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Veranstaltungsreihe: Macroeconomics and Labor Markets (en)

This paper studies the role of wages and job benefits in job search behavior. We use wage and benefit data from a market-leading employer review platform and run a large-scale randomized control trial on an online job board to estimate the elasticity of job seekers' applications to posted wages and their willingness to pay for job benefits. A 10% higher wage increases job seekers' probability to view and apply to an ad by 3-5%. Many job benefits are highly valued by job seekers: Home office and company cars are valued at around 15 percent of wages, company-provided child care at 10 percent and and parking spots at around 7 percent of wages. The average vacancy offers job benefits worth 25 percent of wages. We further document that higher-paying firms typically offer more amenities. Taking the distribution and valuation of job benefits into account, we show that job value inequality is significantly higher than wage inequality. 

Legal rights continue to differ between women and men, particularly in developing countries. In this paper, we examine whether economic integration can improve gender equality by the law during working life. We design a novel instrumental variable strategy based on regional waves of globalization, which serve as strong exogenous predictors of national globalization trends. Our main estimate suggests that an increase in globalization by one relative standard deviation, equivalent to a permanent transition from Indonesia to the United States, is associated with an 12.1% increase in gender equality, measured by the extent to which men and women are treated equally by law. We also find that this effect is almost entirely driven by de facto globalization. Linking globalization to more than 300,000 individuals from over 100 countries, we provide evidence for a microfoundation of the macroeconomic effects.

This seminar is about understanding how individuals form expectations about future wages.

Understanding how individuals form expectations about future wages and how these prospects evolve over time is crucial for assessing the acceptability of existing wage disparities. Providing a novel metric of wage prospects, we propose using probit regressions to assess individual ex-ante expectations of earning a wage from a specific quintile of the wage distribution and relate these estimates to realized (i.e., ex-post) wage outcomes.

Utilizing a large dataset of almost 250,000 observations from the German Socio-Economic Panel, covering the period from 1992 to 2020, our study reveals strong segmentations in the German labor market by gender and region, with women and East German workers more likely to earn lower wages. The 2003-2005 labor market reforms increased the probability of earning lower wages overall but slightly reduced gender and regional segmentation. For the bottom income quintiles, the reforms worsened wage prospects, particularly affecting part-time workers, minijobbers, and workers in West Germany.

Conversely, higher income earners saw improved wage prospects post-reforms. Finally, the new measure of wage prospects is predictive of actual wage transitions and exhibits theory-conform correlation with life satisfaction, which underscores its importance for understanding individual fairness considerations.

This paper quantifies the share of dismissals distorted by conflict and identifies the drivers.

Dismissal costs are shaped by firm and worker behavior. While they might coordinate to minimize costs, adversarial separations may also entail cost-seeking actions ("conflict").

This paper quantifies the share of dismissals distorted by conflict and identifies the drivers. Our strategy exploits the choice between two modes of separation in France: personal dismissals and ''separations by mutual agreement'' (SMAs). Since SMAs waive dismissal red tape costs and enable severance pay bargaining, they should always be preferred to dismissals in an efficient bargaining model. In contrast, we find that only 12% of potential dismissals are resolved through SMAs. We then identify the sources of conflict that lead to the choice of the costlier separation mode in 88% of dismissals.

Our survey of HR directors reveals three crucial drivers, which account for 63% of the failures to convert dismissals into SMAs: (i) hostility between the employer and the employee, (ii) employers using dismissals as a discipline device, and (iii) asymmetric beliefs about labor court outcomes following a dismissal.

The effectiveness of the minimum wage on gender wage differences is examined.

With its introduction in 2015, the national minimum wage intends to benefit primarily low-wage workers in Germany. I examine the effectiveness of the minimum wage on gender wage gaps of full-time workers among the lower half of the wage distribution. Using administrative data, distinct regional differences in the extent of wage differentials and responses to the minimum wage occur. Overall, wage gaps between men and women at the 10th percentile decrease by 2.46 and 6.34 percentage points in the West and East of Germany after 2015. Applying counterfactual wage distributions, I provide new evidence that the introduction of the minimum wage decreases wage differentials by 60% to 95%. Group-specific analyses show various responses on the basis of age, educational level and occupational activity. Counterfactual aggregate Oaxaca-Blinder decompositions indicate a decrease in discriminatory remuneration structures in the West of Germany resulting from the introduced minimum wage.

