A new GLO Discussion Paper shows that the optimal policy response to Covid-19 depends both on the configuration of the contact network and the tolerated infection incidence.
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.
Author Abstract: We address the problem of finding the optimal lockdown and reopening policy during a pandemic like COVID-19 for a social planner who prioritizes health over the economy. Agents are connected through a fuzzy network of contacts, and the planner’s objective is to determine the policy that contains the spread of infection below a tolerable incidence level, and that maximizes the present discounted value of real income, in that order of priority. We show theoretically that the planner’s problem has a unique solution. The optimal policy depends both on the configuration of the contact network and the tolerated infection incidence. Using simulations, we apply these theoretical findings to: (i) quantify the trade-off between the economic cost of the pandemic and the infection incidence allowed by the social planner, and show how this trade-off depends on network configuration; (ii) understand the correlation between different measures of network centrality and individual lockdown probability, and derive implications for the optimal design of surveys on social distancing behavior and network structure; and (iii) analyze how segregation induces differential health and economic dynamics in minority and majority populations, also illustrating the crucial role of patient zero in these dynamics.
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A new GLO Discussion Paper indicates that the negative COVID-19 labour market effects are felt the most by people in the lowest percentiles of the financial wellbeing distributionsuggesting significant increases in financial wellbeing disadvantage and inequality.
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.
Author Abstract: Using an online survey of Australian residents, we elicit the potential impacts of COVID-19 related labour market shocks on a validated measure of financial wellbeing. Experiencing a reduction in hours and earnings, entering into unemployment or having to file for unemployment benefits during the pandemic are strongly and significantly associated with decreases in financial wellbeing of 29% or 18 points on the financial wellbeing scale of 0-100, despite various government measures to reduce such effects. Unconditional quantile regression analyses indicate that the negative COVID-19 labour market effects are felt the most by people in the lowest percentiles of the financial wellbeing distribution. Counterfactual distribution regressions indicate a shifting of the financial wellbeing distribution leftwards brought on by those suffering any of the above-mentioned labour market shocks, indicating potential significant increases in financial wellbeing disadvantage and inequality.
2021 Kuznets Prize Awarded to Yun Qiu, Xi Chen, & Wei Shias announced by the office of the Journal of Population Economics.
Yun Qiu (Jinan University), Xi Chen (Yale University), and Wei Shi (Jinan University) will receive the 2021 Kuznets Prize for their article (please click title below for OPEN ACCESS)
which was published in the Journal of Population Economics (2020), 33(4), pp. 1127–1172. The annual prize honors the best article published in the Journal of Population Economics in the previous year.
The award will be given to the authors during a special public journal event in the Fall of 2020.
Biographical Abstracts
Yun Qiu is an assistant professor at Institute for Economic and Social Research at Jinan University (Guangzhou, China). She obtained a Ph.D. in Agricultural, Environmental, and Development Economics from the Ohio State University. She is a Fellow of the Global Labor Organization (GLO). Yun uses applied econometric techniques to conduct research in areas focused on (1) understanding the health and productivity impacts of extreme weather and air pollution in China; (2) characterizing the influencing factors of the spread of COVID-19 and its socioeconomic impacts; (3) valuing coastal adaptation strategies and urban amenities.
Xi Chen is an associate professor of Health Policy and Economics at Yale University. He obtained a Ph.D. in Applied Economics from Cornell University. His research endeavors focus on improving public policies on population aging, life course health, and global health systems. Dr. Chen is a consultant at the United Nations Institutions, Fellow at the Global Labor Organization (GLO), former President of the China Health Policy and Management Society, and Butler-Williams Scholar at the U.S. National Institutes of Health. Dr. Chen’s work has been published in prestigious economics, science and medical journals, recognized through numerous awards, and widely covered in media.
Wei Shi is an associate professor at the Institute for Economic and Social Research, Jinan University (Guangzhou, China). His research interests include topics in econometrics, real estate economics, and applied microeconomics. His current research focuses on panel data models with spatial interactions and multidimensional heterogeneities, peer effects models, and applications of spatial econometric models. He is a Fellow of the Global Labor Organization (GLO) and obtained his Ph.D. in economics from the Ohio State University.
