The Distributional and Allocative Impacts of Virtual Labor Mobility across Time Zones through Communication Networks

Using a specific‐factors' model, with two goods (a shift‐working good and a non‐shift‐working good), three factors (capital specific to shift‐working, land specific to non‐shift‐working and labor) and two countries (Home and Foreign), which are located in different time zones, we highlight the impact of trade in labor services via communication networks on factor prices and production patterns. If two countries are identical in size, then under free trade in labor services, all workers work only in their local daytime, and night shift in each country is performed by imported labor services supplied by residents of the other country in their local daytime. Night‐time wage becomes the same as daytime wage (a wage equalization result). Other factor prices are also equalized. In both countries, capital rental rate increases, while land rent decreases. However, if two countries are different in size, trade in labor services does not equalize wages: in the large country, wages for night‐shift workers are higher than daytime wages and some residents work at night; in the small country, daytime wages become higher than night‐time wages and no one works at night, and night‐shift work is done by imported labor services from the large country. Land rent in the small country decreases. Land rent in the large country may or may not decrease, but it is always higher than in the small country. Capital rental rates in both countries are equalized and increase.     

Has the Affordable Care Act increased part-time employment?

We examine the impact of the Affordable Care Act (ACA) on part-time employment. Because the ACA’s employer health insurance mandate applies to individuals who work 30 or more hours per week, employers may try to avoid the mandate by cutting workers’ hours below the 30-hour threshold in order to avoid having to provide them with health insurance. Although the employer mandate only went into effect in 2015, many observers have argued that forward-looking employers began to shift towards a part-time workforce well in advance of the mandate. To test this hypothesis, we examine relative shifts across two categories of part-time workers (25–29 hours and 31–35 hours). We find some evidence of a shift from the 31–35-hour category into the 25–29-hour category after the passage of ACA in March 2010. However, that shift is not more pronounced among low-wage workers or among workers in industries and occupations most likely to be affected by the mandate. Thus, there is little evidence that the ACA has caused the shift across hours categories, or led to an increase in part-time employment. However, the ACA could cause a shift towards part-time work in the future as the mandate takes effect.     

A quantitative theory of the gender gap in wages

This paper measures how much of the gender wage gap over the life cycle is due to the fact that working hours are lower for women than for men. We build a quantitative theory of fertility, labor supply, and human capital accumulation decisions to measure gender differences in human capital investments over the life cycle. We assume that there are no gender differences in the human capital technology and calibrate this technology using wage–age profiles of men. The calibration of females assumes that children involves a forced reduction in hours of work that falls on females rather than on males and that there is an exogenous gender gap in hours of work. We find that our theory accounts for all of the increase in the gender wage gap over the life cycle in the NLSY79 data. The impact of children on the labor supply of females accounts for 56% and 45% of the increase in the gender wage gap over the life cycle among non-college and college females, while the rest is due to the exogenous gender differences in hours of work.     

The effects of works councils on overtime hours

This study analyzes the relation between works councils and overtime hours in Germany. The estimated effects differ considerably in dependence of standard contracted working time. Furthermore, we find differences across the quantiles of the overtime hours distribution and these differences between quantiles also vary between employees of establishment with and without works councils. By considering contracted working time effects and comparing conditional quantiles we find in some quantiles that employees of establishments with a works council have a higher amount of overtime hours if an employee regularly works 35 hours per week. This effect diminishes with increasing quantiles of the distribution of overtime hours. If an employee of a codetermined establishment regularly works 40 hours per week, overtime hours are reduced. This reduction becomes larger if higher quantiles are analyzed.     

Gender Patterns and Value of Unpaid Care Work: Findings From China's First Large‐Scale Time Use Survey

Using data from the 2008 China Time Use Survey, this paper examines the gender patterns of time allocation over paid work, unpaid care work, and non‐work activity and estimates the monetary value of unpaid care work. A seemingly unrelated regression (SUR) technique is applied to explore the tradeoff between the three types of activity. The estimates show that, holding constant individual characteristics and regional effects, the total work time of women is higher than that of men by 7 hours per week in the rural sector and by 10.5 hours per week in the urban sector. The monetary value of unpaid care work is estimated by five methods. Depending on the method used, the value assigned to unpaid care work varies from 25 to 32 percent of China's GDP, from 52 to 66 percent of final consumption, and from 63 to 80 percent of the gross products of tertiary industry.     

