Third IESR-GLO Joint Conference with Daron Acemoglu (MIT) and Charles Manski (Northwestern University) on COVID-19, June 5-7. Full program & registration code now available.

Third IESR-GLO Joint Conference. The Institute for Economic and Social Research (IESR) at Jinan University and the Global Labor Organization (GLO) are jointly organizing a virtual conference on economic issues related to the coronavirus (Covid-19) pandemic. We provide a platform for economists to exchange ideas on improving responses to Covid-19 through a series of presentations of high-quality academic papers.

  • We are pleased to announce that the conference will feature keynote addresses by Daron Acemoglu (MIT) and Charles Manski (Northwestern University).

Organizers

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COVID-19 and the Consequences for Free Trade

GLO Policy Brief No. 3 – Special theme: COVID-19 and policy implications

COVID-19 and the Consequences for Free Trade

by
Ewa Björling, Andreas Hatzigeorgiou, Magnus Lodefalk & Fredrik Sjöholm

The response to the COVID-19 pandemic has disrupted global trade, investment and value chains. There is a risk that newly imposed barriers to international trade and mobility will become permanent. Research shows that veiled protectionism in the wake of the COVID-19 pandemic would be associated with greater risks and impede the economic recovery needed to avoid a new economic depression. We argue that failing to reboot free trade and to restore global value chains could aggravate an already difficult and delicate situation in regard to global economic development and poverty reduction. In order to reboot globalization, however, there needs to be a new approach. Simply going over old ground would be insufficient.
____________________

  • Ewa Björling, MD, Associate Professor of Virology, Sweden’s Minister for Trade 2007-2014.
  • Andreas Hatzigeorgiou, PhD, CEO of the Stockholm Chamber of Commerce.
  • Magnus Lodefalk, PhD, Associate Professor of Economics, Örebro University; Ratio Institute, Sweden; and Fellow of the Global Labor Organization.
  • Fredrik Sjöholm, PhD, Professor of International Economics, Lund University, and the Research Institute of Industrial Economics, Sweden.

What we should know

  • Restrictions and lockdowns to address the COVID-19 pandemic have disrupted international markets and global value chains. The travel and trade restrictions imposed by many countries are extreme and unusual both in nature and their implementation, wreaking havoc on global trade and investment flows. These restrictions have been adopted despite lack of evidence of their effectiveness. Some measures go against the guidance by the World Health Organization (WHO) and the World Trade Organization (WTO).
  • Protectionism and anti-globalization tides have been rising already before the COVID-19 pandemic, with Brexit and the China-U.S. trade war, as two examples. The policy response to the pandemic now risks to make the situation worse and constitutes a major disruption to global trade, investment and value chains. Early economic indicators suggest that this disruption is severely hurting growth and employment (Gopinath 2020).
  • Global poverty and inequality are grounds for justifiable concerns. Research suggests that failing to ensure free and predictable markets would be associated with significant risks to poverty and inequality.
  • Many policies to combat the coronavirus pandemic are actually causing both short-term problems for fighting the pandemic, as well as risks in regard to economic recovery, employment, development and poverty reduction over the medium and long term (Evenett 2020, Hoekman et al 2020, Zimmermann et al. 2020).
  • Difficulties in getting supplies of medical equipment have triggered an increased interest in de-globalizing value chains (Miroudot 2020). Already before the pandemic, companies and countries were considering a regionalization or even a nationalization of global value chains. This due to a more adverse trade policy environment, rising wages in manufacturing strongholds and technological advances, e.g., in automation.

The state of free trade in the wake of COVID-19

  • Unilaterally imposing high travel and trade barriers creates uncertainty for exporters and importers of goods and services, as well as for foreign investors. Research indicates that uncertainty about the stability of the rules of the game has a major negative impact on trade and investment, beyond the barriers imposed by the rules themselves (see, e.g., Handley and Limao 2013).
  • Temporary policies risk becoming permanent. They could become precedents for trade barriers and unilateralism in the future.
  • Asymmetric timing for when countries reopen and assymetric epidemiological strategies, pose real risks of triggering protectionism (Bown 2020). For example, when one country is back to full production and shipping, countries that still have not reopened their economies will likely face rising pressure to ‘protect’ domestic businesses.
  • Less-developed countries are more exposed to the risks associated with a failure to reboot and revitalize international trade, investment and value chains. They often face additional difficulties in handling the pandemic itself because of their relatively weaker health care systems. Existing and new trade barriers, such as export restrictions on medical products and food, will exacerbate this situation (Hoekman et al. 2020). Moreover, capital is now fleeing from poor to richer countries. The poorest and most debt-ridden countries can thus be hit twice in the form of the pandemic, and globalization in reverse.

