Essays on Unions, Wages and Performance: Evidence from Latin America

Unions are one of the most important institutions in labor markets, and are capable of affecting workers (wages) and employers (performance). Despite the relevance unions have had worldwide, most of the literature has concentrated on the economic effects of unions in the U.S. and other developed countries, with few studies concentrating on what unions do in developing countries. Because developing countries have contrasting differences compared to developed countries, in terms of economic development, legal settings and institutions, it is possible that conclusions reached in the broader literature might not be appropriate in the framework of developing countries. This dissertation aims to fill this gap in the literature studying the economic effects of unions on wages and performance in selected developing countries in Latin America: Argentina, Bolivia, Chile, Mexico, Panama and Uruguay. The first essay focuses on the impact of unions on wages distribution in Bolivia and Chile, using the novel Recentered Influence Function decomposition. Although both countries have considerably different levels of economic development and institutions, the estimations indicate unions have similar effects increasing wages and reducing wage inequality at the top of the distribution. These results are similar to those found replicating the methodology using U.S. data. The results suggest that the common economic and political forces that govern the role of unions as collective bargaining units transcend other contextual differences in these countries. The second essay analyzes the impact of unions on economic performance of establishments in the manufacturing sector in Argentina, Bolivia, Chile, Mexico, Panama and Uruguay. Using an augmented Cobb Douglas production function, the essay finds that unions have a positive, but small, effect on productivity, with the exception of Argentina. Analyses on alternative measures of performance show that, for most cases, the positive productivity effects barely offset the higher union compensation; that unions show no relationship with sales growth; and that unionized establishments usually reduce investment in capital and R&D. While no single narrative can explain all observed effects across countries, the results provide a step forward to understand the role of unions on economic performance in developing countries

Domestic Violence and Labor Market Outcomes: Evidence from a Mixed-Race Developing Country

This study investigates the heterogeneous effects of domestic violence over labor markets in an ethnically fragmented country such as Bolivia. Among developing countries, Bolivia “excels” in having one of the highest levels of domestic violence in the region. Anecdotal evidence and empirical evidence suggest that response to domestic violence is not homogeneous across different ethnic groups. Using information from the Demographic and Health Survey (DHS) for Bolivia, we examine the heterogeneous impacts of domestic violence over one of the key labor market outcomes such as employment. We employ a probabilistic decision model and treatment regression techniques to examine this effect. We claim that the impact of domestic violence on labor markets is limited among indigenous people, given that violence is, to some extent, socially recognized and accepted. We find that for most of the cases, indigenous women are less responsive to domestic violence than non-indigenous ones, except for groups with a high income level. Our results are robust for alternative methodologies to address possible endogeneity problems.labor markets, domestic violence, Bolivia, indigenous

Quality of match for statistical matches using the Consumer Expenditure Survey 2011 and Annual Social Economic Supplement 2011

This paper describes the quality of the statistical match between the Current Population Survey (CPS) March 2011 supplement and the Consumer Expenditure Survey (CEX) 2011, which are used for the integrated inequality assessment model for the United States. In the first part of this paper, the alignment of the datasets is examined. In the second, various aspects of the match quality are described. The results show appropriate balance across different characteristics, with some imbalances within narrow characteristics

Los sindicatos y rendimiento económico en los países en desarrollo: Estudios de Casos de América Latina

This paper analyzes the economic impact of unions on productivity in the manufacturing sector across six Latin American countries: Argentina, Bolivia, Chile, Mexico, Uruguay, and Panama. Using an augmented Cobb-Douglas production function, the paper finds that unions have positive, but mostly small, effects on productivity, with the exception of Argentina, with a large negative effect, and Bolivia, with no effect. An analysis on profitability shows that, in most cases, the positive productivity effects barely offset higher union compensation, and that unions are negatively related to investment in capital and R & D. Different explanations for these effects are discussed.Este artículo analiza el impacto económico de los sindicatos sobre la productividad en el sector manufacturero en seis países de América Latina: Argentina, Bolivia, Chile, México, Uruguay y Panamá. Utilizando una función de producción aumentada de Cobb-Douglas, el documento encuentra que los sindicatos tienen efectos positivos, pero sobre todo pequeños, sobre la productividad, con la excepción de Argentina, con un gran efecto negativo, y Bolivia, sin efecto. Un análisis de la rentabilidad muestra que, en la mayoría de los casos, los efectos positivos de la productividad apenas compensan una indemnización sindical más alta, y que los sindicatos están relacionados negativamente con la inversión en capital y en I + D. En el artículo se discuten diferentes explicaciones de estos efectos

La informalidad: ¿estrategia de sobrevivencia o forma de vida alternativa?

