relative to U.S. natives and that economic conditions, networks, and border enforcement affect the size of illegal immigrant flows across the border, the interaction of these variables has not been investigated. Results from hazard models using data from the Mexican Migration Project indicate that improvements in U.S. and Mexican economic conditions are associated with a decline in the average educational levels of undocumented immigrants. Stricter border enforcement is associated with higher average skill levels. Access to a network of previous immigrants appears to lower the cost of migrating but has no differential effect by skill level.

People, Places, and Public Policy: Some Simple Welfare Economics of Local Economic Development Programs

Abstract: Most countries exhibit large and persistent geographical differences in wages, income, and unemployment rates. A growing class of place-based policies attempts to address these differences through public investments and subsidies that target disadvantaged neighborhoods, cities, or regions. Place-based policies have the potential to profoundly affect the location of economic activity, along with the wages, employment, and industry mix of communities. These programs are widespread in the United States and throughout the world but have only recently been studied closely by economists. We consider the following questions: Who benefits from place-based interventions? Do the national benefits outweigh the costs? What sorts of interventions are most likely to be effective? To study these questions, we develop a simple spatial equilibrium model designed to characterize the welfare effects of place-based policies on the local and the national economy. Using this model, we critically evaluate the economic rationale...

Industry Wage Differentials, Unobserved Ability, and Rent-Sharing: Evidence from Matched Worker-Firm Data, 1995-2002

Abstract: This paper investigates inter-industry wage differentials in Belgium, taking advantage of access to a unique matched employer-employee data set covering the period 1995-2002. Findings show the existence of large and persistent wage differentials among workers with the same observed characteristics and working conditions, employed in different sectors. The hypothesis that workers with better unmeasured abilities are over-represented in high-wage sectors may not be rejected on the basis of Martins’ (2004) methodology. However, the contribution of this explanation to the observed industry wage differentials appears to be limited. Further results show that ceteris paribus, workers earn significantly higher wages when employed in more profitable firms. Our instrumented wage-profit elasticity stands at 0.063 and Lester’s range of pay is about 41 per cent of the mean wage. This rent-sharing phenomenon accounts for a large fraction of the industry wage differentials. We find indeed that the magnitude, dispersion and significance of industry wage differentials decreases sharply when controlling for profits.

Alternative Measures of Offshorability: A Survey Approach

Abstract: This paper reports on a household survey specially designed to measure what we call the "offshorability" of jobs, defined as the ability to perform the work duties from abroad. We develop multiple measures of offshorability, using both self-reporting and professional coders. All the measures find that roughly 25% of U.S. jobs are offshorable. Our three preferred measures agree between 70% and 80% of the time. Furthermore, professional coders appear to provide the most accurate assessments, which is good news because the Census Bureau could collect data on offshorability without adding a single question to the CPS. Empirically, more educated workers appear to hold somewhat more offshorable jobs, and offshorability does not have systematic effects on either wages or the probability of layoff. Perhaps most surprisingly, routine work is no more offshorable than other work.

Self-Selection, Earnings, and Out-Migration: A Longitudinal Study of Immigrants to Germany

Abstract: In this paper we examine the process of out-migration and investigate whether cross-sectional earnings assimilation results suffer from selection bias due to out-migration. Our 14 year longitudinal study reveals that emigrants are negatively selected with respect to occupational prestige and to stable full time employment. Our results show no selectivity with respect to human capital or gender. The likelihood of return migration is strongly determined by the range and nature of social attachments to Germany and origin countries. It is also the highest during the first five years since arrival, and grows higher toward retirement. Selective emigration, however, does not appear to distort cross-sectional estimates of earnings assimilation in a relevant way.