Joblessness is highly seasonal. To analyze how households adapt to seasonal joblessness, we introduce a measure of seasonal work interruptions premised on the idea that a seasonal worker will tend to exit employment around the same time each year. We show that an excess share of prime-age U.S. workers experience recurrent separations spaced exactly 12 months apart. These separations coincide with aggregate seasonal downturns and are concentrated in seasonally volatile industries. Examining workers most prone to seasonal work interruptions, we find that these workers incur large earnings losses during the off-season. Lost earnings are 1) driven mainly by repeated separations from the same employer, 2) not recouped at other firms, 3) partly offset by unemployment benefits, and 4) amplified by concurrent drops in partners’ earnings. On net, household income falls by about $0.80 for each $1 lost in own earnings.
{"title":"Income in the Off-Season: Household Adaptation to Yearly Work Interruptions","authors":"J. Coglianese, Brendan M. Price","doi":"10.2139/ssrn.3742823","DOIUrl":"https://doi.org/10.2139/ssrn.3742823","url":null,"abstract":"Joblessness is highly seasonal. To analyze how households adapt to seasonal joblessness, we introduce a measure of seasonal work interruptions premised on the idea that a seasonal worker will tend to exit employment around the same time each year. We show that an excess share of prime-age U.S. workers experience recurrent separations spaced exactly 12 months apart. These separations coincide with aggregate seasonal downturns and are concentrated in seasonally volatile industries. Examining workers most prone to seasonal work interruptions, we find that these workers incur large earnings losses during the off-season. Lost earnings are 1) driven mainly by repeated separations from the same employer, 2) not recouped at other firms, 3) partly offset by unemployment benefits, and 4) amplified by concurrent drops in partners’ earnings. On net, household income falls by about $0.80 for each $1 lost in own earnings.","PeriodicalId":125977,"journal":{"name":"ERN: Other Macroeconomics: Employment","volume":"40 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-10-07","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"127444665","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This paper is focused on Modern Monetary Theory's (MMT) treatment of inflation from an open economy perspective. It analyzes how the inflation process is explained within the MMT framework and provides empirical evidence in support of this vision. However, it also makes use of a stock-flow consistent (open economy) model to underline some limits of the theory when it is applied in the context of a non-US (relatively) open economy with a flexible exchange rate regime. The model challenges the contention made by MMTers that measures such as the job guarantee program can achieve full employment without facing an inflation-unemployment trade-off.
{"title":"The Trade-off between Inflation and Unemployment in an MMT World: An Open Economy Perspective","authors":"Emilio Carnevali, Matteo Deleidi","doi":"10.2139/ssrn.3703207","DOIUrl":"https://doi.org/10.2139/ssrn.3703207","url":null,"abstract":"This paper is focused on Modern Monetary Theory's (MMT) treatment of inflation from an open economy perspective. It analyzes how the inflation process is explained within the MMT framework and provides empirical evidence in support of this vision. However, it also makes use of a stock-flow consistent (open economy) model to underline some limits of the theory when it is applied in the context of a non-US (relatively) open economy with a flexible exchange rate regime. The model challenges the contention made by MMTers that measures such as the job guarantee program can achieve full employment without facing an inflation-unemployment trade-off.","PeriodicalId":125977,"journal":{"name":"ERN: Other Macroeconomics: Employment","volume":"17 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"132257827","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Acknowledging that individuals dislike having low relative income renders trade less attractive when seen as a technology that integrates two economies by merging separate social spheres into one. We define a “trembling trade” as a situation in which gains from trade are less than losses in relative income, with the result that global social welfare is reduced. We show that a “trembling trade” can arise even when trade is more gainful in four ways: through trade the absolute income of everyone increases, the income gap in both economies is reduced, as is the income gap between the trading economies. However, trade brings populations, economies, or markets that were not previously connected closer together in social space. As a consequence, separate social spheres merge, and people’s social space and their comparators are altered. Assuming that people like high (absolute) income and dislike low relative income, the aggregate increase in unhappiness caused by the trade-induced escalation in relative deprivation can result in a negative overall impact of trade on (utilitarian-measured) social welfare, if the absolute income gains are not large enough to mitigate the relative income losses.
