Abstract Work-leisure balances are beneficial to society. A partial equilibrium job search model is developed to explain desired work-leisure tradeoffs for single-job holders and multiple-job holders. Significant work-leisure mismatches are found: 63% of the observations underwork by an average of 17 hours per week, while 37% overwork by 8.5 hours. The value of leisure is approximately four times the average hourly real wage when a single job is held, and it drops by one-third when multiple jobs are held. Models ignoring possibilities of multiple jobholding overstate the elasticity of leisure and understate the value of leisure.

Abstract Districts are investing more in school leadership, including the implementation of residency training programs for aspiring principals. There is limited evidence about the district return on these investments, and none in the context in which principal hiring is decentralized at the school level. This paper develops a model highlighting the conditions under which districts benefit from investments in general leadership skills and examines the residency program in the Chicago Public Schools (CPS). The event-study analysis that addresses treatment effect heterogeneity finds that principals who complete a residency are significantly more effective at raising achievement. Although the leadership skills gained through the residency are likely to make a principal more valuable to districts outside of CPS, the large majority of residents remain in CPS despite the absence of salary premia for completion of a residency or high performance. These findings suggest the presence of transition costs that enable CPS to retain more effective, residency-trained principals without having to increase pay, thereby realizing some of the return on the investment in general skills.

Abstract This paper uses data from the Panel Study of Income Dynamics to study the relationship between job displacement and substance use among young adults. Results show that displacement is associated with increases in the probability of smoking cigarettes and drinking and the intensity of consuming alcohol and marijuana. Men, whites, and those who live with family/friends at the time of displacement are more likely to use hard drugs after job loss. Findings suggest that government policy designed to aid displaced workers should contain provisions to anticipate and respond to substance use disorders that may arise, particularly among younger job losers.

Abstract Using high-frequency Italian administrative data, the author studies the heterogeneous effects of a reform raising the normal retirement age (NRA) from 60 years to 65 years for private-sector male employees. The analysis, based on a difference-in-differences (DD) method, shows that the NRA raise reduces pension benefit claims but does not lead to a one-to-one increase in the employment rate since workers also apply for more disability and unemployment benefits. Moreover, most of them simply retire without any benefit. The extent of the effects varies substantially across socio-economic groups, as individuals with poorer health, with lower occupational grades and lower pay levels are the most constrained by the reform, experiencing the highest delay in pension claims, increase in employment, and inactivity. All in all, this paper shows that raising the NRA could have unintended effects as it affects more negatively the most vulnerable in the labor market.

Abstract In many countries, labor courts play a central role in the determination of firing costs by monitoring and supervising the procedures for dismissals, and, eventually, deciding severance payments mandated by the employment protection legislation (EPL). To get some insights about the impact of labor courts on effective firing costs, we explore a new database that contains information on labor courts’ intervention in firings before and after the implementation of significant EPL reforms modifying severance payments and procedures for dismissals. Our results suggest that labor court rulings on economic dismissals did not fully translate the reduction of firing costs mandated by the new EPL to effective firing costs.

Abstract Aggregate wages display little cyclicality compared to what a standard model would predict. Wage rigidities are an obvious candidate, but the existing literature has emphasized the need to take into account the growing importance of worker composition effects, especially during downturns. This paper seeks to understand the role of firm heterogeneity for aggregate wage dynamics with reference to the Italian case. Using a newly available dataset based on social security records covering the universe of Italian employers between 1990 and 2015, we document that firm composition effects increasingly matter in explaining aggregate wage growth and largely reflect shifts of labor from low-paying to high-paying firms, especially in the most recent years. We find that changes in reallocation of workers across firms accounted for approximately one-fourth of aggregate wage growth during the crisis.

Estimates of the Okun coefficient are made for Australian workers grouped by age and gender using an unobserved components model. By analogy we define and estimate a participation coefficient which measures the cyclical response of the labour force participation rate to cyclical output shocks. The trend and cycle decomposition methodology used here leads to higher absolute estimates of the Okun coefficient than those typically found in the literature, although we find a pattern of variation in the coefficient by age and gender which is typical. We also find that, in aggregate, participating males in the middle age groups tend to stay in the labour force throughout the business cycle whereas females of the same age tend to participate procyclically. This has policy implications for attempts to increase the rate of participation of particular groups by age and gender following a cyclical downturn.

In this paper, I use a unique dataset linking administrative school data with birth records to quantify the importance of time-varying family factors for child achievement and time use. Specifically, I take a model of academic achievement commonly used in the test score literature, and I augment it to include a family-year effect. Identification comes from the large number of sibling pairs observed in the same year. While prior literature has focused on specific shocks, such as job loss, I capture the full set of innovations that are shared across siblings in a given year. The distributions of fixed effects reveal that annual family innovations, relative to what was expected based on the previous year, are more important than teacher assignment for student achievement and also play a substantial role in the time students spend on homework, free reading, and television.JEL ClassificationI21, J13, J24

Firm shutdown creates a turbulent situation for workers as it leads directly to layoffs for its workers. An additional consideration is whether a firm’s shutdown within an industry creates turbulence for workers at other continuing firms. Using data drawn from the Longitudinal Worker File, a Canadian firm-worker matched employment database, we investigate the impact of industry shutdown rates on workers at continuing firm. This paper exploits variation in shutdown rates across industries and within an industry over time to explain the rate of permanent layoffs and the growth of workers’ earnings. We find an increase in industry shutdown rates increases the probability of permanent layoffs and decreases earnings growth for workers at continuing firms.

Abstract This paper provides evidence of the effect of age at school entry on college admission and earnings. It does so by exploiting a number of features in the application process to one of the major flagship universities in Brazil. By comparing applicants with different ages at school entry depending on whether they were born on December 31 or on January 1, our estimates show that applicants who delayed first-grade enrollment present higher aptitude test scores and probability of admission. Our results further suggest that advantaged applicants also earn more early in their careers. JEL Classification: I21, J24