A reboot and a new approach to globalization is needed

  • In the short term, a coordinated approach among the major economies on measures to address both the pandemic and its economic consequences are needed. A first step should be to tear down the border and trade barriers put up in the wake of the pandemic (Stellinger et al 2020).
  • In the short to medium term, it is necessary to formulate a strategy to reduce the risks from asymmetric timing in reopening and from differences in the fight against the pandemic.
  • A head-on measure would be to introduce a new free trade and investment agreement that abolish all tariffs and other barriers to trade and investment in pharmaceuticals, medical devices, and other equipment used to prevent or combat pandemics (Bown 2020b, Stellinger et al 2020).
  • Business leaders should act to encourage more resilient and sustainable global value chains, for example by having more suppliers, warehouses and using modern technology to monitor the chains and their resilience in real time (Miroudot 2020). This would be a win-win for the climate and for economic growth.
  • Governments must refrain from top-down attempts to address current and future difficulties of getting supplies by reshoring production of various goods and services (Stellinger et al. 2020). There is ample research on the harmfulness of import-substitution policies.
  • In the longer term, countries need to safeguard both global health and prosperity through common strategies and commitments, concrete measures for future crises and mechanisms for consultations. New and even more serious pandemics cannot be excluded. Countries will have to be able to act quickly, in a coordinated fashion and in a transparent way.
  • A new approach is needed to reboot and revitalize globalization, with the aim to design a system which reduces the risk of both pandemics and protectionism.
  • Mechanisms for applying and enforcing stringent requirements on countries to live up to standards and obligations put in place to minimize the risk of pandemics should be evaluated.
  • The concept of sustainability within the global trading system could be extended to encompass not only environmental and social aspects, but also aspects that more clearly impact public health and epidemiological risks. Increased cross-institutional links between bodies such as the WHO and the WTO should also be created to promote knowledge exchange and technical assistance.

The policy response to the COVID-19 pandemic has disrupted international markets. However, simply restoring free trade would mean ignoring massive human suffering caused by the COVID-19 pandemic. A new approach is needed to reboot and revitalize globalization, with the aim to design a system which reduces the risk of both pandemics and protectionism. Leaders and policymakers must make concerted efforts to: carefully lift restrictions on travel and trade while protecting health; commit to liberalize essential trade for fighting pandemics; address how to deal with calls for protecting domestic industries in the presence of asymmetric economic reopening; and sustain international yet resilient value chains. The aim should be to develop the international trading system to both reduce the risks of pandemics and protectionism.
__________________

References

Bown, C. (2020a). “COVID-19 could bring down the trading system: How to stop protectionism from running amok.”, Foreign Affairs, May/June 2020.

Bown, C. (2020b). “How the G20 can strengthen access to vital medical supplies in the fight against COVID-19.”, Trade and Investment Policy Watch, Peterson Institute for International Economics.

Evenett, S. (2020). “Sickening your neighbor: Export restraints on medical supplies during a pandemic.”, VoxEU, CEPR.

Gopinath, G (2020). “The Great Lockdown: Worst economic downturn since the Great Depression.”, IMF.

Handley, K. and N Limao (2013). “Does policy uncertainty reduce economic activity? Insights and evidence from large trade reforms.”, VoxEU, CEPR.

Hoekman, B.M., Fiorini, M. and A. Yildirim (2020). “Export restrictions: a negative-sum policy response to the COVID-19 crisis.”, EUI RSCAS Working Paper 2020/23.

Miroudot, S. (2020). “Resilience versus robustness in global value chains: Some policy implications.” in Baldwin, R.E. and S.J. Evenett (eds.) (2020). COVID-19 and trade policy: Why turning inward won’t work. VoxEU.org eBook, CEPR Press.

Stellinger, A., Berglund, I. and H. Isakson (2020). “How trade can fight the pandemic and contribute to global health.” in Baldwin, R.E. and S.J. Evenett (eds.) (2020). COVID-19 and trade policy: Why turning inward won’t work. VoxEU.org eBook, CEPR Press.

Zimmermann, K.F., Karabulut, G., Bilgin, M.H. and A.C. Doker (2020). “Inter-country distancing, globalization and the coronavirus pandemic“, The World Economy, OPEN ACCESS, forthcoming. PREPUBLICATION VERSION

NOTE: The opinions expressed here are those of the author and not of the GLO, which has no institutional position.

More from the GLO Coronavirus Cluster

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Sleeping patterns and psychological wellbeing

A new GLO Discussion Paper finds that individuals who sleep for at least 6 hours have improved mental health and are less likely to have suicidal thoughts.

The Global Labor Organization (GLO) is an independent, non-partisan and non-governmental organization that functions as an international network and virtual platform to stimulate global research, debate and collaboration.

GLO Discussion Paper No. 550, 2020

Sleeping patterns and psychological wellbeing: Evidence from young adults in the United StatesDownload PDF
by
Lalji, Chitwan & Pakrashi, Debayan

GLO Fellow Debayan Pakrashi

Author Abstract: One in every six U.S. adults suffers from mental health problems. Mental illnesses, as measured in disability-adjusted life years, account for nearly 6.2% of the total disease burden worldwide and are considered to be one of the leading causes of death by injury, second only to road accidents. For the year 2010 alone, the estimated global direct and indirect economic cost of mental illnesses was reported to be US$2.5 trillion and this is expected to double by 2030. With a “20% increase in service coverage for severe mental disorder”, suggested by the World Health Assembly by the year 2020 for the WHO Member states, examining alternative behavioral changes to reduce mental health problems are worth examining. Using the detailed National Longitudinal Study of Adolescent Health dataset and applying a wide range of econometric techniques we study the causal impact of sleeping pattern on various subjective wellbeing indicators among young U.S. adults. We find robust evidence that individuals who sleep for at least 6 hours have improved mental health and are less likely to have suicidal thoughts. Additionally, our estimates highlight that those who sleep early have better mental health and reduced probability of having suicidal thoughts or going to a counselor. Waking up early is also found to result in better physical health and lower probability of having suicidal thoughts.

