Seminar Series “Macroeconomics and Labor Markets” on 16 January 2024
We are pleased to invite you to the seminar series on “Macroeconomics and Labor Markets“ organized by the Chair of Macroeconomics at the Friedrich-Alexander University Erlangen-Nuremberg, Prof. Merkl, the Chair of Global Governance and International Trade at the Friedrich-Alexander University Erlangen-Nuremberg, Prof. Moser, and the Competence Field Macroeconomics of the Institute for Employment Research (IAB). Researchers of both institutions, as well as national and international guests, present their current work at the intersection of labor- and macroeconomics.
The next seminar will be held on Tuesday, January 16, 4 to 5.30pm (German time) via Zoom.
Brenda Samaniego de la Parra (University of California, Santa Cruz) will talk about
“Wage Setting Protocols and Labor Market Conditions: Theory and Evidence” (joint work with Stanislav Rabinovich and Ronald Wolthoff).
Abstract:
We theoretically and empirically examine how firms’ choices of wage-setting protocols respond to labor market conditions. We develop a simple model in which workers may be able to send multiple job applications and firms choose between posting wages and Nash bargaining. Posting a wage allows the firm to commit to lower wages than would be negotiated ex post, but eliminates the ability to respond to a competing offer, should the worker have one. We show that higher productivity lowers both the application-vacancy ratio and the fraction of firms posting a wage. On the other hand, an increase in the number of applications per worker raises the application-vacancy ratio while lowering the fraction of firms posting a wage. As a result, the equilibrium fraction of firms posting a wage may be positively or negatively correlated with the application-vacancy ratio, depending on the source of shocks. The model also implies that an increase in the number of applications per worker may lead to a decrease in the number of posting firms rather than a change in the wages posted by those firms. Empirically, we demonstrate that the model’s predictions are confirmed in a novel dataset from an online job board.
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For those who cannot get enough of Macro-Labor topics:
There will be an additional presentation on the same day (with the same Zoom login).
From 12 noon to 1 pm, Enzo Weber (IAB) will talk about
“The dovish turnaround: Germany’s social benefit reform and job findings”.
Abstract:
On the labour markets, the last decades were characterised by structural supply-side reforms in many countries. Following its hawkish reforms from the 2000s, recently, Germany made a dovish turnaround. Conditions in basic income support for unemployed became more generous. Before, a sanctions moratorium was applied. We analyse the consequences for job findings. Building on large administrative data, we use a labour market matching and a control group approach. The moratorium dampened job findings by more than seven percent and the subsequent benefit reform by more than six percent – about half of the positive effect of the 2000s reform.