We use data on twins matched to register-based information on earnings to examine the longstanding
puzzle of non-existent compensating wage differentials. The use of twin data allows us to remove otherwise unobserved productivity differences that were the prominent reason for estimation bias in the earlier studies. Using twin differences we find evidence for positive compensation of adverse working conditions in the labor market.
This study investigates the role of adverse working conditions in the determination of individual wages and overall job satisfaction in the Finnish labour market. The potential influence of adverse working conditions on self-reported fairness of pay at the workplace is considered as an alternative, indirect measure of job satisfaction. The results show that working conditions have a very minor role in the determination of individual wages in the Finnish labour market. In contrast, adverse working conditions substantially increase the level of job dissatisfaction and the perception of unfairness of pay at the workplace
This study explores the potential role of adverse working conditions at the workplace in the determination of on-the-job search in the Finnish labour market. The results reveal that workers currently facing adverse working conditions have greater intentions to switch jobs and they are also more willing to stop working completely. In addition, those workers search new matches more frequently. There is evidence that adverse working conditions consistently increase the level of job dissatisfaction and, in turn, it is job dissatisfaction that drives workers’ intentions to quit and intensifies actual job search.
We examine the effects of establishment- and industry-level labor market turnover on employees’ well-being. The linked employer-employee panel data contain both survey information on employees’ subjective well-being and comprehensive register-based information on job and worker flows. Labor market turbulence decreases well-being as experienced job satisfaction and satisfaction with job security are negatively related to the previous year’s flows. We test for the existence of compensating wage differentials by explaining wages and job satisfaction with average uncertainties, measured by an indicator for a high moving average of past excessive turnover (churning) rate. The results are consistent with compensating wage differentials, since high uncertainty increases real wages, but has no effect on job satisfaction.
Matching it up: working arrangements and job satisfactionGRAPE
We leverage the flexibility enactment theory to study empirically the link between working arrangements and job satisfaction. We provide novel insights on the match between the individual inclination to work in non-standard working arrangements and the factual conditions of employment. We thus reconcile the earlier literature, which found both positive and negative effects of non-standard employment on job satisfaction. Using data from the European Working Conditions Survey we characterize the extent of mismatch between individual inclination and factual working arrangements. We provide several novel results. First, the extent of mismatch is substantial and reallocating workers between jobs could substantially boost overall job satisfaction in European countries. Second, the mismatch more frequently plagues women and parents. Finally, we demonstrate that the extent of mismatch is heterogeneous across countries, which shows that one-size-fits-all policies are not likely to maximize the happiness of workers, whether flexibility is increased or reduced.
Existing evidence of inequality aversion relies on data from class-room experiments where subjects face hypothetical questions. This paper estimates the magnitude of inequality aversion using representative survey data, with questions related to the real-economy situations the respondents face. The results reveal that the magnitude of inequality aversion can be measured in a meaningful way using survey data, but the estimates depend dramatically on the framing of the question. No matter how measured, the revealed inequality aversion predicts opinions on a wide range of questions related to the welfare state, such as the level of taxation, tax progressivity and the structure of unemployment benefits.
Paying for ideal discretion: a framed field experiment on working time arran...GRAPE
The notion of "ideal worker" necessitates being available at the discretion of the employer in terms of time. We embed our study in the context of gender. Discretion over working time, meanwhile, is widely considered one of the cornerstones of work-life balance and job satisfaction. We study the pecuniary and social valuation of the autonomy to decide about working schedules. We compare employee-initiated and employer-initiated request for a change towards more flexible working time arrangement. We provide plausibly causal evidence that an \emph{ideal worker} indeed ought to be available, but requesting this availability should be reflected in wage rise on average. There appears to be no penalty to employee-initiated request for flexibility and this result is common for men and women.
Within occupation wage inequality and task dispersionGRAPE
Recent years, we witnessed an increase in wage dispersion at the occupation level, which cannot be explained by differences in workers' characteristics. In this presentation, we show how the task content of jobs can be used to improve our understanding on the topic
This study investigates the role of adverse working conditions in the determination of individual wages and overall job satisfaction in the Finnish labour market. The potential influence of adverse working conditions on self-reported fairness of pay at the workplace is considered as an alternative, indirect measure of job satisfaction. The results show that working conditions have a very minor role in the determination of individual wages in the Finnish labour market. In contrast, adverse working conditions substantially increase the level of job dissatisfaction and the perception of unfairness of pay at the workplace
This study explores the potential role of adverse working conditions at the workplace in the determination of on-the-job search in the Finnish labour market. The results reveal that workers currently facing adverse working conditions have greater intentions to switch jobs and they are also more willing to stop working completely. In addition, those workers search new matches more frequently. There is evidence that adverse working conditions consistently increase the level of job dissatisfaction and, in turn, it is job dissatisfaction that drives workers’ intentions to quit and intensifies actual job search.
We examine the effects of establishment- and industry-level labor market turnover on employees’ well-being. The linked employer-employee panel data contain both survey information on employees’ subjective well-being and comprehensive register-based information on job and worker flows. Labor market turbulence decreases well-being as experienced job satisfaction and satisfaction with job security are negatively related to the previous year’s flows. We test for the existence of compensating wage differentials by explaining wages and job satisfaction with average uncertainties, measured by an indicator for a high moving average of past excessive turnover (churning) rate. The results are consistent with compensating wage differentials, since high uncertainty increases real wages, but has no effect on job satisfaction.
Matching it up: working arrangements and job satisfactionGRAPE
We leverage the flexibility enactment theory to study empirically the link between working arrangements and job satisfaction. We provide novel insights on the match between the individual inclination to work in non-standard working arrangements and the factual conditions of employment. We thus reconcile the earlier literature, which found both positive and negative effects of non-standard employment on job satisfaction. Using data from the European Working Conditions Survey we characterize the extent of mismatch between individual inclination and factual working arrangements. We provide several novel results. First, the extent of mismatch is substantial and reallocating workers between jobs could substantially boost overall job satisfaction in European countries. Second, the mismatch more frequently plagues women and parents. Finally, we demonstrate that the extent of mismatch is heterogeneous across countries, which shows that one-size-fits-all policies are not likely to maximize the happiness of workers, whether flexibility is increased or reduced.
Existing evidence of inequality aversion relies on data from class-room experiments where subjects face hypothetical questions. This paper estimates the magnitude of inequality aversion using representative survey data, with questions related to the real-economy situations the respondents face. The results reveal that the magnitude of inequality aversion can be measured in a meaningful way using survey data, but the estimates depend dramatically on the framing of the question. No matter how measured, the revealed inequality aversion predicts opinions on a wide range of questions related to the welfare state, such as the level of taxation, tax progressivity and the structure of unemployment benefits.
Paying for ideal discretion: a framed field experiment on working time arran...GRAPE
The notion of "ideal worker" necessitates being available at the discretion of the employer in terms of time. We embed our study in the context of gender. Discretion over working time, meanwhile, is widely considered one of the cornerstones of work-life balance and job satisfaction. We study the pecuniary and social valuation of the autonomy to decide about working schedules. We compare employee-initiated and employer-initiated request for a change towards more flexible working time arrangement. We provide plausibly causal evidence that an \emph{ideal worker} indeed ought to be available, but requesting this availability should be reflected in wage rise on average. There appears to be no penalty to employee-initiated request for flexibility and this result is common for men and women.
Within occupation wage inequality and task dispersionGRAPE
Recent years, we witnessed an increase in wage dispersion at the occupation level, which cannot be explained by differences in workers' characteristics. In this presentation, we show how the task content of jobs can be used to improve our understanding on the topic
Decision Making in Optimizing a Product of a Small Scale Industry: A Bayesian...INFOGAIN PUBLICATION
This paper intends to find Expected monetary value (EMV), Expected opportunity loss (EOL) and conditional profit of the main product (Mukta) of a small scale industry–“ORGAMAN” situated at Jorhat District of Assam. To meet the above specific objectives, the method of Bayesian Analysis has been adopted. The data used in this endeavor is secondary in nature, collected by direct personal investigation. As per prior information, the target of the industry is to produce a minimum of 50 MT (low production) of product and a maximum of 350 MT (high production) of the same per month. The prior analysis reveals that the expected monetary value and expected opportunity loss are optimum against high production. Based on both the prior analysis and posterior analysis, it is observed that the profit for the product of the industry is maximum against high production of 350 MT per month. Although, the profit based on posterior analysis is slightly high, it seems that the additional amount of money has to be spend to collect additional information for posterior analysis.
Within occupation wage dispersion and task inequalityGRAPE
We argue that the distribution of tasks affects wage inequality within occupations. We show that occupations with more routine tasks, particularly cognitive, tend to show higher wage dispersion at the top and at the bottom of the income distribution.
The paper examines the antecedents of intentions to quit, job search, and actual job switches during a five-year follow-up period. We use a representative random sample of all Finnish employees (N = 2800). The data both contain information on intentions to quit and on-the-job search from a cross-section survey and records employees’ actual job switches from longitudinal register data that can be linked to the survey. Specifically, we study the contribution of adverse working conditions (harms, hazards, uncertainty, physically and mentally heavy work), work organization (promotion prospects, discrimination, supervisor support) and ease-of-movement factors (mental health, wage level, regional unemployment). According to the estimates, adverse working conditions, poor promotions prospects, discrimination, poor supervisor support and mental health symptoms are positively related to unwillingly staying in a job, since these variables increase the probability of turnover intentions or job search but not actual job switches.
eBbook: The Fair Pay Act and Implications For Compensation ModelingThomas Econometrics
The Fair Pay Act requires the examination of not only compensation decisions made during the class period, but also compensation decisions and “all other employment practices” that affect compensation, regardless of when in the course of the individual’s employment such practices began.
Tutkimuksessa tarkastellaan työn vaatimusten, työntekijän vaikutusmahdollisuuksien ja esimiehiltä saatavan tuen vaikutuksia erikseen ja yhdessä työssä koettuun hyvinvointiin. Tulokset osoittavat, että vaikutusmahdollisuudet ja esimiehen tuki ovat merkittäviä työhyvinvoinnin selittäjiä.
This study employs quantile regression analysis to examine possible non-linearity in the determinants of corporate effective tax rate (ETR). The results generally indicate that the examined determinants have significant impact on ETR along the decides and confirm non-linearity in the distribution of ETR. Firm size, firm leverage and inventory intensity are most influential variables while capital intensity and profitability are fairly influential across the ETR of firms. However, tax expert, firm size and inventory intensity are the most influential for firms with lower ETR. The study also confirms that large firms enjoy political clout but smaller firms are also able to reduce their fiscal pressure. The influence of human controllable factors is also evident in the study.
Eläkepolitiikan tavoitteena on turvata kaikille eläkeläisille kohtuullinen kulutustaso ja estää köyhyys. Tämä teos sisältää tiiviin ja asiapitoisen katsauksen eläkkeen korvaussuhteesta työstä eläkkeelle siirryttäessä vuosina 1999–2003 ja valottaa näin osaltaan eläketurvalle annettujen tavoitteiden onnistumista.