{"title":"An Adverse Social Welfare Effect of Guadruply Gainful Trade","authors":"O. Stark, Grzegorz Kosiorowski","doi":"10.2139/ssrn.3727630","DOIUrl":"https://doi.org/10.2139/ssrn.3727630","url":null,"abstract":"Acknowledging that individuals dislike having low relative income renders trade less attractive when seen as a technology that integrates two economies by merging separate social spheres into one. We define a “trembling trade” as a situation in which gains from trade are less than losses in relative income, with the result that global social welfare is reduced. We show that a “trembling trade” can arise even when trade is more gainful in four ways: through trade the absolute income of everyone increases, the income gap in both economies is reduced, as is the income gap between the trading economies. However, trade brings populations, economies, or markets that were not previously connected closer together in social space. As a consequence, separate social spheres merge, and people’s social space and their comparators are altered. Assuming that people like high (absolute) income and dislike low relative income, the aggregate increase in unhappiness caused by the trade-induced escalation in relative deprivation can result in a negative overall impact of trade on (utilitarian-measured) social welfare, if the absolute income gains are not large enough to mitigate the relative income losses.","PeriodicalId":125977,"journal":{"name":"ERN: Other Macroeconomics: Employment","volume":"16 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-09-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"131057960","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Provides a more robust understanding of retirement decisions by examining joint work-to-retirement trajectories.
通过检查从工作到退休的共同轨迹，对退休决策提供更有力的理解。
{"title":"Alternative Pathways to Retirement in a Household Context","authors":"Kristine M. Brown, K. Carman, K. Edwards","doi":"10.2139/ssrn.3690990","DOIUrl":"https://doi.org/10.2139/ssrn.3690990","url":null,"abstract":"Provides a more robust understanding of retirement decisions by examining joint work-to-retirement trajectories.","PeriodicalId":125977,"journal":{"name":"ERN: Other Macroeconomics: Employment","volume":"85 5 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-09-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"126115022","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-09-11DOI: 10.24815/JPED.V6I2.16804
Muhamad Fathul Muin
Solving the unemployment issue is one of the best ways to reduce poverty. Through the provision of job opportunities, the poverty rate can be reduced. Therefore, this research explores the factors that influence the unemployment rate across 34 provinces over the 2015-2018 period using the panel regression technique. The variable used consisting of economic growth, the percentage of people with IT competence, and the average school duration. This study indicates that the unemployment rate can be reduced by increasing the average school duration. Meanwhile, the level of economic growth and the proportion of people with IT competence have an insignificant influence on Indonesia's unemployment rate. Based on these findings, the government needs to ensure that every resident in its territory can receive an adequate education.
{"title":"Analysis of Determinants of Unemployment Rate in Indonesia","authors":"Muhamad Fathul Muin","doi":"10.24815/JPED.V6I2.16804","DOIUrl":"https://doi.org/10.24815/JPED.V6I2.16804","url":null,"abstract":"Solving the unemployment issue is one of the best ways to reduce poverty. Through the provision of job opportunities, the poverty rate can be reduced. Therefore, this research explores the factors that influence the unemployment rate across 34 provinces over the 2015-2018 period using the panel regression technique. The variable used consisting of economic growth, the percentage of people with IT competence, and the average school duration. This study indicates that the unemployment rate can be reduced by increasing the average school duration. Meanwhile, the level of economic growth and the proportion of people with IT competence have an insignificant influence on Indonesia's unemployment rate. Based on these findings, the government needs to ensure that every resident in its territory can receive an adequate education.","PeriodicalId":125977,"journal":{"name":"ERN: Other Macroeconomics: Employment","volume":"129 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-09-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"132156057","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Formal occupational titles may purposely obscure and misdirect observers from the actual tasks being undertaken. In this paper we consider mandatory workers' compensation benefits and the incentives they present to misclassify employees. Using the universe of OSHA audits of fatal accidents, 1990 to 2009, we estimate the compensating wage differentials paid for risk incurred while performing ``irregular tasks"- tasks outside of the victims regular occupational duties. We decompose the workers' compensation insurance premiums paid by employers using data from multiple sources, calculating the portions attributable to changes in state-mandated benefits. Compensating wage differentials paid for irregular task risk are i) conditional on higher costs from mandatory benefits, and ii) compare to or exceed those paid for regular task risk at the upper quartiles of benefit costs, but iii) are only observed for workers without post-secondary education; wages of US-born Mexican workers are especially sensitive. Our results advise caution when assuming a consistent relationship between occupational title and job tasks, or when making comparisons of risk compensation and implied risk preferences across groups facing different expected returns from insurance benefits.