GLO Discussion Papers are research and policy papers of the GLO Network which are widely circulated to encourage discussion. Provided in cooperation with EconStor, a service of the ZBW – Leibniz Information Centre for Economics, GLO Discussion Papers are among others listed in RePEc (see IDEAS,  EconPapers)Complete list of all GLO DPs – downloadable for free.

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Intergroup contacts and prejudice in conflict settings

A new GLO Discussion Paper finds that intergroup contact reduces the prejudice of both Hindu and Muslim participants toward members of the other religion, but most of the effects disappear after six months.

The Global Labor Organization (GLO) is an independent, non-partisan and non-governmental organization that functions as an international network and virtual platform to stimulate global research, debate and collaboration.

GLO Discussion Paper No. 549, 2020

Don’t judge a book by its cover: The role of intergroup contact in reducing prejudice in conflict settings Download PDF
by
Maiti, Surya Nath & Pakrashi, Debayan & Saha, Sarani & Smyth, Russell

GLO Fellows Sarani Saha & Debayan Pakrashi

Author Abstract: We study the potential for pleasant and cooperative contact to reduce preconceived prejudice between religious groups in the context of India. We randomly assign Hindus and Muslims into groups, in which they interact over the course of a week-long vocational training program. We find that intergroup contact reduces the prejudice of both Hindu and Muslim participants toward members of the other religion one week after the training program finished. While we find that most of the positive effect of intergroup contact on reducing prejudice dissipates after six months, the baseline results for Hindu attitudes toward Muslims are persistent.

GLO Discussion Papers are research and policy papers of the GLO Network which are widely circulated to encourage discussion. Provided in cooperation with EconStor, a service of the ZBW – Leibniz Information Centre for Economics, GLO Discussion Papers are among others listed in RePEc (see IDEAS,  EconPapers)Complete list of all GLO DPs – downloadable for free.

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Lost Wages: The COVID-19 Cost of School Closures

Social distancing requirements associated with COVID-19 have led to school closures affecting more than 90 percent of the world’s learners: 1.5 billion children and young people. A new GLO Discussion Paper finds that the expected earnings loss resulting from this is equivalent to 15 percent of future gross domestic product.

The Global Labor Organization (GLO) is an independent, non-partisan and non-governmental organization that functions as an international network and virtual platform to stimulate global research, debate and collaboration.

GLO Discussion Paper No. 548, 2020

Lost Wages: The COVID-19 Cost of School ClosuresDownload PDF
by
Psacharopoulos, George & Collis, Victoria & Patrinos, Harry Anthony & Vegas, Emiliana

GLO Fellow Harry Patrinos

Author Abstract: Social distancing requirements associated with COVID-19 (coronavirus) have led to school closures. In mid-April, the United Nations Educational, Scientific and Cultural Organization reported that 192 countries had closed all schools and universities, affecting more than 90 percent of the world’s learners: 1.5 billion children and young people. The closures are expected to reduce learning and will lead to future losses in earnings and labor productivity. Schooling attainment leads to increased earnings. What is not known is how much earnings will decline due to the school closures. Starting with the fact that every year of schooling equates to 8-9 percent in additional future earnings, this paper uses the number of months of education closures to estimate the loss in marginal future earnings. The findings show that the school closures reduce future earnings, and this loss is equivalent to 15 percent of future gross domestic product. The school closures will have a large and long-lasting impact on the earnings of future workers. It is also likely that students from low-income countries will be affected most. These estimates are conservative, assuming that the closures will end after four months and school quality will not suffer.

The Journal of Population Economics welcomes submissions dealing with the demographic aspects of the Coronavirus Crisis. After fast refereeing, successful papers are published in the next available issue. An example:

Yun Qiu, Xi Chen & Wei Shi (2020): Impacts of Social and Economic Factors on the Transmission of Coronavirus Disease 2019 (COVID-19) in China, GLO Discussion Paper, No. 494.
REVISED DRAFT NOW PUBLISHED OPEN ACCESS ONLINE: Journal of Population Economics, Issue 4, 2020.

Further publication on COVID-19 of a GLO DP:
GLO Discussion Paper No. 508, 2020
Inter-country Distancing, Globalization and the Coronavirus Pandemic – Download PDF
by
Zimmermann, Klaus F. & Karabulut, Gokhan & Bilgin, Mehmet Huseyin & Doker, Asli Cansin is now forthcoming OPEN ACCESS in The World Economy doi:10.1111/twec.12969 PREPUBLICATION VERSION

More from the GLO Coronavirus Cluster

GLO Discussion Papers are research and policy papers of the GLO Network which are widely circulated to encourage discussion. Provided in cooperation with EconStor, a service of the ZBW – Leibniz Information Centre for Economics, GLO Discussion Papers are among others listed in RePEc (see IDEAS,  EconPapers)Complete list of all GLO DPs – downloadable for free.

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Martin Kahanec appointed to the Slovak COVID-19 Economic Crisis Council. An interview.

Why has Slovakia, a small open economy, done so well with low mortality rates in response to the crisis? And what to do now in face of an expected huge recession? Some insights from an interview with top policy advisor Martin Kahanec.

Some core messages of the interview:

  • Slovakia has done a tremendous job stopping the spreading of the virus, for instance the low mortality rate put the country at the very last place in the ranking in Europe.
  • The success can be traced back not so much to a rigorous, but to a fast and effective response.
  • But the Slovak economy is paying a huge price for the shutdowns in the country and among the trade partners.
  • Income maintenance schemes to strengthen the demand side and measures to preserve liquidity to grease the wheels of the economy are essential for a fast recovery.
  • My role in the advisory body of the Slovak government is to evaluate crisis management procedures and risks and assess possible measures and their effects.

