Melbourne Institute of Applied Economic and Social Research - Research Publications
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ItemThe Effect of Financial Incentives on Labour Supply: Evidence for Lone Parents from Microsimulation and Quasi-Experimental Evaluation(Institute for Fiscal Studies, 2008-06)The aim of this paper is to analyse the work incentive effects of a change in the Australian tax and transfer system on lone parents in July 2000. To evaluate the effect of the total change only, microsimulation can be used; but for a subgroup of lone parents, a few components of this policy change can be analysed through two alternative approaches - microsimulation and quasi-experimental evaluation. Both approaches examine the effects on the probability of employment and on average working hours. The results from microsimulation show that the combined changes introduced in July 2000 - involving reduced withdrawal rates, changed family payments and lower income tax rates - have increased labour supply for lone parents to a moderate extent. The estimated effect on average working hours when using microsimulation is very close to the effect estimated in a quasi-experimental approach using matching techniques to control for alternative influences.
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ItemHow do Administrative Arrangements Affect Exit from Unemployment Payments? The Case of the Job Seeker Diary in Australia(Melbourne Institute of Applied Economic and Social Research, 2003)
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ItemFamily Structure, Usual and Preferred Working Hours, and Egalitarianism in Australia( 2004-02)Data from a representative survey of adult Australians are analysed for usual and preferred working time across family types. We discover a time divide regardless of gender and family type: many short hours individuals desire longer hours of employment, while many long hours individuals prefer shorter hours. The latter group is larger such that the average employee desires fewer hours across family types, with the exception of lone mothers. For dual-earner couples with children, men average approximately 20 hours more per week than women, a difference that would only decline to 18 hours per week if preferred hours were realized. However, approximately one-fifth of these couples exhibited egalitarian or nearly equal working hours. Egalitarian couples averaged a combined 84 hours per week of employment, tended to share the care of children, were more likely to be non-Australian born, and included marked numbers of women holding degrees and in professional occupations.
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ItemDoes 'Work for the Dole' Work?( 2004-07)This study examines the effect of a community-based work experience program - Work for the Dole (WfD) - on transitions out of unemployment in Australia. To evaluate the WfD program a quasi-experimental exact matching approach is applied. Justification for the matching approach is a 'natural experiment' - limits on WfD project funding - that it is argued constituted a source of random assignment to the program. Participation in the WfD program is found to be associated with a large and significant adverse effect on the likelihood of exiting unemployment payments. The main potential explanation is existence of a 'lock-in' effect whereby program participants reduce job search activity.
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ItemOptimal employee turnover rate: theory and evidence( 2002-10)This paper investigates the quantitative effects of employee turnover on firms' productivity.The Australian Business Longitudinal Survey 1995-98, a unique survey providing firm level data on both production and employee turnover, is used as the data source. Theoretical studies have advocated that firm specific human capital and job matching to be the two major, but competing, mechanisms through which turnover affects productivity. Our results indicate that the effect of job matching dominates when turnover is"low," while the effect of firm specific human capital dominates when turnover is"high." We identify that the optimal turnover rate - the rate that maximises productivity, controlling for other factors - is about 0.3, well in excess of the sample mean. The finding suggests that further increasing the flexibility of employment arrangement for small and medium Australian enterprises could yield substantial productivity gains.
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ItemIndividuals' Wage Changes in Australia 1997-2000.( 2001-05)This paper examines Australian household data from over 4000 individuals to assess how downwardly flexible nominal wages have been during the period 1997 to 2000. The data indicate that there is considerable downward rigidity. Only 7.4 per cent of workers who are still working the same hours in the same job experienced a cut in pay over the previous year. People in low- income households, unskilled and part-time workers and workers reliant upon the Safety Net (i.e. their wages are determined solely by award) are more likely to have received a pay cut than others.
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ItemEnterprise Bargaining and Productivity:Evidence from the Business Longitudinal Survey( 2001-07)The 1990s has seen bargaining, and more specifically, enterprising bargaining supplant arbitration as the dominant industrial relations paradigm. In large part, this change reflects widespread belief that enterprise bargaining would stimulate greater levels of productivity. Evidence in support of this link between enterprise bargaining and productivity, however, is both scant and unconvincing. In this paper the relationship between enterprise bargaining and productivity is revisited using data from the Business Longitudinal Study. This data source is unique in that it provides firm-level data for Australia where the individual firms are tracked over a four-year period. Further, the survey period commenced in 1994-95, which is ideal for studying the impacts of the emerging growth in enterprise agreement coverage. Finally, the BLS data provide an objective measure of value added output. Estimation of a simple production function using a random effects model revealed evidence of a strong contemporaneous relationship between registered enterprise agreements and productivity. Indeed, firms where all employees are on such agreements are estimated to have productivity levels that are 8.8 per cent higher than comparable firms but where no employees are covered by an enterprise agreement and are forced instead to rely on conditions specified in an industry award. However, despite this finding, it still proved impossible to establish a direct causal relationship between the introduction of enterprise agreements and subsequent productivity growth.
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ItemAnalysing Firm-Level Labour Productivity Using Survey Data( 2000-06)This paper investigates the determinants of firm-level labour productivity in the manufacturing sector using GAPS data. These data are from a stratified survey, where the strata are based on industry and firm size. The paper focuses on whether weights should be applied in the regression analysis. Augmented Cobb-Douglas production functions are estimated, where a set of dummies are used as proxies for firm-level knowledge stocks. The regression results show that there are significant differences between the parameters estimated by weighted least squares (WLS) and OLS, particularly for the variables union density and training expenditure. These differences can be caused by parameter heterogeneity (across strata); in theoretical terms this means that applying the same production function across all firms is not appropriate. Given this parameter heterogeneity, both the OLS and WLS methods do not estimate parameters of interest. Instead, there is a requirement to estimate sub-sample regressions. These are presented in the second part of the empirical results.
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ItemThe Determinants of Relative Wage Change in Australia( 2000-12)This paper uses micro data from over 4000 Australian individuals to investigate which factors have had a significant influence on microeconomic wage growth over the past 3 years. The relative importance of four type of factors: outside incomes, demand for labour, workers' relative bargaining strength and category of wage contract are compared. Basic individual demographic characteristics (partial substitute variables for outside incomes), and some indicators of workers' bargaining power provided most of the explanation for wage changes. Proxy variables for labour demand, while significant and correctly signed, were small in magnitude. Information on workplace characteristics and the individual's work history were not available.
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ItemEmployee turnover: Less is not necessarily more?(ELSEVIER SCIENCE BV, 2006-01-01)