{"title":"The Wages of Irregular Tasks: Workers’ Compensation Benefits and Occupational Misclassification","authors":"M. Makowsky, Kelsey Roberts-Bacon","doi":"10.2139/ssrn.3674667","DOIUrl":"https://doi.org/10.2139/ssrn.3674667","url":null,"abstract":"Formal occupational titles may purposely obscure and misdirect observers from the actual tasks being undertaken. In this paper we consider mandatory workers' compensation benefits and the incentives they present to misclassify employees. Using the universe of OSHA audits of fatal accidents, 1990 to 2009, we estimate the compensating wage differentials paid for risk incurred while performing ``irregular tasks\"- tasks outside of the victims regular occupational duties. We decompose the workers' compensation insurance premiums paid by employers using data from multiple sources, calculating the portions attributable to changes in state-mandated benefits. Compensating wage differentials paid for irregular task risk are i) conditional on higher costs from mandatory benefits, and ii) compare to or exceed those paid for regular task risk at the upper quartiles of benefit costs, but iii) are only observed for workers without post-secondary education; wages of US-born Mexican workers are especially sensitive. Our results advise caution when assuming a consistent relationship between occupational title and job tasks, or when making comparisons of risk compensation and implied risk preferences across groups facing different expected returns from insurance benefits.","PeriodicalId":125977,"journal":{"name":"ERN: Other Macroeconomics: Employment","volume":"108 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-08-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"126117579","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pillar 2 of the Australian retirement system was introduced in 1993 with contributions made by employers as a percentage of wages to be accumulated for employees until retirement. As originally introduced, the effect of this Pillar 2 system would have been to perpetuate wealth and income inequality in the pre-retirement phase into the post retirement phase. But the effect of restrictions subsequently introduced on maximum contributions and accumulated assets has been to significantly reduce the inequality between the highest and lowest income groups. The higher income groups however remain the major beneficiaries of the effective tax benefits of the Pillar 2 system. This paper quantifies the effects on wealth and income inequality from the introduction of the Pillar 2 system.
{"title":"The Effect on Wealth & Income Inequality of the Pillar 2 Component of the Australian Retirement System","authors":"John R. Evans, A. Razeed","doi":"10.2139/ssrn.3665753","DOIUrl":"https://doi.org/10.2139/ssrn.3665753","url":null,"abstract":"Pillar 2 of the Australian retirement system was introduced in 1993 with contributions made by employers as a percentage of wages to be accumulated for employees until retirement. As originally introduced, the effect of this Pillar 2 system would have been to perpetuate wealth and income inequality in the pre-retirement phase into the post retirement phase. But the effect of restrictions subsequently introduced on maximum contributions and accumulated assets has been to significantly reduce the inequality between the highest and lowest income groups. The higher income groups however remain the major beneficiaries of the effective tax benefits of the Pillar 2 system. This paper quantifies the effects on wealth and income inequality from the introduction of the Pillar 2 system.","PeriodicalId":125977,"journal":{"name":"ERN: Other Macroeconomics: Employment","volume":"127 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-08-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"130851948","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
S. Bandyopadhyay, A. Basu, Nancy H. Chau, Devashish Mitra
We present a model of offshoring of tasks to a developing nation, which is characterized by a minimum wage formal sector and a flexible wage informal sector. Some offshored tasks are outsourced by the formal sector to the lower wage informal sector. An improvement in the productivity in performing offshored tasks in the developing country raises offshoring, but not necessarily formal-to-informal outsourcing, and, in response, the developed nation wage can fall. Productivity improvements in the informal sector expand both offshoring and outsourcing, and the developed nation wage must rise. When the minimum wage is reduced, the developed nation wage falls when most of the efficiency gains accrue to the informal sector.
