A Context-Robust Measure of the Disincentive Cost of Unemployment Insurance

2017 ◽  
Vol 107 (5) ◽  
pp. 343-348 ◽  
Author(s):  
Johannes F. Schmieder ◽  
Till von Wachter
Keyword(s):  
Labor Market ◽  
Labor Supply ◽  
Unemployment Insurance ◽  
Employment Effects ◽  
Different Types

This paper proposes a new measure of the disincentive cost of unemployment insurance (UI): the ratio of the behavioral cost (BC) to the mechanical cost (MC) of a UI reform. This measure represents the labor supply distortion relative to the additional (mechanical) transfer from the UI reform. We show the BC/MC ratio naturally arises from a model of optimal UI and can be readily computed and compared across different types of reforms and labor market contexts. We summarize the evidence regarding the BC/MC ratio for existing studies and relate it to typical measures of employment effects of UI.

scholarly journals Gender Features of Time Allocation, Gender Stereotypes and Labour Supply

Equilibrium ◽  
2011 ◽  
Vol 6 (3) ◽  
pp. 85-102
Author(s):  
Tamila Arnania-Kepuladze
Keyword(s):  
Gender Differences ◽  
Economic Development ◽  
Labor Market ◽  
Labor Supply ◽  
Time Allocation ◽  
Well Being ◽  
Working Time ◽  
Allocation Model ◽  
Men And Women ◽  
Different Types

Securing the well-being, protection of human rights and equality on the ground of age, gender, race, nationality etc along with sustainable economic development becomes the most important goal for any country. Gender differences in labor market are a problem of many countries. Being a larger demographic group, women have played a vital role in employment and economic development. Despite longstanding striving for gender equality, the inequality manifests itself in labor markets around the world. There is no common opinion on the reasons of the existence of gender differences in economic literature. After decades of research most investigators would agree that there can be no single-factor explanation for gender inequality in the labor market. One of the conventional explanations of gender gap in employment sphere includes the differences in men’s and women’s preferences in working hours due their stereotypical roles in the private and public life. This paper is focused on the study of gender feature of time allocation and its impact on the labor supply by men and women. For this purpose, based on the different types of activity, particular: income getting or in­co­me increasing promote activity, non-monetary inco­me obtain activity, income-make activity, non-income-make activity, indirect-receipts activity, the author introduces the time allocation model which includes parameters such as working time, leisure, non-working time, using time, free time and time for satisfying an individual’s physiological needs. For the attribution of different types of practice to certain kinds of activity the “principle of dominant purpose of activity” was offered. According to given time allocation model, the  pattern of features of labor supply by men and women is offered in the paper.

The Employment Effects of Lump-Sum and Contingent Job Insurance Policies: Evidence from Brazil

2020 ◽  
pp. 1-45
Author(s):  
Diogo G. C. Britto
Keyword(s):  
Labor Market ◽  
Unemployment Insurance ◽  
Informal Employment ◽  
Job Displacement ◽  
Severance Pay ◽  
Employment Effects ◽  
Insurance Policies ◽  
Lump Sum ◽  
Formal Employment ◽  
The Impact

Lump-sum job displacement policies (e.g. severance pay) are often presented as a better alternative to contingent policies (e.g. unemployment insurance) in the context of developing countries, under the rationale that the former are less harmful to formal employment as they do not incentivize substitution from formal to informal jobs. First, this paper provides original evidence on the employment effects of lump-sum income in the context of a developing country with high labor informality. Using Brazilian data, a regression discontinuity (RD) design shows that a transfer equivalent to 15 days of earnings (i) increases the duration out of a formal job by 1.9 weeks, (ii) reduces monthly earnings in the next job by 1.6%, and (iii) reduces total earnings in the formal labor market by 3.6% over a three-year period. Second, the paper studies the impact of a one-month extension in unemployment insurance (UI) on a comparable sample of displaced workers. UI is shown to have a stronger impact on the duration out of a formal job compared with a lump-sum transfer. In addition, a novel exercise matching administrative and survey data shows that 57% of the decrease in formal employment caused by UI is compensated by an increase in the incidence of informal employment. However, workers receiving the UI extension partially recover the initial employment loss over time in such a way that the adverse impact on employment over a three-year period is similar compared with the lump-sum transfer. Moreover, UI is found to be less harmful to re-employment wages, possibly because it improves the worker's bargaining power as it offers insurance against the duration of joblessness. Overall, the UI extension is less detrimental to total earnings in the formal labor market over a three-year period. Hence, although these findings indicate that contingent job insurance policies have a stronger impact on the initial duration out of a formal job and indeed incentivize informal employment, they do not support the notion that lump-sum policies are less harmful to formal employment and earnings in the medium term.

