Regina T. Riphahn

The Effect of Employment Protection on Worker Effort: A Comparison of Absenteeism During and After Probation

Employment protection systems are known to generate significant distortions in firms’ hiring and firing decisions. We know much less about the impact of these regulations on worker effort. The goal of this paper is to fill in this gap and in particular to assess whether the provision of employment protection induces less effort among workers in the form of absenteeism. Our analysis is based on weekly observations for the 858 white collar workers hired by a large Italian bank between January 1993 and February 1995. These workers begin to be protected against firing only after the twelfth week of tenure and we observe them for one year. We show that the number of days of absence per week more than doubles once employment protection is granted, thus confirming what is suggested by our theoretical model and what is typically assumed in the literature. We also discuss how this evidence can be used to estimate what the absenteeism rate would be in Italy if employment protection were eliminated.

Female Labor Supply and Parental Leave Benefits - The Causal Effect of Paying Higher Transfers for a Shorter Period of Time

We study the labour supply effects of a major change in child-subsidy policy in Germany in 2007 designed to increase both fertility and shorten birth-related employment interruptions. The reform involved a move from a means-tested maternity leave benefit system that paid a maximum of 300 Euro for up to 2 years to a benefit system that replaced two-thirds of pre-birth earnings for at most 1 year. As the reform took place very recently, we estimate the labour supply effect by using data drawn from the German Socio-Economic Panel (GSOEP) on the intention of women to return to the labour market. Our results show that the reform yields most of the intended effects: the fraction of mothers who plan to return to the labour market within a year after the interview increased by 14 percentage points.

Intergenerational Transmission of Educational Attainment in Germany – The Last Five Decades

Summary Over the last decades the German education system underwent numerous reforms in order to improve “equality of opportunity”, i.e. to guarantee all pupils independent of parental background equal access to higher education. At the same time internationally comparative evidence yields that Germany features particularly low intergenerational mobility with respect to educational attainment. This study investigates the development in intergenerational education mobility in Germany for the birth cohorts 1929 through 1978 with respect to secondary school attainment. We test whether the impact of parental educational background on child educational outcomes changed over time. In spite of massive public policy interventions and education reforms our results yield no significant reduction in the role of parental educational background for child outcomes over the last decades.

Labor Force Transitions of Older Married Couples in Germany

This study investigates the labor force behavior of older married couples in Germany. Monthly observations from the first eleven waves of the German Socio-Economic Panel (GSOEP) are used to describe and analyze the relationship between the labor force behavior of husbands and wives. The empirical model is a discrete time, competing risks hazard model of transitions among labor force states defined by the employment status of both spouses. The analysis indicates that the probability of one spouse exiting employment is much larger if the other spouse is not employed than if the other spouse is employed. Similarly, one member of a couple is much more likely to enter employment if the spouse is employed than if the spouse is not employed. Observed covariates including wages and retirement benefits help to explain these patterns, but unobserved preferences for shared leisure also appear to play an important role.

Rational Poverty or Poor Rationality? The Take-Up of Social Assistance Benefits

In several countries social assistance dependence has been increasing since the 1980s. After surveying the theoretical and empirical take-up literature, this study presents estimates of recent rates of non take-up of social assistance benefits. Once methodological shortcomings of prior estimations are corrected, the results show that take-up has fallen recently and thus cannot explain the rising welfare receipt. Following theoretical predictions, the probability that a rational individual takes up social assistance increases with the expected benefit amount and duration, and falls with application cost and stigma. More than half of all households eligible for transfers under the German social assistance program did not claim their benefits.

Disability retirement and unemployment - substitute pathways for labour force exit? An empirical test for the case of Germany

This paper studies the determinants of disability retirement and unemployment of older workers, two labour market phenomena which the German public discussion combines under the label of early retirement. The implicit assumption that these two mechanisms are exchangeable pathways into permanent retirement is tested. Using panel data the transition rates from employment into disability retirement and into unemploymentare estimated and compared. Statistical tests reject the hypothesis that disability retirement and unemployment are substitutes.

Residential location and youth unemployment: The economic geography of school-to-work transitions

Abstract. In response to increased international policy attention to youth unemployment this study investigates post-secondary school transitions of school leavers. Multinomial logit models are estimated for male and female German youth. The models control for individual, parent, and household characteristics, for those of the youths region of residence and local labor markets. The findings suggest that immigrant youth has particularly low participation rates in continued education, and that youth unemployment is centered in high unemployment states and metropolitan areas. More generous academic benefit policies seem to be correlated with increased academic enrollment, and mens transitions to the military do reflect recent changes in defense policies.

The employment of mothers: Recent developments and their determinants in East and West Germany

Summary We apply German Mikrozensus data for the period 1996 to 2004 to investigate the employment status of mothers. Specifically, we ask whether there are behavioral differences between mothers in East and West Germany, whether these differences disappear over time, and whether there are differences in the developments for high vs. low and medium skilled females. We find substantial differences in the employment behavior of East and West German mothers. German family policy sets incentives particularly for low income mothers not to return to the labor market after birth. East German mothers’ employment outcomes matches that expected based on these policy incentives: over time East German mothers with low earnings potentials appear to adopt West German low employment patterns.

Explaining Applications to the U.S. Disability System: A Semiparametric Approach

This study investigates the determinants of applications for U.S. disability benefits between 1986 and 1993 using a semiparametric discrete factor procedure separately for men and women. Approximating a dynamic optimization model, the estimation accounts for a variety of potential biases that were unaddressed in prior studies. Our results indicate different responses of men and women to variations in policy measures. Past labor earnings and fringe benefits as well as benefit eligibility and benefit amounts clearly affect application behavior.

Employment Effects of Payroll Taxes - An Empirical Test for Germany

This study tests to what degree the incidence of payroll taxes in Germany is on employment and whether in consequence payroll taxes, in particular social insurance contributions, are the culprit behind the growing unemployment problem. Using industry level data for 18 years (1977–1994) a system of five dynamic factor demand equations is estimated. Various simulations indicate that the employment effects of payroll taxes are minimal.