Life-Cycle Patterns in Male/Female Differences in Job Search

We investigate whether women search longer for a job than men and whether these differences change over the life cycle. Our empirical analysis exploits German register data on highly attached displaced workers. We apply duration models to analyze gender differences in job search taking into account observed and unobserved worker heterogeneity and censoring. Simple survival functions show that displaced women take longer to find a new job than comparable men. Disaggregation by age groups reveals that these differences are driven by differential behavior of prime age women. There is no significant difference in job search duration among the very young and older workers. These differential outcomes remain even after we control for differences in human capital, and when time dependence and unobserved heterogeneity are incorporated into the model.gender differences, job search, displaced workers, wage differences, discrimination

The Effect of the Timing and Spacing of Births on the Level of Labor Market Involvement of Married Women

We use panel data from NLSY79 to analyze the effects of the timing and spacing of births on the labor supply of married women in a framework that accounts for the endogeneity of labor market and fertility decisions, the heterogeneity of the effects of children and their correlation with the fertility decisions, and the correlation of sequential labor market decisions. Our results show that timing and spacing of births are important determinants of the effect of children on women's labor supply. Delaying the first birth leads to higher levels of labor market involvement before the birth of the first child and reduces the negative effect of the first child on the level of labor market involvement. Having the second birth after a longer interval reduces the effect of the second child on participation but increases its effect on the probability of working full time, as more women, having returned to work, respond to the second birth by moving from full time to part time jobs. Individual heterogeneity plays an important role in the relationship between labor market and fertility decisions. Women who have fewer children have the first birth later in life and space subsequent births more closely together, work more before the birth of the first child, but face larger effects of children on their labor supply.timing and spacing of births, female labor supply, endogenous fertility decisions, heterogeneous children effects, multinomial probit model, Gibbs sampler

The Effect of Children on the Level of Labor Market Involvement of Married Women: What is the Role of Education?

We analyze the way women's education influences the effect of children on their level of labor market involvement. We propose an econometric model that accounts for the endogeneity of labor market and fertility decisions, for the heterogeneity of the effects of children and their correlation with the fertility decisions, and for the correlation of sequential labor market decisions. We estimate the model using panel data from NLSY79. Our results show that women with higher education work more before the birth of the first child, but children have larger negative effects on their level of labor market involvement. Differences across education levels are more pronounced with respect to full time employment than with respect to participation. Other things equal, higher wages reduce the effect of children on labor supply. Controlling for wages, women with higher education face larger negative effects of children on labor supply, which suggest they are characterized by a combination of higher marginal product of time spent in the production of child quality and higher marginal product of time relative to the marginal product of other inputs into the production of child quality.female labor supply, education, endogenous fertility decisions, heterogeneous children effects, multinomial probit model, Gibbs sampler

A Panel Data Analysis of Racial/Ethnic Differences in Married Women's Labor Supply

We study differences in life-cycle labor supply among white, black, and Hispanic women, focusing on the interaction between race/ethnicity, education, and fertility. We use panel data that capture women's labor market and fertility histories and an econometric model that accounts for the endogeneity of labor market and fertility decisions, the heterogeneity of the effects of children and their correlation with the fertility decisions, and the correlation of sequential labor market decisions. Our results show an intricate connection between race/ethnicity, education, and fertility as determinants of women's life-cycle labor supply. For all levels of education, white women have fewer children, have the first birth later in life, and space subsequent births more closely together. The level of labor market involvement before the first birth is highest for white women and lowest for Hispanic women, but children reverse the relationship between race/ethnicity and level of labor market involvement. The negative effects of children are largest for white women and smallest for Hispanic women, and as a result, among women with two children, black and Hispanic women work more than white women. Racial/ethnic differences in fertility decisions, pre-natal labor supply, and labor supply responsiveness to children decline with the level education. Educational differences contribute to the racial/ethnic differentials in labor supply. White women have the highest levels of education and Hispanic women have the lowest levels of education. Other things equal, women with higher education have fewer children, have the first birth later in life, space subsequent births more closely together, work more before the birth of the first child, but face larger negative effects of children on their level of labor market involvement.racial/ethnic differentials in female labor supply, education, endogenous fertility decisions, heterogeneous children effects, multinomial probit model, Gibbs sampler

Business Incentives and Employment: What Incentives Work and Where?

