Career Paths,Unemployment, and the Efficiency of the Labor Market: Should Youth Employment Be Subsidized?

This paper studies the implications of learning‐by‐doing on youth unemployment and market efficiency when workers benefiting from this kind of training experience search (while on the job) for a higher skill job. Firms with low‐skill jobs suffer from a poaching behavior by firms with high‐skill jobs, causing a shortage of low‐skill jobs and excessive youth unemployment. An optimal policy, consisting of taxing the output of high‐skill jobs and subsidizing the output of low‐skill jobs, restores market efficiency and reduces youth unemployment.     

When a Door Closes,a Window Opens? Long‐Term Labor Market Effects of Involuntary Separations

This study estimates the earning losses of workers experiencing an involuntary job separation. We employ, for the first time in the earning losses literature, a Poisson pseudo‐maximum‐likelihood estimator with fixed effects that has several advantages with respect to conventional fixed effects models. The Poisson estimator allows considering the full set of involuntary separations, including those with zero labor market earnings because of unemployment. By including individuals with zero earnings and by using our new method, the loss in the year of separation becomes larger than in previous studies. The loss starts with roughly 30% and, although it quickly shrinks, it remains at around 15% in the following years. In addition, we find that compared to other reasons for separation, the earning loss pattern is unique for involuntary separations, because no other type of separation implies such permanent scarring. This latter finding makes us confident that the self‐reported involuntariness of a separation is a reliable source of information.     

Hiring Older Employees: Do the Age Limits of Early Retirement and the Contribution Rates of Firms Matter?

We examine the effects of a Finnish pension reform on firms' incentives to hire older employees. The reform restricted the eligibility ages for early retirement and changed the size‐related contribution rates of firms. According to our theoretical model, the positive effect on the values of new hires extends to age groups younger than those directly affected by the reform, and the effects are strongest in the largest firms. These model predictions were confirmed in a difference‐in‐difference‐in‐differences analysis on the probability of the hiring of workers of different ages in firms of different sizes.     

Do Selection Criteria Make a Difference?: Visa Category and the Labour Market Status of Immigrants to Australia

This paper assesses the role of selection criteria in the immigrant settlement process. Do skill-based immigrants have higher participation and employment rates than family-based immigrants? Does this represent a head start or a persistent labour market advantage? The Longitudinal Survey of Immigrants to Australia is used to address these questions. Generally, migrants selected for their skills have better labour market outcomes. Over time, the relative gap in participation rates increases, while the gap in employment rates decreases. Net of visa category, outcomes are better for native English speakers and for those who visited Australia prior to migration.     

Afro‐descendants in Peru: Do beauty and race matter in the labor market?

This is a first study about labor discrimination against Afro‐descendants in Peru. We randomly assigned Afro‐Peruvian and white surnames and photographs (subjectively beautiful, homely looking, or not photos) to 3,828 fictitious résumés, sent for unskilled, technical, and professional occupations. We find an unprecedented, sizeable beauty premium in unskilled occupations (232.5 percent), no effect of looks in technical occupations, and a beauty penalty in professional occupations (–71.3 percent). Overall, whites receive 19.37 percent more callbacks than similarly qualified Afro‐Peruvians; this racial discrimination affects only Afro‐Peruvian females, and particularly those employed in technical occupations. These results remain unaltered when we restrict the sample to those markedly “Afro” surnames. Our findings unveil different dynamics of discrimination across job categories, which tend to be overlooked by the existing literature.     

Can Economists Forecast Exchange Rates? The Debate Re‐Visited: The Case of the USD/GBP Market

In the debate on forecasting exchange rates, critics claimed that traditional macroeconomic models could not outperform a random walk in post‐sample forecasts. Perceived deficiencies include inadequate allowance for simultaneity, and expectations hypotheses inconsistent with the structure of models employed. This paper re‐visits the debate, first to address critics' major concerns, and second because in the view of the present authors, the debate closed on an unduly pessimistic note. This paper develops a simultaneous, rational expectations model of the USD/GBP market, with functional relationships for hedgers, speculators and a spot rate equation. The model is estimated with data contemporaneous to the debate, including a period during which the US Commodity Futures Trading Commission did not collect data on traders' open positions. Using the results of post‐debate research on tests for stationarity with missing observations, the model, using only public information, outperforms a random walk in post‐sample forecasts of the spot rate. Recent microstructure models of the exchange rate based on order flow have re‐kindled the forecasting debate. The model developed here, however, is differentiated from these microstructure models, first because order flow utilises both public and private information, and second because the microstructure models do not directly address critics' concerns.     