La cada vez mayor presencia de un Sector Informal en el ámbito laboral urbano ha generado, al menos, tres lecturas del fenómeno: La que considera que es el resultado del funcionamiento del sistema capitalista, la que lo asocia a una estructura económica que transitaría con base en una racionalidad distinta a los supuestos de la teoría económica, y aquella que la toma como la acción racional de los individuos frente a un sistema con características mercantilistas y excluyentes. De allí surge la interrogante si la informalidad es una estrategia de sobrevivencia o es una alternativa de vida en una estructura económica híbrida. Los resultados alcanzados en esta investigación dan cuenta que la informalidad sería, evidentemente, una respuesta frente a un sistema discriminador contrario a los valores que sustentan una sociedad abierta.The increasing participation of an Informal Sector in the urban labor market, at least, has generated three approaches of this phenomenon: one of them considers that it is the result of the operation of the capitalist system, others associates the informal sector to an economic structure that would function based in a rationality different of the economic theory framework, and the later one which assume rational actions of the individuals facing a system with mercantilist and excluding characteristics. Therefore, the binding question arises concerning if the informality is a strategy of survival or constitutes an alternative of life in a hybrid economic structure. The results reached in this investigation give us the statement that the informality would be, evidently, an answer in front of a discriminatory system who behaves in contrary to the values that sustain an open societ

Immigrant Birthcountry Networks and Unemployment Duration: Evidence around the Great Recession

Using data from the CPS this paper examines the role of birth-country networks on immigrants' unemployment duration from 2001 to 2013. We find that networks significantly lower unemployment duration for all immigrants. Varying the effect of networks over duration categories we find that networks are more effective in lowering duration for immigrants unemployed for 1-2 months than immigrants who are unemployed for longer periods and this effect is further strengthened during the post recession period. This supports the Calvo-Armengol and Jackson hypothesis which posits that longer the agent is unemployed, less effective are her social networks in job search. Our findings are robust to different specifications

Bank accounts and savings - the impact of remittances and migration: a case study of Moldova

In many developing countries, the formal financial sector is underdeveloped and majority of the population does not have access to it. This paper analyzes the empirical link between remittances and financial sector development on a microeconomic level. Using a unique household dataset for Moldova, we find that receiving monetary remittances has a positive and significant effect on the probability of having a bank account, thereby promoting financial sector development. Furthermore, we show that remittances tend to have an even higher positive effect on household savings, which is a sign for a hidden potential for financial sector development

Elasticidad cruzada de la oferta de trabajo

Dadas las condiciones de pobreza, los problemas de ingreso y las condiciones de inserción al mercado laboral en Bolivia, se requiere tratar el problema del desempleo desde una óptica donde las necesidades del hogar sean las que reflejen las restricciones presupuestarias y, al mismo tiempo, expliquen el comportamiento de los miembros del hogar cuando salen del mismo en busca de trabajo. En ese marco, el comportamiento de las mujeres casadas o unidas en pareja al momento de buscar trabajo, está fuertemente afectado por las condiciones de trabajo de sus cónyuges; tal es así que tanto en parejas donde el varón realiza actividades asalariadas, como en aquellos donde es no asalariado, la elasticidad de las horas trabajadas de la mujer, respecto a variaciones en el salario o ingreso del cónyuge, presenta una relación negativa.Given the poverty conditions and the labor market barriers in Bolivia, it is necessary to treat the problem of the unemployment from an optics based in the necessities of the households, reflecting the household’s budgetary restrictions and, at the same time, explaining the behavior of the household members while they are job searching. Therefore, the behavior of the married woman at the moment to look for job, is strongly affected by the working conditions of their spouses; indeed, even where the male carries out salaried activities, like in those where it is not paid a salary, the elasticity of the woman's worked hours, regarding variations in the wage or their spouse's, shows negative signs

Enhancing Electrical Engineering Technology Capstone Experience

The College of Science and Technology (COST) at our university (XXX) offers degrees in Mechanical (MET), Civil (CET) and Electrical Engineering Technology (EET). All the Engineering Technology programs are ABET accredited and have been successful in achieving the TAC2000 outcomes. In particular, our Senior Design capstone course (TEET4010/ 4020) is a comprehensive three-credit, two-semester engineering design course, that all engineering majors are required to take as their capstone experience. We view this course as a very important component in the preparation of a trained EET professional. The course emphasizes both hard and soft skills and serves as an emulation of a real world engineering project. We use both, projects proposed by the faculty and projects contributed from local industry and we partner the teams of student with faculty and industry mentors. As a result of their participation in this course, students are subjected to a real world engineering project development experience for the first time. By participating in real engineering projects, students learn to deal with unplanned events such as: missed deadlines, working in team environment and dealing with difficult team members, even dealing with different industry or faculty mentors. From their participation in the course and the project students get a very valuable learning experience. In this paper, we describe the development of our industry-based projects senior design course. In the next sections we describe the role of the capstone design course in respect to ABET academic outcomes. We also present examples of the type of projects implemented and a summary and listing of future work

Unemployed, Now What? The Effect of Immigration on Unemployment Transitions of Native-born Workers in the United States

Although one would expect the unemployed to be the population most likely affected by immigration, most of the studies have concentrated on investigating the effects immigration has on the employed population. Little is known of the effects of immigration on labor market transitions out of unemployment. Using the basic monthly Current Population Survey from 2001 and 2013 we match data for individuals who were interviewed in two consecutive months and identify workers who transition out of unemployment. We employ a multinomial model to examine the effects of immigration on the transition out of unemployment, using state-level immigration statistics. The results suggest that immigration does not affect the probabilities of native-born workers finding a job. Instead, we find that immigration is associated with smaller probabilities of remaining unemployed, but it is also associated with higher probabilities of workers leaving the labor force. This effect impacts mostly young and less educated people