State governments offer tax and location-based incentives to entice firms to locate or expand operations in their state. We evaluate the effect of these incentives on employment using a panel data of Kentucky counties. These data are unique because they contain information on actual incentives received rather than on incentives offered, an important distinction because the majority of incentives offered are never claimed. Because Kentucky offers incentive plans similar to other states, the results are applicable to other states. Training incentives have a strong, positive effect on economic activity, whereas tax incentives have a more modest positive effect. These effects differ with the location of the county, with almost no impact in interior counties and much larger, positive and significant impacts in counties along state borders. There are few if any spillover effects to adjacent counties.

Where the Girls Are: Trade and Labor Market Segregation in Colombia

Gary Becker's theory of discrimination argues that increasing competition will reduce discrimination in the labor market. We use the Colombian trade liberalization episode over the period 1984–91 to investigate this claim on plant-level data in three ways. First, we examine whether women are concentrated in exporting plants. Second, we examine whether the increase in foreign competition due to unilateral trade liberalization disproportionately drove discriminating plants out of the market. Finally, we investigate whether trade liberalization affected hiring decisions (and thus gender segregation) by Colombian firms.discrimination, trade, competition

New Evidence on Sex Segregation and Sex Differences in Wages from Matched Employee-Employer Data

We assemble a new matched employer-employee data set covering essentially all industries and occupations across all regions of the U.S. We use this data set to re-examine the question of the relative contributions to the overall sex gap in wages of sex segregation vs. wage differences by sex within occupation, industry, establishment, and occupation-establishment cells. This new data set is especially useful because earlier research on this topic relied on data sets that covered only a narrow range of industries, occupations, or regions. Our results indicate that a sizable fraction of the sex gap in wages is accounted for by the segregation of women into lower-paying occupations, industries, establishments, and occupations within establishments. Nonetheless, a substantial part of the sex gap in wages remains attributable to the individual's sex. This latter finding contrasts sharply with the conclusions of previous research (especially Groshen, 1991), which indicated that sex segregation accounted for essentially all of the sex wage gap. Further research into the sources of within-establishment within-occupation sex wage differences is therefore much more important than previously thought.

Down from the Mountain: Skill Upgrading and Wages in Appalachia

Despite evidence that skilled labor is increasingly concentrated in cities, whether regional wage inequality is predominantly due to differences in skill levels or returns is unknown. We compare Appalachia, with its wide mix of urban and rural areas, to other parts of the U.S., and find that gaps in both skill levels and returns account for the lack of high wage male workers. For women, skill shortages are important across the distribution. Because rural wage gaps are insignificant, our results suggest that widening wage inequality between Appalachia and the rest of the U.S. owes to a shortage of skilled cities.wage inequality, region

Economic Growth in Kentucky: Why Does Kentucky Lag Behind the Rest of the South?

Excerpts from the executive summary: Kentucky has consistently been one of the poorest states in the country between 1939 and the present. On top of this already low level of income, Kentucky has experienced fairly slow growth in output in recent years. Between 1997 and 2004, Kentucky had an average annual growth in real gross state product (GSP) of 1.6 percent, ranking 43 rd in terms of growth in GSP relative to the rest of the states. In contrast to Kentucky’s relatively stagnant growth, many of Kentucky’s neighbors, especially to the south, have experienced relatively rapid growth in average earnings in recent years. In 1969, Georgia, Kentucky, North Carolina and Tennessee all had levels of average earnings that were 77-82 percent of the average earnings in the U.S., while Alabama had average earnings that were approximately 70 percent of the national average. By 2004, Kentucky’s average earnings remained at approximately 80 percent of the national average while average earnings in Georgia, North Carolina and Tennessee had grown to 90 percent of the national average, and average earnings in Alabama had grown to over 85 percent of the national average. In other words, while relative average earnings in Kentucky has been flat for the past forty years, average earnings in a number of southern states similar to Kentucky have experienced fairly rapid relative growth since 1969. In this report, we examine whether there are identifiable factors that can explain why Kentucky remains mired at the bottom of the income distribution. We start by first estimating a standard growth regression using data from all the states in the continental U.S. to examine what factors are most important in explaining why some states have grown faster. For this part of the report, we draw on data from a number of sources covering the period from 1969 to 2004. Next we compare the growth of these factors in Kentucky with the growth of these factors in our comparison states: Alabama, Georgia, North Carolina and Tennessee. This comparison will allow us to identify which of these factors explain why these other states have grown faster than Kentucky. Finally, we examine various policies in our comparison states to see if we can identify specific policies that can explain why a given state experienced differential growth in one of these factors