Labour markets

Manudeep Bhuller, Gordon Dahl, Katrine V. Løken, Magne Mogstad, 24 March 2019

Incarceration rates have tripled in the US and almost doubled in Western Europe over the past 50 years. This column uses data on the criminal behaviour and labour market outcomes of every Norwegian to show that in contrast to the US, where incarceration appears to encourage reoffending and damages labour prospects, the Norwegian prison system is successful in increasing participation in job training programmes, encouraging employment, and discouraging crime. It argues that Norway’s high rehabilitation expenditures are more than offset by the corresponding benefits to society.

David Autor, 19 March 2019

Labour markets in US cities today are vastly more educated and skill-intensive than they were 50 years ago, but urban non-college workers now perform much less skilled work than they did. This column shows that automation and international trade have eliminated many of the mid-skilled non-college jobs that were disproportionately based in cities. This has contributed to a secular fall in real non-college wages.

Agata Maida, Andrea Weber, 15 March 2019

Mandated gender quotas in Italy have been successful at increasing the number of women on boards. But the relevant law is temporary and affects only a small number of firms. The column uses evidence on employment and earnings to show no increase in female representation at the top executive level or among top earners. This may be because norms and perceptions take time to change, or because newly appointed women in senior roles wield limited power.

Isamu Yamamoto, 14 March 2019

The adoption of new information technologies such as AI in more workplaces is influencing not just employment and wages, but worker well-being such as job satisfaction, stress, and health. Surveying approximately 10,000 workers in Japan, this column analyses the impact of new information technologies on the nature of tasks performed by workers, job satisfaction, and work-related stress. It finds that AI adoption contributes to both greater job satisfaction and increased stress, and considers approaches to maximise the positives of new technologies adoption while minimising its negative side effects.

Ester Faia, Vincenzo Pezone, 12 March 2019

Policymakers are concerned about effecting real change with monetary policy, particularly in the context of wage rigidity. This column uses extensive Italian data to analyse the extent to which wage rigidity induced by collective bargaining amplifies the effects of monetary policy. The volatility of stock market returns reacts more to monetary policy announcements when the average time left before the renewal of the employees’ collective agreement is large.

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