CAN INTERNATIONAL TRANSFERS BE PROBLEMATIC? HONDURAN REMITTANCES AND LABOR SUPPLY DECISIONS

Declining work force participation rates are a potentially important public policy issue for governments in countries with large capital inflows. Here we consider remittances as both a household and individual characteristic to estimate the impact of this nonwage transfer on labor supply decisions in Honduras. Although an initial view suggests moderate reductions across the working‐age population, we find evidence of increased participation through a reallocation of labor time across work categories. Our inclusion of the individual nature of remittance reception suggests less emphasis on the unified household perspective is warranted. (JEL O15, O12, J29)     

Trade with Time Zone Differences: Factor Market Implications

The main purpose of this study is to illustrate, with a simple two‐factor (skilled and unskilled labor) model, how a time‐saving improvement in business‐services trade benefitting from differences in time zones can have an impact on national factor markets. In doing so, we intend to capture the situation where the night‐shift work in one country is replaced by the day‐shift work in another country. In other words, we will show that trade with time zone differences will result in shifts of the relative supplies and demands for skilled labor around the globe.     

SHIFT WORKING AND TRADE IN LABOUR SERVICES WITH TIME ZONE DIFFERENCES

Using a two‐factor (labour and capital), two‐good (shift‐working and non‐shift‐working commodities) model with two countries (Home and Foreign), which are located in different time zones, we highlight the impact of trade in labour services (via communications networks) on the comparative advantage of countries capable of such trade. It is shown that a comparative advantage in a shift‐working commodity is held by pairs of countries in different time zones and connected through a good communication network. Concerning factor prices, if the shift‐working commodity is capital (respectively, labour) intensive, the wage rate for day‐shift labour will decrease (respectively, increase) as a result of trade in labour services. It is also demonstrated that this labour service utilization is mutual: some of Home's day‐shift labour will be utilized for the Foreign night shift, and vice versa. Thus, periodic trade in labour services occurs across countries.     

Imposing Capital Controls on Credit Unions: An Analysis of Regulatory Intervention in Australia

Abstract ** ** Résumé en fin d’article; Zusammenfassung am Ende des Artikels; resumen al fin del artículo.
: What impacts would minimum capital requirements have on mutual institutions lacking the ability to raise equity capital? Can the response of credit unions to capital controls be explained by internal member bonding? The imposition of capital controls on credit unions by the Australian Financial Institutions Commission is studied as a Box‐Tiao time series quasi‐experiment. Time series intervention and trend analyses are performed on a sample of 150 credit unions over the period 1987 to 1997, together with cross‐sectional regressions of the estimated responses. The results demonstrate that the capital controls had a significant impact on credit union behavior. Consistent with theoretical expectations, the response of individual credit unions is found to be a function of initial capital levels and internal member bonding.     

Capital adjustment cost and inconsistency in income‐based dynamic panel models with fixed effects

After the seminal work of Nickell (1981), a vast literature demonstrates the inconsistency of ‘conditional convergence’ estimator in income‐based dynamic panel models with fixed effects when the time horizon (T) is short but the sample of countries (N) is large. Less attention is given to the economic root of inconsistency of the fixed effects estimator when T is also large. Using a variant of the Ramsey growth model with long‐run adjustment cost of capital, we demonstrate that the fixed effects estimator of such models could be inconsistent when T is large. This inconsistency arises because of the long‐run adjustment cost of capital which gives rise to a negative moving average coefficient in the error term. Income convergence will be thus overestimated. We theoretically characterize the order of this inconsistency. Our Monte Carlo simulation demonstrates that the size of the bias is substantial and it is greater in economies with higher capital adjustment costs. We show that the use of instrumental variables that take into account the presence of the negative moving average term in the error will overcome this bias.     

Learning-by-doing versus Schooling in a Model of Endogenous Growth

A two sector model of learning-by-doing measured by means of production aggregated over time and of human capital accumulation in a schooling sector is presented. Time utilization is rival between schooling and learning-by-doing. Depending on the sum of elasticities of the accumulated factors (i.e., of production experience and educational human capital) in both sectors, a situation with or without endogenous growth results. Dynamic optimization of the choice between leisure and working and of the division of human capital between education and production is executed. Transitional dynamics are analyzed for a Cobb-Douglas example and a numerical simulation is performed.JEL classification: C61, D90, O41.Acknowledgements The author would like to thank Eric C. Meyer and two anonymous referees for helpful comments. The usual caveats apply.revised version received November 23, 2003     

DOES TIME TO WORK LIMIT TIME TO PLAY?: ESTIMATING A TIME ALLOCATION MODEL FOR HIGH SCHOOL STUDENTS BY HOUSEHOLD SOCIOECONOMIC STATUS

We use data from the 2003 to 2014 American Time Use Survey to estimate substitution between working and extracurricular time for high school students, which may have long‐run educational and labor market consequences. We find that working students are 5 percentage points less likely to participate in extracurricular activities and spend 40 minutes less on extracurriculars per day. We estimate heterogeneous effects by socioeconomic indicators to test whether disadvantaged students are more or less likely to substitute time away from extracurriculars. We find the largest interaction effects by paternal education, where working students with low paternal education are 0.5 percentage points more likely to engage in extracurriculars and increase extracurriculars by 15 minutes per day. (JEL I2, J22, J24)     

Institutions for private sector development and pro‐poor growth: Evidence from Vietnam

Using the Vietnam Household Living Standards Survey 2008, we explore the differences in pro‐poor growth performance in provinces in Vietnam according to the quality of the provinces’ institutions that support private sector activity. We exploit the localized and varying effect of French colonial legacy across Vietnamese provinces to address the endogeneity of institutions. We find strong and robust evidence of a positive effect of good‐quality institutions that support private sector activity on pro‐poor growth and that enhanced working hours and hourly wage and extended income from non‐farm self‐employment play critical roles in this outcome.     

