Labor supply response to international migration and remittances in the Republic of Haiti

The Republic of Haiti is the prime international remittances recipient country in the Latin American and Caribbean (LAC) region relative to its gross domestic product (GDP). The downside of this observation may be that this country is also the first exporter of skilled workers in the world by population size. The present research uses a zero-altered negative binomial (with logit inflation) to model households' international migration decision process, and endogenous regressors' Amemiya Generalized Least Squares method (instrumental variable Tobit, IV-Tobit) to account for selectivity and endogeneity issues in assessing the impact of remittances on labor market outcomes. Results are in line with what has been found so far in this literature in terms of a decline of labor supply in the presence of remittances. However, the impact of international remittances does not seem to be important in determining recipient households' labor participation behavior, particularly for women.

Offshoring and directed technical change

To study the short-run and long-run implications on wage inequality, we introducedirected technical change into a Ricardian model of offshoring. A unique final good isproduced by combining a skilled and an unskilled product, each produced from a continuumof intermediates (tasks). Some of these tasks can be transferred from a skill-abundant Westto a skill-scarce East. Profit maximization determines both the extent of offshoring andtechnological progress. Offshoring induces skill-biased technical change because it increasesthe relative price of skill-intensive products and induces technical change favoring unskilledworkers because it expands the market size for technologies complementing unskilled labor.In the empirically more relevant case, starting from low levels, an increase in offshoringopportunities triggers a transition with falling real wages for unskilled workers in the West,skill-biased technical change and rising skill premia worldwide. However, when the extentof offshoring becomes sufficiently large, further increases in offshoring induce technicalchange now biased in favor of unskilled labor because offshoring closes the gap betweenunskilled wages in the West and the East, thus limiting the power of the price effectfueling skill-biased technical change. The unequalizing impact of offshoring is thus greatestat the beginning. Transitional dynamics reveal that offshoring and technical change aresubstitutes in the short run but complements in the long run. Finally, though offshoringimproves the welfare of workers in the East, it may benefit or harm unskilled workers inthe West depending on elasticities and the equilibrium growth rate.

Labor Mobility of the Chinese Graduates from British and Spanish Universities: What Happens to the "Talent Migration"?

The scholarship on migration in Europe heavily focuses on the integration of economically vulnerable migrants. In the age of commercialization of education, however, the European Union attracts a rising number of highly skilled non-EU migrants that take up studies across the continent. Despite economic downturn, the EU universities experience a rapid growth in the number of Chinese students, many of whom settle in Europe upon graduation. Surprisingly, although the number of Chinese students in the EU increases, scholars largely ignore the labor paths that these highly skilled migrants take upon graduating from European universities. This study aims to fill this gap by exploring the variation in the Chinese graduates’ labor incorporation patterns and in their spatial mobility. In this project, I also examine macro-level hypotheses predicting that the EU and host states’ labor market institutions, changes in the EU policies on the highly skilled and the outburst of economic crisis matter for the Chinese highly skilled social and spatial mobility. Seizing on surveys, interviews and on the bodies of literature on stratification and social mobility, economic incorporation, social capital and human capital, I look at the Chinese students that graduated from universities in Great Britain and Spain. These states differ in the university tuition fees, migration policies towards the highly skilled workers and in the period of the Chinese students’ influx, thus providing an economically and socially diverse sample. My research will contribute to the literature on the relations between migrants’ social mobility, class and status background and spatial mobility, at the same time adding a transnational level perspective to the study of highly skilled Asian migration.

Labour market, international trade, and unemployment in a less developed country

This paper constructs a trade general equilibrium model for a less developed country with three sectors. One is the informal and un-tradable sector characterized by áexible wages, while the other two sectors are tradable, export and import sectors. The model imposes a binding minimum wage over the unskilled labour and e¢ cient wage distortions on the skilled labour. Comparative statics is driven to analyze the e§ects on the labour market as consequence of opening the economy, raising the minimum wage and the introduction of an augmenting productivity in the export sector.

Technical change and factor shares

The implications of technical change that directly alters factor shares are examined. Such change can lower the income of some factors of production even when it raises total output, thus offering a possible explanation for episodes of social conflict such as the Luddite uprisings in 19th century England and the recent divergence in the U. S. between wages for skilled and unskilled labor. An explanation also why underdeveloped countries do not adopt the latest technology but continue to use outmoded production methods. Total factor productivity is shown to be a misleading measure of technical progress. Share-altering technical change brings into question the plausibility of a wide class of endogenous growth models.

