Firm Data Analysis in Linked Employer-Employees Datasets

In linked employer-employee databases, when the employees are sampled first and then the employers data are attached, the set of firms that enter the sample is biased towards the large dimension. In this paper I discuss two strategies to impute inflating factors to the employers’ records, and to obtain a sample representative of the entire population of firms. A comparison between the two strategies is made with the help of Monte Carlo simulations. As an application, I build a rotating panel of Italian firms from a linked employer-employee longitudinal database of administrative source for the years 1986 to 1998, and compare some stylised facts derived on it with the existing knowledge on Italian firms’ size distribution.Firm Microdata; Linked Employer-Employees Datasets; Firms’ Size Distribution.

Non Price Interaction and Business Fluctuations in an Agent Based Model of Firms’ Demography

This paper presents some artificial stylised facts emerging in a simulated contestable market where firms interact with each other in taking their stay or go decision. I use nearly zero-intelligence firms: no optimisation is considered, and all the firms sell at a fixed price an equal quantity of the good. The entry of new firms is triggered by the overall profitability of the market, measured by the spread between the average rate of profit and the interest rate. The exit decision is modelled via a mean field effect, to take into account in the decision process both the performance of the individual firm, and the information about the profitability of the market that can be abduced looking at the stay or go decision of the other firms. Financial requirements of production are considered, with a spread between creditor and debtor interest rates. The model is simulated with an ACE approach, using the Swarm libraries released by the Santa Fe Institute.

The Unemployment Route to Versatility

In this paper we document a common sense idea: When an individual is searching for a new job, the longer it takes the more s/he will be available to adapt her/his skills, often with a worsening in status and/or wage. We used a dataset of administrative source, containing a sample of individuals' working careers in the private sector, in Italy, years 1985-1996. We do not observe directly the search activity of individuals: What we observe is the re-entry time elapsing from the separation from a job spell, to the association to a new one. The information collected about the job spells, however, is quite rich, and allows a thorough analysis of the main features of job changes. If we do not take into account re-entry times into dependent work, the inter-industry mobility we report is relatively limited, even at high levels of disaggregation. Still (roughly) 50% of job changes occurs within the same 3-digit Ateco sectors, and without changing skill/status. If we condition on re-entry times, we find a positive effect on the probabilities of changing sector in the first months of the search, while for longer re-entry times, and of worsening the working status and wage.Job matching; Job changes; Re-entry times; Inter sectoral mobility; Wage dynamics; Linked employer-employee datasets.

The lifetime gender gap in Italy. Do the pension system countervails labour market outcomes?

In Italy large work career gender gaps currently exists, particularly regarding wages and activity rates. The paper investigates the issue looking at lifetime incomes, where from the one side all the career gaps tend to accumulate, from the other the redistribution acted by the pension system may mitigate the differences. Exploiting an original database on the entire work careers, we document how the pay gap constantly opens with age and how women tend to cumulate lower seniority. Both gaps have an impact in the pension calculation, so that the day after retirement gender differences are even higher. By means of a microsimulation model we show that the pension system partially countervails labour market outcomes, implying lower differences in lifetime incomes. However, due to the current transition to an actuarially neutral system, the effect is going to vanish in following decades, posing some concerns about future prospects of gender income inequality.

Employability of Older Workers in Italy and Europe

In many European countries the participation rates of older workers are worryingly low, and Italy – within this picture – has one of the worst records, particularly for females. In this paper we investigate whether this signals an issue about their employability. Indeed, the non-participation of an individual does not point to an employability issue as long as it is a free choice of the person, and as long as it does not hinder their future participation in the labour market. To address this point we single out which are the empirically most relevant factors in shaping cross country differentials. Two selection processes emerged as having a most prominent role: the life cycle decision for women of not participating to the labour market, and the access for men and women to early retirement schemes. Controlling for these selection processes international differences reduce significantly. In both cases the main issue is the possibility that a participation choice made in a given point in time – for instance the early retirement decision – can have long lasting consequences, hindering future transition possibilities of the individuals. The magnitude of the two selection processes suggests already some policy conclusions, which are derived in the paper, and points to the need of further research to ascertain whether there are barriers to late entries and re-entries in the labour market.Employability; Ageing; Participation rate.

Local Human Capital Externalities and Wages at Firm Level

We use a unique data set providing administrative information on earnings by skill-level (blue collars, white collars), on the local stock of human capital and on several firm’s characteristics, including balance sheet data, to investigate the size of localized human capital externalities in Italian manufacturing. Our estimates do not show any evidence of human capital spillovers neither at the firm nor at the local level. This finding is not really surprising and can be explained by many features of Italian manufacturing.externalities, human capital, manufacturing, wages.

LABORsim: an Agent-Based Microsimulation of Labour Supply. An Application to Italy

Most Oecd Countries are experiencing a rapid population ageing. Italy adds to this picture a very low labour market participation of the elders, so that most projections of the impact of ageing on the labour market are rather pessimistic. However, there are other long run modifications currently underway that will presumably have a sizeable impact on the labour market, above all changes in the retirement legislation, in educational choices and participation behaviour. In this paper we present LABORsim, an agent based microsimulation model of labour supply, which offers new insights on the likely evolution of the labour force in the next decades in Italy. LABORsim integrates the current demographic projections with simulation modules modelling retirement rules, retirement behaviours, migrations, education and participation choices, plus a consolle to implement various policy scenario analyses. When all these factors are taken into account, projections for next decades are not that pessimistic. In most scenarios, the overall participation rate is expected to increase steadily for the next two decades, while shortages in the labour force supply and an unfavourable dynamics for the economic dependency rate are expected to show up only after 2020, when the baby boom generations will arrive at their retirement ages. This is not enough, however, to allow Italy to meet the EU Stockolm and Lisbon targets for male and female employment rates for many decades to come. The sharp increase in the participation rates for the elderly (aged 55-64), mainly driven by the recent changes in the retirement eligibility criteria, will make it possible to meet the Stockholm target of 50% employment rate in this age group by 2015, i.e. with only 5 years of delay.microsimulation, participation, employment, retirement, education, policy evaluation.

Local Human Capital Externalities and Wages at the Firm Level: The Case of Italian Manufacturing

We use a unique firm-level data set merging administrative information on average wages paid by firms by skill level (blue collars and white collars), Population Census information on the local stock of human capital available to firms and survey information on firm characteristics to investigate the existence and magnitude of local human capital externalities in Italian Manufacturing. The latter represents an interesting case study due to the prevalence of small family business and a technological lag with respect to the US, to which most evidence supporting local human capital spillovers refers. Our estimates show that in Italy, like in the US, firms located in geographical areas with a higher stock of human capital pay higher wages. This evidence is robust to many variants of the econometric specification and to addressing potential endogeneity issues using instrumental variables estimation and instruments based on the lagged expansion of the Italian higher education system and the lagged demographic structure.firm, local human capital externalities, Italy, manufacturing, wages

Measuring Skill level integrating Administratrive Dataset and National Collective Agreement Archive

Given the group job classification and collective agreement identification code, we extracted from the national bargaining archive the skill level definition and we created a skill grades classification for the workers. We added this information to Workers History Italian Panel -Whip-, and we created a new variable which allow us to identify whether a worker is skilled or unskilled. The new skill level variable increase the possibility for a better comprehension of labour market issues as well as for new studies in the field of job risk evaluation. The sections are organized as follow: 1. creation of skill level classification from national collective agreements archive; 2. short explanation of Whip archives; 3. adding informations to Whip archives; 4. checking the consistency and coverage of the skill level variable in Whip; 5. a first interpretation of the resulting skill distribution.