A Global Vector Autoregression (GVAR) model for regional labour markets and its forecasting performance with leading indicators in Germany
01 April 2015
The focus of this paper is on forecasting regional labour markets. It is broadly accepted that two aspects regarding the modeling strategy are essential for the accuracy of forecast: a parsimonious model focusing on the important structures, and the quality of prospective information. Here, we establish a Global VAR framework, a technique that considers a variety of spatio-temporal dynamics in a multivariate setting, that allows for spatially heterogeneous slope coefficients, and that is nevertheless feasible for data without extremely long time dimension. Second, we use this framework to analyse the prospective information regarding the economy due to spatial co-development of regional labour markets in Germany. The predictive content of the spatially interdependent variables is compared with the information content of various leading indicators which describe the general economic situation, the tightness of labour markets and environmental impacts like weather.
IAB-Discussion Paper 13/2015
AAPOR Report on Big Data
23 March 2015
There is a great potential in Big Data but there are some fundamental challenges that have to be resolved before its full potential can be realized. In this report we give examples of different types of Big Data and their potential for survey research. We also describe the Big Data process and discuss its main challenges.This report has four objectives: to educate the AAPOR membership about Big Data (Section 3), to describe the Big Data potential (Section 4 and Section 7), to describe the Big Data challenges (Section 5 and 6) and to discuss possible solutions and research needs (Section 8).
AAPOR Report on Big Data
Job mobility as a new explanation for the immigrant-native wage gap
23 March 2015
Theoretically, wage gaps between migrants and natives can be explained by human capital theory through either depreciation in human capital with migration or differences in endowments. However, even after considering human capital measures, an unexplained difference remains. We assume that differences in the employment trajectories of migrants and natives contribute to wages that diverge after labor market entrance. Utilizing a rich longitudinal data set (ALWA-ADIAB), we analyze the job mobility of migrants and natives in Germany and distinguish among voluntary, involuntary, internal and other job changes.
IAB-Discussion Paper 12/2015
Direct and indirect effects of mass layoffs
20 March 2015
Using a novel data set that contains precise geo-referenced information on the universe of German establishments, we analyse both the direct effects of mass layoffs and any indirect impacts on workers who are employed in the vicinity of an establishment being closed down. In line with the literature, we document economically significant impacts of mass layoffs on the employment and earnings prospects of directly displaced workers. In contrast, neither an individual-level difference-indifference approach nor an alternative establishment-level approach inspired by the spatial economics literature find evidence of additional adverse economic effects for workers or establishments indirectly exposed to mass layoffs.
IAB-Discussion Paper 11/2015
From deregulation to re-regulation
12 March 2015
From the mid-1980s until 2005 the German labour market was characterised by continuous deregulation. In the period of an improving German labour market, the German governments have since imposed measures to re-regulate the labour market in order to strengthen employees' rights. At the same time one can observe a tendency towards atypical forms of employment and an increase in low-wage employment. Two closely interrelated questions arise: What role did deregulation play with respect to the overall improvement of the German labour market and shifts in the employment structure? How could re-regulation impact labour market performance and employment structure in the future? The paper presents evidence that institutional reforms were an important driver of the improvement of the German labour market as well as of changes in the employment structure but definitely not the only one.
IAB-Discussion Paper 10/2015
Multinational resilience or dispensable jobs?
03 March 2015
This article investigates the employment development of Czech-based firms in German ownership in the years around the Great Recession of 2008/2009. The intense involvement of German firms in the economy of the neighboring country via foreign direct investment (FDI) raises the question whether under the conditions of a historically deep global downturn, Czech employees in multinational companies were confronted with an increased volatility of their jobs.
IAB-Discussion Paper 9/2015
Structural Unemployment in Selected Countries
27 February 2015
Structural – or non-cyclical – unemployment is a consequence of mismatch between worker and job profiles, institutional conditions or persistent economic shocks. There is no convention how to measure structural unemployment. The following country re-ports sketch the specific situation based on national statistics. Nonetheless, it becomes clear that low qualification, skill depreciation during long unemployment spells, and regional disparity or structural imbalances are important aspects to consider when combating structural unemployment. Typically, the individual barriers to re-integration into the labour market are manifold which necessitates specifically tailored policy measures. However, the most efficient policy would be prevention.
This report introduces basics on structural unemployment in some member countries of the International Labour Market Forecasting Network. The Network is a cooperation of forecasters and policy advisors related to Public Employment Services. The following contributions were presented on the annual meeting 2014.
Current report: Structural Unemployment in Selected Countries
Do changes in regulation affect temporary agency workers' job satisfaction?
18 February 2015
This paper evaluates the impact on temporary agency workers' job satisfaction of a reform that considerably changed regulations covering the temporary help service sector in Germany. We isolate the causal effect of this reform by combining a difference- in-difference and matching approach and using rich survey data. We find that the change of the law substantially decreased agency workers' job satisfaction while regular workers' job satisfaction remained unchanged. Further analysis reveals that the negative effect on agency workers' job satisfaction can be attributed to a decrease in wages and an increase in perceived job insecurity.
IAB-Discussion Paper 8/2015
Intra-regional economic integration
17 February 2015
Regional clusters have attracted a great deal of attention for more than two decades. The interest comes from two major fields: regional economics and regional economic policy. At the interface between research and policy, the cluster-oriented regional information system CORIS is located. This research project generates information on supply chains, clusters, cluster participants and their embeddedness in two Bavarian regions. It provides a unique data source used for analyses in the present publication.
Offshoring of medium-skill jobs, polarization, and productivity effect
13 February 2015
We examine the effects of endogenous offshoring on cost-efficiency, wages and unemployment in a task-assignment model with skill heterogeneity. Exact conditions for the following insights are derived. The distributional effect of offshoring (high-) low-skill-intensive tasks is similar to (unskilled-) skill-biased technology changes, while offshoring medium-skillintensive tasks induces wage polarization. Offshoring improves cost-efficiency through international task reallocation and puts a downward pressure on all wages through domestic skill-task reallocation. If elasticities of task substitution are low (high), the downward pressure on wages in neighboring skill segments is low (high) with a net effect of higher (lower) wages and employment.
IAB-Discussion Paper 7/2015
Higher wages or lower expectations?
10 February 2015
Labour shortages are a field of research that has been investigated quite thoroughly. The reactions of firms facing problems during the hiring process are, however, largely neglected in empirical literature. Our research will fill this empirical gap and shed light on the question of whether reactions according to the neoclassical theory or to the Reder Hypothesis are more common in reality.
IAB-Discussion Paper 6/2015
The productivity effect of migrants
06 February 2015
Empirical evidence for the US shows that migrants increase the productivity of regions. To explain the impact of migrants on the average firm productivity we construct a general equilibrium model with monopolistic competition a la Melitz (2003). We consider heterogeneous firms with different productivity levels and imperfect substitutability between migrants and natives. This gives rise to wage differences between natives and migrants.
IAB-Discussion Paper 5/2015