Showing papers in "Labour in 2004"

A Consumers' Republic: The Politics of Mass Consumption in Postwar America

Abstract: H and social scientists analyzing the contemporary world unfortunately have too little contact and hence miss some of the ways that their interests overlap and the research of one field might benefit another. I am, therefore, extremely grateful that the Journal of Consumer Research has invited me to share with its readers an overview of my recent research on the political and social impact of the flourishing of mass consumption on twentieth-century America. What follows is a summary of my major arguments, enough to entice you, I hope, to read A Consumers’ Republic (Cohen 2003), in which I elaborate on these themes. Although this essay is by necessity schematic, the book itself is filled with extensive historical evidence and is heavily illustrated with period images. In tracing the growing importance of mass consumption to the American economy, polity, culture, and social landscape from the 1920s to the present, I in many ways establish the historical context for your research into contemporary consumer behavior and markets. I hope you will discover illuminating and fruitful connections between your work and my own. The United States came out of World War II deeply determined to prolong and enhance the economic recovery brought on by the war, lest the crippling depression of the 1930s return. Ensuring a prosperous peacetime would require making new kinds of products and selling them to different kinds of markets. Although military production would persist, and expand greatly with the cold war, its critical partner in delivering prosperity was the mass con-

Temporary Employment, Working Conditions and Expected Exits from Firms

Abstract: . This paper analyses two issues related to working conditions and tem-porary employment. First, why do temporary workers exhibit lower scores in objec-tive indicators of working life? Second, what is the influence of working conditionson mobility? Using information for Spanish workers, the results indicate that dif-ferences in working conditions remain after controlling for individual, job and firmcharacteristics: in particular, temporary workers with short job tenure seem tooccupy jobs with poorer working conditions. Moreover, there is evidence thatworkers with worse working life are more likely to expect to leave their current firms. 1. Introduction Recently, the OECD (2002) has analysed different issues relatedto the growth of temporary employment in a number of countriesduring the last two decades. This increase has raised concerns about insecurity for workers and increasing labour market dualism.Features such as wages and fringe benefits, access to training andmobility are compared for workers holding temporary and perma-nent contracts. In terms of job satisfaction and working conditions,the results indicate that temporary workers tend to be less satisfiedwith their jobs than permanent workers and that temporary jobsare less desirable than permanent jobs.

Firm‐level Consequences of Large Minimum‐wage Increases in the Czech and Slovak Republics

Abstract: After an initial decline in the level of real minimum-wage rates, there were series of unusually large increases in their levels — 70 and 50 per cent — during the years 1999-2002 in the Czech and Slovak Republics, respectively. Using information from matched employee-employer data sets, we look at the impact of minimum-wage hikes on both wages and employment. Our results suggest that there are some, but not substantial, job losses in reaction to minimum-wage hikes and that the impact on firm wages is rather large, implying that further increases of similar magnitude might very well have negative conse- quences for employment.

Unequal Opportunities for Young People with Immigrant Backgrounds in the Swedish Labour Market

Abstract: . This paper investigates labour-market performance for 'young people with immigrant backgrounds' and those 'born in Sweden with native-born parents' in the Swedish labour market. It focuse ...

Early Career Mobility and Earnings Profiles of German Apprentices: Theory and Empirical Evidence

Abstract: We investigate how apprenticeship training affects the early career mobility and earnings profiles of young apprentices in Germany. The heterogeneous quality and nature (whether general or firm specific) of training across firms is expected to be reflected in the post-apprenticeship mobility and earning patterns of young workers. In this paper, we argue that a simple model of training and labour turnover can explain such patterns. Specifically, assuming that job changes are associated with a loss of accumulated firm-specific skills, the model predicts that although movers initially experience a productivity loss, their earnings grow at a faster rate than those of stayers. As job changes become more costly the longer a worker stays with the training firm, later movers experience a larger reduction in their earnings compared with direct movers. Estimated selectivity-corrected earnings equations for movers and stayers, based on data from the German Socioeconomic Panel (GSOEP), support the predictions of the model and highlight important differences in earnings profiles and mobility patterns by apprenticeship firm size.