Using Finnish data this paper examines to what extent the share of all nurses in unemployment, health care employment and being out of the labour market after the exam of a cohort have affected the long-run outcomes of the cohort. The shares are calculated for all cohorts and years and standardised in each year by dividing the cohort specific rate with the average rate for all nurses. These standardised variables are used as dependent variables. The long-term effects are significant at least for the unemployment and the depression have according to the estimates raised the long-run unemployment by more than 2 percentage points for the nurses graduating then. For the employment in the health care industry the effects may be even larger but the estimates are more uncertain.
Decision Making in Optimizing a Product of a Small Scale Industry: A Bayesian...INFOGAIN PUBLICATION
This paper intends to find Expected monetary value (EMV), Expected opportunity loss (EOL) and conditional profit of the main product (Mukta) of a small scale industry–“ORGAMAN” situated at Jorhat District of Assam. To meet the above specific objectives, the method of Bayesian Analysis has been adopted. The data used in this endeavor is secondary in nature, collected by direct personal investigation. As per prior information, the target of the industry is to produce a minimum of 50 MT (low production) of product and a maximum of 350 MT (high production) of the same per month. The prior analysis reveals that the expected monetary value and expected opportunity loss are optimum against high production. Based on both the prior analysis and posterior analysis, it is observed that the profit for the product of the industry is maximum against high production of 350 MT per month. Although, the profit based on posterior analysis is slightly high, it seems that the additional amount of money has to be spend to collect additional information for posterior analysis.
Within occupation wage dispersion and task inequalityGRAPE
We argue that the distribution of tasks affects wage inequality within occupations. We show that occupations with more routine tasks, particularly cognitive, tend to show higher wage dispersion at the top and at the bottom of the income distribution.
The paper examines the antecedents of intentions to quit, job search, and actual job switches during a five-year follow-up period. We use a representative random sample of all Finnish employees (N = 2800). The data both contain information on intentions to quit and on-the-job search from a cross-section survey and records employees’ actual job switches from longitudinal register data that can be linked to the survey. Specifically, we study the contribution of adverse working conditions (harms, hazards, uncertainty, physically and mentally heavy work), work organization (promotion prospects, discrimination, supervisor support) and ease-of-movement factors (mental health, wage level, regional unemployment). According to the estimates, adverse working conditions, poor promotions prospects, discrimination, poor supervisor support and mental health symptoms are positively related to unwillingly staying in a job, since these variables increase the probability of turnover intentions or job search but not actual job switches.
eBbook: The Fair Pay Act and Implications For Compensation ModelingThomas Econometrics
The Fair Pay Act requires the examination of not only compensation decisions made during the class period, but also compensation decisions and “all other employment practices” that affect compensation, regardless of when in the course of the individual’s employment such practices began.
Tutkimuksessa tarkastellaan työn vaatimusten, työntekijän vaikutusmahdollisuuksien ja esimiehiltä saatavan tuen vaikutuksia erikseen ja yhdessä työssä koettuun hyvinvointiin. Tulokset osoittavat, että vaikutusmahdollisuudet ja esimiehen tuki ovat merkittäviä työhyvinvoinnin selittäjiä.
This study employs quantile regression analysis to examine possible non-linearity in the determinants of corporate effective tax rate (ETR). The results generally indicate that the examined determinants have significant impact on ETR along the decides and confirm non-linearity in the distribution of ETR. Firm size, firm leverage and inventory intensity are most influential variables while capital intensity and profitability are fairly influential across the ETR of firms. However, tax expert, firm size and inventory intensity are the most influential for firms with lower ETR. The study also confirms that large firms enjoy political clout but smaller firms are also able to reduce their fiscal pressure. The influence of human controllable factors is also evident in the study.
Eläkepolitiikan tavoitteena on turvata kaikille eläkeläisille kohtuullinen kulutustaso ja estää köyhyys. Tämä teos sisältää tiiviin ja asiapitoisen katsauksen eläkkeen korvaussuhteesta työstä eläkkeelle siirryttäessä vuosina 1999–2003 ja valottaa näin osaltaan eläketurvalle annettujen tavoitteiden onnistumista.
Using Finnish data this paper examines to what extent the share of all nurses in unemployment, health care employment and being out of the labour market after the exam of a cohort have affected the long-run outcomes of the cohort. The shares are calculated for all cohorts and years and standardised in each year by dividing the cohort specific rate with the average rate for all nurses. These standardised variables are used as dependent variables. The long-term effects are significant at least for the unemployment and the depression have according to the estimates raised the long-run unemployment by more than 2 percentage points for the nurses graduating then. For the employment in the health care industry the effects may be even larger but the estimates are more uncertain.
Ikäihmisten asumispalveluiden tuottavuutta pyritään nostamaan, jotta kunnat pystyisivät vastaamaan kasvavaan palvelutarpeeseen tulevaisuudessa. Onko yksityisten palveluntuottajien käyttö vastaus tähän haasteeseen? Miten käy hoidon laadun ja henkilöstön hyvinvoinnin? Toimivatko nykyiset palveluiden kilpailuttamistavat? Kirjassa pureudutaan ikäihmisen asumispalveluiden kustannusten, laadun ja henkilöstön hyvinvoinnin eroihin yksityisten ja kunnallisten tuottajien välillä. Toisena teemana on kuntatilaajien ja yksityisten palveluntuottajien kokemukset kilpailutuksista. Tutkimuksessa on käytetty tilastollisista aineistoa sekä haastatteluita.
Yksityisillä palvelualoilla naiset ovat yliedustettuina matalapalkkaisissa osa-aikaisissa ja määräaikaisissa tehtävissä. Sukupuolten välinen keskimääräinen palkkaero kaventuisi, jos naisten yliedustus näissä tehtävissä vähenisi tai jos näissä tehtävissä maksettaisiin yhtä suurta keskimääräistä palkkaa kuin kokoaikaisissa ja vakinaisissa tehtävissä. Palvelualoilla sukupuolten välisiä palkkaeroja selittää pitkälti naisten ja miesten erilainen sijoittuminen eri tehtäviin. Säännöllisen työajan kiinteän palkan päälle maksettavat erilaiset palkanlisät kasvattavat pääsääntöisesti sukupuolten välisiä palkkaeroja.
Suomen bkt kasvoi viime vuonna 0,5 prosenttia ja siten noin prosenttiyksikön hitaammin kuin euroalueen bkt. Kasvuero selittyy kuitenkin lähes kokonaan Suomen Venäjän-viennin jyrkästä supistumisesta ja Suomen muuta euroaluetta kireämmästä finanssipolitiikasta. Tänä vuonna Suomen bkt kasvaa 1,1 prosenttia ja ensi vuonna 1,3 prosenttia edellisvuodesta. Suomen viennin tukemiseksi todennäköisesti tehtävä kilpailukykysopimus alentaa työvoimakustannuksia tuntuvasti jo ensi vuonna. Odotukset sopimuksen työllisyysvaikutuksista ovat varsin toiveikkaita. Riskinä on, että sopimus heikentää julkisen talouden rahoitusasemaa, mihin reagoidaan lisäleikkauksin.
Suomen bkt kasvoi viime vuonna 0,5 prosenttia ja siten noin prosenttiyksikön hitaammin kuin euroalueen bkt. Kasvuero selittyy kuitenkin lähes kokonaan Suomen Venäjän-viennin jyrkästä supistumisesta ja Suomen muuta euroaluetta kireämmästä finanssipolitiikasta. Tänä vuonna Suomen bkt kasvaa 1,1 prosenttia ja ensi vuonna 1,3 prosenttia edellisvuodesta. Suomen viennin tukemiseksi todennäköisesti tehtävä kilpailukykysopimus alentaa työvoimakustannuksia tuntuvasti jo ensi vuonna. Odotukset sopimuksen työllisyysvaikutuksista ovat varsin toiveikkaita. Riskinä on, että sopimus heikentää julkisen talouden rahoitusasemaa, mihin reagoidaan lisäleikkauksin.
Tutkimuksessa tarkastellaan työmarkkinoiden polarisoitumista Suomessa. Aiemmat tutkimukset tarkastelevat kehitystä koko talouden, toimialojen tai alueiden tasolla. Tutkimuksessa tarkastellaan työpaikkojen rakennemuutosta yritystasolla. Tulokset osoittavat, että rutiiniluonteiset työtehtävät ovat vähentyneet merkittävästi suomalaisissa yrityksissä. Palkkajakauman keskivaiheilla olevien rutiiniluonteisten työtehtävien väheneminen kytkeytyy informaatio- ja kommunikaatioteknologian käyttöönottoon yrityksissä.
Ammatillinen järjestäytymisaste on laskenut Suomessa viimeisen kahden vuosikymmenen aikana. Samaan aikaan rinnalle on syntynyt ammattiliitoista riippumattomat työttömyyskassat. Työttömyyskassoihin kuuluvien osuus potentiaalisista jäsenistä on kuitenkin pysynyt melko muuttumattomana viimeisen 20 vuoden aikana, ollen noin 85 prosenttia. Toisin sanoen, noin 15 prosenttia työllisistä ei kuulu työttömyyskassaan. Nykyisessä taloudellisessa tilanteessa työttömyyden uhka on todellinen ja koskettaa aiempaa laajempaa joukkoa palkansaajia. Tässä raportissa pyritään selvittämään, mitkä palkansaajaryhmät jättäytyvät vapaaehtoisen ansiosidonnaisen työttömyysvakuutuksen piirin ulkopuolelle.
Tutkimuksessa hyödynnetään Tilastokeskuksen vuoden 2013 Työolotutkimusta, joka on liitetty FLEED (Finnish Longitudinal Employer-Employee Data) aineiston tietoihin henkilön toimintahistoriasta. Empiiristen tulosten mukaan on joukko henkilöitä, jotka hyötyisivät kassajäsenyydestä merkittävästi, mutta jättäytyvät silti jäsenyyden ulkopuolelle. Kassaan kuulumattomat ovat tyypilliseltä profiililtaan nuoria, epätyypillisissä työsuhteissa työskenteleviä ja matalasti koulutettuja miehiä. Näillä palkansaajaryhmillä on selvästi suuri työttömyysriski. Tulosten mukaan työssäoloehdon täyttymättömyydellä ei voida selittää kyseessä olevien palkansaajaryhmien kassajäsenyyden vähäisyyttä. Lisäksi kun otetaan huomioon, että nettokorvausaste on matalapalkkaisilla selvästi parempi korkeapalkkaisiin verrattuna, työttömyyskassan ulkopuolelle jättäytyminen kertoo epärationaalisesta päätöksenteosta.
Jatkotutkimuksena voisi keskittyä kassajärjestelmän ulkopuolelle jättäytyneeseen joukkoon ja tutkia mikä ajaa heidän motiiveitaan olla liittymättä kassaan. Onko kyse budjettirajoitteesta, ideologiasta, välinpitämättömyydestä, ryhmäpaineesta vai kenties tiedon puutteesta?
