Labour Force Behaviour of Men and Women in Elderly Two-Adult Households: Evidence from EU Countries. ENEPRI Research Reports No. 7, 1 April 2005

This paper studies the effect of individual and spousal characteristics on the labour force participation of individuals living in elderly two-adult households. The comparative approach taken here studies men and women separately and uses the first eight waves (1994-2001) of the European Community Household Panel (ECHP). We compare results of three countries: Finland (a country with a high degree of women’s labour force participation), Belgium and Germany (countries where women’s labour force participation is relatively low). Results of multinomial logit model estimations suggest that are substantive differences between countries as well as between the behaviour of men and women across the various channels out of employment. We find evidence that a wife exerts a stronger influence on a husband’s retirement decision. One explanation for this may be found in asymmetric complementarities of leisure – a husband’s enjoyment of non-employment may depend much more on his wife also being non-employed than vice versa. There is evidence that the complementarities of leisure hypothesis dominates the hypothesis concerning the added worker (where the labour supply of one spouse increases when the other spouse’s income is reduced or disappears). These results are in line with evidence from the US and have some important implications: simulations of the effect of changes in the pension system on men’s retirement may yield incorrect answers if spillover effects are ignored

A comparative survey of structural characteristics of Finnish university departments

This descriptive paper analyses structural characteristics of Finnish university departments (FIDs) and benchmarks them against foreign university departments from Scandinavia, the UK and the US (FODs). In the first place the study aims to reveal information on differences in department size. In addition, the analysis pays attention to internationalization, study times and the level of business activities at different university departments. The paper is based on new survey data that distinguish between the national rankings of the university departments and between the department fields. The first finding shows that FIDs are small. This finding seems to hold irrespective of the department field. The second finding shows that the best departments tend to be bigger than the rest. The third result shows that FIDs have low shares of foreign students. Finally the results show that the faculty of Finnish university departments is relatively well involved in business creation

High growth firms and job creation in Finland

The goal of this descriptive paper is to identify which firms add the most employment in Finland. The analysis is based on firm and establishment data from the Finnish Business Register (period 2003-2006). It is found that in 2006 Finland had 750 High Growth Firms (according to the OECD-definition). This represents roughly 5% of the firms with at least 10 employees. As growth has a multi-facetted nature it is crucial to not only focus on how much a firm grows but also how it grows. Not all of those 750 HGF's grew organically. In fact, of all the jobs they created 65% turned out to be organic employment. There seems to be a positive relationship between the initial size of a HGF and what proportion of the employment is acquired. Correcting for acquisition growth leaves us with 642 organic HGF's. The share of HGF's was the highest in the sectors 'other business activities', 'computer and related activities' and 'health and social work'. It does look like a substantial number of HGF's have been expanding due to trends in domestic outsourcing. Future research should focus on the causes and consequences of the expansion of those firms. Firm group information should be used as to be able to better capture shifts of employment between firms of the same group

Conceptualising mobility

The information on the impact of mobility on society is plenty but scattered. A good understanding of the impact of mobility requires first an understanding of what mobility actually means. This paper lists aspects of mobility that can contribute to a useful conceptualisation. It is found that in its core mobility is about connectivity of individuals. In addition mobility is more than just geographical mobility of human interactions. Mobility also has important temporal and contextual dimensions. Mobile technology has increased mobility in these dimensions and has been the driver of digitalising society into a mobile network society that connects not only individuals but also remote data and objects. There seems to be a need for an in depth conceptualisation of mobility that has to be updated along the lines of a fast moving mobile technology and mobile societ