Labor rights, formality and spillovers: evidence from Brazil

Nós analisamos o efeito da emenda constitucional 72/13 no Brasil, que igualou direitos trabalhistas de empregadas domésticas a aqueles de outros empregados. Mostramos que, após a legislação, uma considerável cobertura midiática e um interesse público intensificado aumentou o conhecimento geral de direitos trabalhistas de empregadas domésticas. Como consequência, o não-seguimento de legislações trabalhistas no setor de serviços domésticos ficou mais difícil. Ao mesmo tempo, a necessidade de regulamentar adicionalmente a emenda fez com que custos trabalhistas ficassem praticamente inalterados. Usando uma abordagem de diferença-em-diferenças que compara ocupações selecionadas ao longo do tempo, mostramos que a emenda -- e a discussão que ela causou -- levou a um aumento na formalização e nos salários de empregados domésticos. Então, usando a heterogeneidade do impacto da emenda em grupos demográficos, nossos resultados mostram que emprego doméstico foi reduzido e que mulheres pouco qualificadas saíram força de trabalho e foram para empregos de menor qualidade. Testes de placebo e análises de robustez indicam que nossos resultados não são explicados por diversas interpretações alternativas.

Our Lives, Our Thoughts and Our Allegiance: New Immigrants and American Industry in 1914

Through comparative analysis of the immigrant labor forces at work in iron mining in northern Minnesota, coal mining in Illinois, and steel milling in the Calumet region of Chicago and Gary, this paper addresses the forms of social distance separating and marginalizing new immigrants from American society and trade unionism that existed in 1914, the year that marked the end point of mass immigration from Eastern and Southern Europe. The “new immigration” was a labor migration that congregated its subjects overwhelmingly in what were called "unskilled" or "semi-skilled" forms of labor. Skilled work was largely, with certain variations, the preserve of "American" or old immigrant workers. This labor gulf separating new immigrants and American workers was hardened by a spatial separateness. New immigrants often lived in what have been called industrial villages—the mining town or location, the factory neighborhood— striking in their isolation and insularity from mainstream society. This separateness and insularity became a major preoccupation for corporate managers, Progressive reformers, and for American trade unions as new immigrants began to engage in major labor struggles leading up to 1914. But among the three industries, only the union of coal miners, the United Mine Workers, enjoyed success in organizing the new immigrants. In the steel mills and the iron mines, the unions were either rooted out or failed to gain a foothold at all. The explanation for these differences is to be found in the different forms of industrial development among the industries studied.

International labor migration in Vietnam and the impact of receiving countries' policies

Labor export has been part of Vietnam’s socio-economic development strategy since the beginning of the doi moi era. Recent years, Vietnam has sent about 80,000 workers abroad per year. Vietnam has become a major source country of unskilled foreign workers for high-income East Asian countries. However, in these receiving countries, the desertion rate among Vietnamese workers is quite high, compared with that for workers from other countries. This paper examines the impact of Korean and Japanese policies for receiving foreign workers applied to and implemented in Vietnam, as well as the impact of Vietnamese labor sending system, on the problem of runaway workers.

Skilled emigration and exchange rate : theory and empirics

In this paper we build a theoretical model on the wage effect of skilled emigration to the fluctuations in real exchange rate through the relative prices of nontradables. Our theoretical model predicts that skilled emigration is associated with an increase in the prices of nontradable, which in turn appreciates the exchange rate. We provide robust empirical support to a higher skilled emigration associated with higher prices in nontradables and appreciation of the real effective exchange rate. Based on two samples of countries with 51 and 67 observations, in 1990 and 2000 respectively, we find robust empirical support to a higher skilled emigration associated with higher prices in nontradables and appreciation of the REER. In addition, the support for the remittance-channel of the Dutch disease is also significant; overall, our findings corroborate the remittance-based Dutch disease phenomenon by providing an additional channel through which the labor mobility across borders affects the real exchange rate volatility.

Skill sorting and production chains : evidence from India

This study proposes a new mechanism that explains skill-sorting patterns and skill wage differentials across industries based on the length of the industry's production chain. A simple simultaneous production model shows that when the quality of intermediate inputs deteriorates rapidly along the production chains, high-skilled individuals choose to work in industries with shorter production chains because of higher returns to skill. I empirically confirm this skill-sorting pattern and these inter-industry skill wage differentials in India, where the quality of intermediate inputs is likely to degrade rapidly because of the high number of unskilled laborers, poor infrastructure, and less-advantaged technology. The results remain robust even when considering selection bias, alternative reasons for inter-industry skill wage differentials, and a different period. The results of this study have important implications when considering countries' industrial development patterns.

