This paper examines the long-run impacts of childhood left-behind experience resulting from the labour migration of one or both parents on labour market outcomes in adulthood in China. We find that ...exposure to a left-behind experience due to maternal migration in early and late childhood has a detrimental effect on one’s probability of finding a job and wages, respectively. However, maternal absence in late childhood has a positive impact on the probability of finding a job. The long-run effects of childhood left-behind experience on labour market outcomes are more pronounced among those who are males, those who are from medium- and low-income families, and those who currently live in rural areas. We also find that educational attainment, health status, cognitive ability, personality traits and personal values are possible channels through which early-life left-behind experience affects labour market outcomes in adulthood. Our findings provide a fresh understanding of the effects of parental migration on the economic wellbeing of left-behind children and can be used to inform policies to mitigate the long-lasting negative effects of childhood left-behind experience.
We examine individual-level compensating differentials for commuting distance in a quasi-natural experiment setting by examining how wages respond to changes in commuting distance induced by firm ...relocations. This set-up enables us to test for the relevance of job search frictions within labour market models. Due to the quasi-experimental set-up, we are able to avoid a range of endogeneity issues. We demonstrate that a 1 km increase in commuting distance induces an almost negligible wage increase in the year after the relocation but a more substantial wage increase of about 0.15% three years later.
Ethnic and religious differentials in labour market outcomes within many countries have been remarkably persistent. Yet one very well‐known differential—the Catholic/Protestant unemployment ...differential in Northern Ireland—has largely (although not completely) disappeared. This paper charts its decline since the early 1980s and examines potential explanations using Census data from 1991, 2001 and 2011 together with annual survey data. These data span the ending of The Troubles, the signing of the Good Friday Agreement, the introduction of fair employment legislation, growth in hidden unemployment and major structural changes in Northern Ireland. We assess the potential impact of these changes.
This article discusses the changing social distribution of unemployment and long-term unemployment risks during the current financial and economic crisis. These risks are interpreted as the result of ...three different, overlapping forms of labour market segmentation: first, the institutionally stabilized polarization between labour market insiders and outsiders; second, the occupational dualization of high- and low-skilled employees and occupations; and third, the marginalization of disadvantaged social groups. On the basis of European Union-Survey on Income and Living Conditions (EU-SILC) data for 24 European countries (2005–2012), it can be shown that (long-term) unemployment risks increase especially for low-skilled persons and occupations, single parents, migrants and disabled persons. Women, older and permanently employed persons are relatively less affected by short-term unemployment but more affected by long-term unemployment. Hence, the current crisis strengthens the occupational and social dualization of labour markets, endangering the inclusiveness and long-term growth potential of the European economy and societies.
This article uses linked worker-firm data in the United States to estimate the transitional costs associated with reallocating workers from newly regulated industries to other sectors of the economy ...in the context of new environmental regulations. The focus on workers rather than industries as the unit of analysis allows me to examine previously unobserved economic outcomes such as nonemployment and long-run earnings losses from job transitions, both of which are critical to understanding the reallocative costs associated with these policies. Using plant-level panel variation induced by the 1990 Clean Air Act Amendments (CAAA), I find that the reallocative costs of environmental policy are significant. Workers in newly regulated plants experienced, in aggregate, more than $5.4 billion in forgone earnings for the years after the change in policy. Most of these costs are driven by nonemployment and lower earnings in future employment, highlighting the importance of longitudinal data for characterizing the costs and consequences of labor market adjustment. Relative to the estimated benefits of the 1990 CAAA, these one-time transitional costs are small.
The study of inequality by economists has largely focussed on distributive inequalities of various kinds. The focus on different dimensions of distributive inequality in access and outcomes is ...welcome. However, it is also important to consider relational inequalities and power imbalances, which economists typically consider to be the domain of sociology, anthropology and related disciplines. Many economic processes cannot be understood without analysing the underlying relational inequalities, which can reveal much about economic processes and associated policies. Some examples from the Indian experience, specifically relating to power imbalances created by gender and caste differentiation, indicate how this can play out. These are not simply 'traditional social forms' that are in opposition to or contradictory with capitalist accumulation. Rather, they are crucial in enabling segmented labour markets and enabling extractivist patterns of accumulation, on which recent Indian economic growth has been dependent.
We study the extent of persistence in unemployment and low-pay employment in Italy in the period 2014-2017, using the Italian component of the EU-SILC survey merged with administrative data. We model ...persistence in unemployment and low-pay employment using different dynamic random-effects models accounting for observed and latent individual heterogeneity as well as endogeneity of the initial conditions. We find evidence of true state dependence in place for both unemployment and low-pay employment. Moreover, past unemployment spells increase the probability of being low-paid, conditional on being employed, while the opposite effect is limited. For both processes the degree of reliance on the previous state is considerably greater than the magnitude of cross-effects. Thus, evidence is presented that these processes shape almost independent no-pay/low-pay tunnels leading individuals into two different traps, rather than a cycle between the two states.
•We study persistence in unemployment and low-pay in Italy using linked survey-administrative data.•Evidence is presented of state dependence for unemployment and low-pay employment.•Independent no-pay/low-pay tunnels lead individuals into two different traps.•The structure of the Italian labour market resembles more to a tunnel than a cycle.
Nordic welfare states are known for their universalistic and all‐encompassing approach to welfare and having a long tradition for active labour market policy as tool in economic crises with adverse ...impact on employment. They have had a long tradition for strong egalitarian approaches and their residents are consistently among the happiest in the world. A key issue is whether a crisis like the COVID‐19 outbreak is changing the Nordic welfare states. This article focuses on providing a description of what instruments the Nordic countries have taken or expect to use as part of dealing with the welfare challenges resulting from rising unemployment and greater social and economic insecurity in the wake of the crisis. The tentative conclusion is that the crisis so far has strengthened key characteristics of the Nordic welfare states by the state taking on a strong central role not only for the functioning of the market but also continued in a path‐dependent way with universal and relatively generous benefits such as for those who become unemployed or have reduced income because of the crisis.
Flexible labour markets are increasingly regarded as the answer to a wide spectrum of labour market and societal challenges from creating jobs to reducing segmentation and welfare dependency, ...improving public finances and supporting workforce diversity and innovation. The contention is that, contrary to these claims, flexible labour markets generate fundamental contradictions and unsustainable long‐term trends. The jobs miracle is exaggerated and based on low productivity jobs, outsiders often lose most from competition, claimants must work flexibly but still secure a full‐time wage, low‐wage employment is shrinking the fiscal base, jobs are not being adjusted to accommodate workers' changing needs and capacities and the disposable labour model is undermining long‐term productivity.
We show that the effects of taxes on labor supply are shaped by interactions between adjustment costs for workers and hours constraints set by firms. We develop a model in which firms post job offers ...characterized by an hours requirement and workers pay search costs to find jobs. We present evidence supporting three predictions of this model by analyzing bunching at kinks using Danish tax records. First, larger kinks generate larger taxable income elasticities. Second, kinks that apply to a larger group of workers generate larger elasticities. Third, the distribution of job offers is tailored to match workers' aggregate tax preferences in equilibrium. Our results suggest that macro elasticities may be substantially larger than the estimates obtained using standard microeconometric methods.
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