Domestic employment effects of offshoring: Empirical evidence from Finland

This study empirically explores whether the propensity to offshore affects the total domestic employment at the firm level. The analysis is based on a Finnish weighted sample of 652 firms and screens the effect of offshoring different kinds of tasks. Two main channels of offshoring tasks are taken into account: offshore outsourcing and in-house offshoring. The main conclusion is that offshoring can significantly affect the total domestic employment but that the significance and the direction of the effect depend on which kind of offshoring is involved. Our results offer evidence that in both the manufacturing and service sectors offshore outsourcing of services has a positive effect on employment. In addition it was found that the effect of R&D offshoring on the probability to anticipate an increase of total domestic employment depends on the offshoring channel. Offshore outsourcing of R&D has a positive effect on the anticipated domestic employment, whereas in-house offshoring of R&D has a negative effect. Specific for the manufacturing sector is that offshore outsourcing of production also has a negative significant effect. A final conclusion is that only in the service sector does in-house offshoring of services have a negative effect on the probability to anticipate an increase of domestic employment. By dissecting offshoring by tasks and channels the above empirical findings contribute to a better understanding of the aggregate effects of offshoring on domestic employment

Retirement decisions and option values: Their application regarding Finland, Belgium and Germany

This paper studies determinants of retirement transitions of Europeans and focuses on the impact of social security systems on retirement behaviour. The analysis uses the first 8 waves (1994-2001) of the European Community Household Panel (ECHP). Based on those survey data, option values are constructed for each sampled individual of three countries: Finland, Belgium and Germany. The overall results of the duration and probit models show that the option value, health and well-being at work have a significant impact on retirement decisions. Poor health has an important effect on retirement risk, especially in Germany. In Germany and Belgium we see spikes in retirement at age 60 or 65, whereas the retirement path in Finland is smooth as of age 56. We suggest that a rise in the official retirement age is effective in Germany and Belgium, whereas in Finland the sustainable pension system requires a further cut in the level of pensions if retirement takes place before the official retirement age. The current economic incentives in Germany around the age of 65 or the new ones introduced in Finland with an accrual rate of 4.5% between the ages of 63 and 68 are not effective if workers retire before those ages.Tutkimus tarkastelee eläkkeelle siirtymistä Euroopassa keskittyen sosiaaliturvajärjestelmän vaikutuksiin. Aineistona on kahdeksan vuotta (1994-2001) eurooppalaisessa kotitalousaineistossa European Community Household Panel (ECHP). Tarkastelussa käytetään optioarvoja. Nämä ilmaisevat eläkkeelle jäämisen nykyarvon silloin kun tämä on kannattavinta verrattuna siihen, että jäätäisiin heti eläkkeelle. Eläkkeelle siirtymisen optioarvot on laskettu kolmessa maassa: Suomi, Belgia ja Saksa. Duraatio- ja probit-mallien perusteella taloudellisilla kannustimilla, optioarvoilla, ja terveydellä on merkitsevä vaikutus eläkkeelle siirtymiseen. Taloudellisten kannustimien ohella hyvinvointi työssä on tärkeä selittävä tekijä, koska tyytyväisyys työhön tai vapaa-aikaan on tärkeä tekijä eläkepäätöksessä. Maittain tulokset vaihtelevat etenkin terveyden suhteen. Saksassa huono terveys selittää selkeimmin eläkkeelle siirtymistä. Saksassa ja Belgiassa eläkkeelle siirtyminen on keskittynyt ikävuosiin 60 ja 65, kun sen sijaan Suomessa eläkkeelle siirrytään hyvin tasaisesti 56 ikävuodesta alkaen. Eläkkeellesiirtymisiän nostaminen on tehokasta etenkin Saksassa ja Belgiassa, kun sen sijaan Suomessa kustannuksiltaan tehokas eläkejärjestelmä voi edellyttää eläke-etujen karsintaa jo ennen 60 ikävuotta. Nykyiset eläkekannustimet sijoittuvat Saksassa pääosin 65 ikävuoden molemmin puolin ja Suomessa eläkekarttuma on 4.5% ikävuosien 63 ja 68 välillä, mikä ei riitä jos eläkkeelle siirrytään jo pääosin tätä ennen

