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Current Program

Please note that the seminar will be held online during the summer term 2021.

Time: 12.15–1.30 p.m.

Klaus F. Zimmermann

Social Assimilation and Labor Market Outcomes of Migrants in China

Previous research has found identity to be relevant for international migration, but has neglected internal mobility as in the case of the Great Chinese Migration. However, the context of the identities of migrants and their adaption in the migration process is likely to be quite different. The gap is closed by examining social assimilation and the effect on the labourmarket outcomes of migrants in China, the country with the largest record of internal mobility. Using instrumental variable estimation, the study finds that identifying as local residents significantly increase migrants’ hourly wages and reduce hours worked, although their monthly earnings remained barely changed. Further findings suggest that migrants with strong local identity are more likely to use local networks in job search, and to obtain jobs with higher average wages and lower average hours worked per day.

Bernd Fitzenberger

The role of unemployment and job changewhen estimating the returns to migration

Estimating the returns to migration from East to West Germany, we focus on pre-migration employment dynamics, earnings uncertainty, and job change. Migrants are found to be negatively selected with respect to labor market outcomes,with a large drop in earnings and employment during the last few months before migration. We find sizeable positive earnings and employment gains of migrationboth in comparison to staying or job change. The gains vary considerably with pre-migration earnings and with the counterfactual considered. Future migrantshave worse expectations for their labor market prospects in the East and migrants show a greater openness to mobility.

Evi Pappa

What are the likely macroeconomic effects of the EU Recovery plan

We examine the dynamic macroeconomic effects of the two largest EU regional structural funds. On average, ERDF funds have significant positive short term consequences on regional macroeconomic variables and gains dissipate almost entirely within three years. ESF funds have negative impact effects on regional variables, but their average cumulative medium term multipliers are positive and economically significant. We detect important regional asymmetries which may induce differential transition paths and outlooks for economic transformation. Location, level of development, EU tenure, Euro area membership and national borders account for part of the asymmetries. We present a two-region equilibrium model with sticky prices and endogenous growth through investment in R&D and human capital that reproduces the facts and explains some of the observed asymmetries. The policy implications for the newly created Recovery fund are discussed.

Josef Brüderl

The Age Trajectory of Happiness: How Lack of Causal Reasoning has Produced the Myth of a U-Shaped Age-Happiness Trajectory

A large interdisciplinary literature on the relationship between age and subjective well-being (happiness) has produced very mixed evidence. Virtually every conceivable age-happiness trajectory has been supported by empirical evidence and theoretical arguments. Sceptics may conclude that the social science of happiness can only produce arbitrary results. In this paper we argue that this conclusion is premature. Instead, the methodological toolbox that has been developed by the modern literature on causal inference gives scholars everything they need to arrive at valid conclusions: the causal inference toolbox only must be applied by happiness researchers. We identify four potential sources of bias that may distort the assessment of the age-happiness relationship. By causal reasoning we derive a model specification that avoids these biases. For an empirical illustration, we use the longest running panel study with information on happiness, the German Socio-Economic Panel (1984-2017; N persons=70,922; N person-years =565,703). With these data we demonstrate the relevance of the four biases and how combinations of different biases can reproduce almost any finding from the literature. Most biases tend to produce a spuriously U-shaped age trajectory, the most prominent finding from the literature. In contrast, with our specification we find a (nearly monotonic) declining age-happiness trajectory.