Volume 12 (2022): Issue 1 (January 2022)

Although short message services (SMS) are constantly used to transmit information, little is known about the use of SMS by public institutions to direct people. This paper presents a field experiment in France about the effectiveness of SMS in directing disadvantaged people toward public services. Two types of treatment SMS were provided: one type had its content written in a formal style; the second type SMS style was much informal. All the SMS were individualized and included specific information about the agencies. Results indicate that the SMS had no significant effect on enrollment. There is also no apparent heterogeneous effect according to individual, agency, or location characteristics. In line with other academic evidence, these findings suggest that SMS have very limited effectiveness in directing this population toward public services.

During the last decade, unemployment in Greece climbed up to 28%, almost quadrupling due to the economic crisis that hit Greece. In the present paper, we examine the determinants of the unemployment dynamics and the impact of the minimum wage on the probability of making a transition into and out of unemployment. We use micro-level data from the Greek Labour Force Survey (LFS) of the period 2004 to 2019 and control for several demographic factors, macro-economic conditions, regional differences, and changes in the statutory minimum wage. The results suggest that individual-level characteristics play an important role in making a transition into or out of unemployment. Changes in the real minimum wage are estimated to have either a statistically insignificant or a very small impact on unemployment entries and exits. Further, the impact of economy's growth rate follows the theoretical predictions as higher growth rates increase unemployment outflows and decrease inflows, while the regional differences are also important. Our findings persist even when we split the sample in three periods (pre-crisis, crisis, recovery). The results have important policy implications. Given that the disemployment effect of the minimum wage seems to be very limited in the Greek labor market, while the socioeconomic characteristics and regional characteristics play an important role, improving the skills of individuals through the educational system and reskilling or up-skilling programs while targeting specific regions may facilitate labor market mobility.

Hiring subsidies are widely used to create (stable) employment for the long-term unemployed. This paper exploits the abolition of a hiring subsidy targeted at long-term unemployed jobseekers older than 45 years of age in Belgium to evaluate its effectiveness in the short and medium run. Based on a triple-difference methodology, the hiring subsidy is shown to increase the job-finding rate by 13% without any evidence of spillover effects. This effect is driven by a positive effect on individuals with at least a bachelor's degree. However, the hiring subsidy mainly creates temporary short-lived employment: eligible jobseekers are not more likely to find employment that lasts at least 12 consecutive months compared with ineligible jobseekers.

Aging is the foremost challenge in recent times, given the demographic shift in populations across the world. It implies the costs of healthcare burden and involves economic and social security challenges through shortage of labor supply, consumption–saving paradox, increase in expenditure on healthcare, and most importantly, social capital among the developing countries. Furthermore, there is a likely challenge of old age security in terms of income and expenditure due to increasing healthcare costs and low earning incentives at older ages. India currently has the second largest population globally, with >9% of its population accounting for aging. Based on the multidimensional aging index (AI) using the latest longitudinal survey data of older adults in India, we examined the possible challenges of the economics of aging in India while examining the economic health and social outcomes of the elderly. Our results found that the elderly in India are highly exposed to negative impacts due to vulnerability in socio-economic and health spheres of life. Low labor force participation, lack of skills, and low literacy are the prevalent challenges faced by the elderly Indian population, particularly women. Similarly, the fiscal challenges include increased income tax and insurance coverage for the elderly, while health challenges imply a greater proportion of the disabled and multi-morbid, leading to more burden on the health and welfare system of India. Thus, given the possible short- and long-term effects of aging on the path of economic growth in India, policy incentives are required to minimize the impact and avert the burden of population aging in the country.

Would countercyclical fiscal policy during recessions improve or worsen the gender employment gap? We answer this question by exploring the state-dependent impact of fiscal spending shocks on employment by gender in the G-7 countries. Using the local projection method, we find that, during recessions, a positive fiscal spending shock increases female employment more than male employment, contributing to gender employment equality. Our findings are driven by disproportionate employment changes in female-friendly industries, occupations, and part-time jobs in response to fiscal spending shocks. The analysis suggests that fiscal stimulus, particularly during recessions, could achieve the twin objectives of supporting aggregate demand and improving gender gaps.

This paper examines the effect of a new maximum work hour restriction introduced in South Korea in 2018 that limited maximum working hours from 68 h/week to 52 h/week. I use difference-in-differences analysis with continuous treatment measuring the prevalence of those working longer than 52 h/week prior to the policy change across industry-occupation-education groups. I find that the policy reduces work hours while increasing monthly earnings and hourly wages for male full-time workers. However, I find that the policy does not significantly affect total work hours, total employment, and total worker pay at the industry-occupation-education group level.

We use European Union Labour Force Survey data for the period 2005–2018 to investigate the cyclicality of training in Europe. Consistent with the view that firms use recessions as times to update skills, we find that training participation is moderately countercyclical for the employed. Within the not-employed group, this is true also for the unemployed, who are likely to be involved in public training programs during recessions, but not for the inactive, who may be affected by liquidity constraints.

We use microlevel data from the India Human Development Survey to test our hypothesis that ownership of time-saving household appliances results in the following: an increase in employment rates for married women; an increase in school enrollment rates; and a decrease in employment rates for children. We address the concern of endogeneity of appliance ownership by instrumenting household ownership of time-saving appliances by two family-specific time-using household assets and (1) average ownership rate among single women living in the same primary sampling unit (for the adult female sample) or (2) average ownership among households with no children living in the same primary sampling unit (for the child sample). Our results suggest a decrease in married women's and children's employment when ownership of time-saving appliances increases. Disaggregating our measure of employment, we find that married women use time-saving appliances as a substitute for human capital and increase their probability of working in more productive employment outside of the household.

This paper analyzes the effects of hypothetical MW (HMW) increases on social and fiscal outcomes in 21 European Union (EU) countries with a statutory national MW (NMW) based on a microsimulation approach using EUROMOD. The methodological challenges related to the use of available EU household survey data are described, along with the choices made to address these challenges. The paper assesses hypothetical scenarios in which countries with a statutory NMW increase their minimum wage (MW) to various reference values, set in relation to the gross national median and average wage. The model simulations suggest that MW increases can significantly reduce in-work poverty, wage inequality, and the gender pay gap, while generally improving the public budget balance. The implied wage increases for the beneficiaries are substantial, while the implied increases in the aggregate wage bill are generally modest. Extensions explore possible effects on employment and labor supply at the intensive margin.

Australia's “Transition to Retirement Income Streams” (TRIS) program aims to prolong labor force participation for older workers (aged 55–65 years) by offering early access to a worker's compulsory retirement savings (superannuation). Using a difference-in-differences design, our results suggest a small labor supply response, which increases after the program's initial years. The size of the effects appears to be consistent with the program adoption profile, which was low initially. For this reason, our estimates should be viewed as a lower bound for the true effects. We find that individuals with higher incomes are more likely to adopt TRIS. At least half of the program participants appear to be using strategies to minimize tax, a behavioral response that seems at odds with the program's intent.