Raportissa luonnehditaan yrityskauppojen maantiedettä Suomessa. Huomattava osa kotimaisista fuusioista toteutuu alueiden sisäisinä yrityskauppoina. Toisin sanoen maantieteellinen läheisyys on keskeinen tekijä kotimaisissa yrityskaupoissa. Kotimaiset yrityskaupat vahvistavat taloudellisen toimeliaisuuden ydinalueen ja periferian eroja Suomessa. Syynä tähän on se, että Uudenmaan maakunnassa sijaitsevat yritykset hankkivat yrityskaupoilla
nettomääräisesti määräysvaltaa muiden maakuntien elinkeinoelämästä. Määräysvaltaa menettävät
melko tasaisesti kaikki muut Suomen maakunnat. Ostavan yrityksen henkilökunnan koulutustasolla on varsin selkeä ja yksisuuntainen vaikutus yrityskauppojen maantieteelliseen
rakenteeseen: korkea koulutustaso lisää kaukokauppojen, erityisesti ulkomaisten yritysten ostojen todennäköisyyttä. Ostavan yrityksen T&K-pääomakannalla on samansuuntainen
vaikutus. Suomalaisen yrityksen investoinnit T&K:hon lisäävät myös sen todennäköisyyttä tulla ulkomaisen yrityksen ostamaksi.
Tutkimuksessa tarkastellaan epämukavien työolojen ja johtamiskäytäntöjen vaikutuksia työntekijöiden eläköitymiskäyttäytymiseen Suomessa. Yhdistetty tutkimusaineisto sisältää tietoja työoloista, työtyytyväisyydestä, ja eläkeaikeista Tilastokeskuksen työolotutkimuksista sekä toteutuneista eläkkeelle siirtymisistä Eläketurvakeskuksen rekistereistä. Useamman yhtälön mallin tulokset osoittavat, että epämukavien työolojen aiheuttama tyytymättömyys työhön on yhteydessä eläkeaikeisiin, jotka seurantajakson aikana ilmenevät puolestaan aikaisempana eläkkeelle siirtymisenä. Uudet johtamiskäytännöt taas parantavat työtyytyväisyyttä ja eläkeaikomusten vähenemisen kautta pidentävät työuria.
The paper examines the effect of innovative work practices on the prevalence of sickness absence and accidents at work. We focus on several different aspects of workplace innovations (self-managed teams, information sharing, employer-provided training and incentive pay) along with the “bundles” of those practices. We use nationally representative individual-level data from the Finnish Quality of Work Life Survey from 2008. Using single equation models, we find that innovative work practices increase short-term sickness absence for blue-collar and lower white-collar employees. In twoequation models that treat innovative workplace practices as endogenous variables we do not find relationship between innovative work practices and sickness absence or accidents at work.
We examine the prevalence of sickness absenteeism and presenteeism, using survey data covering 725 Finnish union members in 2008. Controlling for worker characteristics, we find that sickness presenteeism is much more sensitive to workingtime arrangements than sickness absenteeism. Permanent full-time work, mismatch between desired and actual working hours, shift or period work and overlong working weeks increase the prevalence of sickness presenteeism. We also find an interesting trade-off between two sickness categories: regular overtime decreases sickness absenteeism, but increases sickness presenteeism. Furthermore, the adoption of three days’ paid sickness absence without a sickness certificate and the easing of efficiency demands decrease sickness presenteeism.
We examine the effect of the replacement rate of a social insurance system on sickness absence by exploiting a regression kink design. The elasticity of absence with respect to the benefit level, in addition to risk preferences, is a critical parameter in defining the optimal sickness insurance scheme. Using a large administrative dataset, we find a robust behavioral response. The statistically significant point estimate of the elasticity of the duration of sickness absence with respect to the replacement rate in a social insurance system is on the order of 1. Given our estimate, we characterize the optimal benefit level.
This paper investigates the links between a number of subjective measures of worker wellbeing and within establishment wage dispersion. These may be linked either because wage dispersion influences the way in which individuals perceive their own relative and prospective income or because they are concerned about fairness in general. The analysis is based on a data set where the Quality of Work Survey is matched with register-based information on individuals and establishments. The results show that there is no significant overall association. Some significant relationships, however, can be found if the method of pay is assumed to be performance pay that is based on individual or group performance. The results also suggest that the question as to whether wages are public knowledge can be of importance.
Tutkimuksessa tarkastellaan persoonallisuuden vaikutuksia pitkän aikavälin ansioihin ja työllisyyteen. Tarkastelu perustuu suomalaiseen kaksosaineistoon, jonka avulla on mahdollisuus ottaa huomioon perhetaustaan ja genetiikkaan liittyvien muuten havaitsemattomien tekijöiden vaikutus aikaisempia tutkimuksia paremmin. Tutkimuksessa käytetään faktorianalyysia mittaamaan latentteja persoonallisuuden piirteitä vuodelta 1981. Näitä ovat sosiaalisuus, miellyttävyys, suorituskeskeisyys, järjestelmällisyys, aktiivisuus ja rehellisyys. Tutkimuksessa hyödynnetään lisäksi tietoa neuroottisuudesta. Työmarkkinatulemia (työllisyyskuukausia ja ansiotasoa) mitataan vuosien 1990-2009 keskiarvolla. Tulosten mukaan suorituskeskeisten henkilöiden ansiotaso on selvästi korkeampi muihin ryhmiin verrattuna 20-vuoden seurantajakson aikana. Suorituskeskeisyys on myös positiivisessa yhteydessä korkeampiin pääomatuloihin. Tulokset eivät muutu, vaikka henkilöiden koulutus, aiempi terveydentila, negatiiviset elämäntilanteet ja terveyskäyttäytyminen otetaan huomioon.
The aim of this paper is to dicriminate between alternative compensation policies in Finnish industries using linked employer-employee data covering the period 1987–1992. Our results suggest that earnings equations should have a firm effect with a firm-specific intercept and seniority effect. There is also a strong association of firm-level compensation to education, in contrast to weak correlation to other human capital components such as general experience. Experience payments from initial tenure, and also from general experience, are increasing with educational level. We also examine the efficiency of the compensation policies on the basis of their impact on labor and total factor productivity. We find seniority compensations in general efficient. This holds particularly for the middle educated.
Low-wage subsidies are often proposed as a solution to the unemployment problem among the low skilled. Yet the empirical evidence on the effects of low-wage subsidies is surprisingly scarce. This paper examines the employment effects of a Finnish payroll tax subsidy scheme, which is targeted at the employers of older, full-time, low-wage workers. The system’s clear eligibility criteria open up an opportunity for a reliable estimation of the causal impacts of the subsidy, using the difference-in-difference-in-differences approach. Our results indicate that the subsidy system had no effects on the employment rate. However, it appears to have increased the probability of part-time workers obtaining full-time employment.
Running head: ANNOTATED BIBLIOGRAPHY 1
ANNOTATED BIBLIOGRAPHY 2
Annotated Bibliography
Arielle Black
Webster University
December 1, 2017
Annotated Bibliography
Fatma, I. K. (2017). The Level Of Wage And Labor Productivity In Hotel Industry: An Analysis. Eurasian Journal of Economics and Finance, 5(2), 36-50.
Wage is an aspect that happens today is high wage and high aggressiveness. Wage hypothesis that was created by Rees (1973) and Katz (1980) clarify that payment can't just be seen just as a generation cost yet additionally as a piece of a push to expand the work thriving and inspiration. This hypothesis is a wage effectiveness hypothesis, which expressed that organization's income can increment notwithstanding paying pay over the market wage harmony. Even though here the two specialists had ascertained the issue of work's quality however they have not achieved observational testing by building up specific model. Subsequently, the specialists saw this hole as a chance to unwind the marvels event to work and try to build up an exact model to see the impact of wage to profitability and variable that can quantify the nature of work and different factors that influence salary and efficiency at the same time.
The components utilized are the distinction between singular trademark, human capital, and nature of work life (Fatma, 2017). The approach of this exploration is constructivism approach through quantitative investigation procedure with concurrent condition framework. Examination unit in this exploration is work in friendliness industry. Estimation aftereffects of research demonstrate that instruction, preparing, knowledge, work hour and profitability have a critical positive impact on wage, while age and work status isn't massive. Nature of work life and payment have the enormous positive impact on profitability, while training, background, age, and work status have no huge impact. Imperative finding from inquiring about that preparation has a noteworthy implication for profitability however contrarily. Discoveries of this examination demonstrate that beneficial outcome of preparing to profitability will be greater in an association that ready to put resources into the workplace that help the work.
McGowan, M. A. (2017). Labor Market Mismatch and Labor Productivity: Evidence from PIAAC Data☆. In Skill Mismatch in Labor Markets, (pp. 199-241). Emerald Publishing Limited.
This paper investigates the connection amongst ability and capability confuse and work profitability utilizing cross-country industry information for 19 OECD nations. Using bungle pointers totaled from miniaturized scale information sourced from the current OECD Survey of Adult Skills (PIAAC), the principle comes about propose that higher aptitude and capability crisscross is related with bringing d ...
This paper explores the potential role of adverse working conditions in the determination of workers’ sickness absences. Our data contain detailed information on the prevalence of job disamenities at the workplace from a representative sample of Finnish workers. The results from reduced-form models reveal that workers facing adverse working conditions tend to have a greater number of sickness absences. In addition, reduced-form models clearly show that regional labour market conditions are an important determinant of sickness absences. Hence, sickness absences are more common in regions of low unemployment. Recursive models suggest that the prevalence of harms at the workplace is associated with job dissatisfaction and dissatisfaction with workers’ sickness absences.
“Can Firm-specific idiosyncratic financial data provide a solution to the mac...iosrjce
IOSR Journal of Economics and Finance (IOSR-JEF) discourages theoretical articles that are limited to axiomatics or that discuss minor variations of familiar models. Similarly, IOSR-JEF has little interest in empirical papers that do not explain the model's theoretical foundations or that exhausts themselves in applying a new or established technique (such as cointegration) to another data set without providing very good reasons why this research is important.
BUS308 – Week 1 Lecture 2 Describing Data Expected Out.docxcurwenmichaela
BUS308 – Week 1 Lecture 2
Describing Data
Expected Outcomes
After reading this lecture, the student should be familiar with:
1. Basic descriptive statistics for data location
2. Basic descriptive statistics for data consistency
3. Basic descriptive statistics for data position
4. Basic approaches for describing likelihood
5. Difference between descriptive and inferential statistics
What this lecture covers
This lecture focuses on describing data and how these descriptions can be used in an
analysis. It also introduces and defines some specific descriptive statistical tools and results.
Even if we never become a data detective or do statistical tests, we will be exposed and
bombarded with statistics and statistical outcomes. We need to understand what they are telling
us and how they help uncover what the data means on the “crime,” AKA research question/issue.
How we obtain these results will be covered in lecture 1-3.
Detecting
In our favorite detective shows, starting out always seems difficult. They have a crime,
but no real clues or suspects, no idea of what happened, no “theory of the crime,” etc. Much as
we are at this point with our question on equal pay for equal work.
The process followed is remarkably similar across the different shows. First, a case or
situation presents itself. The heroes start by understanding the background of the situation and
those involved. They move on to collecting clues and following hints, some of which do not pan
out to be helpful. They then start to build relationships between and among clues and facts,
tossing out ideas that seemed good but lead to dead-ends or non-helpful insights (false leads,
etc.). Finally, a conclusion is reached and the initial question of “who done it” is solved.
