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Boosting the Employment Rate of Older Men and Women

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  • V. Vandenberghe

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Abstract

European countries need to expand employment among older individuals. Many papers have examined this issue from different angles. However, very few seem to have considered its gender dimension properly, despite evidence that lifting the overall senior employment rate requires significantly raising that of women older than 50. The key issue examined by this paper is whether employers are willing to employ more older workers, in particular older women. The answer depends to a large extent on the ratio of older individuals’ productivity to their cost to employers. To address this question we tap into a unique firm-level panel of Belgian data to produce robust evidence on the causal effect of age/gender on productivity and labour costs. We take advantage of the panel structure to identify age/gender-related differences from within-firm variation. Moreover, inspired by recent developments in the production function estimation literature, we address the problem of endogeneity of the age/gender mix, using a structural production function estimator (Olley & Pakes, 1996; Levinsohn & Petrin, 2003) alongside IV-GMM methods where lagged value of labour inputs are used as instruments. Our results indicate a small negative impact of larger shares of older men on the productivity-labour cost ratio. An increment of 10%-points of in their share causes a 0.17 to 0.69%-point contraction. However, the main result is that the equivalent handicap with older women is larger, ranging from 1.3 to 2.0%-points. This is not good news for older women’s employability. And the vast services industry does not seem to offer working conditions that mitigate older women’s disadvantage, on the contrary.

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Bibliographic Info

Article provided by Springer in its journal De Economist.

Volume (Year): 159 (2011)
Issue (Month): 2 (June)
Pages: 159-191

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Handle: RePEc:kap:decono:v:159:y:2011:i:2:p:159-191

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Web page: http://www.springerlink.com/link.asp?id=100260

Related research

Keywords: Ageing; Labour productivity; Panel data analysis; J24; C33; D24;

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References

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  16. D. Borowczyk Martins & V. Vandenberghe, 2010. "Using Firm-Level Data to Assess Gender Wage Discrimination in the Belgian Labour Market," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2010007, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
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Citations

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Cited by:
  1. Stephan Kampelmann & François Rycx, 2012. "Are Occupations Paid What They are Worth? An Econometric Study of Occupational Wage Inequality and Productivity," De Economist, Springer, vol. 160(3), pages 257-287, September.
  2. Lovász, Anna & Rigó, Mariann, 2013. "Vintage effects, aging and productivity," Labour Economics, Elsevier, vol. 22(C), pages 47-60.
  3. Lara LEBEDINSKI & Vincent VANDENBERGHE, 2013. "Assessing education's contribution to productivity using firm-level evidence," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2013017, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  4. Vincent VANDENBERGHE, 2012. "Are firms willing to employ a greying and feminizing workforce?," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2012016, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  5. Pfeifer, Christian & Wagner, Joachim, 2012. "Age and Gender Composition of the Workforce, Productivity and Profits: Evidence from a New Type of Data for German Enterprises," IZA Discussion Papers 6381, Institute for the Study of Labor (IZA).
  6. Stephan Humpert, 2012. "Age and Gender Differences in Job Opportunities," Working Paper Series in Economics 235, University of Lüneburg, Institute of Economics.

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