The effects of (different types of) immigrants on labor market outcomes of (different groups of) natives

2017 ◽  
Vol 38 (3) ◽  
pp. 338-353 ◽  
Author(s):  
Muhammad Asali
Keyword(s):  
Labor Market ◽  
Labor Supply ◽  
Labor Market Outcomes ◽  
Complementarity Effect ◽  
Market Outcomes ◽  
Content Type ◽  
Heterogeneous Effects ◽  
Native Workers ◽  
Different Types ◽  
Israeli Arabs

Purpose The purpose of this paper is to study the effects of different types of immigrants on the labor market outcomes of different native groups. Design/methodology/approach The study uses a quasi-experimental approach, utilizing the border closures policy as well as political instability and economic conditions in the major countries of origin as exogenous sources of variation in the number of immigrants, to measure the effect of an immigrant-induced labor supply shock of each immigrant type (Palestinians and foreign guest workers) on the wage and employment of native workers (Israeli Arabs and Israeli Jews). Findings The effects of immigrants on local labor market outcomes vary with their origin. The different native groups, moreover, are affected differently by each type of immigrants. Specifically, a foreign-worker-induced increase in the labor supply negatively affects only the least-skilled Jewish workers. In contrast, a 10 percent Palestinian-induced increase in the labor supply increases the wage of Israeli Arabs by 3.4 percent, suggesting a net complementarity effect. Short-term slight employment adjustments occur at the intensive rather than the extensive margin. Originality/value The paper studies heterogeneous effects of immigrants by their type; also it studies heterogeneous effects experienced by different native groups. This paper informs the policy discussion about immigration and its effects on native workers.

Implications of higher retirement age for the labor market

2017 ◽  
pp. 22-39 ◽  
Author(s):  
M. Ivanova ◽  
A. Balaev ◽  
E. Gurvich
Keyword(s):  
Economic Growth ◽  
Labor Market ◽  
Labor Supply ◽  
Labor Force ◽  
Labor Demand ◽  
Retirement Age ◽  
Demographic Trends ◽  
Men And Women ◽  
Demographic Projections ◽  
The Impact

The paper considers the impact of the increase in retirement age on labor supply and economic growth. Combining own estimates of labor participation and demographic projections by the Rosstat, the authors predict marked fall in the labor force (by 5.6 million persons over 2016-2030). Labor demand is also going down but to a lesser degree. If vigorous measures are not implemented, the labor force shortage will reach 6% of the labor force by the period end, thus restraining economic growth. Even rapid and ambitious increase in the retirement age (by 1 year each year to 65 years for both men and women) can only partially mitigate the adverse consequences of demographic trends.

Are You Ready for Some Football? Estimating the Effect of American Football Season on Labor Supply in the United States

2021 ◽  
pp. 152700252110246
Author(s):  
Luke Petach ◽  
Dustin Rumbaugh
Keyword(s):  
United States ◽  
Labor Market ◽  
Labor Supply ◽  
Economic Cost ◽  
The United States ◽  
American Football ◽  
Hourly Wage ◽  
Market Models ◽  
Supply Effect ◽  
The Business Cycle

American football season reduces the Monday labor hours of employed men by two-thirds of an hour. A similar effect is found for Friday labor hours. We term these effects the “hangover effect” and “happy hour effect.” Consistent with a wide class of labor market models, the labor supply effect varies over the business cycle, increasing in expansions. The hangover effect implies an intertemporal elasticity of labor supply on the order of 0.014. Evaluated at the median hourly wage, our estimates imply an annual economic cost of foregone earnings associated with football season in the neighborhood of $5.06 billion.

scholarly journals Kwacha Gonna Do? Experimental Evidence about Labor Supply in Rural Malawi

2016 ◽  
Vol 8 (1) ◽  
pp. 129-149 ◽  
Author(s):  
Jessica Goldberg
Keyword(s):  
Labor Market ◽  
Field Experiment ◽  
Labor Supply ◽  
Experimental Evidence ◽  
Wage Distribution ◽  
Wage Elasticity ◽  
Supply Elasticity ◽  
Labor Supply Elasticity ◽  
Job Offers ◽  
Daily Wage

I use a field experiment to estimate the wage elasticity of employment in the day labor market in rural Malawi. Once a week for 12 consecutive weeks, I make job offers for a workfare-type program to 529 adults. The daily wage varies from the tenth to the ninetieth percentile of the wage distribution, and individuals are entitled to work a maximum of one day per week. In this context (the low agricultural season), 74 percent of individuals worked at the lowest wage, and consequently the estimated labor supply elasticity is low (0.15), regardless of observable characteristics. (JEL C93, J22, J31, O15, O18, R23)

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