GLO Fellow and GLO Cluster Lead “Labor Mobility” Martin Kahanec (Central European University and Bruegel) is also the Director of the Slovak Think Tank CELSI. He was just appointed by his government to the Slovak COVID-19 Economic Crisis Council. He reports on the Slovak experiences and the way to recovery.

Middle photo by Mika Baumeister on Unsplash

Interview

GLO: How well did Slovakia get through the COVID-19 crisis in terms of infections and death cases?

Martin Kahanec: Slovakia has done a tremendous job stopping the spreading of the virus. After more than 11 weeks since its first case of COVID-19, recorded on March 6, 2020, as of 25 May 2020 Slovakia had only 1,513 cases (of which only 163 active). Its 5 deaths per million inhabitants (28 in total) put Slovakia at the distant last place in the ranking of European countries by this mortality measure. For comparison, during the same period (eleven weeks into the pandemic) similarly-sized Ireland recorded more than 16 times as many cases and more than 55 times as many deaths and Denmark more than 7 times as many cases and nearly 20 times as many deaths. In spite of local outbursts in care homes and marginalized Roma settlements, the “first wave” of the pandemic in Slovakia was only a wavelet, as the country has to date recorded only 6 days with more than 50 new cases.

For the record, this result is not an issue of (the lack of) testing or isolation of the country: per million of inhabitants Slovakia has done fewer tests than Denmark, but more than Sweden, France, or the Netherlands, and just about as many as Finland. Slovakia is a small open economy with a very busy international transportation system, and the share of cross-border workers is the highest in Europe, at about 5.2% of its labor force – many of whom work in care homes and touristic resorts in Austria and northern Italy. Slovaks spend on average more nights abroad than Czechs, Italians, or Spaniards. Bratislava and Vienna are among the closest national capitals in the world, just about 65 km apart, Czechia is about the same distance from Bratislava, and Hungary, just like Austria, share borders with Slovakia.

GLO: Is this success the result of a more rigorous Slovak response strategy?

Martin Kahanec: Perhaps not as much rigorous as speed. Within ten days since the first case, Slovakia had shut down schools (in Bratislava within less than a week), introduced mandatory face masks in public transportation (first in Europe), closed non-essential shops, introduced border controls and mandatory quarantine for people returning from abroad (within a week), and shut down international air as well as bus and train passenger services. An important factor has been the impressive compliance of the general public, with face masks becoming the norm immediately, with politicians and television celebrities as well as news anchors leading by example and wearing facemasks on all occasions. Several mistakes have been made, but overall the system of measures has worked effectively.

GLO: What were the consequences in terms of GDP losses?

Martin Kahanec: Slovakia is paying a hefty price for the shutdowns in the country and among our trade partners. Primarily due to weakened foreign demand, in Q1 2020 Slovak GDP shrank by 3.9% y-o-y, which was one of the largest drops in Europe. Fitch has downgraded Slovakia from A+ to A on May 8. In April 2020 the unemployment rate increased by 1.38 percentage points y-o-y. On the other hand, the government is now gradually removing the restrictions, and the automotive sector, one of the backbones of the Slovak economy, is rebounding, with the four large car making plants in Slovakia (VW, PSA, Kia, Land Rover) gradually returning to their capacity.

GLO: What can be done to foster a fast recovery?

Martin Kahanec: During the trough of the crisis the government should help those who have been hit the hardest and lost their livelihoods. This moral obligation is strengthened by the fact that keeping especially the workers with the highest risks of spreading the virus at home reduces the negative externality their continued activity would inflict on the rest of the society and that, for this reason, some sectors were shut down directly by the government. For a swift recovery, as soon as the epidemiological situation permits, workers should be allowed to return to jobs and children to schools. Effective testing, tracing, and isolating of the cases is needed to avoid a possible second wave.

Income maintenance schemes to strengthen the demand side and measures to preserve liquidity to grease the wheels of the economy are essential. For Slovakia, as a small open economy, coordination with its key trading partners and, especially, at the European level is of key importance.

But it is important to understand that the crisis will make some products, services, or even sectors obsolete, and it will open new opportunities and avenues for innovative economic activities at the same time. Therefore, what will matter in the long run is how the measures adopted will facilitate the reallocation of resources to the most promising economic endeavors, rather than cementing them in those, which have no economic future.

GLO: You have been just appointed to the Slovak COVID-19 Economic Crisis Council; what is the role of this council?

Martin Kahanec: The Economic Crisis Council is a temporary advisory and coordinating body at the Ministry of Finance during the COVID-19 crisis. Its purpose is to evaluate crisis management procedures and risks for the development of the Slovak economy and assess possible measures and their effects. We elaborate on specific proposals in response to the economic crisis caused by the global COVID-19 pandemic in Slovakia.

*************
With Martin Kahanec spoke Klaus F. Zimmermann, GLO President.

The Journal of Population Economics welcomes submissions dealing with the demographic aspects of the Coronavirus Crisis. After fast refereeing, successful papers are published in the next available issue. An example:

Yun Qiu, Xi Chen & Wei Shi (2020): Impacts of Social and Economic Factors on the Transmission of Coronavirus Disease 2019 (COVID-19) in China, GLO Discussion Paper, No. 494.
REVISED DRAFT NOW PUBLISHED OPEN ACCESS ONLINE: Journal of Population Economics, Issue 4, 2020.