DOES POPULATION AGEING PROMOTE FASTER ECONOMIC GROWTH?

Can divergent demographic trends account for differences in per capita output across countries? We address this question by offering evidence that the process of population ageing is positively and significantly related to cross‐country economic performance. We define and estimate the effect of demographic change in two ways. First, a growing cohort of working age persons (15–64) as a share of the total population is found to have a large positive effect on GDP per capita. Second, an increase in the number of prime age persons (35–54) relative to the younger working age population (15–34) is found to have a positive but curvilinear effect with respect to per capita GDP. We find that changes in per capita GDP peak when the ratio of the prime‐to‐younger age population reaches an optimum of prime age workers for every younger aged worker. Beyond or below this optimal ratio, per capita output is lowered.     

Worker Productivity, Working Time Reduction, And The Short–Run And Long–Run Employment Effects

This paper illustrates a shirking–type efficiency wage model to explain why shorter working hours cause an ambiguous effect on employment as the empirical result. We find that shorter working hours have an uncertain impact on the work effort, and the relationship between work effort and shorter working time is a decisive factor in the employment effect of working time reduction. Moreover, it is also found that, given the zero profit constraint, the long–run employment effect of reducing working hours will intensify the short–run employment effect.     

Aid,non‐traded goods,and growth

Abstract We examine the effects of foreign aid in a small recipient country with two traded goods, one non‐traded good, and two factors. Learning by doing and intersectoral knowledge spillovers contribute to endogenous growth. We obtain two main results. First, a permanent increase in untied aid raises (or lowers) the growth rate if and only if the non‐traded good is more capital intensive (or effective labour intensive) than the operating traded good. Second, a permanent increase in untied aid raises welfare if the non‐traded good is more capital intensive than the operating traded good; otherwise, it may raise or lower welfare.     

Saving–investment Association and Regional Capital Mobility in China: A Nonparametric Panel Approach

Using a nonparametric panel data model, this paper estimates the degree of time‐varying and province‐specific capital mobility in China during 1970–2006. We estimate the savings–investment association, that is, the savings retention rate à la Feldstein and Horioka, as a measure of capital mobility. We also split the total savings (investment) into private and government savings (investment) to explore the role of government in improving capital mobility. Over time, we find an improvement in capital mobility after the mid‐1990s. Across provinces, we observe higher capital mobility in eastern/coastal regions. From the 1990s, the government is found to play a less important role in promoting capital mobility. Across provinces, the government is found to be more important in either the municipalities (Shanghai and Beijing) or the less developed inland provinces.     

Fiscal Policy in Real Time*

In this paper, I estimate the ex ante or intentional cyclical stance of fiscal policy in OECD countries. I use the fiscal plans reported at the time of budgeting, together with other information available to fiscal policy‐makers in real time. Indeed, fiscal plans might be significantly different from ex post outcomes because governments do not have complete control over their implementation, which is influenced by several exogenous factors. When fiscal‐policy rules are estimated using real‐time data, I show in this paper that OECD countries have often planned a counter‐cyclical fiscal stance, especially during economic expansions. This contrasts with conventional findings based on actual data, which tend to point towards a‐cyclicality or pro‐cyclicality. Forecast errors for the government structural balance and the output gap play a central role in explaining the differences between estimates based on ex ante and ex post data.     

Labour Supply,Life Satisfaction,and the (Dis)Utility of Work*

In economic theory, it is typically assumed that there is a “disutility of labour”. However, empirical research on subjective well‐being has consistently shown that unemployed people are less happy than employed people, even after taking income differences into account. In this paper, we attempt to reconcile both findings. We show that happiness and work hours exhibit an inverse U‐shaped relation – working longer raises the level of happiness, as long as the total working time is not too long. Hence, working can be beneficial for happiness and, at the same time, it can exert a disutility at the margin.     

Driving restrictions that work? Quito's Pico y Placa Program

Programs to reduce traffic congestion and air pollution by restricting use of motor vehicles on working days have generally not met with success, given existing studies of such programs. We conduct the first study of Quito, Ecuador's four‐year‐old Pico y Placa program and find that it has reduced ambient concentrations of carbon monoxide (CO), a pollutant primarily emitted by vehicles, by 9% to 11% during peak traffic hours. Given that ambient concentrations of CO generally track the spatial and temporal distributions of traffic, these reductions in pollution suggest similar reductions in vehicle flows. We find no significant evidence that traffic has shifted to other times of the day or week, or to other locations.