Domestic R&D employment effects of offshoring R&D tasks: Some empirical evidence from Finland

This study empirically explores whether R&D offshoring affects the domestic R&D employment at the firm level. Overall, the Finnish survey data suggest that the impact of R&D internationalization on domestic R&D employment depends on the mode of internationalization (in-house offshoring vs. offshore outsourcing vs. in-house expansion of R&D abroad). Moreover, manufacturing and service firms are found to be different when it comes to R&D internationalization and its domestic employment effects. In the manufacturing sector, especially in-house offshoring of R&D has a significant negative impact on the plan to increase R&D employment. But the relationship between the in-house expansion of R&D abroad and domestic R&D employment turns out to be complementary. In the service sector, it is in the first place offshore outsourcing of R&D that has a significant negative impact on the plan to increase R&D employment. A final result supports the view that R&D does not always follow production but that a strong location link between production and R&D does have a significant negative effect on the domestic R&D employment

Mobility of corporate headquarter functions: A literature review

This paper reviews the recent literature on the relocation of headquarters (HQs). Overall results show that full and direct international relocations of corporate HQs are rare events. However, there is a trend that MNEs increasingly unbundle their HQs so as to spread their different HQs functions over several locations around the world. The literature on the organisation of companies shows that HQ unbundling can go hand in hand with different patterns of HQ relocations. The international trade literature underlines that falling communication costs enable firms to offshore HQ-tasks that were previously considered nontraded. International competition occurs now between individual workers performing similar HQ-tasks in different nations. The new economic geography literature explains the spatial concentration of HQs functions by the existence of agglomeration effects. Most empirical literature focuses on relocations within the United States. Relocations within the EU are less frequent which may be explained by legal and cultural barriers. An important finding is that many HQ relocations result from a merger or acquisition, but institutional factors, such as international tax incentives and labour market institutions, were also identified as key drivers of HQ relocations. The effects of relocations on the company performance are relatively small although results seem to depend on the motivation behind the relocation. For nations, the unbundling of HQs implies that the competition between (potential) locations for HQ functions will rise

Labour force behaviour of elderly two adult households: Evidence from EU-countries

This paper studies the effect of individual and spousal characteristics on the labour force participation of elderly two-adult households. The comparative approach studies men and women separately and uses the first 8 waves (1994-2001) of the European Household Panel (ECHP). We compare results between three countries: Finland, a country with a high female labour force participation and Belgium and Germany, countries where female labour force participation is relatively low. Results of multinomial logit model estimations suggest that country differences are substantive and that men and women behave differently across different channels out of employment. We find evidence that the wife exerts a stronger influence on the husband’s retirement decision. One explanation may be found in asymmetric complementarities of leisure: the husbands’ enjoyment of nonemployment may depend much more on the wife also being non-employed than vice versa. There is evidence that the complementarities of leisure hypothesis dominates the added worker hypothesis. The results are in line with evidence from the U.S. and have some important implications: Simulations of the effect of changes in the pension system on men’s retirement may yield incorrect answers if spill-over effects are ignored

Health and retirement decisions: An update of the literature

This paper surveys the relation between labour supply and health of the elderly and is based both on major earlier studies and new literature. Most empirical literature on the topic is based on US data, although new European datasets have enabled analysis in several EU countries. The paper complements previous surveys in that it includes those recent European results and overviews most recent developments in micromodelling issues. The quest for unbiased estimates of the effect of health on retirement is characterised by several challenges. A first important challenge is the endogenous character of the relation. A second challenge is the reporting bias that certain health measures may be prone to. The empirical literature surveyed suggests that poor health reduces the capacity to work and has substantial effects on labour force participation. The exact magnitude, however, is sensitive to both the choice of health measures and identification assumptions. For that reason a comparison of health effects between different studies is difficult. An old myth that objective health measures are superior to subjective health measures has proven to be interpreted with care