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Archives: IAB-Veranstaltungen

This paper studies the real effects of monetary policy on firms' labor adjustment.

This paper studies the real effects of monetary policy on firms' labor adjustment. Using detailed bank data together with administrative firm and worker data for Germany, we find that firms reduce employment in response to contractionary monetary policy.

We show that this employment reduction results from a relative decline in inflows rather than outflows. Inflows fall in particular for low-wage workers, whereas firms retain high-wage workers. Outflows for transitions to unemployment increase, while employment-to-employment outflows falls.

We interpret this as evidence for labor hoarding. Using variation in the bank exposure to monetary policy, we show that these results are driven by the exposure of the firm to the bank-lending channel.

This study examines the relationship between local income inequality and the centre bias.

We examine the relationship between local income inequality / local income levels on the one hand, and the “centre bias” on the other. The latter refers to people’s misconception of being in the middle of the national income distribution, rather than at its more extreme ends.

Local income distributions shape perceptions of inequality because co-residents are a reference group that affects the availability of opportunities for upward and downward social comparison. Theoretically, we outline four mechanisms that could link higher and lower local income inequality and income levels to residents' perceptions of their own relative income position (exposure vs. segregation, contrast vs. assimilation). Empirically, we link geo-referenced survey data to external datasets containing information on income inequality and income levels in respondents' home municipalities. Results suggest that higher local inequality is associated with a lower “centre bias” for both poor and rich respondents, supporting an “exposure” mechanism.

With respect to poorer versus richer municipalities, we find that only by tendency, either group estimates their position in the national income distribution to be somewhat higher. However, this evidence in favor of the “assimilation” mechanism is weak.

This study is about prevalence, perceived costs and consequences of sexual harassment (SH) in German workplaces.

We study the prevalence, perceived costs and consequences of sexual harassment (SH) in German workplaces. We first use a discrete choice experiment to estimate workers' willingness to pay (WTP) for workplaces without a history of known SH cases and preventive firm measures. Women, particularly early in their careers, display the highest WTP. Preventive measures significantly increase the attractiveness of workplaces, even when there is a history of SH.

Motivated by these results, we then document SH experiences using new data from the Linked Personnel Panel (LPP) and the IAB-OPAL online panel. SH is widespread: 20 percent of employees have either experienced SH at work personally or in their close work environment. Women are affected significantly more often than men. Women are also less likely to trust that leadership will respond appropriately to reported cases, and this lack of trust correlates with higher experienced incidence rates. Firms with active complaint procedures and preventive measures report greater employee awareness and more open discussion of SH. Taken together, our findings provide a strong economic rationale for preventive policies.

This study shows how costly is inflation to workers.

How costly is inflation to workers? Answers to this question have focused on the path of real wages during inflationary periods. We argue that workers must take costly actions (“conflict”) to have nominal wages catch up with inflation, meaning there are welfare costs even if real wages do not fall as inflation rises. We study a menu-cost style model, where workers choose whether to engage in conflict with employers to secure a wage increase. We show that, following a rise in inflation, wage catch-up resulting from more frequent conflict does not raise welfare. Instead, the impact of inflation on worker welfare is determined by what we call “wage erosion”—how inflation would lower real wages if workers’ conflict decisions did not respond to inflation.

As a result, using observed wage growth to measure worker welfare understates the costs of inflation. We conduct a survey showing that workers are willing to sacrifice 1.75% of their wages to avoid conflict. Calibrating the model to survey data, incorporating conflict significantly raises the costs of inflation for workers.

Find here draft of the working paper.

This study evaluates the Education Maintenance Allowance in England.

We evaluate the Education Maintenance Allowance, a large conditional cash transfer that paid teenagers from lower-income backgrounds up to $3,200 per year to remain in full-time education beyond the compulsory school-leaving age.

Exploiting the program's staggered rollout in England, we find that it increased education participation and reduced crime. However, we find no improvements in test scores, no effect on qualifications beyond the lowest level, and a small negative effect on labour market outcomes up to age 30. A key channel appears to be delayed labour market entry without offsetting gains in human capital.

This study shows us that the city-size wage premium is larger for low-skilled than for high-skilled workers in Peru.

We use individual geocoded data from Peru and document that the city-size wage premium is larger for low-skilled than for high-skilled workers, in contrast with most developed countries. We interpret this evidence using a model of location choice with private amenity goods and non-homothetic preferences.

Skilled workers enjoy higher incomes and devote a higher expenditure share to amenity goods, such as private schools or upper-class neighborhoods. The supply of these amenities is subject to a fixed cost, and only sufficiently large cities have enough demand to offer them. Thus, skilled workers demand a higher wage premium to live in small cities, and the returns to working in a large city are smaller for them than for their unskilled counterparts. Our quantitative exercises indicate that the mechanism accounts for two-thirds of the gap in the city-size wage premium between high-skilled and low-skilled workers.

joint with Andrii Parkhomenko and Daniel Velásquez-Cabrera

This study rationalizes intuition and evidence altogether using a nonsequential search model.

Employers hire more selectively between heterogeneous productivity workers when applicants' queues are longer. Consistently, CPS data reveal a positive and concave relation between unemployment rates and wage inequality.

We rationalize intuition and evidence altogether using a nonsequential search model in which selective hiring stretches out the right tail of the wage distribution and compresses the left one. Using GMM-estimated parameters, we show that mean worker productivity distribution shifts are consistent with the evidence.

Welfare analysis suggests that regressive taxation may enhance efficiency because expected good matches stimulate vacancies, creating a positive externality for other job seekers.

(joint work with Alessandra Pizzo)

This worksphop is about using Linked employer-employee data to study worker and firm heterogeneity in wages as well as the importance of labour market sorting.

Linked employer-employee data offer a wide range of possibilities for researchers. For example, this type of data is used to understand the role of worker and firm quality in the development of wage inequality, as for example in Card, Heining, Kline (2013). A widely used approach to identify worker and firm quality was developed by Abowd, Kramarz and Margolis (1999).

Since then, many researchers have used the AKM model to study worker and firm heterogeneity in wages, as well as the importance of labour market sorting. While the model continues to be heavily used until today, recent developments discuss potential biases and propose corrections (for example Abowd et al, 2004; Andrews et al, 2008, 2012; Kline, Saggio, Sølvsten 2020; Bonhomme et al, 2023). As with the first edition of the workshop that took place in 2023, the purpose of the second edition continues to be to bring together researchers working on or interested in topics related to worker and firm quality to discuss current work.

This study is about the Increase in Refugees to Germany by Using the German Socio-Economic Panel and local district-level administrative data.

In 2015–16, Germany experienced a rapid and controversial increase in refugees that varied substantially across German districts. This increase provides unique leverage for analyzing how fractionalization, threat, and contact shape the consequences of immigration and ethnolinguistic heterogeneity.

Using the German Socio-Economic Panel and local district-level administrative data on refugee shares, we innovatively focus on within-person/within-district change in six exclusionary beliefs and behaviors. We demonstrate a two-level cross-cutting process that integrates threat and contact theory but contradicts fractionalization theory.

As the refugee share increased nationally, concerns about immigration and Far Right party support increased. However, district-level refugee shares significantly reduced concerns about immigration and Far Right party support. Also, rising district-level refugee shares are not associated with concerns about social cohesion, trust, residential moves, and subjective fair tax rates. While districts with fewer refugees drove the national-level threat, rising district-level refugee shares reduced or did not heighten exclusionary beliefs and behaviors.