Jose Maria Barrero, Nicholas Bloom, Steven J. Davis
Many Americans continued some forms of social distancing after the pandemic. This phenomenon is stronger among older persons, less educated individuals, and those who interact daily with persons at high risk from infectious diseases. Regression models fit to individual-level data suggest that social distancing lowered labor force participation by 2.4 percentage points in 2022, 1.2 points on an earnings-weighted basis. When combined with simple equilibrium models, our results imply that the social distancing drag on participation reduced US output by $205 billion in 2022, shrank the college wage premium by 2.1 percentage points, and modestly steepened the cross-sectional age-wage profile.
{"title":"Long Social Distancing","authors":"Jose Maria Barrero, Nicholas Bloom, Steven J. Davis","doi":"10.1086/726636","DOIUrl":"https://doi.org/10.1086/726636","url":null,"abstract":"Many Americans continued some forms of social distancing after the pandemic. This phenomenon is stronger among older persons, less educated individuals, and those who interact daily with persons at high risk from infectious diseases. Regression models fit to individual-level data suggest that social distancing lowered labor force participation by 2.4 percentage points in 2022, 1.2 points on an earnings-weighted basis. When combined with simple equilibrium models, our results imply that the social distancing drag on participation reduced US output by $205 billion in 2022, shrank the college wage premium by 2.1 percentage points, and modestly steepened the cross-sectional age-wage profile.","PeriodicalId":48308,"journal":{"name":"Journal of Labor Economics","volume":"45 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"136259939","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Rising between-firm pay dispersion accounts for the majority of the dramatic increase in earnings inequality in the United States in the last several decades. This paper shows that a distinct cross-cohort pattern drives this rise: newer cohorts of firms enter more dispersed and stay more dispersed throughout their lives. These cohort patterns suggest a link between changes in firm entry associated with the decline in business dynamism and the rise in earnings inequality. Cohort effects also imply a slow diffusion of inequality: inequality rises as younger and more unequal cohorts of firms replace older and more equal cohorts.
{"title":"The Slow Diffusion of Earnings Inequality","authors":"Isaac Sorkin, Melanie Wallskog","doi":"10.1086/726635","DOIUrl":"https://doi.org/10.1086/726635","url":null,"abstract":"Rising between-firm pay dispersion accounts for the majority of the dramatic increase in earnings inequality in the United States in the last several decades. This paper shows that a distinct cross-cohort pattern drives this rise: newer cohorts of firms enter more dispersed and stay more dispersed throughout their lives. These cohort patterns suggest a link between changes in firm entry associated with the decline in business dynamism and the rise in earnings inequality. Cohort effects also imply a slow diffusion of inequality: inequality rises as younger and more unequal cohorts of firms replace older and more equal cohorts.","PeriodicalId":48308,"journal":{"name":"Journal of Labor Economics","volume":"198 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"136259940","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Policymakers continuously debate the current U.S. Housing Voucher Program, which features a high degree of rationing and decreasing subsidy amount as income increases. This paper studies the effect of the Housing Voucher Program on low-income household labor supply and welfare. Using several datasets, I estimate a dynamic lifecycle model to study the long-term impacts of housing vouchers on employment, and examine how a set of policy reforms affect household labor supply and well-being. I show that voucher usage (as opposed to no vouchers) decreases female labor supply by 17% and male labor supply by 7% in the long run. Compared to the current program, a proposed reform that provides every recipient with a flat-rate subsidy increases female labor supply by 4% and leads to higher welfare. Policies that offer a lower subsidy to a larger population decrease labor supply by 3-4% and increase household welfare. Time-limited subsidies increase female employment by 4% and improve overall welfare.
{"title":"In-Kind Housing Transfers and Labor Supply: A Structural Approach","authors":"Ning Zhang","doi":"10.1086/727839","DOIUrl":"https://doi.org/10.1086/727839","url":null,"abstract":"Policymakers continuously debate the current U.S. Housing Voucher Program, which features a high degree of rationing and decreasing subsidy amount as income increases. This paper studies the effect of the Housing Voucher Program on low-income household labor supply and welfare. Using several datasets, I estimate a dynamic lifecycle model to study the long-term impacts of housing vouchers on employment, and examine how a set of policy reforms affect household labor supply and well-being. I show that voucher usage (as opposed to no vouchers) decreases female labor supply by 17% and male labor supply by 7% in the long run. Compared to the current program, a proposed reform that provides every recipient with a flat-rate subsidy increases female labor supply by 4% and leads to higher welfare. Policies that offer a lower subsidy to a larger population decrease labor supply by 3-4% and increase household welfare. Time-limited subsidies increase female employment by 4% and improve overall welfare.","PeriodicalId":48308,"journal":{"name":"Journal of Labor Economics","volume":"26 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-09-18","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135151679","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
P. Carneiro, Yyannú Cruz-Aguayo, Francesca Salvati, Norbert R. Schady
We study the impact on learning of a child's rank in the classroom using a unique experiment from Ecuador. Within each school, students were randomly assigned to classrooms in every grade between kindergarten and 6th grade. Therefore, two students with the same ability can have different classroom ranks because of the (random) peer composition of their classroom. To isolate the impact of rank from other peer influences we include classroom fixed effects. Children with higher classroom rank at the beginning of the academic year have significantly higher math test scores at the end of that grade. Classroom rank in math, not language, drives our results. The impact of classroom math rank is larger for younger children, and grows substantially over time. Exogenous changes in classroom rank in math also improve executive function, child happiness, and teacher perceptions of student ability.