Further publication on COVID-19 of a GLO DP:
GLO Discussion Paper No. 508, 2020
Inter-country Distancing, Globalization and the Coronavirus Pandemic – Download PDF
by
Zimmermann, Klaus F. & Karabulut, Gokhan & Bilgin, Mehmet Huseyin & Doker, Asli Cansin is now forthcoming OPEN ACCESS in The World Economy doi:10.1111/twec.12969 PREPUBLICATION VERSION

More from the GLO Coronavirus Cluster

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Employment Protection and Earnings Mobility

A new GLO Discussion Paper finds that the stronger the employment protection for regular contracts, the smaller is earnings mobility, although the effect is stronger among women of high reproductive age.

The Global Labor Organization (GLO) is an independent, non-partisan and non-governmental organization that functions as an international network and virtual platform to stimulate global research, debate and collaboration.

GLO Discussion Paper No. 547, 2020

Gendered Effects of Employment Protection on Earnings Mobility Download PDF
by
Bárcena-Martín, Elena & Medina-Claros, Samuel & Pérez-Moreno, Salvador

GLO Fellows Elena Bárcena-Martín & Salvador Pérez-Moreno

Author Abstract: This paper explores potential gendered effects of employment protection on earnings mobility, differentiating between upward and downward movements. We conduct a micro-macro mobility analysis for 23 European countries over the economic downturn period 2008–2014. The results confirm that, overall, the higher the protection for regular contracts, the lower the earnings mobility (either upwards or downwards) although the effect is stronger among women of high reproductive age. Nevertheless, protection for temporary employment seems to be only associated with reduced downward earnings mobility when considering transitions into and out of employment, with no gender differential effect.

GLO Discussion Papers are research and policy papers of the GLO Network which are widely circulated to encourage discussion. Provided in cooperation with EconStor, a service of the ZBW – Leibniz Information Centre for Economics, GLO Discussion Papers are among others listed in RePEc (see IDEAS,  EconPapers)Complete list of all GLO DPs – downloadable for free.

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In Memoriam Don DeVoretz

May 28, 2020: Don DeVoretz (*May 28, 1942; + March 14, 2020), a prominent migration researcher, GLO Fellow and long-term collaborator of the GLO President, Klaus F. Zimmermann, would have been 78 today. We bemoan and remember a great scientist and friend.

Don DeVoretz obtained his doctorate in Economics from the University of Wisconsin (Madison) in 1968. He was the co-director of the Centre of Excellence for the Study of Immigration (1996-2007) and Professor of Economics at Simon Fraser University (since 1968) and Professor Emeritus (since 2010).

Don DeVoretz has held visiting positions at Duke University, University of Ibadan (Nigeria), University of the Philippines, University of Wisconsin, and the Norwegian School of Economics.

Don DeVoretz was named the Willy Brandt Professor in 2004 at IMER, Malmö University.

Don DeVoretz, a friend of the late Julian Simon, gave the first Julian Simon Lecture at IZA in 2004.

Selective Publications

  • Don DeVoretz, Nahikari Irastorza. Economic Theories of Citizenship Ascension. In: Ayelet Shachar, Rainer Bauböck, Irene Bloemraad, Maarten Vink (Eds.), The Oxford Handbook of Citizenship. Oxford 2017.
  • Don J. DeVoretz. The Economics of Immigrant Citizenship Ascension. In: Amelie Constant, Klaus F. Zimmermann, International Handbook on the Economics of Migration, Edward Elgar 2013.
  • Klaus F. Zimmermann, Martin Kahanec, Amelie F. Constant, Don J. DeVoretz, Liliya Gataullina, Anzelika Zaiceva. Study on the Social and Labour Market Integration of Ethnic Minorities. Report for the High Level Advisory Group on Social and Labour Market Integration of Ethnic Minorities and the European Commission, Bonn 2008, IZA Research Report No. 16.
  • Don J. DeVoretz. Immigration Policy: Methods of Economic Assessment. International Migration Review, 2006, 40 (2), 390-418. (Based on the Julian Simon Lecture 2004.)
  • Don J. DeVoretz, Samuel A. Laryea. Canadian Immigration Experience: Any Lessons for Europe? In: : K.F. Zimmermann (ed.), European Migration – What Do We Know? Oxford University Press, 2005.
  • Don J. DeVoretz (Ed.). Diminishing Returns: The Economics of Canada’s Recent Immigration Policy. C. D. Howe Institute 1995.
  • Ather Akbari, Don J. DeVoretz. The Substitutability of Foreign Born Labour in Canadian Production: Circa 1980. Canadian Journal of Economics, 25(3): 604-614. 1992.

Interviews with Associates

Below are two interviews with close associates of Don DeVoretz:

  • GLO Fellow Ather Akbari is Professor of Economics at Saint Mary’s University in Canada and Chair of the Atlantic Research Group on Economics of Immigration, Aging and Diversity. He is a former PhD student of Devoretz.
  • GLO Fellow Pieter Bevelander is a Professor at Malmö University and Director of the Malmö Institute for Studies of Migration, Diversity and Welfare. He is a former research partner of Devoretz.

Interview with Ather Akbari

GLO: How was Don as a teacher and PhD supervisor?