Data analysis, and specifically statistical analysis, is done quite the same way as we will
see.
Descriptive Statistics
Week 1 Clues
We are interested in whether or not males and females are paid the same for doing equal
work. So, how do we go about answering this question? The “victim” in this question could be
considered the difference in pay between males and females, specifically when they are doing
equal work. An initial examination (Doc, was it murder or an accident?) involves obtaining
basic information to see if we even have cause to worry.
The first action in any analysis involves collecting the data. This generally involves
conducting a random sample from the population of employees so that we have a manageable
data set to operate from. In this case, our sample, presented in Lecture 1, gave us 25 males and
25 females spread throughout the company. A quick look at the sample by HR provided us with
assurance that the group looked representative of the company workforce we are concerned with
as a whole. Now we can confidently collect clues to see if we should be concerned or not.
As with any detective, the first issue is to understand the.
We examine the impact of a Finnish reform in the 1990s that restricted the use of particular early retirement channels, unemployment pension and individual early retirement, and
simultaneously changed the rules of firm size related experience rating in disability pensions. Our emphasis is on how the reforms affected the incentives of the firms to hire older employees. In a simple model we illustrate how forward-looking behaviour of firms affects the value of a new hire. Simulations with the model illustrate that although the reform in the unemployment pension in principle affected particular age groups, 53-54 year olds in the case of unemployment pension and 55-57 year olds in the case of individual early retirement, the impacts on hiring may have been felt also in other, younger, age groups. On the other hand, the effects of both reforms are likely to have varied by firm size. In a differences-indifferences- in-differences analysis with firm-level data we show that the impact of the reforms has been to increase the probability of hiring especially in the age group 51-52 and
especially in the largest firms.
Similar to Using twins to resolve the twin problem of having a bad job and a low wage (20)
Talous & Yhteiskunta -lehden numero 4/2019 sisältää artikkeleita ja haastattelun, jotka kertovat alueellista keskittymistä käsitelleistä tutkimuksista. Suomen seitsemän suurimman kaupunkiseudun väestö kasvaa nopeimmin, kun taas pienempien kaupunkien ja maaseudun väestöosuus supistuu. Muutos on kuitenkin verrattain hidasta, ja sille on myös vastavoimia.
Talous & Yhteiskunta -lehden numeron 3/2019 teemana on työ ja terveys. Artikkeleissa tarkastellaan Suomen terveydenhuoltojärjestelmän toimivuutta ja pohditaan mitä voitaisiin oppia Ruotsissa jo tehdyistä terveydenhuollon uudistuksista. Muissa artikkeleissa käsitellään terveyskäyttäytymisen ja työmarkkinamenestyksen yhteyttä, työttömien aktivointia, työikäisten eritasoisia terveyspalveluja, työaikajoustojen vaikutusta terveyteen sekä informaatioteknologian ja tekoälyn käyttöä mielenterveyspalvelujen tukena. Haastateltavana on THL:n tutkimusprofessori Unto Häkkinen. Hänen mielestään sote-uudistus on tehtävä, vaikka se vaatiikin vielä monen yksityiskohdan ratkaisemista.
Opiskelijavalinta ylioppilaskirjoitusten nykyarvosanojen perusteella ei ole täysin perusteltua, todetaan Aalto-ylipiston ja Palkansaajien tutkimuslaitoksen uudessa tutkimuksessa. Ylioppilaskirjoitusten arvosanoilla on pitkän ajan vaikutuksia. Hienojakoisempi arvosteluasteikko tekisi opiskelijavalinnasta nykyistä reilumman.
Esimerkkiperhelaskelmissa tarkastellaan seitsemää kotitaloutta. Laskelmat kuvaavat ansiotulojen, tulonsiirtojen sekä verojen ja veronluonteisten maksujen kehityksen vaikutusta perheiden ostovoimaan. Perheille lasketaan Tilastokeskuksen tietoihin perustuvat perhekohtaiset kulutuskorit, jotka mahdollistavat perhekohtaisten inflaatiovauhtien ja reaalitulokehitysten arvioinnin. Ensi vuonna eläkeläispariskunnan ostovoima kasvaa eniten ja työttömien vähiten. Esimerkkiperhelaskelmia on tehty Palkansaajien tutkimuslaitoksella vuodesta 2009 lähtien.
Palkansaajien tutkimuslaitos ennustaa Suomen talouskasvuksi tänä vuonna 1,3 prosenttia ja ensi vuonna 1,1 prosenttia. Kasvua hidastaa eniten yksityisen kulutuksen kasvun hidastuminen. Toisaalta vienti kasvaa tänä vuonna hieman ennakoitua nopeammin, neljä prosenttia, ja ensi vuonnakin vielä kaksi prosenttia. Tuotannollisten investointien kasvu jatkuu maltillisena, mutta rakentamisen vähentyminen kääntää yksityiset investoinnit kokonaisuutena pieneen laskuun ensi vuonna. Hallituksen vuoteen 2023 mennessä tavoittelemien 75 prosentin työllisyysasteen ja julkisen talouden tasapainon toteutumista on vaikea arvioida, koska nämä tavoitteet on määritelty rakenteellisina ja niiden eri arviointimenetelmät saattavat tuottaa hyvin erilaisia tuloksia.
Suomen palkkataso oli 2015 ylempää eurooppalaista keskitasoa. Suomen suhteellinen asema ei ole juurikaan muuttunut 2010-luvun alun tilanteesta. Hintatason huomioiminen kuitenkin heikentää asemaamme palkkavertailussa. Palkkaerot meillä olivat vertailumaiden pienimpiä ja pysyivät melko samalla tasolla koko tarkastelujakson 2007–2015 ajan. EU-maissa havaittiin erisuuntaista kehitystä palkkaeroissa. Suurin osa palkkojen kokonaisvaihteluista selittyi taustaryhmien sisäisillä palkkaeroilla.
Suomessa toteutettiin vuonna 2005 laaja eläkeuudistus, jossa vanhuuseläkkeen alaikärajaa laskettiin. Tutkimuksessa havaitaan, että ikärajan lasku aikaisti eläkkeelle jäämistä. Kun alaraja laskettiin 65:stä 63:een, myös yleinen eläköitymisikä laski. Taloudellisten kannustimien muutosten vaikutukset eläköitymiseen jäivät paljon heikommiksi alaikärajan muuttamiseen verrattuna. Eläköitymisikään voidaan siis vaikuttaa tehokkaasti ja vähäisin kustannuksin lakisääteistä eläkeikää muuttamalla.
Talous & Yhteiskunta -lehden numeron 2/2019 artikkelit ja haastattelu kertovat tutkimuksista, joita on tehty Suomen Akatemian strategisen tutkimuksen neuvoston hankkeessa "Osaavat työntekijät - menestyvät työmarkkinat". Keskeinen kysymys on, miten sopeudutaan teknologisen kehityksen mukanaan tuomaan työn murrokseen.
Tutkimuksessa tarkastellaan ammattirakenteiden polarisaatiota sekä sitä, että mihin supistuvissa ja rutiininomaisissa ammateissa olevat työntekijät päätyvät hyödyntämällä kokonaisaineistoa vuosille 1970-2014. Ammattirakenteiden polarisaatio on jatkunut Suomessa jo vuosikymmeniä. Ammattirakennemuutoksen kehityskulku on pääosin tapahtunut siten, että keskitason tuotanto- ja toimistotyöntekijät ovat nousseet urapolkuja pitkin asiantuntijatöihin. Viimeaikaista palveluammattien osuutta on puolestaan kasvattanut se, että nuoret siirtyvät työmarkkinoille palvelutöihin. Rutiininomaisia ja kognitiivisia taitoja vaativien ammattien työntekijöillä on kuitenkin suurempi todennäköisyys nousta korkeammille palkkaluokille rutiininomaista ja fyysistä työtä tekeviin työntekijöihin verrattuna. Rutiininomaista ja fyysistä työtä tekevät tippuvat puolestaan suuremmalla todennäköisyydellä matalapalkka-aloille, ja heidän ansiotason kehitys on myös heikompaa.
Palkansaajien tutkimuslaitos on alentanut Suomen talouskasvun ennustettaan kuluvalle vuodelle viimesyksyisestä 2,3 prosentista 1,4 prosenttiin. Kansainvälisen talouden näkymien epävarmuus hidastaa Suomen talouskasvua etenkin kuluvana vuonna. Jos pahimmat uhkakuvat jäävät toteutumatta, kasvu piristyy ensi vuonna hivenen 1,5 prosenttiin. Viime vuonna pysähtynyt viennin kasvu elpyy, ja myös yksityisen kulutuksen kasvu tukee talouskasvua. Suomi on sopeutunut ammattirakenteiden murrokseen yleisesti ottaen hyvin, mutta etenkin perusasteen koulutuksen varassa olevien varttuneiden työntekijöiden työllistämiseen voi olla vaikea löytää työkaluja.
The Labour Institute for Economic Research has lowered its forecast of Finland’s economic growth for the current year from last autumn’s 2.4 per cent to 1.4 per cent. Uncertainty in the international economic outlook will slow Finland’s economic growth, particularly this year. If the worst threats do not materialise, growth will pick up slightly next year to 1.5 per cent. Export growth, which came to a halt last year, will recover and growth in private consumption growth will also provide support to economic growth. In general, Finland has adjusted well to occupational restructuring, but it may be difficult to find means to employ older workers who only have basic education.
Palkansaajien tutkimuslaitos on alentanut Suomen talouskasvun ennustettaan kuluvalle vuodelle vii-mesyksyisestä 2,3 prosentista 1,4 prosenttiin. Kansainvälisen talouden näkymien epävarmuus hidastaa Suomen talouskasvua etenkin kuluvana vuonna. Jos pahimmat uhkakuvat jäävät toteutumatta, kasvu piristyy ensi vuonna hivenen 1,5 prosenttiin. Viime vuonna pysähtynyt viennin kasvu elpyy, ja myös yksityisen kulutuksen kasvu tukee talouskasvua. Suomi on sopeutunut ammattirakenteiden murrokseen yleisesti ottaen hyvin, mutta etenkin perusasteen koulutuksen varassa olevien varttuneiden työntekijöiden työllistämiseen voi olla vaikea löytää työkaluja.
Tämä PT Policy Brief tuo esiin havaintoja Suomen tuloerojen kehityksestä 1990-luvun puolivälin jälkeen. Tällä ajanjaksolla tuloerot ovat kasvaneet. Aluksi kasvu oli hyvin nopeaa, kunnes kehitys tasaantui finanssikriisin myötä. Tämä näkyy tarkasteltaessa kehitystä viiden vuoden ajalta lasketuissa keskituloissa. Taloudessa on tuloliikkuvuutta, ts. tulot vaihtelevat vuodesta toiseen. Havaitsemme, että liikkuvuus tuloportaikossa on vähentynyt. Samalla kun tuloerot ovat kääntyneet kasvuun, on tuloverotuksen progressiivisuus alentunut. Valtion tuloveron alennusten ohella tähän on erityisesti tulojakauman huipulla vaikuttanut pääomatulojen voimakas kasvu.