{"title":"The Effect of Classroom Rank on Learning Throughout Elementary School: Experimental Evidence from Ecuador","authors":"P. Carneiro, Yyannú Cruz-Aguayo, Francesca Salvati, Norbert R. Schady","doi":"10.1086/727515","DOIUrl":"https://doi.org/10.1086/727515","url":null,"abstract":"We study the impact on learning of a child's rank in the classroom using a unique experiment from Ecuador. Within each school, students were randomly assigned to classrooms in every grade between kindergarten and 6th grade. Therefore, two students with the same ability can have different classroom ranks because of the (random) peer composition of their classroom. To isolate the impact of rank from other peer influences we include classroom fixed effects. Children with higher classroom rank at the beginning of the academic year have significantly higher math test scores at the end of that grade. Classroom rank in math, not language, drives our results. The impact of classroom math rank is larger for younger children, and grows substantially over time. Exogenous changes in classroom rank in math also improve executive function, child happiness, and teacher perceptions of student ability.","PeriodicalId":48308,"journal":{"name":"Journal of Labor Economics","volume":" ","pages":""},"PeriodicalIF":3.8,"publicationDate":"2023-08-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46527233","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
A. Ichino, Omar Bamieh, Decio Coviello, Nicola G. Persico
We document a causal relationship between business uncertainty and workforce management at the firm level, by leveraging litigation-generated quasi-experimental variation in business uncertainty. The causal effects of business uncertainty on turnover, hiring and separations are of the expected negative direction, and of sizable magnitude. These consequences are stronger among firms that operate in sectors in which business uncertainty is intrinsically higher, and can be attributed to the effect of regulation induced business risk on normal operations. In particular, employee turnover, hiring and separations are ratcheted down to reduce the risk of additional wrongful termination lawsuits. Value added is also shown to decrease in business risk.
{"title":"Effect of Business Uncertainty on Turnover","authors":"A. Ichino, Omar Bamieh, Decio Coviello, Nicola G. Persico","doi":"10.1086/727201","DOIUrl":"https://doi.org/10.1086/727201","url":null,"abstract":"We document a causal relationship between business uncertainty and workforce management at the firm level, by leveraging litigation-generated quasi-experimental variation in business uncertainty. The causal effects of business uncertainty on turnover, hiring and separations are of the expected negative direction, and of sizable magnitude. These consequences are stronger among firms that operate in sectors in which business uncertainty is intrinsically higher, and can be attributed to the effect of regulation induced business risk on normal operations. In particular, employee turnover, hiring and separations are ratcheted down to reduce the risk of additional wrongful termination lawsuits. Value added is also shown to decrease in business risk.","PeriodicalId":48308,"journal":{"name":"Journal of Labor Economics","volume":" ","pages":""},"PeriodicalIF":3.8,"publicationDate":"2023-08-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46101958","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
true Throughout most of the twentieth century, economic growth was associated with rising median real wages. However, since the early 1980s, measured median real hourly compensation has been stagnant despite robust productivity growth. To the extent that measured real wage growth has occurred, it has been concentrated disproportionately at the upper end of the wage distribution. Many view the lack of growth of median wages over this time period as evidence that the American middle class has not advanced and as a symptom of declining social mobility. The decoupling of measured median real wage growth and productivity growth has been viewed as a puzzle among both academics and policy makers. During this time period, there has also been a separation of wage growth and othermacroeconomic fundamentals. For instance, theUnited States has had record low levels of unemployment in the years prior to the global pandemic, yet during the prepandemic period there was little accompanying wage growth. This presents an apparent contradiction of the long-standing Phillips curve analysis that negatively relates unemployment towage growth. Researchers have begun to dig into this puzzle of late (see, e.g., Del Negro et al. 2020). Recent explanations involve the possibility that we have mismeasured the amount of slack in the economy (Krueger, Cramer, and Cho 2014; Abraham, Haltiwanger, and Rendell 2020) or that we have a flatter