Ather Akbari: I wrote my doctoral thesis, entitled “Some Economic Impacts of Immigrant Population in Canada” under Don’s supervision. At that time (1980s), there was a paucity of  empirical research on Canadian immigration, but interest in impact of immigration was growing in public policy circles, as well as in general public. Under Don’s supervision, I really learned to communicate results of an academic research for both academic and nonacademic audience.  Results of my thesis attracted a lot of attention in news media and in public policy circles and I owe it a lot to my training under Don.

GLO: What was your joint prominent paper in the Canadian Journal of Economics about?

Ather Akbari: This paper entitled “Substitutability of Immigrants in Canadian Production Circa 1980” (not a part of my thesis) was the first in Canada to assess if immigrants displaced Canadian born workers in Canadian industries. Using data from Canadian census, we estimated a translog production function and found that although there was displacement in some industrial sectors, overall there was no displacement effect.   

GLO: Migration research was his focus, can you outline an example from his work?

Ather Akbari: I think Don’s most important contribution to migration research are his many contributions to the economics of citizenship. He has published conceptual and empirical research in this area. He also co-edited a book on the issue with Pieter Bevelander (Malmö University) with a preface written by Irene Bloemraad (Berkley University). This volume had contributions from Europe and North America. Main focus of the book was to present evidence on the impact of citizenship status on economic performance and contributions of immigrants in the host country. Very important policy implications as rights for citizenship ascension vary much across countries.

GLO: What was his contribution to policy advice, in particular to Canadian migration policy?

Ather Akbari: In the late 1980s, the Canadian government undertook a demographic review of Canadian population. All forecasts based on the demographics of the time indicated that Canada was moving towards a population distribution which will be more heavily skewed towards the elderly. This could could cause economic and labor market challenges. Don was very passionate in recommending to the Canadian government that it should liberalize its immigration policy as one important tool to meet these challenges. He was also in favor of attracting international students and for liberalizing rules for their permanent residency. Over time, Canadian immigration policy became more liberal. He was also very much in favor of immigration policy based on evidence-based research. He promoted an increased availability of data for researchers and was among the proponents of the use of administrative data in connection with survey data (especially the Longitudinal Immigration Database, IMDB).

GLO: Don was increasingly worried about the future of migration, what do you think are the major challenges ahead?

Ather Akbari: Globalization has resulted in greater movement of goods and people around the world and has resulted in great benefits. However, many have also been hurt, economically and politically, by unequal distribution of these benefits. In the West, this has led to the current wave of nationalism which threatens free movements of goods and of people. World leaders, academic researchers and news media need to address this seriously.  

Interview with Pieter Bevelander

GLO: How did you get connected with Don?

Pieter Bevelander: I met Don DeVoretz in Spring 2004. He had just taken up the Willy Brandt Guest Professorship at the Department of International Migration and Ethnic Relations at Malmö University. He felt a bit lost among all non-economists that were working there. I was myself just on a post doc visit at the Erasmus University in Rotterdam, and met him when I was on a visit. During his first weeks in Malmö he had read my dissertation on the employment integration of immigrants in Sweden and showed especially large interest into the citizenship analysis. Further that Spring, he organized in Malmö a multidisciplinary workshop on the consequences of citizenship ascension in different countries and from different disciplinary angles.

GLO: You published together the edited volume The Economics of Citizenship. How did this project evolve?

Pieter Bevelander: Since the workshop in 2004 and his time in Malmö we slowly started to have conversations on a volume on the economic effects of citizenship in different countries. Don was a Research Fellow at IZA and met often its Director in Bonn. Through this network it was possible to meet either in Bonn or on his way into Europe in Malmö. We presented our ideas and papers at conferences and started to screen possible researchers for being part of the volume. We published then the book in 2008.

GLO: How has this project affected your both careers and the profession?

Pieter Bevelander: For us both, Don and me, this volume has been very valuable.
It was followed by subsequent articles, handbook chapters, policy papers for think tanks and government institutions, all analyzing why immigrants take up the citizenship of another country and whether this leads to increased economic integration in new environment. Don, for instance, was involved in policy recommendations through the think tank Center for American Progress in 2014 about how to find a way for allowing undocumented migrants to become full citizens in the US. Today, I am an advisor for the Swedish government’s investigation about changing citizenship regulations.

NOTE
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With Ather Akbari & Pieter Bevelander spoke Klaus F. Zimmermann, GLO President.

Klaus F. Zimmermann: Don DeVoretz has been a academic companion for most parts of my life as a migration researcher.

  • We met 1992 when we both participated at the famous migration workshop, Herbert Giersch organized in Vancouver for the Egon-Sohmen-Foundation. (Herbert Giersch, Ed., Economic Aspects of International Migration, Springer Berlin. Heidelberg, 1994.)
  • He visited me during my tenure as Professor of Economics at the University of Munich and was part of the migration network I had created at the time as Programme Director Migration for the Centre of Economic Policy Research (CEPR) in London. A CEPR conference on “European Migration – What Do We Know?”, which I organized 1997 at the University of Munich mobilized the network which enabled the publication of K.F. Zimmermann (ed.), European Migration – What Do We Know? Oxford University Press, 2005.
  • After I created IZA, the Institute for the Study of Labor, as the Founding Director in 1998 in Bonn, Don DeVoretz and the migration network moved with me, and I appreciated his experienced support for two decades. Within this period, he was instrumental in large research projects for the Volkswagen Foundation (“The Economics and Persistence of Migrant Ethnicity”, 2005 – 2008) and the European Commission (“Study on Social and Labour Market Integration of Ethnic Minorities”, 2006 – 2007). He helped building up and developing the IZA migration network together with Amelie Constant and Barry Chiswick. He started the prominent IZA Julian Simon Lecture series in 2004, and was a regular visitor throughout the period.
  • Don DeVoretz stayed in contact with email exchange and ambitious research projects until earlier this year. We all miss his friendship, sharp thinking and helpful advice.