Changes in Union Membership Over Time: A Panel Analysis for West Germany

Abstract: Despite the apparent stability of the wage bargaining institutions in West Germany, aggregate union membership has been declining dramatically since the early 90's. However, aggregate gross membership numbers do not distinguish by employment status and it is impossible to disaggregate these su±ciently. This paper uses four waves of the German Socioeconomic Panel in 1985, 1989, 1993, and 1998 to perform a panel analysis of net union membership among employees. We estimate a correlated random effects probit model suggested in Chamberlain (1984) to take proper account of individual specific effects. Our results suggest that at the individual level the propensity to be a union member has not changed considerably over time. Thus, the aggregate decline in membership is due to composition effects. We also use the estimates to predict net union density at the industry level based on the IAB employment subsample for the time period 1985 to 1997.

Basic Wages and Firm Characteristics: Rent Sharing in French Manufacturing

Abstract: . This paper shows that firm profits (and losses), and value added, are strongly related to individual hourly basic wages for most employees, as well as to the total earnings measures used previously but correlated with working time. Capital intensity is independently important without reducing the significance of profits, as in other studies. Value added avoids the negative bias implicit in accounting profits, and has a much larger effect on basic wages and earnings in the presence of numerous individual and firm controls.

Why is the Return to Training So High

Abstract: . Cross-sectional results show that training increases wages by 5 per cent. This return is on a par with the return to 1 year of education. Considering that the average duration of training is very short, this result is strange and needs further examination. After leaving out the importance of measurement error, we control for accumulated stock of firm-specific skills, unobserved heterogeneity in wage levels, heterogeneity in training returns, and heterogeneity in wage growth. By this we manage to reduce the return considerably. Unobserved heterogeneity in wage levels is the most important contributor to the ‘too high’ returns to training.

Schooling and Labor Market Impacts of a Natural Policy Experiment

Abstract: . We use a nationally representative household survey to estimate returns to schooling in Venezuela from instrumental variables based on a supply-side intervention in the education market. These estimates apply to a subgroup of individuals, in the spirit of the local average treatment effect (LATE) literature. Returns to schooling estimates that apply to a subgroup of individuals affected by the policy intervention may be more interesting from a policy perspective than the return to the ‘average’ individual. We use an instrument based on the 1980 education reform (the Organic Law of Education), which provided for 9 years of compulsory basic education. Alternative estimates derived from interacting the education reform with father's education are also obtained. The estimates are consistent with recent findings suggesting that the effect of education, at least for certain subgroups affected by policy intervention, is as large as or larger than what is suggested by ordinary least squares estimates.

Is the Swiss Labor Market Segmented? An Analysis Using Alternative Approaches

Abstract: In this paper, three common empirical methods encountered in the segmentation literature are used in order to establish whether or not the Swiss labor market is segmented: (i) a hierarchical cluster analysis; (ii) a switching model with unknown regime; and (iii) an analysis of low-wage mobility with a bivariate probit model with endogenous selection. According to method (i), segmentation can hardly be observed. Method (ii) shows that the Swiss labor market is dualistic in nature. Method (iii) reveals that a certain degree of persistence exists in low-wage jobs. Whether or not the Swiss labor market is segmented thus depends on the choice of method, i.e. on the definition and understanding of segments. In any case, none of the methods used in this study point to the existence of a large and well-defined secondary segment.

Do the Falling Earnings of Immigrants Apply to Self‐employed Immigrants?

Abstract: It is well known that the earnings of recent cohorts of immigrant men have fallen further behind native-born men. Using several years of Canadian Census data, this study finds that immigrants have turned to self-employment at a much faster rate than the native born. In addition, the earnings gap between self-employed immigrant and native-born men has not grown with successive cohorts, but rather has followed a cyclical movement: narrowing at the peak, and widening in times of weaker economic activity. However, immigrants choosing self-employment still face challenges, as their earnings are far below native-born earnings, and convergence is a lengthy process.

Size, Skill and Sorting

Abstract: The rise in inequality between the 1970s and the 1990s and the per- sistent gap in pay between large and small employers are two of the most robust findings in the study of labor markets. Mainstream economists focus on differences in observable and unobservable skills to explain both the overall rising inequality and the size-wage gap. In this paper we model how increasing returns to skill can affect the size-wage gap both with constant sorting and with size-biased, skill- biased technological change (e.g. if large firms always had access to computers, but small firms gained access to computers with the rise of affordable personal computers). We analyze the Current Population Surveys from 1979 to 1993 to determine whether large and small employers are converging in terms of mean wages (the employer size-wage effect), wage structures by occupation and education, charac- teristics of employees, and wage structures by region. We find mixed evidence of convergence and no consistent support for any single version of human capital theory.

