Evidence-based policy making

IZA World of Labor is an online platform that provides policy analysts, journalists, academics and society generally with relevant and concise information on labor market issues. Based on the latest research, it provides current thinking on labor markets worldwide in a clear and accessible style. IZA World of Labor aims to support evidence-based policy making and increase awareness of labor market issues.

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Firm size and business cycles

Do small businesses shed proportionately more jobs than large businesses during recessions?

Tulio A. Cravo

The discussion on how economic activity affects employment in large and small businesses is critical for the formulation of labor policies, especially during recessions. Knowing how firm size is related to job creation and job destruction is important to design effective policies aimed at dampening employment fluctuations. Recent evidence for developed countries indicates that large firms are proportionately more sensitive to cycles than small firms; however, this pattern is not confirmed for periods of credit constraint or in a developing country context, where small businesses might be more sensitive due to more extreme credit constraints.

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  • The Chinese labor market, 2000–2016

    The world’s second largest economy has boomed, but a rapidly aging labor force presents substantial challenges

    Junsen ZhangJia Wu, May 2018
    China experienced significant economic progress over the past few decades with an annual average GDP growth of approximately 10%. Population expansion has certainly been a contributing factor, but that is now changing as China rapidly ages. Rural migrants are set to play a key role in compensating for future labor shortages, but inequality is a major issue. Evidence shows that rural migrants have low-paying and undesirable jobs in urban labor markets, which points to inefficient labor allocation and discrimination that may continue to impede rural–urban migration.
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  • Maternity leave versus early childcare—What are the long-term consequences for children?

    Despite increasingly generous parental leave schemes their advantages over subsidized childcare remain unclear

    Most OECD countries spend substantially more on maternity leave schemes than on early childcare. However, given high tax burdens and rapidly aging populations, female labor force participation is critically needed. Moreover, it is important to know whether the main beneficiaries, the children themselves, reap more benefits from one or the other in the long term. The first cohorts exposed to the introduction or extension of maternity/paternity leave schemes and subsidized childcare programs have now completed education and entered the labor market, allowing an investigation of these programs’ long-term economic effects.
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  • The labor market in Norway, 2000–2016

    Negative consequences of falling oil prices were offset by real wage flexibility, reduced immigration, and labor reallocation

    Øivind A. Nilsen, May 2018
    Norway has a high labor force participation rate and a very low unemployment rate. Part of the reason for this fortunate situation is so-called “tripartism”: a broad agreement among unions, employers, and government to maintain a high level of coordination in wage bargaining. This has led to downward real wage flexibility, which has lessened the effects of negative shocks to the economy. Reduced net immigration, especially from neighboring countries, has also mitigated the negative effects of the recent drop in oil prices. A potential drawback of this tripartism is, however, the difficulty of reducing employee absences and disability.
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  • The usefulness of experiments

    Are experiments the gold standard or just over-hyped?

    Jeffrey A. Smith, May 2018
    Non-experimental evaluations of programs compare individuals who choose to participate in a program to individuals who do not. Such comparisons run the risk of conflating non-random selection into the program with its causal effects. By randomly assigning individuals to participate in the program or not, experimental evaluations remove the potential for non-random selection to bias comparisons of participants and non-participants. In so doing, they provide compelling causal evidence of program effects. At the same time, experiments are not a panacea, and require careful design and interpretation.
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  • Jun 04, 2018 - Jun 15, 2018

    University of Maryland School of Public Policy: Understanding and Synthesizing Evidence-Based Research

    Paris

    The University of Maryland School of Public Policy will offer a for-credit international graduate course on understanding and synthesizing evidence-based research in Summer 2018.

  • Jun 19, 2018

    International Labour Organization: Polarisation(s) in Labour Markets

    Conference Room « Pierre Laroque », Ministry of Health 14, avenue Duquesne 75007 Paris

    The Directorate for Research, Studies and Statistics (DARES) of the French Ministry of Labour and the Research Department of the International Labour Organization (ILO) are organizing an international conference on “Polarisation(s) in Labour Markets”. 
     

  • Jun 28, 2018 - Jun 29, 2018

    The World Labor Conference 2018

    Berlin, Germany

    The IZA will hold a World Labor Conference, to celebrate the 20th anniversary of IZA, in Berlin, Germany, on Thursday and Friday, June 28 and 29, 2018. There will be 8 sets of two-hour parallel sessions, with each of the 48 sessions containing four papers. In addition, there will be: One plenary session each day with a keynote address, one by Francine Blau (Cornell University and IZA) and one by Chris Pissarides (London School of Economics and IZA); and a ceremonial dinner on the evening of June 28, at which the biennial IZA Prize in Labor Economics will be presented. 

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