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1. Job Search and Hiring with Two-Sided Limited Information about Workseekers' Skills

Author:
Eliana Carranza, Robert Garlick, Kate Orkin, and Neil Rankin
Publication Date:
07-2020
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
This paper presents field experimental evidence that limited information about workseekers’ skills distorts both firm and workseeker behavior. Assessing workseekers’ skills, giving workseekers their assessment results, and helping them to credibly share the results with firms increases workseekers’ employment and earnings. It also aligns their beliefs and search strategies more closely with their skills. Giving assessment results only to workseekers has similar effects on beliefs and search, but smaller effects on employment and earnings. Giving assessment results only to firms increases callbacks. These patterns are consistent with two-sided information frictions, a new finding that can inform the design of information-provision mechanisms.
Topic:
Labor Issues, Employment, Business, and Job Creation
Political Geography:
Global Focus

2. Labor force participation, job search effort and unemployment insurance in the laboratory

Author:
Wolfgang Lechthaler and Patrick Ring
Publication Date:
03-2020
Content Type:
Working Paper
Institution:
Kiel Institute for the World Economy (IfW)
Abstract:
How the provision of unemployment benefits affects employment and unemployment is a debated issue. In this paper, we aim at complementing theoretical and empirical contributions to this debate with a laboratory experiment: We simulate a job market with search effort and labor force participation decisions while varying the maximum length of unemployment benefit eligibility. Our results reveal two separable, opposing effects: Individuals within the labor force search with lower effort when unemployment benefits are extended. However, individuals are more likely to participate in the labor force and to actively search for a job. Concerning employment, the second effect dominates so that unemployment benefits raise employment.
Topic:
Economics, International Political Economy, Markets, Labor Issues, Employment, Unemployment, and Job Creation
Political Geography:
Global Focus

3. Jobs’ Amenability to Working from Home: Evidence from Skills Surveys for 53 Countries

Author:
Maho Hatayama, Mariana Viollaz, and Hernan Winkler
Publication Date:
05-2020
Content Type:
Working Paper
Institution:
Center for Distributive, Labor and Social Studies (CEDLAS)
Abstract:
The spread of COVID-19 and implementation of “social distancing” policies around the world have raised the question of how many jobs can be done at home. This paper uses skills surveys from 53 countries at varying levels of economic development to estimate jobs’ amenability to working from home. The paper considers jobs’ characteristics and uses internet access at home as an important determinant of working from home. The findings indicate that the amenability of jobs to working from home increases with the level of economic development of the country. This is driven by jobs in poor countries being more intensive in physical/manual tasks, using less information and communications technology, and having poorer internet connectivity at home. Women, college graduates, and salaried and formal workers have jobs that are more amenable to working from home than the average worker. The opposite holds for workers in hotels and restaurants, construction, agriculture, and commerce. The paper finds that the crisis may exacerbate inequities between and within countries. It also finds that occupations explain less than half of the variability in the working-from-home indexes within countries, which highlights the importance of using individual-level data to assess jobs’ amenability to working from home.
Topic:
Employment, Pandemic, Job Creation, COVID-19, and Hospitality
Political Geography:
Global Focus

4. Automation and a Changing Economy: Policies for Shared Prosperity

Author:
Alastair Fitzpayne, Conor Mckay, and Ethan Pollack
Publication Date:
04-2019
Content Type:
Working Paper
Institution:
Aspen Institute
Abstract:
Part I of this report, Automation and a Changing Economy: The Case for Action, explores how automation has impacted and will continue to impact the economic security and opportunity of the American worker. But technology is not destiny. The impact of innovation on the American worker is mediated by policies and institutions. We can choose to create an economy that: promotes technological progress; prepares workers to take advantage of the opportunities technology presents; supports those who are negatively impacted by automation return to stable work; and shares technology’s gains more broadly. These goals are achievable with the right support, but the policy structures currently in place are inadequate. This part of the report, Automation and a Changing Economy: Policies for Shared Prosperity, outlines a policy agenda for addressing these challenges and opportunities. Doing so requires an all-of-the-above approach, from targeted, specialized interventions to those with systems-level impact; from place-based policies to national-level reforms to safety net programs. The paper identifies four objectives that guide its recommendations
Topic:
Science and Technology, Labor Issues, Automation, and Job Creation
Political Geography:
Global Focus

