IZA World of Labor reaches new milestones

Launched in 2014, the online platform IZA World of Labor is well on track. It already comprises over 100 articles providing decision-makers with relevant and succinct information based on sound empirical evidence on policy-relevant labor market topics. The project is a collaboration between IZA and Bloomsbury Publishing with support from the World Bank. Responsible for producing and coordinating the content, IZA is able to draw on the expertise of its large global network of Research Fellows.


Nigel Newton, Klaus F. Zimmermann

During a business meeting on January 23, Bloomsbury’s Executive Director Nigel Newton presented two volumes with the now available articles to IZA Director Klaus F. Zimmermann. The goal is to reach 500 articles covering all relevant areas in labor economics. As another milestone, IZA World of Labor is now indexed by EconLit, the American Economic Association’s electronic bibliography of economics literature from around the world.

In 2014, a series of IZA World of Labor events hosted by such prominent international partners as the LSE, CEMFI and the OECD debated the evidence of topical labor market issues and implications for policy making. The event series will continue in 2015 with a RIETI/IZA World of Labor Policy Symposium in Japan, focusing on institutional reforms to promote elderly employment.

Visit IZA World of Labor to find out more about this innovative resource!

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How can host governments best engage with diaspora groups? IZA and RAND Europe analyze EU and US diasporas

Policymakers increasingly see possibilities in interacting with diaspora communities to improve relationships with their countries of origin and as a means to foster governance and rule of law, and political and economic development in those countries.

Mapping Diasporas in the European Union and the United StatesA new IZA Research Report on “Mapping Diasporas in the European Union and United States: Comparative analysis and recommendations for engagement”, conducted for the European Commission collaboration with RAND Europe, provides an overview of diaspora communities in Europe and the US, with concrete recommendations for engaging with diaspora groups as a bridge to their countries of origin.

Key findings include:

  • The authors identified 339 diaspora groups from 24 selected countries of origin currently present in the European Union and the United States. Of these, 269 groups were sufficiently large to be included in the in-depth analysis, most of them located in EU-15 countries.
  • In comparison with the populations of their countries of origin, diaspora groups achieve better outcomes overall on a range of socioeconomic indicators.
  • The comparison with the populations of receiving countries offers a more complex picture.
  • Diasporas are increasingly seen as important partners for both sending and receiving country governments’ strategies aimed at improving political, security and economic outcomes.
  • Measured levels of engagement between diaspora organizations and their partners were positively correlated with the organizations’ measured level of satisfaction with that engagement.
  • Proactive communication is desired from actors wishing to engage with diaspora organizations.
  • Concrete ways to engage with individual diaspora groups need to take into account their characteristics and be tailored to specific contexts.

Download the summary report and supplementary material.

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Interview with the authors of the Labor Economics textbook

laboreconomicsbookcoverAuthored by IZA Program Director Pierre Cahuc with Stéphane Carcillo and André Zylberberg, Labor Economics has long become the graduate-level textbook that combines depth and breadth of coverage with recent, cutting-edge work in all the major areas of modern labor economics. The second edition, now available, has been substantially updated and augmented.

In an interview with IZA Newsroom, the authors provide some insights into their work:

More than 1,000 pages and lots of supplementary material – looks like a lot of work… What was your main motivation behind this book?

We wanted to provide a comprehensive textbook that could be used both in graduate and introductory classes, with a strong focus on facts, a clear presentation of the main theories and empirical methods. And ten years after the first edition, serious updates were needed.

What are the key improvements over the first edition?

The second edition is more oriented towards empirical methods than the previous one, with dedicated sections in each chapter presenting key econometrics approaches and using a different reference paper each time.  A companion website (www.labor-economics.org) provides the data and the Stata codes necessary to reproduce the main results presented in the book. This second edition also presents theories and evaluations of labor market policies and institutions in more detail, with three dedicated chapters. Important issues, such as discrimination, globalization and the effect of technological progress, are also given more attention.

Did you incorporate any user feedback in the second edition?

We surely did. For instance, discussing with students and colleagues we realized that the first edition of the book was somewhat too arduous and abstract when presenting empirical methods. That is why we decided to explain them in a more concrete manner, using seminal papers and explaining them step by step.

What do you believe to be the major trends in labor economics that have shaped and will further advance the discipline?

The development of empirical methods is probably what has contributed most to changing labor economics over the last decade, and we wanted to reflect this in the book. The identification of causal relationships is often a challenge in social sciences, but the field has developed various strategies that can be useful to other disciplines. This trend is likely to strengthen in the coming years with more and more good quality data becoming available, and also with the spread of a culture of evaluating public policies. The theory is also changing: the understanding of job search behavior, labor mobility and labor market dynamics has made important progress over the last decade. Our book also reflects these advances.


For more information on the book go to the MIT Press page.

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How health status affects individual time use

alarm clockEconomics is the science on scarce resources. And what is more scarce than time in modern societies? A recent literature acknowledges this scarcity of disposable time of individuals and households and analyzes the interplay between time allocation and economic decisions and outcomes.