The OECD Better Life Initiative: How's Life? and the Measurement of Well‐Being

This paper presents the framework used by the OECD for defining and measuring well‐being, developed as part of the OECD Better Life Initiative launched in 2011. This framework measures well‐being by considering 11 dimensions covering both current material conditions and quality of life, while also recognizing the importance of taking account the sustainability of well‐being in the future. This framework has been populated with indicators for each dimension, whose selection has relied on international standards on measurement and was made in consultation with experts and National Statistical Offices of OECD countries. The paper also discusses the pros and cons of various approaches for presenting and disseminating information on multidimensional well‐being to different audiences—including the OECD Better Life Index, an interactive web tool. The paper concludes by illustrating the progress made in developing measures of well‐being and outlines the statistical agenda ahead to improve existing indicators and develop new ones.     

Post‐secondary attendance by parental income in the U.S. and Canada: Do financial aid policies explain the differences?

We examine the extent to which tuition and needs‐based aid policies explain important differences in the relationship between family income and post‐secondary attendance relationships between Canada and the U.S. Using data from recent cohorts, we estimate substantially smaller attendance gaps by parental income in Canada relative to the U.S., even after controlling for family background, cognitive achievement, and local‐residence fixed effects. We next document that U.S. public tuition and financial aid policies are actually more generous to low‐income youth than are Canadian policies. Equalizing these policies across Canada and the U.S. would likely lead to a greater difference in income‐attendance gradients.     

Hand pollination,mass spraying,and hybrid seedlings: Do these technologies affect the welfare of smallholder cocoa farmers in Ghana?

Adoption of cocoa production technologies has the potential to improve productivity and welfare of smallholder producers in low-income countries. While studies investigating synergies in agricultural technologies are growing, empirical evidence on the determinants and impacts of adopting multiple cocoa production technologies on smallholder farmers' welfare is scarce. Therefore, this study contributes by analyzing the determinants and effects of adoption of multiple cocoa production technologies on the welfare of smallholder farmers in Ghana. To achieve this, we used the multinomial endogenous switching regression and multivalued inverse probability regression adjustment models to a random sample of 2233 cocoa farmers from Ghana. The results show that various socioeconomic characteristics (e.g., farmer's age and experience), resource constraints (e.g., land ownership and credit access), market-related factors (e.g., distance to the market), and production shocks (e.g., rainfall) influence the adoption of multiple cocoa production technologies. Furthermore, the results reveal that adopting multiple production technologies significantly improves cocoa yields, gross income, per capita consumption expenditure, and reduces household food insecurity. Therefore, policies, such as financial support, need to be aimed at improving and strengthening smallholder cocoa producers' capacity to adopt synergistic conventional and non-conventional cocoa production technologies to maximize smallholder farmers' welfare.     

Laying the Tracks for Successful Science,Technology, Engineering and Mathematics Education: What Can We Learn from Comparisons of Immigrant–Native Achievement in the USA?

This paper examines the immigrant–native achievement gap in science, technology, engineering, and mathematics (STEM) fields in college in the USA. Using student survey data from the Beginning Postsecondary Longitudinal Studies 2004/09, I find that on average immigrant students have significantly higher rates entering and persisting in STEM fields compared to their native counterparts. There is, however, considerable variation across immigrant generations and race and ethnicity. The immigrant attainment advantage is particularly large among first‐generation Asian and white immigrant students who attended foreign K–12 schools. I explore the channels leading to the achievement gap, including socioeconomic status, individual preferences, and academic preparation in math and science. Results suggest that the immigrant STEM advantage is largely due to better academic preparation in math and science in high school. This indicates that improvements in students' college STEM attainment may depend crucially on policy efforts devoted to strengthening the quality of high school math and science education.