Julkisen budjetin sopeuttamistoimia toteutetaan usein etuuksien indeksileikkauksina tai tuloverojen korotuksina. Näillä toimenpiteillä on tulonjako- ja työllisyysvaikutuksia. Tämä PT Policy Brief esittää SISU-mallilla lasketut vaikutukset käytettävissä oleviin tuloihin tuloluokittain, jos valtion tuloveroasteikkoa korotettaisiin 0,4 prosenttiyksiköllä tai jos kansaneläkeindeksiä leikattaisiin. Molemmissa toimenpiteissä budjetti vahvistuisi 180 miljoonalla eurolla mutta tulonjakovaikutukset ovat huomattavan erilaiset. Oheisen kuvion mukaisesti indeksileikkaukset kohdistuvat voimakkaasti alempiin tulonsaajakymmenyksiin, kun taas tuloveron korotukset kohdistuvat ylempiin kymmenyksiin. Kun huomioidaan muutosten aiheuttamat työllisyysvaikutukset, kokonaiskuva muuttuu vain hieman.
Makeisvero otettiin käyttöön makeisille ja jäätelölle vuoden 2011 alusta. Virallinen perustelu oli kerätä verotuloja, mutta poliittisessa keskustelussa selvä tavoite oli ohjata kulutusta terveellisempään suuntaan. Makeisvero nosti selvästi makeisten kuluttajahintoja, mutta se ei vaikuttanut makeisten kysyntään. Toisaalta vuonna 2014 virvoitusjuomavero nousi sokerillisille juomille, mutta sokerittomat juomat jäivät alemmalle verotasolle. Tämä muutos alensi sokerillisten juomien kulutusta ja ohjasi kulutusta sokerittomiin juomiin. Onnistunut terveellisiin tuotteisiin ohjailu näyttääkin vaativan riittävän läheisen terveellisempien tuotteiden ryhmän olemassaolon.
Talous & Yhteiskunta-lehden "Suuren vaalinumeron" 1/2019 jutut käsittelevät aiheita, jotka voivat nousta esille kevään vaalikeskusteluissa. Pääpaino on ilmastonmuutoksessa: haastateltavana on Maailman ilmatieteen järjestön pääsihteeri Petteri Taalas, ja kahdessa eri artikkelissa pohditaan metsien hiilinielujen ja yhdyskuntarakenteen merkitystä pyrittäessä hillitsemään ilmaston lämpenemistä. Muut artikkelit käsittelevät tuloerojen kasvua, sotea, eläkkeiden riittävyyttä, maahanmuuttajien työllistymistä, EMUn uudistamista, eurooppalaista palkkavertailua ja kestävyysvajeen sopimattomuutta talouspolitiikan suunnitteluun.
Raportissa tehdään laskelmia korkeakouluopiskelijoille suunnatun opintotuen tulorajojen muutosten vaikutuksista. Opintotuen tulorajojen tavoite on, että suurituloisille opiskelijoille ei makseta opintotukea. Samalla nykyiset tulorajat kuitenkin estävät opiskelijoita tienaamasta niin paljon kuin he haluaisivat. Laskelmissa hyödynnetään simulaatiomallia, jonka avulla voidaan arvioida miten opiskelijoiden tulojakauma muuttuisi eri vaihtoehtoisissa opintotuen tulorajojen muutoksissa. Tulosten mukaan nykyisiä tulorajaoja voisi nostaa esimerkiksi 50 prosentilla, jolloin yhdeksän kuukauden ajan opintotukea nostavan opiskelijan vuosituloraja olisi 18 000 euroa nykyisen noin 12 000 euron sijaan. Laskelmien mukaan tällöin päästäisiin opintotuen nykyisten tulorajojen haitallisista tulovaikutuksista laajasti ottaen eroon, koska vain harva opiskelija tienaisi tätä tulorajaa enempää. Ottaen huomioon verotulot ja tulonsiirrot tämä vaihtoehto lisäisi julkisyhteisöjen nettotuloja arviolta 5,9 miljoonaa euroa vuodessa.
Tässä tutkimuksessa tutkitaan diskreettien valintajoukkojen vaikutusta palkansaajien työn tarjonnan reagoimiseen tuloveroihin. Artikkelin empiirisessä osiossa hyödynnetään opintotuen tulorajojen aiheuttamaa tuloveroissa tapahtuvaa äkillistä nousua, ja reformia, jossa tulorajoja nostettiin. Tulosten mukaan vuoden 2008 reformi, jossa tulorajaa nostettiin 9 opintotukikuukautta nostaneille 9000 eurosta 12000 euroon, aiheutti merkittäviä muutoksia opiskelijoiden tulojakaumassa. Tulojakauma siirtyi korkeammalle tasolle lähtien noin 2000 euron tuloista. Koska opiskelijoiden verojärjestelmässä ei tapahtunut muutoksia näin alhaisella tasolla vuoden 2008 reformissa, eivät työn taloustieteen normaalit mallit pysty selittämään tätä siirtymää. Artikkelissa esitetään empiirisiä lisätuloksia, teoreettisia argumentteja ja simulaatiomalli, jotka kaikki viittaavat siihen, että tuloksen pystyy selittämään diskreettien valintajoukkojen mallilla. Lisäksi artikkelissa esitetään, että verotuksen hyvinvointitappiot voivat olla suuremmat kuin empiirisesti estimoidut, jos valintajoukot ovat diskreettejä, mutta niiden ajatellaan olevan jatkuvia.
Talous & Yhteiskunta -lehden uuteen numeroon sisältyy artikkeleita veropohjasta ja -vajeesta, liikenteen veroista, naisista tulojakauman huipulla, työllisyyden kasvusta, mikrosimulaatiomalleista ja digitalisaatiosta. Lehdessä on myös Helsingin yliopiston professori Uskali Mäen haastattelu, jossa käsitellään tieteenfilosofista näkökulmaa taloustieteeseen.
Tutkimuksessa rakennettiin uusia makrotaloudellisia malleja PT:n ennustetyötä varten. Malleilla tehtiin ennusteita vuosille 2017 ja 2018. Mallien BKT-ennuste vuodelle 2017 on 3,1 prosenttia (vrt. toteutunut 2,8 prosenttia) ja vuodelle 2018 1,8 prosenttia (vrt. PT:n 11.9 ennuste 2,7 prosenttia).
Jennifer Schaus and Associates hosts a complimentary webinar series on The FAR in 2024. Join the webinars on Wednesdays and Fridays at noon, eastern.
Recordings are on YouTube and the company website.
https://www.youtube.com/@jenniferschaus/videos
A process server is a authorized person for delivering legal documents, such as summons, complaints, subpoenas, and other court papers, to peoples involved in legal proceedings.
Russian anarchist and anti-war movement in the third year of full-scale warAntti Rautiainen
Anarchist group ANA Regensburg hosted my online-presentation on 16th of May 2024, in which I discussed tactics of anti-war activism in Russia, and reasons why the anti-war movement has not been able to make an impact to change the course of events yet. Cases of anarchists repressed for anti-war activities are presented, as well as strategies of support for political prisoners, and modest successes in supporting their struggles.
Thumbnail picture is by MediaZona, you may read their report on anti-war arson attacks in Russia here: https://en.zona.media/article/2022/10/13/burn-map
Links:
Autonomous Action
http://Avtonom.org
Anarchist Black Cross Moscow
http://Avtonom.org/abc
Solidarity Zone
https://t.me/solidarity_zone
Memorial
https://memopzk.org/, https://t.me/pzk_memorial
OVD-Info
https://en.ovdinfo.org/antiwar-ovd-info-guide
RosUznik
https://rosuznik.org/
Uznik Online
http://uznikonline.tilda.ws/
Russian Reader
https://therussianreader.com/
ABC Irkutsk
https://abc38.noblogs.org/
Send mail to prisoners from abroad:
http://Prisonmail.online
YouTube: https://youtu.be/c5nSOdU48O8
Spotify: https://podcasters.spotify.com/pod/show/libertarianlifecoach/episodes/Russian-anarchist-and-anti-war-movement-in-the-third-year-of-full-scale-war-e2k8ai4
Presentation by Jared Jageler, David Adler, Noelia Duchovny, and Evan Herrnstadt, analysts in CBO’s Microeconomic Studies and Health Analysis Divisions, at the Association of Environmental and Resource Economists Summer Conference.
This session provides a comprehensive overview of the latest updates to the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (commonly known as the Uniform Guidance) outlined in the 2 CFR 200.
With a focus on the 2024 revisions issued by the Office of Management and Budget (OMB), participants will gain insight into the key changes affecting federal grant recipients. The session will delve into critical regulatory updates, providing attendees with the knowledge and tools necessary to navigate and comply with the evolving landscape of federal grant management.
Learning Objectives:
- Understand the rationale behind the 2024 updates to the Uniform Guidance outlined in 2 CFR 200, and their implications for federal grant recipients.
- Identify the key changes and revisions introduced by the Office of Management and Budget (OMB) in the 2024 edition of 2 CFR 200.
- Gain proficiency in applying the updated regulations to ensure compliance with federal grant requirements and avoid potential audit findings.
- Develop strategies for effectively implementing the new guidelines within the grant management processes of their respective organizations, fostering efficiency and accountability in federal grant administration.
Donate to charity during this holiday seasonSERUDS INDIA
For people who have money and are philanthropic, there are infinite opportunities to gift a needy person or child a Merry Christmas. Even if you are living on a shoestring budget, you will be surprised at how much you can do.
Donate Us
https://serudsindia.org/how-to-donate-to-charity-during-this-holiday-season/
#charityforchildren, #donateforchildren, #donateclothesforchildren, #donatebooksforchildren, #donatetoysforchildren, #sponsorforchildren, #sponsorclothesforchildren, #sponsorbooksforchildren, #sponsortoysforchildren, #seruds, #kurnool
Jennifer Schaus and Associates hosts a complimentary webinar series on The FAR in 2024. Join the webinars on Wednesdays and Fridays at noon, eastern.
Recordings are on YouTube and the company website.
https://www.youtube.com/@jenniferschaus/videos
Understanding the Challenges of Street ChildrenSERUDS INDIA
By raising awareness, providing support, advocating for change, and offering assistance to children in need, individuals can play a crucial role in improving the lives of street children and helping them realize their full potential
Donate Us
https://serudsindia.org/how-individuals-can-support-street-children-in-india/
#donatefororphan, #donateforhomelesschildren, #childeducation, #ngochildeducation, #donateforeducation, #donationforchildeducation, #sponsorforpoorchild, #sponsororphanage #sponsororphanchild, #donation, #education, #charity, #educationforchild, #seruds, #kurnool, #joyhome
Using twins to resolve the twin problem of having a bad job and a low wage
1. 292
A Kink that
Makes You Sick:
The Incentive
Effect of Sick
Pay on Absence
Petri Böckerman*
Ohto Kanninen**
Ilpo Suoniemi***
294
Using twins
to resolve the
twin problem of
having a bad job
and a low wage
Petri Böckerman
Pekka Ilmakunnas
Jari Vainiomäki
2. Helsinki 2014
* We would like to thank seminar participants at the Finnish Economic Association XXXVI Annual Meeting (Kuopio,
2014) and XXXI Summer Seminar for Economists (Jyväskylä, 2014) for comments. The data used in this study are
confidential. To obtain access to the data, please contact the Research Services unit of Statistics Finland, FI-00022,
Finland, tutkijapalvelut@stat.fi. The computer programs to generate the results of the study are available from Petri
Böckerman. This research has been financially supported by the Jenny and Antti Wihuri Foundation.