The Opportunity Costs of STEM Degrees and the Unmet Needs of the Low-Skilled: Two labour market problems explained. CEPS Policy Brief No. 295, 26 June 2013

There is general consensus that to achieve employment growth, especially for vulnerable groups, it is not sufficient to simply kick-start economic growth: skills among both the high- and low-skilled population need to be improved. In particular, we argue that if the lack of graduates in science, technology, engineering and mathematics (STEM) is a true problem, it needs to be tackled via incentives and not simply via public campaigns: students are not enrolling in ‘hard-science’ subjects because the opportunity cost is very high. As far as the low-skilled population is concerned, we encourage EU and national policy-makers to invest in a more comprehensive view of this phenomenon. The ‘low-skilled’ label can hide a number of different scenarios: labour market detachment, migration, and obsolete skills that are the result of macroeconomic structural changes. For this reason lifelong learning is necessary to keep up with new technology and to shield workers from the risk of skills obsolescence and detachment from the labour market.

Satisfying Labour Demands in Mid- and Low-Skilled Occupations through Immigration

The purpose of this article is to explain the importance and necessity of satisfying labour demands through the migration of less-skilled workers. It will also argue that more work is needed to anticipate labour and skill shortages and will examine ways of better identifying the role of mid- and low-skilled migration in filling such shortages.

A dual definition for the factor content of trade and its effect on factor rewards in US manufacturing sector

We introduce a dual definition of the Factor Content of Trade (FCT) using the concept of the Equivalent Autarky Equilibrium. Estimating a symmetric normalized quadratic revenue function for the U.S. manufacturing sector between 1965 and 1991, we find that the FCT for capital is positive, while the FCT for skilled and unskilled labor is negative, suggesting that the Leontief Paradox is not present. Then the growth rate of the factor rewards is decomposed to the FCT, endowments, and technological change effects. We find that technological change is the most important determinant in explaining wage inequality between skilled and unskilled labor.

An analysis of the labor market situation of vocational students based on national and international data

The article focuses on the labour market situation and opportunities of the Hungarian vocational students. After briefly placing the topic in an international context, the study introduces the findings of the Hungarian empirical researches. Due to the differences between the various national education systems, it is not easy to make international comparisons; therefore I chose former socialist countries with characteristics similar to those of Hungary. When comparing the relevant data, it became clear that obtaining a diploma provides more advantages in Hungary. Hungarian researches suggest that vocational schools mostly attract students with poor competence test scores at the end of primary school. Also a significant proportion of these students are disadvantaged. Vocational students are the most likely to drop out of the system and their return to the school later is sporadic at best. Although a completed VET improves their employment conditions and prospects, many of the graduates will leave their profession or do unskilled labour. Their labour income varies greatly depending on their type of trade and experience gained.

Three essays on labor liberalization and its effects on world economy

This dissertation consists of three theoretical essays on immigration, international trade and political economy. The first two essays analyze the political economy of immigration in developed countries. The third essay explores new ground on the effects of labor liberalization in developing countries. Trade economists have witnessed remarkable methodological developments in mathematical and game theoretical models during the last seventy years. This dissertation benefits from these advances to analyze economic issues related to immigration. The first essay applies a long run general equilibrium trade model similar to Krugman (1980), and blends it with the median voter ala-Mayer (1984) framework. The second essay uses a short run general equilibrium specific factor trade model similar to Jones (1975) and incorporates it with the median voter model similar to Benhabib (1997). The third essay employs a five stage game theoretical approach similar to Vogel (2007) and solves it by the method of backward induction. The first essay shows that labor liberalization is more likely to come about in societies that have more taste for varieties, and that workers and capital owners could share the same positive stance toward labor liberalization. In a dynamic model, it demonstrates that the median voter is willing to accept fewer immigrants in the first period in order to preserve her domestic political influence in the second period threatened by the naturalization of these immigrants. The second essay shows that the liberalization of labor depends on the host country's stock and distribution of capital, and the number of groups of skilled workers within each country. I demonstrate that the more types of goods both countries produce, the more liberal the host country is toward immigration. The third essay proposes a theory of free movement of goods and labor between two economies with imperfect labor contracts. The heart of my analysis lies in the determinants of talent development where individuals' decisions to emigrate are related to the fixed costs of emigration. Finally, free trade and labor affect income via an indirect effect on individuals' incentives to invest in the skill levels and a direct effect on the prices of goods.