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Skills, Employment, and Labor Market Institutions: Evidence from PIAAC
[journal article]
Abstract Hanushek et al (2015, ‘Returns to Skills Around the World: Evidence from PIAAC’, European Economic Review 73: 103) find a weak wage–skill relationship in countries with limited skill reward possibilities due to high union density, strict employment protection, and large public sector. If these facto... view more
Hanushek et al (2015, ‘Returns to Skills Around the World: Evidence from PIAAC’, European Economic Review 73: 103) find a weak wage–skill relationship in countries with limited skill reward possibilities due to high union density, strict employment protection, and large public sector. If these factors also restrict employment possibilities and the incentives to join the labor market, a possible mirror image of the weak wage–skill relationship is a steeper employment–skill gradient. We use PIAAC data to estimate the employment–skill association, and the results for the whole sample of individuals give some indication that the employment–skill gradient is steeper in countries with strict employment rules and centralized bargaining. Our results for subgroups show imprecisely estimated employment–skill gradients for immigrants. For individuals with poor health conditions and low formal education, the estimated gradient is somewhat higher than in the whole sample in countries with high bargaining coverage, a large public sector, and centralized collective bargaining systems.... view less
Keywords
employability; labor market; trade union; collective bargaining; minimum wage; public sector; protection of employee rights; employment; cognitive ability; health status; migrant; level of education; regression analysis
Classification
Labor Market Research
Free Keywords
Programme for the International Assessment of Adult Competencies (PIAAC)
Document language
English
Publication Year
2020
Page/Pages
p. 277-304
Journal
LABOUR, 34 (2020) 3
DOI
https://doi.org/10.1111/labr.12174
ISSN
1467-9914
Status
Published Version; peer reviewed