**Corresponding author. Turku School of Economics, Labour Institute for Economic Research, and IZA.
Address: Pitkänsillanranta 3A, FI-00530 Helsinki, Finland. E-mail: petri.bockerman@labour.fi
*** Department of Economics, Aalto University School of Business, P.O. Box 21240, FI-00076 Aalto, Finland.
E-mail: pekka.ilmakunnas@aalto.fi
**** Department of Economics, School of Management, FI-33014 University of Tampere, Finland.
E-mail: jari.vainiomaki@uta.fi
3. TYÖPAPEREITA 294
WORKING PAPERS 294
Palkansaajien tutkimuslaitos
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Labour Institute for Economic Research
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ISBN 978–952–209–131–4 (pdf)
ISSN 1795–1801 (pdf)
4. 1
Tiivistelmä
Tutkimuksen tavoitteena on tarkastella ns. kompensoivien palkkaerojen esiintymistä työmark-
kinoilla. Tutkimuksessa käytetään hyväksi suomalaista kaksosaineistoa. Kaksosten vertaami-
sen avulla voimme kontroloida työolojen valintaan liittyviä havaitsemattomia tekijöitä. Tulok-
set antavat tukea sille, että epämukavat työolot korvataan ainakin jossakin määrin työnteki-
jöille korkeamman palkan muodossa.
Abstract
We use data on twins matched to register-based information on earnings to examine the long-
standing puzzle of non-existent compensating wage differentials. The use of twin data allows
us to remove otherwise unobserved productivity differences that were the prominent reason for
estimation bias in the earlier studies. Using twin differences we find evidence for positive
compensation of adverse working conditions in the labor market.
JEL classification: J28, J31
Keywords: Compensating differentials; Earnings; Unobserved ability; Productivity
1. Introduction
The idea that adverse working conditions should be compensated in the form of higher pay is
an old one. It dates back at least to Adam Smith’s Wealth of Nations. Although the notion is
intuitively appealing, verifying it has turned out to be difficult. Over the years, empirical
5. 2
research has investigated this issue in various ways, but with conflicting results (see Rosen,
1986, for a survey).
The main approach has been to estimate hedonic wage functions, where earnings are explained
by personal characteristics and various indicators for working conditions. In a competitive
labor market with differing tastes and technologies, workers with a high distaste for a negative
aspect of work are matched with firms that have a low cost of avoiding it, and obtain a low
wage. Correspondingly, workers with a lower distaste for a disamenity are matched with firms
with a high cost of producing lower levels of it, and obtain a higher pay.
This forms the theoretical basis for expecting that estimation of a wage equation augmented
with job characteristics would yield estimates of compensating wage differentials.
A variety of different aspects of work have been investigated, including risk of death, physical
and mental harms, different hazards, shift work, part-time work, night work, promotion
prospects, conflicts etc. Sometimes the analysis is conducted at an aggregate level – for
example using industry or occupation as the observation unit – but mostly using individuals as
observation units. Even in the latter case the measures of working conditions may be taken
from a more aggregate level (firm or occupation). In the most appealing circumstances the
analyses use information on the actual working conditions that the workers face (e.g. Duncan
and Holmlund, 1983).
The clearest result is that occupations with a high risk of death are better compensated, given
the characteristics of the individual (e.g. Dorman and Hagstrom, 1998). However, in many
studies no compensating differential has been found or even have negative returns appeared.
This finding has initiated work that has aimed to explain the unexpected findings. Hwang et al.
6. 3
(1992) have shown theoretically how unobservable worker productivity differences cause
substantial bias in the estimates. Persons who have more human capital (and hence higher
productivity) choose jobs with both a higher wage and better working conditions, although
with fixed human capital there is a tradeoff between wage and job quality. Hwang et al. (1998)
have demonstrated that an additional bias is caused by unobserved productivity differences in
the firm side.
If there are unobservable individual characteristics that are correlated with the job
characteristics, panel data could be used to eliminate time-invariant unobservables (e.g. Brown,
1980). Another alternative is to account for the endogeneity of the working conditions by using
instrumental variables or selection correction (e.g. Garen, 1988). In practice, even these
solutions are not always successful. It is difficult to find appropriate instruments that are
significantly correlated with working conditions but are otherwise unrelated to earnings.
Another issue is measurement error in the working conditions variables. This error may arise
for example from the use of aggregate occupational measures, or from the use of self-reported
information. Classical measurement errors tend to attenuate the estimates for compensating
differentials. Using panel data with differencing has been suggested as a solution (at least
partial) to this problem in case of measurement error which is correlated within individual over
time (Duncan and Holmlund, 1983).
Other reasons for not finding compensating differentials (even with panel data) include wage
bargaining institutions (e.g. Daniel and Sofer, 1998), or search and other frictions in the labor
market (e.g. Manning, 2003). Both make the actual labor markets differ from the competitive
markets that underlie the theory of compensating differentials.
7. 4
We examine compensating differentials using data on twins. When wage differences within
pairs of identical twins are explained by within-pair differences in working conditions, the
unobservable characteristics that are similar to both twin are eliminated. This approach is an
alternative to the use of panel data and purges unobservables that are same within the family,
but may be time-varying e.g. by age. The effects are identified for twins who work under
different conditions. Using data on identical twins it is possible to account for genetic and other
family factors like parental investments that may predispose individuals to both poor working
conditions and low earnings.
We use a large sample of Finnish twins born before 1958, who were surveyed in 1975, 1981,
and 1990. The surveys include some work-related questions that we use to measure working
conditions; assessment of how monotonous the work is, physical demands of the work, and
opportunities to influence work content. The data can be linked to register data on the same
individuals. We explain earnings from tax registers in 1975 and 1990 by working conditions
reported in the surveys. This allows us to control for both time-invariant person-specific
unobservables and family-specific, possibly time-varying effects. We find that the results
support the idea that pooled OLS estimation and even fixed effect estimation may lead to an
underestimation of the wage effects of adverse working conditions. In twin differencing, the
estimates increase, and we find compensating differentials for having no influence on work
content and for physically demanding work.
The paper unfolds as follows. Section 2 analyzes potential biases arising from measurement
errors and autocorrelation of job characteristics and how they can be solved with appropriate
differencing using panel data on twins. Section 3 presents our data and Section 4 the estimation
results. Section 5 concludes the paper.
8. 5
2. Econometric issues in estimating compensating wage differentials
We investigate what factors cause biases in the estimates and how they can be avoided in
different types of data sets. To do this, we combine insights from Duncan and Holmlund
(1983) on measurement errors of working conditions and from Isacsson (2007) on the use of
twin data and panel data to remove unobservables. For ease of exposition we assume that there
is only one job characteristic variable and that there are no control variables (or they have been
netted out with a prior regression).
2.1 Accounting for unobserved effects using twin data and panel data
Following Isacsson (2007) we assume
0 1ijt ijt ijty J uβ β= + + , (1)
where ijty is log earnings, ijtJ is job characteristic, i=1, 2 denotes individuals within twin
pairs, j=1, … , N denotes twin pairs and t=1, … , T refers to years. The characteristic J is
assumed to be a positive aspect, so its return 1β is expected to be negative.
Furthermore, we assume the following structure for the error term:
ijt t ij ijtu A eγ= + , (2)
where ijA is an individual-specific, time-invariant unobserved characteristic (“ability”). tγ is
the return to unobserved ability, which we allow to vary over time (e.g. because of increasing
skill bias). Isacsson (2007) allows the ability term to change over time, but assumes the change
to be the same for both twins. Our formulation is slightly more general and can be justified as
9. 6
allowing the return to unobserved ability to change over time similarly to the return to
education.
It is well known that the cross-section OLS estimate is biased if ijA correlates with ijtJ . For
example, negative compensating differential for a job amenity is biased towards zero if the
more productive (able) persons choose more amenable jobs. The estimate can even turn
positive. This is the unobserved productivity (human capital) bias in estimating compensating
differentials stressed e.g. in Brown (1980), Duncan and Holmlund (1983) and Hwang et al.
(1992).
Panel data fixed effects (time difference) estimator is obtained by using OLS for the equation
1( ) ( ) ( )ijt ijs ijt ijs t s ij ijt ijsy y J J A e eβ γ γ− = − + − + − , t s> (3)
If s = t-1, this is the first-difference (FD) model, otherwise the long difference model. This
yields consistent estimates for 1β only if ability-related wage growth components are not
correlated with the changes in job characteristics. However, if more able persons’ higher wage
growth (( )t s ijAγ γ− >0) leads them to choose better job conditions (( )ijt ijsJ J− >0), the
compensating differential estimate 1
FD
β is biased towards zero. The standard panel data
assumption is that the return to ability is constant over time, ( t sγ γ− ) = 0, which eliminates the
bias.
A fixed effects estimator based on twin data (twin differences) is given by
1 2 1 1 2 1 2 1 2( ) ( ) ( )jt jt jt jt t j j jt jty y J J A A e eβ γ− = − + − + − (4)
It is a standard assumption that the unobserved ability is equal for identical (MZ)
twins, 1 jA = 2 jA , because they share exactly the same genes and they are usually brought up in
10. 7
the same family environment and they usually also share the same peer group in their youth.
This assumption yields consistent estimates for compensating differentials 1β for MZ twins,
because the ability term is eliminated due to twin-differencing. However, for DZ twins and
other siblings the compensating differentials estimates are biased towards zero if twin-
differences in ability correlate positively with twin-differences in job amenities.
A Difference-in-Differences (time difference – twin difference) estimator is obtained from
1 1 2 2 1 1 1 2 2 1 2
1 1 2 2
( ) ( ) [( ) ( )] ( )( )
[( ) ( )]
jt js jt js jt js jt js t s j j
jt js jt js
y y y y J J J J A A
e e e e
β γ γ− − − = − − − + − −
+ − − −
(5)
The DiD estimator removes the ability effects only if the ability related wage growth
components are fixed within twin pairs (i.e. pair specific). This prevails, for example, if
1 jA = 2 jA for MZ twins. Otherwise, e.g. for DZ twins, a downward bias remains even in DiD
estimation, if the twin with higher wage growth is experiencing larger improvement in job
amenity over time.
Isacsson (2007) assumes the following structure for the ability term:
ijt j ij jA f g h t= + + . (6)
In this case the wage growth component ( )jh t s− is the same for both twins in the twin pair, so
it is eliminated by twin-differencing. The twin-difference in individual-specific effects
1 2j j jg g g∆ = − is time-invariant, so it is eliminated by time-differencing in the DiD estimator.
