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Archives: IAB-Veranstaltungen

The Covid crisis revived the interest in the topic of short-time work (sometimes also known as furlough schemes or work sharing). In many countries, the schemes were utilised in unprecendented ways. The Institute for Employment Research organises a one-day online workshop on May 13, 2022 that focuses on current research on short-time work. Contributions may address the Covid crisis or previous economic crises. Both theoretical and applied papers with both micro- and macroeconomic approaches are welcome.

The workshop provides the opportunity for timely exchange on cutting-edge research on a specific topic. Presentations and discussions should spur the debate on usage, effects and design of a crucial labour market instrument.

COVID-19 drove a mass social experiment in working from home (WFH). We survey more than 30,000 Americans over multiple waves to investigate whether WFH will stick, and why. Our data say that 20 percent of full workdays will be supplied from home after the pandemic ends, compared with just 5 percent before. We develop evidence on five reasons for this large shift: better-than-expected WFH experiences, new investments in physical and human capital that enable WFH, greatly diminished stigma associated with WFH, lingering concerns about crowds and contagion risks, and a pandemic-driven surge in technological innovations that support WFH. We also use our survey data to project three consequences: First, employees will enjoy large benefits from greater remote work, especially those with higher earnings. Second, the shift to WFH will directly reduce spending in major city centers by at least 5-10 percent relative to the pre-pandemic situation. Third, our data on employer plans and the relative productivity of WFH imply a 5 percent productivity boost in the post-pandemic economy due to re-optimized working arrangements. Only one-fifth of this productivity gain will show up in conventional productivity measures, because they do not capture the time savings from less commuting.

We investigate the role of information frictions in the US labor market using a new nationally representative panel dataset on individuals' labor market expectations and realizations. We find that expectations about future job offers are, on average, highly predictive of actual outcomes. Despite their predictive power, however, deviations of ex post realizations from ex ante expectations are often sizable. The panel aspect of the data allows us to study how individuals update their labor market expectations in response to such shocks. We find a strong response: an individual who receives a job offer one dollar above her expectation subsequently adjusts her expectations upward by $0.47. We embed the empirical evidence on expectations and learning into a model of search on- and off- the job with learning, and show that it is far better able to fit the data on reservation wages relative to a model that assumes complete information. We use the framework to gauge the welfare costs of information frictions which arise because individuals make uninformed job acceptance decisions and find that the costs due to information frictions are sizable, but mitigated by the presence of learning.

Social science research demonstrates that dispersal policies and restrictions on the freedom of residence have inhibited refugees’ socio-economic integration, presumably because such policies prevent refugees from moving to places where they can employ their skills most fruitfully. However, studies of refugees’ actual residential choices provide little evidence that good economic prospects attract refugees, and some even suggest that refugees often move to deprived cities with frail labor markets. The combination of negative effects of residence restrictions and emerging evidence of disadvantaging secondary migration forms what we call the ‘refugee mobility puzzle’. In this study, we aim at unpacking this puzzle by analyzing the inner-German migration patterns of recent refugees. Specifically, we ask: What attracts refugees to deprived areas, and can their seemingly unfortunate residential choices be understood as moves to opportunity and increased prospects of labor market integration after all? Empirically, we draw on the IAB-BAMF-SOEP Survey of Refugees and track the location of more than 2,000 refugee respondents who were exogenously allocated a place of residence and subsequently became free to move. Based on linear-probability discrete choice models across all German counties and postcodes, we confirm that refugees tend to move to areas with high unemployment. We show that major attractors like housing availability, co-ethnic networks, and service-oriented labor markets are clustered in areas with high unemployment. Taken together, our results complicate recent critiques of dispersal policies and restrictions. On the one hand, our findings show that seemingly disadvantaging relocations into high unemployment areas can conceal potentially improved economic perspectives in relevant labor markets. On the other hand, refugees’ search for affordable housing may turn into an unintended lock-in factor in the mid- and long-run.

This paper studies the interplay between how much workers value workplace flexibility, whether they have such amenities, and how the presence of amenities affects their wages. To overcome the challenge of eliciting quantitative measures of willingness to pay (WTP) at the individual level, we propose the use of dynamic choice experiments, a method which we call the Bayesian Adaptive Choice Experiment (BACE). We implement this method to collect data on the joint distribution of wages, work arrangements, and WTP for different forms of flexibility. We then introduce and estimate a model in which workers may face different prices for job amenities depending on their productivity, extending the Rosen (1986) model of compensating differentials. The model captures key patterns in the data, including (i) the relationship between wages and having amenities, (ii) inequality in workplace amenities across the earnings distribution even when workers value these amenities similarly, and (iii) the tradeoffs across different forms of flexibility. We use the estimates to explore the welfare consequences of workers facing different amenity prices.