Yun Qiu
Xi Chen
Wei Shi
Abstract of the Winning Paper
“This study models local and cross-city transmissions of the novel coronavirus in China between January 19 and February 29, 2020. We examine the role of various socioeconomic mediating factors, including public health measures that encourage social distancing in local communities. Weather characteristics 2 weeks prior are used as instrumental variables for causal inference. Stringent quarantines, city lockdowns, and local public health measures imposed in late January significantly decreased the virus transmission rate. The virus spread was contained by the middle of February. Population outflow from the outbreak source region posed a higher risk to the destination regions than other factors, including geographic proximity and similarity in economic conditions. We quantify the effects of different public health measures in reducing the number of infections through counterfactual analyses. Over 1.4 million infections and 56,000 deaths may have been avoided as a result of the national and provincial public health measures imposed in late January in China.”
About the Kuznets Prize
The Journal of Population Economics awards the ‘Kuznets Prize’ for the best paper published in the Journal of Population Economicsin the previous year. Starting from 2014 the Prize has been awarded annually. Papers are judged by the Editors of the Journal.
Simon Kuznets, a pioneer in population economics, Professor Emeritus at Harvard University and the 1971 Nobel Prize laureate in economics, died on July 10, 1985. Professor Kuznets was born 1901 in Pinsk, Belarus, and came to the United States in 1922. He earned his Bachelor of Science in 1923, a Master of Arts degree in 1924 and his doctorate in 1926, all from Columbia University. During World War II he was Associate Director of the Bureau of Planning and Statistics on the War Production Board, and he served on the staff of the National Bureau of Economic Research from 1927 to 1960. Mr. Kuznets was a faculty member at the University of Pennsylvania for 24 years and Professor of Political Economy at Johns Hopkins University from 1954 until he joined Harvard University in 1960. He retired in 1971 and was given the title of George F. Baker Professor Emeritus of Economics. He was a former president of the American Economic Association and the American Statistical Association.
Previous Winners
The Kuznets Prize (please click titles for READ LINKS FOR FREE) has previously been awarded to:
2020: Gautam Hazarika (University of Texas Rio Grande Valley), Chandan Kumar Jha (Le Moyne College, Madden School of Business), and Sudipta Sarangi (Virginia Tech) for their article “Ancestral ecological endowments and missing women,“ Journal of Population Economics (2019), 32(4): pp. 1101-1123.
2016: Loren Brandt (University of Toronto), Aloysius Siow (University of Toronto), and Hui Wang (Peking University) for their article “Compensating for unequal parental investments in schooling,” Journal of Population Economics 28: 423-462.
Period 2010-2012: Richard W. Evans (Brigham Young University), Yingyao Hu (Johns Hopkins University) and Zhong Zhao (Renmin University) for their article “The fertility effect of catastrophe: US hurricane births“, Journal of Population Economics 23: 1-36.
A new paper published ONLINE FIRST in the Journal of Population Economics challenges the anecdotal view of additional paid vacation days as an adequate means to improve workers’ health.
Published ONLINE FIRST. Forthcoming: Journal of Population Economics (2021), volume 34. FREEREADLINK: https://rdcu.be/b7sJK
Author Abstract: This study estimates the causal effect of paid vacation on health. Using register data on the universe of central government employees in Sweden, I exploit an age-based rule stipulated in the collective agreement covering these employees. I achieve identification by combining a regression discontinuity with a difference-in-differences design to control for time-invariant differences between consecutive birth cohorts and isolate the true effect at two separate discontinuities at ages 30 and 40. The main results indicate that an increase of three paid vacation days at age 30 and four days at age 40 do not cause significant changes in health, as proxied by visits to specialized outpatient care, inpatient admissions, and long-term sick leaves. These findings challenge the anecdotal view of additional paid vacation days as an adequate means to improve workers’ health.
LEAD ARTICLE OF ISSUE 4: Yun Qiu, Xi Chen & Wei Shi, Impacts of social and economic factors on the transmission of coronavirus disease 2019 (COVID-19) in China Journal of Population Economics33, 1127–1172 (2020). OPEN ACCESS Over 21K journal downloads & over 60 Google Scholar cites as of September 10, 2020.