In this case DiD is consistent (unbiased).
Our formulation is slightly more general and clarifies the central assumption for the
consistency of DiD. The wage growth component ( )t s ijAγ γ− must be pair-specific, not
individual-specific, for the DiD to be consistent. Our formulation allows for wage growth to be
11. 8
different for the two twins in general, but making the equal ability assumption for the MZ
twins, wage growth turns out to be the same for the twins. Thus, the wage growth term is
eliminated in the DiD estimation, and thereby the ability bias is avoided. But it remains, for
example, for DZ twins. The DiD for MZ twins is therefore unbiased with the standard
assumption of equal ability within MZ twin pairs.
2.2 Measurement error bias with correlated errors and job characteristics
Assume that job characteristics are measured with error (the individual and pair indexes are not
shown for simplicity)
*
t t tJ J ε= + , (7)
where tε is measurement error, *
tJ is the observed job characteristic and tJ is the true job
characteristic.
Assuming that random measurement error is not correlated with true job characteristic J or
with ability A, the cross-section OLS is (further) biased towards zero due to the well-known
attenuation bias. The bias towards zero is increasing in the noise-to-signal ratio. It is often
assumed that differencing increases the bias to the extent that the noise-to-signal ratio is higher
compared to cross-section OLS.
Next we allow for the measurement error to be correlated over time using the same s period lag
in the correlation structure as in the time differencing above
t s tvεε ρ ε= + , (8)
where 2
. . (0, )t vv i i d σ≈ . It can then be shown that for ,
var( )tε∆ =
2
2
1
v
ε
σ
ρ+
, (9)
12. 9
where we have used
2
2
var( ) var( ) var( )
1
v
t s
ε
σ
ε ε ε
ρ
= = =
−
.
Furthermore, we assume that the true job characteristics may also be correlated. With
unchanged preferences for working conditions, and unchanged market price for job amenities,
an individual’s optimum wage-amenity combination should be stable over time, captured here
by high autocorrelation (again, we use lag s in the correlation structure)
t J s tJ J wρ= + , (10)
where 2
. . (0, )t ww i i d σ≈ . Then, analogously to measurement error, we get
var( )tJ∆ =
2
2
1
w
J
σ
ρ+
(11)
Using this and the previous result for measurement error to rewrite the noise-to-signal ratio, we
obtain for the probability limit of the FE (time difference) estimate of compensating
differential
plim 1 1
1 2
2
(1 )1 var( ) var( )
1
(1 )
FE
J vt t
w
J
ε
β β
β
ρ σε
ρ σ
= =
++ ∆ ∆
+
+
(12)
This formulation implies that the bias in the estimate towards zero is larger, ceteris paribus, if
1) 2
vσ increases (there is more measurement error)
2) 2
wσ decreases (there is less idiosyncratic variation in true J)
3) Jρ increases (true J is more highly correlated, i.e. more persistent)
4) ερ decreases (measurement error is less correlated, i.e. less persistent)
13. 10
As noted by Duncan and Holmlund (1983), if individuals have a tendency to persistently over-
or underestimate their working conditions in surveys, the job characteristics measures are
strongly correlated over time. Time-differencing this time-invariant measurement error
component out reduces measurement error bias. However, it does not disappear even in the
case of perfect autocorrelation, as claimed by Duncan and Holmlund (1983).1
Note that high correlations in signal and measurement error have opposing effects on the bias.
Persistence in measurement error improves, but persistence in signal worsens the consistency
of the fixed effects estimate for compensating differential. The latter effect arises because the
variation in the differenced explanatory variable is reduced by persistence in working
conditions over time. However, using very long differences may lower the autocorrelation in J.
We use the job characteristics as indicator variables. The following results apply to the
measurement error (classification error) in this case (Freeman, 1984)
plim 1 1 10 01 *
var( )
(1 )
var( )
OLS t
t
J
p p
J
β β= − − (13)
plim 1 1 10 01 *
var( )
(1 )
var( )
FE t
t
J
p p
J
β β
∆
= − −
∆
(14)
where 10p and 01p are the misclassification probabilities, i.e. 10p ( 01p ) is the probability that
1 (0) is erroneously classified as 0 (1). Since J and J*
are binary, var( ) (1 )tJ P P= − and
* * *
var( ) (1 )tJ P P= − , where P and P*
are the proportions of true and observed 1’s. Further, if
these proportions are equal, the limit of the OLS estimate reduces to
1 1 10 01plim (1 )OLS
p pβ β= − − .
1
Duncan and Holmlund (1983, p. 371) argue that “… in the special case with ‘perfect’ autocorrelation (ρ=1), the
OLS estimate is consistent.” However, in this case
2
var( )t vε σ∆ = , so the signal-to-noise ratio does not disappear
from (12).
14. 11
For the size of bias these formulas have similar implications as in the continuous case:
1) more misclassification increases the bias towards zero
2) higher noise-to-signal ratio (lower variance ratio of true J to observed J*
) increases the
bias
3) FE bias is larger than OLS bias if noise-to-signal ratio is larger in differences
However, these results assume uncorrelated measurement error.2
2.3 Comparison of twin-differences vs. time-differences FE estimators
The results for the panel FE (time-difference) estimator above extend analogously to the twin-
difference estimator, where the difference is taken between the two twins in the same pair. The
correlations are now between the true job characteristics or the measurement errors of the two
twins within the same pair.
Therefore, we make the following conclusions regarding the relative biases in twin-difference
and panel-difference FE estimators:
1) If the within twin-pair correlation in true J ( Jρ ) is smaller than the panel correlation
for individuals, then the bias from Twin FE is smaller than that from time difference
FE, other things being equal. This should be the case, because it is likely that
2
The issue of measurement errors in binary variables, combined with correlation over time has not been
examined in the literature. This would involve specifying the probabilities of staying at the same value (0 or 1)
over time, 00q and 11q , and the corresponding transition probabilities, 01 001q q= − and 10 111q q= − .
15. 12
preferences for job characteristics vary more between twins than for an individual over
time, at least when relatively short differences are used.3
2) If the twin correlation in measurement error ( ερ ) is also smaller than the panel
correlation, then the bias from Twin FE tends to be larger than that from time-
difference FE, other things being equal. This should be the case, because it is less likely
that the two twins over- or underestimate their working conditions in the same way than
it is for the same individual to over- or underestimate in different time periods.
Therefore, we cannot make unambiguous predictions about the size of bias in Twin FE and
time difference FE due to measurement error effects.
Neither can we make definitive conclusions about the size of unobserved ability bias in these
two estimators in Section 2.1. There is no unobserved ability bias in panel FE, if there are no
wage growth effects from ability. Twin FE is unbiased for MZ, if their ability is equal. Both of
these assumptions can in principle be questioned, so unbiasedness cannot be claimed
indisputably.4
Furthermore, not even DiD is unambiguously consistent without further
restrictions on ability effects. However, for MZ twins the DiD estimator is unbiased given the
standard assumption of equal ability within MZ twin pairs. For DZ twins and other siblings the
bias from unobserved heterogeneity remains. The size of biases is therefore an empirical issue.
3
Cesarini et al. (2009) show that genetic factors explain only about 20% of the variation in behavior in their
dictator experiments. Hence social preferences are only in small part explained genetically.
4
For example, Sandewall et al. (2014) challenge the identification power of equal ability assumption for MZ
twins. They argue that controlling additionally for IQ test scores reduces within-twin pair estimates of returns to
schooling by about 15%. However, their within-twin pair estimates are over 50% smaller than cross-sectional
OLS estimates, so it seems that the “equal ability” assumption for MZ twins accounts for the bulk of the ability
variation across individuals.
16. 13
3. Data
The twin data used in this study are based on the Older Finnish Twin Cohort Study of the
Department of Public Health at the University of Helsinki. The initial twin data gathered in
1974 contain almost all same-sex DZ (dizygotic) and MZ (monozygotic) twins in the Finnish
population born before 1958 (see Kaprio et al., 1979; Hyytinen et al., 2013). The surveys were
sent to the twins in 1975, 1981, and 1990. Identification of the DZs and MZs is based on the
survey questions, but later this identification was confirmed for a small subsample using blood
markers. The results based on the tests and surveys matched almost perfectly.
We link the twin sample to the FLEED (Finnish Longitudinal Employer-Employee Data)
maintained by Statistics Finland using personal ID codes attached to every person residing in
Finland.5
This matching is exact, and there are no misreported ID codes. We therefore avoid
problems associated with errors in record linkages (e.g., Ridder and Moffitt, 2007). FLEED is
constructed from a number of different registers of individuals and firms maintained by
Statistics Finland. FLEED includes information on individuals’ labor market status and salaries
and other income, taken directly from tax and other administrative registers that are collected
and/or maintained by Statistics Finland. Thus, our earnings data do not suffer from
underreporting or recall error, nor is it top coded. We concentrate on year 1990 in the FLEED
data, as a twin survey is available from the same year. For the survey year 1975 earnings data
are available from the Longitudinal Population Census of Statistics Finland. (There is no
income information available for the survey year 1981.) The income measure is the logarithm
of annual earnings from the tax register. Because the data on earnings contain some outliers,
we have truncated the observations outside the 1st
and 99th
percentiles.
5
Hyytinen et al. (2013, p. 63) document that the life-time labor market outcomes of the linked twin data are
representative of the Finnish population.
17. 14
Working conditions are self-reported in the survey waves conducted in 1975 and 1990.
Monotonous work (1975 and 1990) is measured using the question “your work can be
characterized as” with the alternatives: “very monotonous”, “rather monotonous”, “rather non-
repetitive” and “very non-repetitive”. To detect potential non-linear patterns in the effect of
working conditions on earnings, we form three binary indicators for the degree of monotony of
work, using “very non-repetitive” as the reference category. Opportunities to influence work
methods (1990) are measured with the alternatives: “no influence”, “some influence” and
“substantial freedom in choosing work methods”. We use two indicators for the level of
influence, with “substantial freedom” as the reference. Physically demanding work (1975 and
1990) is measured with alternatives: “my work is physically very demanding”, “my work
involves lifting and carrying objects in addition to standing and walking”, “my work involves
standing and walking but no other physical activity” and “my work requires hardly any
physical activity”. Again, we use binary indicators for the types of physical demands with
“hardly any” as the reference category.
To prevent education and early pension choices from affecting our earnings measures, we
restrict the analyses to persons in prime working age. All empirical specifications are estimated
for individuals born after 1944 but before 1958. Our analysis focuses on men, because they are
more strongly attached to the labor market. Male labor supply decisions are also much less
complex compared with women because men are less affected by family and fertility choices.
All models include (unreported) control for observed human capital using the years of
education, based on standard degree times used by Statistics Finland.
18. 15
4. Results
Before the presentation of the estimation results, it is useful to report some unconditional
correlations of our measures for working conditions in the twin data. Table 1 documents that
measured self-reported working conditions are significantly less correlated between twins
(Panel A) than within individuals over time (Panel B), even when the time difference is as long
as from 1975 to 1990. The pattern gives some support for our conjecture above that the same
would hold for the correlations of true working conditions. This would imply that the twin FE
estimates are less biased than the panel FD estimates, other things being equal.