{"title":"Offshoring to a Developing Nation with a Dual Labor Market","authors":"S. Bandyopadhyay, A. Basu, Nancy H. Chau, Devashish Mitra","doi":"10.20955/r.102.237-53","DOIUrl":"https://doi.org/10.20955/r.102.237-53","url":null,"abstract":"We present a model of offshoring of tasks to a developing nation, which is characterized by a minimum wage formal sector and a flexible wage informal sector. Some offshored tasks are outsourced by the formal sector to the lower wage informal sector. An improvement in the productivity in performing offshored tasks in the developing country raises offshoring, but not necessarily formal-to-informal outsourcing, and, in response, the developed nation wage can fall. Productivity improvements in the informal sector expand both offshoring and outsourcing, and the developed nation wage must rise. When the minimum wage is reduced, the developed nation wage falls when most of the efficiency gains accrue to the informal sector.","PeriodicalId":125977,"journal":{"name":"ERN: Other Macroeconomics: Employment","volume":"791 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-07-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"123286257","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This article is two sections from a much longer article entitled Chinese COVID Lockdowns, Black Economic Dysphoria, Global Crony Capitalism. and the Killing of George Floyd. We argue that the Republican Party trade deals had a disproportionate negative economic effect on Black people. By the time the COVID lockdowns were implemented, Black workers had already been herded into the most unstable jobs in the gig economy. The six service sectors bore the brunt of the economic damage of the lockdowns. We argue that modern racism began around 1985, with the political organization of the Business Roundtable, that sought legislation to offshore production.
{"title":"The Origins of Modern Racism in the United States and Black Economic Dysphoria Under Global Corporate Crony Capitalism and the COVID Economic Lockdown Shock","authors":"Laurie Thomas Vass","doi":"10.2139/ssrn.3625160","DOIUrl":"https://doi.org/10.2139/ssrn.3625160","url":null,"abstract":"This article is two sections from a much longer article entitled Chinese COVID Lockdowns, Black Economic Dysphoria, Global Crony Capitalism. and the Killing of George Floyd. \u0000 \u0000We argue that the Republican Party trade deals had a disproportionate negative economic effect on Black people. \u0000 \u0000By the time the COVID lockdowns were implemented, Black workers had already been herded into the most unstable jobs in the gig economy. \u0000 \u0000The six service sectors bore the brunt of the economic damage of the lockdowns. \u0000 \u0000We argue that modern racism began around 1985, with the political organization of the Business Roundtable, that sought legislation to offshore production.","PeriodicalId":125977,"journal":{"name":"ERN: Other Macroeconomics: Employment","volume":"40 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-06-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"127370928","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Spousal insurance raises a worker's outside option, allowing workers to bargain a higher wage. To study this mechanism I propose a random search model with ex-ante heterogeneity in ability, endogenous marriage, endogenous labor supply of spouses and wages determined by Nash Bargaining. Using the model, I derive an empirical specification to test the mechanism and the sources of endogeneity to be addressed. I use a combination of an instrument derived from theory and one instrument based on policy variation to confirm the predictions of the model. A 1 percentage point increase in the share of married women working increases the wage of married individuals by 2.51-3.51%.
{"title":"Spousal Insurance, Outside Options and Wage Bargaining","authors":"João Galindo da Fonseca","doi":"10.2139/ssrn.3623323","DOIUrl":"https://doi.org/10.2139/ssrn.3623323","url":null,"abstract":"Spousal insurance raises a worker's outside option, allowing workers to bargain a higher wage. To study this mechanism I propose a random search model with ex-ante heterogeneity in ability, endogenous marriage, endogenous labor supply of spouses and wages determined by Nash Bargaining. Using the model, I derive an empirical specification to test the mechanism and the sources of endogeneity to be addressed. I use a combination of an instrument derived from theory and one instrument based on policy variation to confirm the predictions of the model. A 1 percentage point increase in the share of married women working increases the wage of married individuals by 2.51-3.51%.","PeriodicalId":125977,"journal":{"name":"ERN: Other Macroeconomics: Employment","volume":"30 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-06-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"130926450","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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