The authors use employer-employee data to follow US workers' long-run employment flows and earnings after trade liberalization with China.

We use employer-employee data to follow US workers' long-run employment flows and earnings after trade liberalization with China. We find that manufacturing workers in more exposed counties flow disproportionately into low-skill services such as retail and temp agencies, and are more likely to exhibit nominal wage declines after seven years. Formal difference-in-differences analysis reveals that exposure to this shock operates predominantly through workers' local labor market versus industry, that greater upstream exposure via suppliers can offset the adverse impact of own and downstream exposure, and that workers initially employed outside manufacturing generally exhibit relative earnings growth as a result of the liberalization.

This paper studies the allocation of time among workers across jobs that vary in their remote intensity.

The proportion of employees who work remotely has surged from under 5% to over 60% between January to March 2020, converging to roughly 28% of days working from home versus in the office as of 2023. Motivated by these large structural shifts in the nature of work, this paper studies the allocation of time among workers across jobs that vary in their remote intensity. Drawing on the American Time Use Survey between 2019 and 2022, I document three main results. First, time allocated to leisure increased and to work decreased among more remote jobs with no significant change in home production. Second, these changes were concentrated among males, singles, and those without children. Third, these declines in labor supply cannot explain the recent decline in productivity; in contrast, sectors with greater remote work intensity exhibited greater productivity growth. In addition, I will also present results from a complementary paper that draws on employee engagement and labor market data from over 70,000 workers. While there is a positive association between always WFH and satisfaction, it vanishes after controlling for employee compensation, occupation, demographics, and workplace environment characteristics (e.g., feeling appreciated at work). Employees who always WFH also have a higher intention to leave their job than employees who never work from home. In contrast, less frequent WFH arrangements relate to higher satisfaction but no difference in intention to leave, and their impact is limited relative to workplace environment characteristics.

Using French administrative data we estimate the wage gap distribution between in-house and temporary agency workers.

Using French administrative data we estimate the wage gap distribution between in-house and temporary agency workers working in the same establishment and the same occupation. The average wage gap is about 3%, but the gap is negative in more than 25% of establishment × occupation cells. We develop and estimate a search and matching model which shows that the wage gap depends on the cost of job vacancies, on labor market frictions and on the labor management costs of temporary agencies for temp workers and user firms for in-house workers. Only a portion of the wage gap is efficient. A simple formula allows for estimating the taxes and subsidies that eliminate its inefficient component.

On the labour markets, the last decades were characterised by structural supply-side reforms in many countries.

On the labour markets, the last decades were characterised by structural supply-side reforms in many countries. Following its hawkish reforms from the 2000s, recently, Germany made a dovish turnaround. Conditions in basic income support for unemployed became more generous. Before, a sanctions moratorium was applied. We analyse the consequences for job findings. Building on large administrative data, we use a labour market matching and a control group approach. The moratorium dampened job findings by more than seven percent and the subsequent benefit reform by more than six percent – about half of the positive effect of the 2000s reform.

We theoretically and empirically examine how firms’ choices of wage-setting protocols respond to labor market conditions.

We theoretically and empirically examine how firms’ choices of wage-setting protocols respond to labor market conditions. We develop a simple model in which workers may be able to send multiple job applications and firms choose between posting wages and Nash bargaining. Posting a wage allows the firm to commit to lower wages than would be negotiated ex post, but eliminates the ability to respond to a competing offer, should the worker have one. We show that higher productivity lowers both the application-vacancy ratio and the fraction of firms posting a wage. On the other hand, an increase in the number of applications per worker raises the application-vacancy ratio while lowering the fraction of firms posting a wage. As a result, the equilibrium fraction of firms posting a wage may be positively or negatively correlated with the application-vacancy ratio, depending on the source of shocks. The model also implies that an increase in the number of applications per worker may lead to a decrease in the number of posting firms rather than a change in the wages posted by those firms. Empirically, we demonstrate that the model’s predictions are confirmed in a novel dataset from an online job board.