===== Table 1 here =====
The central aim of this paper is to compare various estimations to evaluate different sources of
bias. We first present the standard OLS estimates to obtain baseline results that are comparable
to the earlier studies. Then we proceed to estimate models using twin differences to control for
otherwise unobserved productivity/human capital effects. The estimations for DZs control for
sibling effects i.e. family background and some of the genetics (DZ twins share about 50% of
genes). The estimations using data on MZs control for family background, peer effects and
genetics more completely (MZ twins are genetically identical).6
We also estimate panel data fixed effects models using two of our three measures for working
conditions that are available in the survey waves for both 1975 and 1990. First, we estimate
individual-level fixed effects models using the panel dimension of the data (i.e. long
6
We focus on models in which each working condition measure is entered in a separate model, because there is
substantial correlation between the measures.
19. 16
differences of 15 years). These models control for all time-invariant unobservable
characteristics at the individual level.
Second, we estimate fixed effects specifications for twin differences, i.e. Difference-in-
Differences models. In addition to the standard twin differences for DZs and MZs, these
models also control for all otherwise unobservable time-invariant characteristics at the twin
pair level that may matter for workers’ sorting into workplaces. For example, it is possible that
the place of residence,7
spouse’s occupation or family situation in general have effects on
persons’ occupational choices and therefore on working conditions. To the extent that these
effects vary between twins, but are invariant over time, their effects are not controlled by twin
differencing, but are controlled by time differencing of twin differences.
Since the working condition variables describe negative aspects of work, the compensating
differentials would imply positive coefficients (unlike in Section 2 above, where the job
characteristic was a positive aspect). The standard OLS estimates show that the indicator for
rather monotonous work and the indicators for somewhat and very physical work are
significantly negatively related to earnings (Table 3, Panels A and C, Column 1). This result is
contrary to the expected positive compensating wage differential for adverse working
conditions. The pattern is likely to be driven by unobserved heterogeneity related to the sorting
of workers into different working conditions. The OLS estimations of compensating wage
differentials in other studies have also often found wrong-signed premiums for adverse
working conditions.
7
Finland is sparsely populated. In many regions there are only a few large firms with a fixed set of tasks and
working conditions.
20. 17
Next we turn to the results that use the panel dimension of our data. Table 2 reports the
estimates for individual-level panel fixed effects models. These results show that controlling
for time-invariant unobservable characteristics at the individual level is not able to remove the
negative compensating wage differentials for our measure of physical work (Table 2, Panel B).
In fact, we observe a statistically significant negative compensation. Our result is similar to
Duncan and Holmlund (1983, p. 373) who also do not find a positive compensating wage
differential for physically demanding work in panel FE models. However, Duncan and
Holmlund (1983) find support for compensating wage differentials for dangerous work and
stressful work in panel estimations.8
Our panel results are similar to the OLS estimates. One
reason may be the difference in the working conditions being studied.
===== Table 2 here =====
The use of twin differences changes the picture (Table 3, Columns 2-3). First, the statistically
significant negative effects observed in the OLS models turn either insignificant or positive in
the twin difference models. Second, we obtain some evidence for positive compensation for
adverse working conditions. In particular, having no influence at work and being positioned in
somewhat physical work both have a statistically significant positive effect on earnings for
MZs at the 10% level (Table 3, Panels A and B, Column 3). For DZs we obtain a positive
effect at the 10% level also for some (rather than substantial) influence at work. This effect is
positive and larger for MZs, as expected, but it is not statistically significant, possibly due to
the smaller sample size. For MZs the point estimate of no influence at work is notably larger
than the estimate for some influence. These results suggest that the unobserved ability bias
considerably affects the OLS point estimates. Even using twin differences we do not obtain
significant positive compensation for monotonous work. We also find that the positive
8
Böckerman et al. (2011) obtain a positive compensating differential for job uncertainty using Finnish panel data.
21. 18
compensation for physical work does not apply to those who are in the worst working
conditions.
===== Table 3 here =====
The unique feature of our data is that we are also able to perform Difference-in-Differences
estimations (Table 4). These specifications control for unobservable time-invariant
characteristics at the twin pair level and for the common wage growth for the twins. We find
evidence for positive compensating wage differentials for both monotonous and physical work
using the data on MZs (Table 4, Panels A and B, Column 3). The effects are statistically
significant only at the 10% level probably because the sample size is even smaller for MZs
when using information on working conditions and earnings both in 1975 and 1990.
For physical work the results in Table 4 are similar to the ones that use twin differences for
MZs in Table 3. For rather monotonous work the point estimates are also similar but the effect
obtains statistical significance only in Table 4. It is notable that the point estimates for
significant effects are similar in Tables 3-4 and in accordance with the discussion in Section 2.
Assuming that equal ability assumption holds for MZs the results support the notion that both
twin difference estimates and D-in-D estimates are unbiased for MZs.
===== Table 4 here =====
22. 19
5. Conclusions
We use twin data matched to register-based information on earnings to examine the long-
standing puzzle of non-existent compensating wage differentials. The use of twin data allows
us to remove otherwise unobserved productivity differences that are the prominent reason for
estimation bias in the earlier studies.
The standard OLS estimates show negative or insignificantly positive compensating wage
differentials as are often also found in the earlier studies. In contrast to Duncan and Holmlund
(1983), who found some support for compensating wage differentials in panel estimations, our
panel results are similar to the OLS estimates.
The use of twin differences changes the picture. Using twin differences for MZs we find
evidence for positive wage compensation for somewhat physically demanding work and for
having no influence on work content. These results suggest that unobserved ability bias affects
the OLS point estimates considerably.
The unique feature of our data is that we are able to estimate specifications that also control for
unobservable time-invariant characteristics at the twin pair level (e.g. place of residence,
spouse’s occupation, or family situation) and the common wage growth for the twins. We find
evidence for positive compensating wage differentials for both monotonous and physical work
using the data on MZs. Assuming that equal ability assumption holds for MZs, the results
imply that both twin difference estimates and Difference-in-Differences (combined twin
difference – time difference) estimates are unbiased for MZs.
23. 20
The pattern that positive compensating wage differential does not prevail in the worst working
conditions (i.e. “very monotonous work” and “very physical work”) may be due to the lack of
control for workers’ bargaining power, if bargaining power effects are particularly important in
the most onerous low-wage jobs. Daniel and Sofer (1998) argue that positive relationship
between job amenities and earnings is possible along the contract curve from joint bargaining
of job amenities and earnings.
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25. 22
Table 1. Correlation coefficients between the measures of working conditions.
Panel A: within twin-pairs
(1990)
DZ MZ
Monotonous work 0.0915
(0.1056)
0.2216***
(0.0090)
Opportunities to influence 0.1144**
(0.0428)
0.1334
(0.1189)
Physically demanding work 0.0696
(0.2188)
0.1911**
(0.0248)
Panel B: within individuals
(1975-1990)
DZ MZ
Monotonous work 0.2258***
(0.0000)
0.2349***
(0.0000)
Physically demanding work 0.2571***
(0.0000)
0.2251***
(0.0000)
Notes: Spearman’s rank correlation coefficients reported. Significant at *10%, ** 5%, and *** 1% level.
26. 23
Table 2. The effect of working conditions on earnings: individual-level panel fixed effects
estimations.
Panel A: FE All FE DZ FE MZ
Very monotonous work -0.1322
(0.2600)
-0.1726
(0.3344)
-0.1067
(0.3297)
Rather monotonous work -0.0350
(0.1661)
-0.2266
(0.1959)
0.4111
(0.3101)
Rather non-repetitive work -0.0856
(0.1027)
-0.1347
(0.1249)
0.0227
(0.1783)
N 1232 855 377
Panel B: FE All FE DZ FE MZ
Very physical -0.6731***
(0.1770)
-0.6581***
(0.2163)
-0.7041**
(0.3051)
Rather physical -0.3849***
(0.1409)
-0.3698**
(0.1758)
-0.4158*
(0.2274)
Somewhat physical -0.1608
(0.1685)
-0.1629
(0.2151)
-0.1614
(0.2581)
N 1303 906 397
Notes: Working conditions are measured in 1975 and 1990. In Panel A the reference category is very non-
repetitive work. In Panel B the reference category is non-physical work. All models include (unreported) control
for the years of education. Significant at *10%, ** 5%, and *** 1% level.
27. 24
Table 3. The effect of working conditions on earnings.
Panel A: OLS Twin differences:
DZ
Twin differences:
MZ
Very monotonous work -0.2306
(0.3624)
-0.0999
(0.2078)
-0.0254
(0.2913)
Rather monotonous work -0.3467**
(0.1724)
-0.1032
(0.2484)
0.7219
(0.4881)
Rather non-repetitive work -0.0861
(0.0927)
0.0252
(0.1227)
-0.0279
(0.2265)
N 1988 994 324
Panel B: OLS Twin differences:
DZ
Twin differences:
MZ
No influence -0.4030
(0.2792)
0.2358
(0.3047)
0.5718*
(0.2969)
Some influence 0.0824
(0.0765)
0.1966*
(0.1024)
0.2749
(0.2246)
N 1872 936 311
Panel C: OLS Twin differences:
DZ
Twin differences:
MZ
Very physical -0.4593**
(0.1833)
-0.2424
(0.2555)
-0.1191
(0.4529)
Rather physical -0.0775
(0.1121)
-0.1105
(0.1760)
0.1016
(0.2816)
Somewhat physical -0.2832*
(0.1613)
0.0516
(0.2047)
0.6869*
(0.3564)
N 2030 1015 334
Notes: All working conditions are measured in 1990. In Panel A the reference category is very non-repetitive
work. In Panel B the reference category is having substantial influence. In Panel C the reference category is non-
physical work. All models include (unreported) control for the years of education. Significant at *10%, ** 5%,
and *** 1% level.
28. 25
Table 4. The effect of working conditions on earnings: fixed effects specification for twin
differences (difference in differences).
Panel A: FE All FE DZ FE MZ
Very monotonous work 0.3404
(0.2716)
0.3686
(0.3099)
0.4236
(0.4153)
Rather monotonous work 0.0855
(0.1975)
-0.1071
(0.2321)
0.6141*
(0.3568)
Rather non-repetitive work 0.0277
(0.1042)
0.0643
(0.1191)
-0.0195
(0.2084)
N 806 554 252
Panel B: FE All FE DZ FE MZ
Very physical -0.1565
(0.2306)
-0.2078
(0.2965)
-0.0694
(0.3487)
Rather physical 0.0864
(0.1831)
-0.0721
(0.2308)
0.4199
(0.2824)
Somewhat physical 0.1354
(0.1648)
-0.0926
(0.1884)
0.5946*
(0.3121)
N 874 600 274
Notes: Working conditions are measured in 1975 and 1990. In Panel A the reference category is very non-
repetitive work. In Panel B the reference category is non-physical work. All models include (unreported) control
for the years of education. Significant at *10%, ** 5%, and *** 1% level.