Ronald Meng

Literacy and Numeracy

In this study, the authors examine the determinants of literacy and numeracy among native-born Canadians. The role of literacy and numeracy as determinants of labor market outcomes is assessed, and both are found to contribute to the explanation of labor market status, weeks worked, and income. Significant differences in the male and female estimates are noted. Estimates of the return to years of schooling are shown to be sensitive to the exclusion of measures of literacy and numeracy. Further, the inclusion of these variables decreases the estimated return to years of schooling for males and increases the estimated return for females.

Minorities, Cognitive Skills and Incomes of Canadians

This paper uses the Statistics Canada Survey of Literacy Skills Used in Daily Activities (LSUDA) to investigate minority-white income differences and the role cognitive skills play in those patterns. Some minority groups have substantially lower (tested) levels of literacy and numeracy skills than whites and other more economically successful minorities and, in the case of certain male groups, these differences play a significant role in explaining the observed income patterns. The ethnic-white income gaps are, however, much smaller for women, and the literacy and numeracy variables do not have much of a role to play in explaining those differences. Various policy implications are discussed.

Explaining language proficiency: Objective versus self-assessed measures of literacy

Abstract Serious error-in-variable bias results when a self-assessed measure is used to estimate the determinants of literacy. When Instrumental Variables is used to account for the joint determination of earnings and literacy, the measurement error does not affect parameter estimates in a standard earnings equation.

The Determinants of Welfare Participation of Female Heads of Household in Canada

This paper assesses the impact on the probability of welfare participation of budget constraint variables such as the expected wage, welfare benefit level, and implicit welfare tax rate. The empirical results are based on a model of welfare participation that is estimated using a sample of female heads of household in Canada. The coefficients on the budget constraint variables are significant and carry signs that are generally consistent with the predictions of the model and the results of related studies based on data from the United States. In addition to the budget constraint variables, which include important policy tools, a wide range of sociodemographic variables are included in the specification.

Literacy and labour market outcomes: self-assessment versus test score measures

This paper looks at the determinants of literacy and the relation between literacy and labour market outcomes while focusing on comparisons of self-assessment versus test score measures of literacy. The test score measure performs considerably better than the self-assessments when literacy is treated as an outcome variable in terms of the overall fit of the model and the specific coefficient estimates, with the self-assessments sometimes actually generating wrongly signed parameters. The test score measure also performs much better as an explanatory variable in the employment models, with the self-assessment variable generating significant underestimates of the effects of literacy on the probability of being employed. Finally, the test score is also superior in the income models, although the self-assessment measure is at least a reasonably good performer in this regard, suggesting that the main results reported in much of the existing literature (based on such measures) should perhaps be taken as good representations of the true underlying relationships.

The Valuation of Risk of Death in Public Sector Decision-Making

The unavoidable trade-off between monetary expenditures and health and safety benefits means that the risk of death must be considered in a wide variety of public sector decisions. This paper argues that this consideration should be explicit and consistent across policy areas. The most conceptually valid approach to the valuation of benefits from reduced risk is to base estimates on the required compensation for exposure to risk. An empirical estimate of required compensation is generated by measuring the statistical value of life based on data from the Canadian labor market. The estimated value of life is

Cognitive skills and the youth labour market

5.2 million in 1983 dollars. This is recommended as a useful lower bound estimate for a variety of public policy applications in Canada. In some applications, we argue that substantially higher values are required.

Union effects on wage dispersion in Canadian industry

With the use of test score data it is found that literacy, numeracy and education strongly influence the probability of being employed, unemployed, having a wage-paying job and obtaining government transfer payments in addition to incomes, weeks worked and weeks unemployed for a sample of 16 to 24-year-olds.

Collective bargaining, firm size and pensions in Canada

Abstract This paper analyzes the effects that unions have on the dispersion of wages in Canada. The empirical results indicate that unions have a significant effect in reducing wage dispersion. The standard deviation in hourly wages is smaller for unionized workers than it is for non-unionized workers. This result holds not only for the more general case but also for narrowly defined demographic, industrial and occupational categories. Finally, regression estimates indicate that the coefficients on the wage determining variables are smaller in the unionized sector.

The relationship between unions and job satisfaction

Abstract The following paper analyzes the provision of job-related pensions in Canada. The empirical results indicate that both unions and firm size have significant effects on the distribution of pensions. The significance of unions on the provision of pensions does decline as firm size increases.