{"title":"Overview: Wage Dynamics in the Twenty-First Century","authors":"Erik Hurst, Lisa B. Kahn","doi":"10.1086/727200","DOIUrl":"https://doi.org/10.1086/727200","url":null,"abstract":"true Throughout most of the twentieth century, economic growth was associated with rising median real wages. However, since the early 1980s, measured median real hourly compensation has been stagnant despite robust productivity growth. To the extent that measured real wage growth has occurred, it has been concentrated disproportionately at the upper end of the wage distribution. Many view the lack of growth of median wages over this time period as evidence that the American middle class has not advanced and as a symptom of declining social mobility. The decoupling of measured median real wage growth and productivity growth has been viewed as a puzzle among both academics and policy makers. During this time period, there has also been a separation of wage growth and othermacroeconomic fundamentals. For instance, theUnited States has had record low levels of unemployment in the years prior to the global pandemic, yet during the prepandemic period there was little accompanying wage growth. This presents an apparent contradiction of the long-standing Phillips curve analysis that negatively relates unemployment towage growth. Researchers have begun to dig into this puzzle of late (see, e.g., Del Negro et al. 2020). Recent explanations involve the possibility that we have mismeasured the amount of slack in the economy (Krueger, Cramer, and Cho 2014; Abraham, Haltiwanger, and Rendell 2020) or that we have a flatter","PeriodicalId":48308,"journal":{"name":"Journal of Labor Economics","volume":"41 1","pages":"S1 - S12"},"PeriodicalIF":3.8,"publicationDate":"2023-08-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46177741","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Using establishment-level panel data from the Occupational Employment and Wage Statistics program, I estimate the effect of minimum wage increases implemented by 10 states in 2014 and 2015. I show that minimum wage increases lead to wage spillovers within establishments. I find little evidence that minimum wage increases induce establishments to reorganize their occupational mix. Finally, I find that minimum wage increases propagate up the management hierarchy, leading to increased wages for supervisors. Nonetheless, I find that overall wage inequality decreases within establishments after minimum wage increases.
{"title":"The Effect of Minimum Wage Policies on the Wage and Occupational Structure of Establishments","authors":"E. Forsythe","doi":"10.1086/726820","DOIUrl":"https://doi.org/10.1086/726820","url":null,"abstract":"Using establishment-level panel data from the Occupational Employment and Wage Statistics program, I estimate the effect of minimum wage increases implemented by 10 states in 2014 and 2015. I show that minimum wage increases lead to wage spillovers within establishments. I find little evidence that minimum wage increases induce establishments to reorganize their occupational mix. Finally, I find that minimum wage increases propagate up the management hierarchy, leading to increased wages for supervisors. Nonetheless, I find that overall wage inequality decreases within establishments after minimum wage increases.","PeriodicalId":48308,"journal":{"name":"Journal of Labor Economics","volume":"41 1","pages":"S291 - S324"},"PeriodicalIF":3.8,"publicationDate":"2023-07-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"44187613","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Worker mobility and wages have declined in the United States amid rising employer market power. I propose a theory of the labor market in which a decrease in employer competition, characterized by fewer firms per worker, drives the decline in worker mobility and wages. A finite and decreasing number of employers exert market power by excluding their offers from the outside options of their employees. This reduces the value of workers’ outside options and, consequently, their wages and transitions across employers. I quantify the model to explain the long-run decline in worker mobility and wages and examine its cross-sectional implications.
{"title":"Firm Market Power, Worker Mobility, and Wages in the US Labor Market","authors":"Sadhika Bagga","doi":"10.1086/726819","DOIUrl":"https://doi.org/10.1086/726819","url":null,"abstract":"Worker mobility and wages have declined in the United States amid rising employer market power. I propose a theory of the labor market in which a decrease in employer competition, characterized by fewer firms per worker, drives the decline in worker mobility and wages. A finite and decreasing number of employers exert market power by excluding their offers from the outside options of their employees. This reduces the value of workers’ outside options and, consequently, their wages and transitions across employers. I quantify the model to explain the long-run decline in worker mobility and wages and examine its cross-sectional implications.","PeriodicalId":48308,"journal":{"name":"Journal of Labor Economics","volume":"41 1","pages":"S205 - S256"},"PeriodicalIF":3.8,"publicationDate":"2023-07-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"47198381","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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