Julia & Don DeVoretz

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Telework and Time Use in the United States

A new GLO Discussion Paper finds that some teleworkers earn a wage premium; they also spend less time on commuting and grooming activities but more time on leisure and household production activities and more time with family on work-at-home days.

The Global Labor Organization (GLO) is an independent, non-partisan and non-governmental organization that functions as an international network and virtual platform to stimulate global research, debate and collaboration.

GLO Discussion Paper No. 546, 2020

Telework and Time Use in the United StatesDownload PDF
by
Pabilonia, Sabrina Wulff & Vernon, Victoria

GLO Fellows Sabrina Pabilonia & Victoria Vernon

Victoria Vernon

Author Abstract: Remote work is rapidly increasing in the United States. Using data on full-time wage and salary workers from the 2017–2018 American Time Use Survey Leave and Job Flexibilities Module, this paper examines the characteristics of teleworkers, the effects of teleworking on wages, and differences in time-use patterns between office and work-at-home workdays. We find that some teleworkers earn a wage premium, but it varies by occupation, gender, parental status, and teleworking intensity. Teleworkers also spend less time on commuting and grooming activities but more time on leisure and household production activities and more time with family on work-at-home days.

Photo by Charles Deluvio on Unsplash

GLO Discussion Papers are research and policy papers of the GLO Network which are widely circulated to encourage discussion. Provided in cooperation with EconStor, a service of the ZBW – Leibniz Information Centre for Economics, GLO Discussion Papers are among others listed in RePEc (see IDEAS,  EconPapers)Complete list of all GLO DPs – downloadable for free.

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Living and Working in Corona Times: Interview with Director Paulien Osse of the WageIndicator Foundation

Recently, the WageIndicator Foundation had announced the Continuous Global Online Survey ‘Living and Working in Corona Times’. (See also the report in the GLO NEWS on March 29.) Two months later, the team has already collected 14,000 valid observations from 72 countries, with much more to come. The WageIndicator Foundation is led by GLO Fellow Paulien Osse as the Director, is a long-term partner of the GLO. (For more information about Director Osse, see our 2019 interview.) The right moment to interview Paulien Osse about the new venture, to give a progress report, and outline difficulties, challenges and the huge potentials.

The Continuous Global Online Survey ‘Living and Working in Corona Times’ 

GLO: Any global crisis needs short-term data for nowcasting. How can WageIndicator help?

Paulien Osse: WageIndicator tries to help in two ways. First, we started a special Corona – Work Life Survey on March 23. Two months later it already collected 14,000 valid observations from 72 countries. Each day the state of affairs as covered by this living & working survey in corona-times is updated and shown in refreshed infographics, global, regional and country-specific. The survey is ongoing, 24/7, and will last as long as the pandemic is raging. Results show increased anxiety and dissatisfaction across the board, also in countries which remained almost untouched by the coronavirus, but with lockdowns in force.

A second global survey (which we run since 2014), mapping cost of living-levels, may become more and more relevant. Face-to-face data collection on streets and market places is not everywhere possible, but we do as we always do online and now also include web-based food shops. We understand that during the pandemic there are more online food shops, and people get more digitalised, EVERYWHERE. We want to show price levels as per July first world-wide in an attempt to picture the corona-impact on the cost of living and living wage-levels. As far as we can see now we will cover 120 countries with prices and living wages. 12 interns from FLAME University help us out!

These are our nowcasting contributions.

GLO: You execute a special Covid work life survey for “everybody” and one for HR. What do you want to achieve, what is the focus?

Paulien Osse:
Generally speaking, we want to provide insight into the impact of the coronacrisis on the work/life balance of working individuals and their families. We assume there will be a long lasting aftermath, with less jobs, increased job insecurity, and a great variety in the consequences for different occupational groups, male/female, formal/informal employment etc. How will this work out for each of us? To be precise: in the survey you can select different contract types (for employees, workers, informals, and employers). You may choose from 1,700 occupations.

Our HR-survey is directed at (big) companies that have already participated in earlier compliance research, in Indonesia, Ethiopia and Uganda, both in the garment and flower industry. We now combine it with questions regarding health & safety and company policies to survive the coronacrisis. This data is shared each fortnight with trade union partners in these countries, as input for bipartite and tripartite negotiations and consultations. Highly in demand, since precise.

GLO: You have many country teams, how do they work and what problems do they face?

Paulien Osse: Like everybody else, our team members have to comply with lockdown regulations. Practically this has meant that, to varying degrees, all stayed at home much of the time, starting at the end of March beginning of April. For some this was a slight inconvenience. I personally work from home already for many years, so my routine did not change much. Others, like in India, lost help in the household or food delivery that they were used to. Now they shop and cook and clean and work and look after the kids all at once Some are not even allowed to leave the house (45 degrees), or get medication for their ailing mother in an emergency. Another colleague saw her boy friend confined to the oil rig where he works. Forever it seems. There are many stories like these and worse, like in Mozambique where corona is for Rogerio, our Portuguese content manager, just another nuisance on top of terrorist acts and civil war. Very unnerving, all this.