A new paper published in the Journal of Population Economics investigates for the Italian case the effects of working from home on income inequality at the time of COVID-19 and the implications for the future.
Luca Bonacini, Giovanni Gallo & Sergio Scicchitano
Journal of Population Economics (2020), published ONLINE FIRST. PDF free accessible. Based on GLO Discussion Paper No. 541, 2020
GLO Fellows Giovanni Gallo & Sergio Scicchitano and GLO Affiliate Luca Bonacini
Giovanni Gallo
Sergio Scicchitano
Luca Bonacini
Author Abstract: In the current context of the COVID-19 pandemic, working from home (WFH) became of great importance for a large share of employees since it represents the only option to both continue working and minimise the risk of virus exposure. Uncertainty about the duration of the pandemic and future contagion waves even led companies to view WFH as a ‘new normal’ way of working. Based on influence function regression methods, this paper explores the potential consequences in the labour income distribution related to a long-lasting increase in WFH feasibility among Italian employees. Results show that a positive shift in WFH feasibility would be associated with an increase in average labour income, but this potential benefit would not be equally distributed among employees. Specifically, an increase in the opportunity to WFH would favour male, older, high-educated, and high-paid employees. However, this ‘forced innovation’ would benefit more employees living in provinces have been more affected by the novel coronavirus. WFH thus risks exacerbating pre-existing inequalities in the labour market, especially if it will not be adequately regulated. As a consequence, this study suggests that policies aimed at alleviating inequality, like income support measures (in the short run) and human capital interventions (in the long run), should play a more important compensating role in the future.
LEAD ARTICLE OF ISSUE 4: Yun Qiu, Xi Chen & Wei Shi, Impacts of social and economic factors on the transmission of coronavirus disease 2019 (COVID-19) in China Journal of Population Economics33, 1127–1172 (2020). OPEN ACCESS
OTHER COVID-19 ARTICLES JUST PUBLISHED ONLINE FIRST.
Fabio Milani: COVID-19 outbreak, social response, and early economic effects: A global VAR analysis of cross-country interdependencies. Journal of Population Economics, (2020). https://doi.org/10.1007/s00148-020-00792-4. PDF free accessible.
Luca Bonacini, Giovanni Gallo & Fabrizio Patriarca: Identifying policy challenges of COVID-19 in hardly reliable data and judging the success of lockdown measures. Journal of Population Economics, (2020). https://doi.org/10.1007/s00148-020-00799-x PDF free accessible.
All the presentation in this series are based on the projects that GLO-VirtYS program scholars completed as part of their program participation.
September 17th Program
Sydney (10pm), Beijing (8pm), Istanbul (3pm), Berlin (2pm), London (1pm), Cape Town (2pm), Washington DC (8am), Santiago de Chile (8am)
Satyendra Kumar Gupta, Jindal School of Government and Public Policy and GLO Affiliate Irrigation and Culture: Gender Roles and Women’s Rights (GLO VirtYS program advisor Professor Almas Heshmati)
Kelly Hyde, University of Pittsburgh and GLO Affiliate The Regressive Costs of Drinking Water Contaminant Avoidance (GLO VirtYS program advisor Professor Anurag Sharma)
Chaired by GLO VirtYS Program Director Olena Nizalova. Full video of the event. For more information about both speakers and their paper abstracts.
Watch also his related GLO Virtual Seminar presentation on Despair, Unhappiness and Age. Video of seminar.
GLO Fellow David G. Banchflower & Research Director GLO
Author Abstract: A large empirical literature has debated the existence of a U-shaped happiness-age curve. This paper re-examines the relationship between various measures of well-being and age in 145 countries, including 109 developing countries, controlling for education and marital and labor force status, among others, on samples of individuals under the age of 70. The U-shape of the curve is forcefully confirmed, with an age minimum, or nadir, in midlife around age 50 in separate analyses for developing and advanced countries as well as for the continent of Africa. The happiness curve seems to be everywhere. While panel data are largely unavailable for this issue, and the findings using such data largely confirm the cross-section results, the paper discusses insights on why cohort effects do not drive the findings. I find the age of the minima has risen over time in Europe and the USA.
