43 research outputs found

    The Catalan Premium: Language and Employment in Catalonia

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    In this paper I measure the contribution of knowing Catalan to finding a job in Catalonia. In the early eighties a drastic language policy change (normalització) promoted the learning and use of Catalan in Catalonia and managed to reverse the falling trend of its relative use versus Castilian (Spanish). Using census data for 1991 and 1996, I estimate a significant positive Catalan premium: the probability of being employed increases between 3 and 5 percentage points if individuals know how to read and speak Catalan; it increases between 2 and 6 percentage points for writing Catalan.Language, Immigration, Skill Premium

    Employment and Deadweight Loss Effects of Observed Non-Wage Labor Costs

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    To assess the employment effects of labor costs it is crucial to have reliable estimates of the labor cost elasticity of labor demand. Using a matched firm-worker dataset, we estimate a long run unconditional labor demand function, exploiting information on workers to correct for endogeneity in the determination of wages. We evaluate the employment and deadweight loss effects of observed employers' contributions imposed by labor laws (health insurance, training, and taxes) as well as of observed workers' deductions (social security, and income tax). We find that non-wage labor costs reduce employment by 17% for white-collars and by 53% for blue-collars, with associated deadweight losses of 10% and 35% of total contributions, respectively. Since most firms undercomply with mandated employers' and workers contributions, we find that full compliance would imply employment losses of 4% for white-collars and 12% for blue-collars, with respective associated deadweight losses of 2% and 6%.Employment, Deadweight Loss, Job Creation, Labor Costs, Labor Law

    Occupational Selection in Multilingual Labor Markets

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    In multilingual labor markets agents with high proficiency in more than one language may be selected into occupations that require high levels of skill in communicating with customers or writing reports in more than one language. In this paper we measure this effect in Catalonia, where two languages, Catalan and Spanish, coexist. Using census data for 1991 and 1996, and controlling for endogeneity of Catalan knowledge, we find that proficiency in speaking, reading and writing Catalan reinforces selection into communication intensive jobs/positions such as entrepreneurial, trade, and service activities; white-collar occupations; and permanent employment. Interestingly, the effect of language on occupational selection is stronger for women than for men.occupational selection, language, labor markets

    Employment and deadweight loss effects of observed non-wage labor costs

    Get PDF
    To assess the employment effects of labor costs it is crucial to have reliable estimates of the labor cost elasticity of labor demand. Using a matched firm-worker dataset, we estimate a long run unconditional labor demand function, exploiting information on workers to correct for endogeneity in the determination of wages. We evaluate the employment and deadweight loss effects of observed employers’ contributions imposed by labor laws (health insurance, training, and taxes) as well as of observed workers’ deductions (social security and income tax). We find that non-wage labor costs reduce employment by 17% for whitecollars and by 53% for blue-collars, with associated deadweight losses of 10% and 35% of total contributions, respectively. Since most firms undercomply with mandated employers’ and workers contributions, we find that full compliance would imply employment losses of 4% for white-collars and 12% for blue-collars, with respective associated deadweight losses of 2% and 6%.

    Occupational Selection in Multilingual Labor Markets: The Case of Catalonia

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    In multilingual labor markets agents with high proficiency in more than one language may be selected into occupations that require high levels of skill in communicating with customers or writing reports in more than one language. In this paper we measure this effect in Catalonia, where two languages, Catalan and Spanish, coexist. Using census data for 1991 and 1996, and controlling for endogeneity of Catalan knowledge, we find that proficiency in speaking, reading, and writing Catalan reinforces selection into being employed, being an entrepreneur, and into white-collar occupations and communication-intensive jobs. In particular, being able to read and speak Catalan increases the probability of selection into white collar occupations by betwen 9 and 14 percentage points, while writing Catalan increases by 6 to 13 percentage points the probability of engaging in services, and government and educational activities.Language, Occupational Selection, Industry, Immigration, Skill Premium.

    International Job Search: Mexicans in and out of the US

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    It is argued that migration from Mexico to the US and return migration are determined by international wage di erentials and preferences for origin. We use a model of job search, savings and migration to show that job turnover is a crucial determinant of the migration process. We estimate this model by Simulated Method of Moments (SMM) and nd that migration practically disappears if Mexico has American arrival rates while employed. Doubling migration costs reduces migration rates in half, while subsidizing return migration in $300 reduces migration rates of older migrants but increases migration rates of younger migrants.International Migration, Job Search, Job Turnover, Savings, Structural Estimation. Classification-JEL : F22, J64, E20

    International Job Search: Mexicans in and out of the U.S.

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    It is argued that migration from Mexico to the US and return migration are determined by international wage differentials and preferences for origin. We use a model of job search, savings and migration to show that job turnover is a crucial determinant of the migration process. We estimate this model by Simulated Method of Moments (SMM) and find that migration practically disappears if Mexico has American arrival rates while employed. Doubling migration costs reduces migration rates in half, while subsidizing return migration in $300 reduces migration rates of older migrants but increases migration rates of younger migrants.International Migration, Job Search, Job Turnover, Savings, Structural Estimation

    Job search and asset accumulation under borrowing constraints

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    In this paper I show how borrowing constraints and job search interact. I fit a dynamic model to data from the National Longitudinal Survey (1979-cohort) and show that borrowing constraints are significant. Agents with more initial assets and more access to credit attain higher wages for several periods after high school graduation. The unemployed maintain their consumption by running down their assets, while the employed save to buffer against future unemployment spells. I also show that, unlike in models with exogenous income streams, unemployment transfers, by allowing agents to attain higher wages do not 'crowd out' but increase saving.Job search, asset accumulation liquidity constraints, consumption, unemployment, estimation of dynamic structural models

    Working and Studying in Rural Latin America: Critical Decisions of Adolescence

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    This paper evaluates the determinants of school attendance and work of rural adolescents between 10 and 18 years old in 1997-1998 for a sample of Latin American countries. Rural adolescents are quite disadvantaged relative to their urban counterparts. The share of rural adolescents studying while concurrently working part-time is significantly higher, household income is significantly lower, “supply-side” issues are an important factor in rural non-attendance, and to the extent that the educational attainment of the parents creates inter-generational persistence we find that rural youth are starting from a disadvantaged position. We present some statistical analysis that highlights these problems and also perform bivariate binary estimation to identify the determinants of these decisions. We find that for most countries critical determinants for making these choices are household income and parental education as well as household composition. Further, we find that there is evidence of a significant “trade-off” between working and studying. Finally, inter-generational factors allow for both a virtuous cycle and a vicious cycle.

    Does Wealth Explain Black-White Differences in Early Employment Careers?

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    In this paper I inquire about the effects initial wealth has on black-white differences in early employment careers. I set up a dynamic model in which individuals simultaneously search for a job and accumulate wealth, and fit it to data from the National Longitudinal Survey (1979-cohort). The estimates show that borrowing constraints are tight for both race groups. Regime changes reveal that differences in initial wealth account almost fully for the racial gap in wealth and wages at the beginning of employment careers, but their effect tapers off and completely dissapears several years after graduation. In contrast, differences in the labor market environment and in preferences are shown to account fully for both racial gaps, in wealth and in wages, persisting several years after High School graduation.Job search, wealth, racial differences, borrowing constraints, consumption, unemployment, estimation of dynamic structural models
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