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Inaugural lecture pedro martins 2015 10-21
- 1. Understanding how tocreate more and better jobs Professor Pedro Martins Inaugural Lecture Queen Mary University of London October 21st, 2015
- 2. Mentors and co-authors •Prof Ian Walker, LancasterU • Prof Pedro Portugal, Bank of PT • Prof Jonathan Thomas, Edinburgh U • Prof Alvaro S. Pereira, OECD • Prof Gary Solon, Arizona U • Prof Andrew Oswald, Warwick U • Prof Pedro T. Pereira, Madeira U • Prof Brigitte Granville, QMUL • Prof Robin Naylor, Warwick U • Prof Lazlo Andor, Brussels U • Prof Jonathan Haskel, Imperial Coll • Prof Huw Dixon, Cardiff U • Dr Alex Hijzen, IMF • Dr Francisco Lima, Lisbon U • Dr Yong Yang, Sussex U • Dr Luiz Esteves,CADE, Brazil • Dr Richard Upward, Nottingham U • Prof Andy Snell, Edinburgh U • Sofia P. Costa, QMUL • Dr Jim Jin, St Andrews U 2
- 3. Outline 1. Labour economicsand labour policy 2. Globalisation 3. Institutions 4. Public programmes 3
- 4. Labour economics &policy – recent drivers 1/2 • Wider theory base • Neoclassical: competitive markets (productivity, prices) • Human capital (Becker 1992) • Search (frictions, flows) (DMP 2010) • Behavioural • Institutional • Greater focus on evidence • Emergence of evidence-based policy • Increasing demand for ‘policy-actionable’ evidence • Eurozone debate on structural reforms vs monetary policy vs debt relief 4
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- 6. Labour economics &policy – recent drivers 2/2 • Counterfactual empirical methods • Social experiments (Deaton 2015) • Regression and matching (Heckman 2000) • Regression discontinuity • Difference-in-differences • Instrumental variables • Big(ger) data • Matched employer-employee longitudinal data • Social security and other administrative data sets • Public records of firms • Internet 6
- 7. International aspects • Globalisation:FDI, GVCs, international trade, migration • “Second unbundling” (ideas and production) • Multinationals as sweatshops or promoters of more and better jobs? • Job polarisation in G7 countries? • Work co-authored with A. Hijzen, R. Upward, Th. Schank and Y. Yang, part of which in collaboration with the OECD, Paris • Orbis firm-level data (1996-2007): 2,179 (parent) multinationals; 5,230 affiliates • Focus on the cases of UK, Ger, PT, BR and Indonesia 7
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- 9. International aspects • International“rent sharing” • Profits of multinationals are shared with workers in affiliates • Effects stronger when greater differences in characteristics (complementarities) but weaker when more affiliates (substitution) • Acquisitions/divestments (UK, DE, PT, BR, IND) • Positive wage effects of foreign ownership (especially for developing countries) • Higher wage increases following from mobility to foreign firms • Greater job security following foreign takeovers 9
- 10. Change in unemployment rate between2014 and 2009 10
- 11. Labour-market institutional aspects •Employment protection law • Collective bargaining, unions and employer associations • Minimum wages (incl tax credits and DNWR) • Unemployment benefits (and income support) • (Public) employment services • Active labour market policies (incl training) • Flexicurity approach (protecting people, not jobs) vs segmentation 11
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- 14. Activation services • Supportto the unemployed: job search, training, ALMPs • Aggregate demand vs structural reforms • Public vs private provision • Potential substitution effects of activation (in periods of high unempl) • Evaluation of programme in PT targeted at unemployed for 6 months or more, involving over 200,000 people in its first year • Merged data from PES and Social security • CGR WP with S. P. Costa, cited in new EC initiative (& new collaboration with gov’t of MZ, ILO and IGC) 14
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- 17. Management training • Marketfailures in training provision, uncertain returns: lower productivity • €65b to be spent by the EU on education, training and employment measures (2013-2020) • Counterfactual evaluation of €100m programme in PT (‘FIG’, 2008) • Funding to provide skills to workers (incl managers) • Allocation depending on scores in different criteria, training and firm characteristics, and available resources • Merge of administrative and matched panel data • Work in progress, in collaboration with the European Commission 17
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- 23. 23 Change in firm performance (salesper worker), between 2012 and 2008
- 24. Final thoughts: Understandinghow to… • Work in progress, many different approaches • Important contributions and developments • Different theoretical concepts • More sophisticatedempirical methods • Richer data • Significant potential from greater interaction between economics, management, other fields of study (politics, law, etc) and other stakeholders (public bodies, int’l organisations, etc)… • … to promote further improvements in labour market evidence, policy and outcomes 24