5. Automation and a Changing Economy: The Case for Action

Author:
Alastair Fitzpayne, Conor Mckay, and Ethan Pollack
Publication Date:
04-2019
Content Type:
Working Paper
Institution:
Aspen Institute
Abstract:
Technology fuels our economy, captures our collective imaginations, and promises extraordinary possibilities. It permeates almost all aspects of our lives. From electrification and the internal combustion engine, to search engines and smartphones, technology has changed how we travel, access information, buy products, and communicate with each other. As technology changes our personal lives, it also changes work. For generations, economic change has replaced products, jobs, and industries with innovative new models. The American economy has transitioned from agrarian to industrial, service to digital, and with each evolution, America has prospered even as it grappled with the profound challenges of change. The American ideal embraces the promise that economic progress can create an inclusive society in which prosperity is broadly shared. Work is more than simply a way to earn a living. It gives structure, dignity, and purpose to our lives. For this reason, workers should not be treated as a cost of doing business but recognized for their productivity and creativity. For too many Americans, the promise of work is not being kept. New technologies are creating great wealth for some, but we are simultaneously experiencing historic income and wealth inequality. Without robust policies and strong institutions, new innovations risk exacerbating the economic insecurity and political and civil divides that we are experiencing today. Emerging technologies, including artificial intelligence, machine learning, and advanced robotics, have the potential to automate many tasks currently performed by workers. Historically, automation has been an important ingredient driving economic growth and progress. Automation has enabled us to feed a growing population while allowing workers to transition from subsistence farming to new forms of work. Automation helped move us from a craft system to mass production, from blue-collar to white-collar to “new-collar” work—with better work, higher wages, more jobs, and better living standards. Similar to past innovations, these new technologies offer the potential to help us meet human needs while supporting new jobs and industries never before imagined. However, automation can also have negative effects on individuals and communities. Those who lose their jobs suffer economic, social, and psychological hardship. Communities that relied on single industries that have been automated have struggled to recover. New jobs are being created, but their geographic distribution and skill requirements often make them inaccessible to the individuals and the communities where those whose jobs were lost. This dislocation has played a role in exacerbating America’s economic, political, geographic, and social divides. The answer to the dislocations that can result from automation should not be to stifle innovation. Policies and reforms should encourage both the development of new technologies and the promise of work. Workers need access to the opportunities technology creates. Policymakers and employers can help by providing access to skills training, ensuring the availability of good jobs, and improving the systems that are in place to help those who will transition from declining to growing occupations. While there are many unanswered questions about what the future holds, this report attempts to explain how automation impacts the labor market and how to better prepare American workers to benefit from the changes to come.
Topic:
Economics, Science and Technology, Labor Issues, Automation, and Job Creation
Political Geography:
Global Focus

6. Full Employment, Open Economy Macroeconomics, and Keynes’ General Theory: Does the Swan Diagram Suffice?

Author:
Paul Davidson
Publication Date:
02-2016
Content Type:
Working Paper
Institution:
Institute for New Economic Thinking (INET)
Abstract:
This paper provides critical comments on the Peter Temin - David Vines promotion of the basic Swan Diagram as (1) a policy tool to encourage any individual debtor nation experiencing balance of payment deficits to reduce its exchange rate in order to expand exports and reduce imports and (2) the Swan Diagram as a simple model for understanding Keynes’s General Theory for an Open Economy. This paper explains that the Swan Diagram is completely incompatible with Keynes’s analysis. Instead Keynes advocated that the onus should be placed on creditor nations to correct international payments imbalances and thereby promote economic expansion internationally. Keynes warned against any deficit nation adopting a policy that tries to achieve a balance in its international payments by following any policy designed to reduce imports and increase exports. Such a policy sends a contractionary force onto the international economy and tends to injure all trading partners.
Topic:
Economics, Employment, Economic Theory, Macroeconomics, Unemployment, and Job Creation
Political Geography:
Global Focus

7. Discrimination, Social Identity, and Coordination: An Experiment

Author:
Vessela Daskalova
Publication Date:
04-2015
Content Type:
Working Paper
Institution:
Institute for New Economic Thinking (INET)
Abstract:
This paper presents an experiment investigating the effect of social identity on hiring decisions. The question is whether people discriminate between own and other group candidate This paper presents an experiment investigating the effect of social identity on hiring decisions. The question is whether people discriminate between own and other group candidates. Key features of the experiment are: First, to consider whether they do so in individual, as well as in joint decisions; Second, to document whether the identity of the co‐decision maker matters in joint decisions. Substantial discrimination occurs in both individual and joint decision‐making situations. In joint decisions, decision makers discriminate when deciding with someone from their own group, but not when deciding with someone from the other group.
Topic:
Economics, Race, Employment, Inequality, Discrimination, Job Creation, Social Order, and Identity
Political Geography:
Global Focus

8. The Cyclicality of Job-to-Job Transitions and Its Implications for Aggregate Productivity

Author:
Toshihiko Mukoyama
Publication Date:
02-2013
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
This paper analyzes the job-to-job transitions of workers in the United States. I propose a new method of correcting the time-aggregation bias. The bias-corrected series from 1996 to 2011 reveals a procyclical pattern of job-to-job transition and a large decline since the beginning of the 2000s. I construct a model of on-the-job search and explore the implications of this phenomenon. The calibrated model shows that the decline in the reallocation of workers through job-to-job transitions has had a substantial effect on total factor productivity (TFP). From 2009 to 2011, the model accounts for about 0.5%-0.7% annual decline in TFP.
Topic:
Employment, Job Creation, Labor Market, and Productivity
Political Geography:
Global Focus

9. Unemployment and Business Cycles

Author:
Lawrence J. Christiano, Martin Eichenbaum, and Mathias Trabandt
Publication Date:
09-2013
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
We develop and estimate a general equilibrium model that accounts for key business cycle properties of macroeconomic aggregates, including labor market variables. In sharp contrast to leading New Keynesian models, wages are not subject to exogenous nominal rigidities. Instead we derive wage inertia from our specification of how firms and workers interact when negotiating wages. Our model outperforms the standard Diamond-Mortensen-Pissarides model both statistically and in terms of the plausibility of the estimated structural parameter values. Our model also outperforms an estimated sticky wage model.
Topic:
Labor Issues, Employment, Business, Economic Theory, Unemployment, and Job Creation
Political Geography:
Global Focus