In a new IZA Discussion Paper, José Alberto Molina and J. Ignacio Gimenez-Nadal look at a new aspect of time use: They provide international evidence on how individual satisfaction with one’s health status affects the allocation of time to different daily activities. The researchers analyze daily diaries from six countries in which individuals report how they use their time.

Without claiming a causal interpretation, the authors find that a better health perception is associated with more time spent on paid work and less time devoted to sleep, body care and leisure. But unlike healthier Americans, who also spend more time on home production, Europeans do less housework when they feel healthier. In addition, the study reveals differences in how Europeans tend to allocate their time. For example, Germans invest less time in sleeping or leisure activities compared to other Europeans, but spend more on personal care.

Read abstract or download Discussion Paper.

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Tradable quotas as a new way to deal with refugee inflows

European UnionHow to handle the inflow of refugees to the European Union is one of the current hot topics in the media. Under the current regime, the share of inflows borne by EU member states is heavily skewed to a small number of receiving countries. As the recent public discussion shows, this unequal distribution gives rise to general resentment of immigration and negative attitudes towards asylum seekers in particular.

To achieve a fairer distribution of asylum seekers and refugees,  Jesús Fernández-Huertas Moraga and Hillel Rapoport propose an innovative way to deal with refugees from crisis regions. In their new IZA discussion paper, they propose an EU-wide market for tradable refugee quotas.

Offering asylum to refugees with valid claims is considered an international public good, but for the particular receiving country it constitutes a significant financial burden. The authors show that a market mechanism could efficiently distribute immigrants to the country with the lowest costs (direct costs of accommodation and administration as well as social and political distress). Furthermore, a market mechanism could be designed to take into account preferences of the asylum seekers themselves (in terms of cultural and linguistic proximity).

The resulting solution could lead to a fair distribution of costs, which potentially would increase public acceptance and reduce the probability of social distress created by the increasing asylum-seeker flows.

Read the abstract or download the complete discussion paper [PDF].

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Do we have to be afraid of the future world of work?

Werner Eichhorst

Werner Eichhorst

The current public debate in many developed countries about the future of paid employment is characterized by strong feelings of uncertainty. Studies emphasizing the potentially deep and severe impact of globalization and automation have nourished fears of significant job destruction in the future. Furthermore, in labor markets that have become increasingly flexible, at least in certain areas of employment, issues such as precarity, unstable employment or low pay have gained attention, in particular in the aftermath of the recent global economic crisis.

At the same time, many of those who are employed perceive work as increasingly stressful and demanding, or psychologically overburdening due to ever growing pressure on performance and work intensification. So what can we expect from the future, based on an assessment of the current and most plausible future developments?

From past and current experience, we know that outdated, simple jobs are threatened by offshoring or outsourcing to foreign locations with lower labor costs, or by automation. Companies and sectors shrink or disappear. However, this process seems to be becoming faster and more radical, especially in the age of information and communication technology where opportunities of digitalization are constantly increasing, sometimes at an unexpected speed.

Thus, many see an expanding threat on a fundamental level to existing jobs and firms in developed economies and a massive imminent disruption of employment trends through the digital revolution. This process of the elimination of jobs on the one hand, with the creation of innovative new ones on the other, has long been known as creative destruction.

Continue reading

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IZA awards three prizes at ASSA meeting in Boston

During the annual meeting of the Allied Social Science Associations (ASSA), the world’s largest economist conference with more than 12,000 attendees, IZA traditionally hosts a very popular reception for network members and friends. This year the event in Boston featured a “triple prize ceremony”:

Brian Kovak, Corrado Giulietti

Brian Kovak, Corrado Giulietti

The IZA Young Labor Economist Award, which honors the best published article in a peer-reviewed journal written by young scholars under 40, was given to Brian Kovak (Heinz College, Carnegie Mellon University), for his paper on Regional Effects of Trade Reform: What is the Correct Measure of Liberalization?, published in the American Economic Review in 2013. IZA Research Director Corrado Giulietti presented the award that was established in 2006 [see previous winners].


Haoming Liu, K. F. Zimmermann

Haoming Liu (National University of Singapore) received the 2015 Kuznets Prize. His paper on “The quality–quantity trade-off: evidence from the relaxation of China’s one-child policy” was selected as the best article published in the Journal of Population Economics in 2014 [read more about the paper]. IZA Director Klaus F. Zimmermann, who is also editor-in-chief of the journal, awarded the prize. This was the first time the Kuznets Prize was  presented during the ASSA meeting.

Gang, Fields, Zimmermann

Ira Gang, Gary Fields, Klaus F. Zimmermann

As the final highlight of the event, Gary S. Fields was awarded the 2014 IZA Prize in Labor Economics for his outstanding contributions on the importance of efficient labor markets to fight poverty and foster economic development in low- and middle-income countries. Worth 50,000 euros, the IZA Prize is regarded as the most prestigious science award in the field. Ira Gang (Rutgers University) delivered the laudatory remarks [read more about the IZA Prize].


Read also the op-ed Working Hard, but Working Poor by Gary Fields, which was published by China’s leading financial and business magazine Caixin, The Japan Times, The Business Times (Singapore) and Frankfurter Rundschau (German version).

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