Youth unemployment has been a problem in Europe for several decades, but some European countries have fared much better than others in recent years. This column summarises the policy lessons to be drawn from a new VoxEU.org eBook that compares the labour market experiences of different European countries and provides an early evaluation of the European Commission’s Youth Guarantee scheme.
Juan Dolado, Monday, February 9, 2015
Manudeep Bhuller, Magne Mogstad, Kjell G. Salvanes, Monday, September 22, 2014
The impact of education on earnings over the life cycle is a critical factor for policy decisions ranging from education to taxation and pensions. This column exploits a unique Norwegian population panel data set to estimate an internal rate of return to additional schooling of about 10%. The standard Mincer-regression approach is also shown to substantially underestimate schooling’s rate of return.
Peter Cappelli, Sunday, September 21, 2014
Many high-paying jobs in the US cannot be filled, raising concerns about an existing skills gap. However, this column does not find evidence in support of serious skills gap or shortages in the US labour force. Similarly to other developed economies, the prevailing situation in the US is due to skill mismatches. This could have implications for students and their tuition-paying families.
Michele Battisti, Gabriel Felbermayr, Giovanni Peri, Panu Poutvaara, Friday, August 8, 2014
Immigration continues to be a hotly debated topic in most OECD countries. Economic models emphasising the benefits of immigration for natives have typically neglected unemployment and redistribution – precisely the things voters are most concerned about. This column analyses the effects of immigration in a world with labour market rigidities and income redistribution. In two-thirds of the 20 countries analysed, both high-skilled and low-skilled natives would benefit from a small increase in immigration from current levels. The average welfare gains from immigration are 1.25% and 1.00% for high- and low-skilled natives, respectively.
Alex Edmans, Friday, July 25, 2014
Happy workers might well be more productive than unhappy ones, but high worker satisfaction could also be a sign that workers are overpaid or underworked. This column examines the link between worker satisfaction and future stock returns in 14 countries. In most but not all countries, employee satisfaction is associated with higher future stock returns. Abnormal returns to companies with high worker satisfaction are significantly increasing in the flexibility of their countries’ labour markets.
David Autor, Friday, May 2, 2014
David Autor talks to Viv Davies about his recent research that analyses the differential effects of trade and technology on employment patterns in US local labour markets between 1990 and 2007. While the effect of trade competition is growing over time, the effect of technology has shifted from automation of production activities in the manufacturing sector towards computerisation of information-processing tasks in the service sector. The interview was recorded in April 2014 at the annual conference of the Royal Economic Society.
Pierre Brochu, David A Green, Wednesday, January 22, 2014
Economic research finds little evidence in support of the hypothesis that an increase in minimum wages significantly affects employment – either positively or negatively. This column discusses a study of the impact of minimum-wage changes on turnover rates. Minimum-wage increases are associated with a lower probability that a job will end, and with a lower probability that an unemployed person will find work. The former effect is established only for newly hired workers. Increases in the minimum wages are also associated with more stable jobs for all low educated workers. Thus, the trade-off between fewer jobs with higher wages and more job stability versus easier access to jobs should be taken into account in the minimum-wage policy debates.
Bob Butcher, Tuesday, December 17, 2013
The labour market ‘hollowing out’ thesis suggests that there are far fewer intermediate-level jobs and far more low- and high-level jobs than two or three decades ago, primarily due to technological advancement. This column reviews recent research that finds little evidence in support of this conclusion. Though the composition of intermediate-level jobs has changed, their volume has probably not. Policy implications for specific groups of job seekers are discussed.
Bernhard Dachs, Bernd Ebersberger, Steffen Kinkel, Oliver Som, Saturday, September 7, 2013
European offshoring mostly concerns factory jobs, but some worry that innovation will soon follow. This column shows that offshoring firms employ more people in R&D and design, introduce more frequently new products, and invest more frequently in advanced process technologies compared to non-offshoring firms. Concerns that offshoring may hurt innovation because of the lost links between production and product development are not supported by the evidence.
Luis Garicano, John Van Reenen, Thursday, May 30, 2013
France has a raft of labour-market regulations that kick in for firms with 50 workers or more. This column uses this threshold to identify the economic effects of size-contingent regulations. Such policies seem to subsidise small firms at the expense of larger firms. But since small firms are on average less productive than large firms, the French economy loses out.
Danielken Molina, Marc Muendler, Monday, May 27, 2013
Exporting is essential for economic development. But can firms move from local sales to export sales? How do firms prepare for exporting? This column presents new research showing that worker mobility is an important mechanism by which exporter knowledge spreads through the economy.
Richard Dobbs, Anu Madgavkar, Wednesday, September 19, 2012
Unemployment in the US and UK is over 8% and in many Eurozone countries is far higher. This column argues that we can’t just blame the recession – this is also symptomatic of long-term trends that, without a concerted effort by policymakers, will continue to stunt growth, deepen income inequality, weigh on public budgets, and cause living standards in many countries to stagnate.
Johann Custodis, Tuesday, September 18, 2012
There were 35 million prisoners of war in WWII. This column presents new research on the use of their labour in Nazi Germany, quantifying the economic impact on the Nazi wartime economy.
Federico Etro, Friday, December 23, 2011
To some, the world of art and world of economics are diametrically opposed. To others, such as the author of this column, they are part of the same. This column looks at the wages of painters during the 17th century Baroque art movement and asks what insights it can provide for art lovers, economists, and those who consider themselves both.
Sascha O Becker, Marion Jansen, Marc Muendler, Saturday, October 1, 2011
As jobs losses continue to haunt the headlines, people are left asking if long-term unemployment is to be one of the so-called benefits from globalisation. This column reports on a conference aimed at understanding how globalisation can be made to work for workers.
Marga Peeters, Loek Groot, Tuesday, August 2, 2011
Fiscal pressure from demographic changes is mounting across the globe. This column asks whether labour markets will create enough jobs. Cross-country comparisons suggest that, until at least 2050, the countries most under pressure will be Poland, Turkey, and Greece.
Patrick Gaulé, Tuesday, December 14, 2010
Brain drain can be a good thing for the source country; one benefit is that some skilled workers eventually return. Unfortunately, there is little evidence on the incidence and nature of such return migration. This column presents new data on the return-migration decisions of foreign faculty based in US chemistry departments.
Federico Etro, Thursday, November 4, 2010
Looking at the contracts for large oil paintings in Italy (1550-1750), this column finds evidence of strong competition between painters. Contracts were structured to address moral hazard problems, and prices closely reflected demand and supply conditions in an integrated market.
Francesco D'Amuri, Giovanni Peri, Sunday, October 31, 2010
Several studies find that immigrants do not harm the wages and job prospects of native workers. This column seeks to explain these somewhat counterintuitive findings by emphasizing the scope for complementarities between foreign-born and native workers. Examining 14 European countries from 1996 to 2007, it finds that immigrants often supply manual skills, leaving native workers to take up jobs that require more complex skills – even boosting demand for them. Immigrants replace “tasks”, not workers.
Christopher Cotton, Frank McIntyre, Joseph Price, Thursday, October 21, 2010
Around the world, the pay and achievement gap between men and women remains significant, as shown by last week’s Global Gender Gap Report. This column explores whether this gap can be explained by attitudes towards competition. Using experimental evidence from math quiz competitions in primary schools, it finds that while males respond better to competition initially, this advantage is short-lived, as females are just as responsive over time.