LEAD ARTICLE OF ISSUE 4: Yun Qiu, Xi Chen & Wei Shi, Impacts of social and economic factors on the transmission of coronavirus disease 2019 (COVID-19) in China Journal of Population Economics33, 1127–1172 (2020). OPEN ACCESS Over 21K journal downloads & over 60 Google Scholar cites as of September 10, 2020.
A new GLO Discussion Paper studies the role of long-term vacancies in a Diamond-Mortensen-Pissarides style search and matching model calibrated to the US economy and identifies a vacancy depletion channel.
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.
Author Abstract: We reassess the role of vacancies in a Diamond-Mortensen-Pissarides style search and matching model. In the absence of free entry long lived vacancies and endogenous separations give rise to a vacancy depletion channel which we identify via joint unemployment and vacancy dynamics. We show conditions for constrained efficiency and discuss important implications of vacancy longevity for modeling and calibration, in particular regarding match cyclicality and wages. When calibrated to the postwar US economy, the model explains not only standard deviations and autocorrelations of labor market variables, but also their dynamic correlations with only one shock.
A new GLO Discussion Paper studies the wage gap between formal and informal sector workers in Turkey confirming that an informal wage penalty is persistent even after unobserved heterogeneity is taken into account.
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.
Author Abstract: Many empirical studies found wage gaps between formal and informal sector workers even after controlling for a number of individual and firm level characteristics. While there is limited amount of research considering the same question in the Turkish labor market, wage gap between formal and informal employees generally do not take unobserved characteristics into account. In our paper, we carry this analysis for Turkey and estimate the wage gap between formal and informal sector workers utilizing panel data from Survey of Income and Living Conditions (SILC) for the period of 2014 and 2017. Mincer wage equations across quantiles are estimated considering observable and unobservable characteristics with a fixed effect model, and for sensitivity tests we regard the possibility of nonlinearity in covariate effects and estimate a variant of matching models. Our results show that informal wage penalty is persistent even after unobserved heterogeneity is taken into account, however, the penalty is not statistically significant at the upper end of the wage distribution. Moreover, we show that there are important differences between informal workers who have permanent contracts versus informal workers that have relatively more irregular work arrangements. Not only the latter is subject to earnings reductions, but they also have slightly lower probability of moving out of informal employment. We also demonstrate that the mobility of lower and upper tier informal workers is affected by different variables.
Posted inNews, Research|Comments Off on Pay Gaps and Mobility for Lower and Upper Tier Informal Sector Employees: an investigation of the Turkish labor market
A new GLO Discussion Paper studies the effects of unemployment and unauthorized immigration on attitudes related to populism and populist voting in the 2016 U.S. Presidential Election.
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.
Author Abstract: This paper examines how economic insecurity and cultural anxiety have triggered different dimensions of the current populism in the United States. Specifically, I exploit two quasi-natural experiments, the Great Recession and the 2014 Northern Triangle immigrant influx, to investigate the effects of unemployment and unauthorized immigration on attitudes related to populism and populist voting in the 2016 U.S. Presidential Election. I discover that recent unemployment during the Great Recession, rather than existing unemployment from before the recession, increased the probability of attitudes forming against wealthy elites by 15 percentage points. Such attitudes are connected with left-wing populism. I identify perceived economic unfairness as a mechanism through which recent unemployment drove left-wing populism. However, cultural anxiety rather than economic insecurity more likely led to the over 10 percentage points rise in the probability of anti-immigration attitudes developing. These attitudes are related to right-wing populism. Furthermore, I obtain evidence that cohorts economically suffering the aftermath of the Great Recession were associated with 40 percentage points higher likelihood of supporting left-wing populist Bernie Sanders, while cohorts residing in regions most intensely impacted by the immigrant in ux were associated with 10 percentage points higher possibility to vote for right-wing populist Donald Trump. This study attempts to link distinct economic and cultural driving forces to different types of populism and to contribute to the understanding on the potential interactions of the economic and cultural triggers of the currently surging populism.
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