Union–Firm Bargaining, Productivity Improvement and Endogenous Growth

Abstract: This paper presents a growth model with two sectors. In the high-tech sector, R&D increases productivity and union–firm bargaining determines wages, but in the traditional sector there are neither R&D nor labour unions. The government is able to regulate union bargaining power. The main results are as follows. Because firms try to escape wage increases through the improvement of productivity by R&D, the increase in union bargaining power boosts R&D and growth. It is welfare enhancing to strengthen (weaken) unions when the growth rate is below (above) some critical level. A specific rule is presented for when de-unionization is socially desirable.

Occupational Attainment and Earnings: The Case of the Disabled

Abstract: . This paper offers, for the first time, an investigation of wage differentials between disabled and non-disabled workers in Sweden. It extends the traditional wage decomposition by incorporating explained and unexplained differences in occupational attainment. Data from the Swedish Level of Living Survey for 1981 and for 1991 have been used. The results show that in both years the disabled worked in low-level occupations to a greater extent relative to the non-disabled. This is due to the fact that disabled workers have lower qualifications. The unexplained component due to differences in returns on wage determinants is insignificant in the 1981 case but is highly significant in 1991, constituting around 50–60 per cent of the average log wage differential.

Urban Versus Rural Return to Human Capital in Portugal: A Cookbook Recipe for Applying Assignment Models

Abstract: . The Portuguese economy has been characterized by modernization since the post-war period, and Lisbon is a centre of this process. This paper analyses rates of return on human capital in Lisbon versus the rest of the country in the period 1982–92. An assignment model of heterogeneous workers to heterogeneous jobs is applied. We introduce the concept of the complexity dispersion parameter, which measures job heterogeneity and the ease of substitution between worker types. It is free dimension and can be compared across countries. We also develop a cookbook recipe for the estimation of this parameter. The main implication of the model — a high return to human capital is associated with similar workers being assigned to more complex jobs — is confirmed by the data. The complexity dispersion parameter suggests that paying half of the optimal wage level at least doubles the cost per efficiency unit of labour.

Stepping stones to permanent employment in the public service

Abstract: Labour force transitions are investigated using a longitudinal database covering staff movements in the Queensland public service. The database covers those who have entered the public service through traditional recruitment methods as well as those who have entered through temporary and casual appointments. The analysis is based on a new methodology of cumulative incidence function testing and competing risks regression analysis. Interest is centred on entry by non-standard employees and their subsequent transition through the public service. It was found that non-standard employment can be a stepping stone to permanent employment but only for about one in four new non-standard employees.

Beyond Regional Institutions: Widening Unemployment Differentials in Italy

Abstract: . Building on Layard and Jackman's framework, we propose a simple model to analyse the relation between labour productivity and unemployment differentials in Italy and present some panel data evidence to support the theoretical predictions of the model. The empirical analysis strongly suggests that the productivity differential is one of the main factors driving the dynamics of the unemployment differential in Italy.

Sources of Job and Worker Flows: Evidence from a Panel of Regions

Abstract: This study explores the structure and the dynamics of regional job and worker flows. The measures of job and worker flows are related to economic fluctuations, demographic factors and industry structure by employing the data of 85 Finnish regions over the period 1988-97. It is shown that labour market dynamics differ markedly between regions. As in previous analyses of linked employer-employee data, job and worker flows are shown to behave cyclically. In addition, the results indicate that observable differences in regional productivity, in-migration, demographics and industry structure help to explain the prevailing disparities in regional labour markets.

The Impact on Inequality of Raising the Minimum Wage: Gap‐narrowing and Reranking Effects

Abstract: Raising the minimum wage may reduce inequality by increasing the wages of low-skill workers, but it may also increase inequality due to negative impacts on employment that produce wage losses. Using previous estimates of the elasticities of wages and employment to changes in the minimum wage in Colombia and Brazil, we show that the net impact on inequality of increasing the minimum wage may depend on the distributional weights used for inequality measurement. The results are obtained by decomposing the Gini index into reranking and gap-narrowing effects. Inequality-increasing reranking effects, which are associated with job losses, may dominate inequality-decreasing gap-narrowing effects, which are associated with wage gains, when high weights are placed on workers with low earnings. For standard distributional weights, however, the likely net impact is a reduction in wage inequality.