But as teams used to working and communicating online, we thrive. We are not beginners online, like many others have become just now. We have meetings more frequently, shorter, more efficient. And we Zoom-socialize on Fridays at a fixed time, sharing fun, frustrations and small victories, and the Italians serve Prosecco.

But, as already mentioned, the face-to-face data collection unfortunately has to be shelved for another few weeks, like in Bangladesh. This blocks progress, where we were about to embark on a nationwide wage and cost of living survey.

GLO: How do you judge the productivity of your teams in comparison to normal times?

Paulien Osse: Team members travel less – I mean NOT. So there are many more hours for productive work. Also, we see each other more frequently for online consultations. Thanks to the growing quality of Zoom, I must say. Because of all this practice we have faster, shorter meetings, more to the point. So, result: a nice set of new projects! After 2 months however, I notice that this higher gear holds the risk of exhaustion. But when WageIndicator offers an escape from depressing living conditions under severe restrictions of movement, ‘take a rest’ is easier said than done. Some of us haven’t seen sunshine for many weeks.

GLO: Can the surveys identify losers and winners of the crisis, and what can we learn?

Paulien Osse: Our first scientific report from Pablo Pedraza, Martin Guzi and Kea Tijdens (see GLO DP # 544) covers the data collected in the first 6 weeks since the launch of the corona-survey. We must be very cautious given the paucity of data. Yet, on the most general level of outcomes we can say that there are no winners of the crisis, just losers. Working people do not feel less, but more anxious as a result of state-imposed emergency measures. Having to stay home and wear protective gear when going out, makes people not just more anxious but also more dissatisfied.

Not surprisingly, reduced income or prospects also increases anxiousness and dissatisfaction. Changes in the workload and/or routine have the same effect: an increase of tasks, but a decrease of the workload too, makes people more anxious and dissatisfied.

Our researchers conclude that their findings are relevant for policy-makers who design paths to recovery. They endorse the pursued maintenance of employment for as many people as possible: ‘protecting jobs implies the protection of citizen’s well-being’. They say this applies to the lockdown period studied, but also to the much needed recovery.

GLO: Covid-19 has affected first the developed world, but now reaches the developing economies: can you trace differences in the major challenges?

Paulien Osse: The global lockdown was initiated to protect the infected, more developed parts of the world, first and fast. Several months into the pandemic it now becomes clear that the less developed and least-infected countries are paying a heavy economic price just the same. In Mozambique for instance, with very low corona-infection and zero death rates – but people report that they have lost their job last month. In Madagascar, also almost corona-free and no corona deaths reported, even 1 in 5 respondents say they lost their job already. A similar situation can be seen in Vietnam, where close to 1 in 10 respondents report to have lost their job as a consequence of the corona lockdown. Yet, corona-related death rates are zero in Vietnam. The figures are from the first week of May.

Keep in mind that working from home is an option for the higher educated. Working from home might be cool, but no fun with bad connections, and/or small children around. So in general for developing countries, hardly any corona, yet; but they suffer just the same, if not more.

GLO: Is working from home different between the sexes, e.g. is the burden on females larger and rising?

Paulien Osse: Women report anxiety more often than men, living with a partner makes people more satisfied and less anxious, but having children in the household makes no difference in this respect. But if prevailing gender pay gaps, prejudice and role divisions in the household are anything to go by, one may assume that women are hit harder than men. Also, they usually earn less and have smaller or less protected jobs. Therefore, prospects are not bright and single mothers in particular will need additional support in the recovery period.

By the end of April most respondents in our survey had reported to believe that they will still have their job next month, however 1 in 3 was afraid to lose income in May. There might be a relation with the fact that more respondents around the world report that they got less, instead of more work. But it is too early to measure the real and lasting gender-specific impact, or for female dominated occupations.

GLO: Are older people more lonely and unhappy?

Paulien Osse: More lonely, we cannot say. But surprisingly, 50 plus respondents, though more vulnerable, report lower dissatisfaction and anxiety than the average from our survey.

GLO: How do you provide access for researchers to use country level and individual data?

Paulien Osse: The normal channels may be used, they are open to researchers. Daily update of data, check the project page. Daily fresh maps. Daily fresh graphs.

GLO: How satisfying is it for you to see the project prospering?

Paulien Osse: Fun! So far, we are there to stay. However: The reason for our corona-survey does not make one happy. Neither do the economic prospects for the near future, also and maybe more so in the developing world. Now the return of massive poverty threatens.

Our WageIndicator teams, also and especially from developing countries, are not so easily shocked. We are an experienced lot. For us the joy is to show how fast, lean and precise we can be, working remote. Believing also helps: our data may contribute! We try and keep our spirits high. As one out of 25 recently recruited interns from FLAME university noticed: “WageIndiators are hard working people from all around the world, very inspiring”.

*************
With Paulien Osse spoke Klaus F. Zimmermann, GLO President.
Further activities and reports of the GLO Research Cluster on the coronavirus.

  • Left: Picture Franca Berkvens, Burkina Fasso: 20 observations in the Corona Work Life Survey.
  • Right: Picture Professor Rupa Korde. Her home office in Pune, India: 100 % lock down in Red Zone.
New researcher reality
Picture of Zoom meeting with some WageIndicator team members from
South Africa, India, Hungary, Italy and Amsterdam

Videos

Overview team of WageIndicator Foundation

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