Social disparities in track choices are a well-known mechanism for the intergenerational reproduction of inequality. School guidance may help reducing such disparities by narrowing information gaps and by reducing the family influence on students’ decision making. We investigate the potential equalizing role of guidance programs by analysing an intervention carried out in Italy, where students are tracked at age 14 and teacher recommendations are non-binding. The intervention took place in 2018 in the city of Turin and involved 40% of all eighth-grade students, shortly before their transition from comprehensive to tracked education. The students attended four two-hour sessions designed to provide them with information about the educational system and related job market opportunities, and to raise their awareness of their aptitudes and inclinations. We expected the programme to be of particular benefit to low socio-economic status (SES) and migrant students and thus to reduce social gaps in track choices. We adopted a mixed-method research design: with quantitative analyses based on a combination of propensity-score-matching and differences-in-differences techniques, we compared the outcomes of comparable students from the 2017 and 2018 cohorts who were or were not exposed to the intervention in order to assess its impact on inequality; additionally, we use qualitative non-participatory observation to unveil the actual content and implementation of the program and the behaviour of the key actors. We find that while the program contributed to reducing indecision, probably by compelling students to reflect more carefully about their decisions during this crucial transition, it did not have any major effect on social inequalities. Results from the qualitative analysis help us shed light on the mechanisms at play behind this lack of effect. In particular, the heavy emphasis placed on current achievement records, dropout risks, and (short-term) labour-market outcomes may counteract the equalizing potential of the program by pushing low-SES and migrant students towards vocational tracks.

We use French data over the 1994-2013 period to study how imports of industrial robots affect firm-level outcomes. Guided by a simple model, we develop various empirical strategies to identify the causal effects of robot adoption. Our results suggest that, while demand shocks generate a positive correlation between robot imports and employment at the firm level, exogenous exposure to automation leads to job losses. We also find that robot exposure increases productivity and some evidence that it may increase the relative demand for high-skill professions.

We analyze the effects of large-scale local public infrastructure investments on economic development, exploiting the infrastructure shock following when Brazil was awarded the 2014 FIFA World Cup. We place particular emphasis on effect heterogeneity with respect to the type, location, temporal evolution, and costs and benefits of the investments. Using novel data on monthly night light luminosity at the municipal district level as a proxy for economic activity, we apply Difference-in-Differences and event studies for estimation. Overall, we find strongly positive impacts both in the short and longer run. However, a closer examination reveals that effects are larger and longer-lasting for transport infrastructure as opposed to sports infrastructure, and they are more pronounced in smaller areas. Importantly, we quantify significant negative spatial spillovers. Factoring them in, we still find positive net benefits of transport infrastructure investments two years after the tournament.

While many countries are discussing substantial increases in the minimum wage, policy makers lack a comprehensive analysis of the macroeconomic and distributional consequences of raising the minimum wage. This paper investigates how employment, output and worker welfare respond to increases in the minimum wage beyond observable levels -- both in the short- and long run. To that end, I incorporate endogenous job search effort, differences in employment levels, and a progressive tax-transfer system into a search-matching model with worker and firm heterogeneity. I estimate my model using German administrative and survey data. The model replicates the muted employment response, as well as the reallocation effects in terms of productivity and employment levels documented by reduced form research on the German introduction of a federal minimum wage in 2015.  Simulating the model, I find that long-run employment increases slightly until the minimum wage is equal to 60% of the full-time median wage (Kaitz index) as higher search effort offsets lower vacancy posting. In addition, raising the minimum wage reallocates workers towards full-time jobs and high-productivity firms. Total hours worked and output peak at Kaitz indices of 73% and 79%. However, policy makers face an important inter-temporal trade-off as large minimum wage hikes lead to substantial job destruction, unemployment and recessions in the short-run. Finally, I show that raising the minimum wage largely benefits men. For women, who often rely on low-hours jobs, the disutility from working longer hours outweighs the utility of higher incomes.

The presentation offers an overview about the new data service of the Research Data Centre of the Federal Office for Migration and Refugees (BAMF-FDZ). The BAMF-FDZ gives access to register and survey data for migration and integration research. The presentation will introduce the available and future data sets and discuss advantages and limitations. In addition, the application procedure is also explained.