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Teacher effectiveness has a dramatic effect on
student outcomes—how can it be increased?
Teacher effectiveness is the most important
component of the education process within schools for pupil attainment. One
estimate suggests that, in the US, replacing the least effective 8% of
teachers with average teachers has a present value of $100 trillion.
Researchers have a reasonable understanding of how to measure teacher
effectiveness; but the next step, understanding the best ways to raise it,
is where the research frontier now lies. Two areas in particular appear to
hold the greatest promise: reforming hiring practices and contracts, and
reforming teacher training and development.
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Employment has increased since the recession due
to a cyclical upturn and structural reforms
Denmark is often highlighted as a “flexicurity”
country characterized by lax employment protection legislation, generous
unemployment insurance, and active labor market policies. Despite a sharp
and prolonged decline in employment in the wake of the Great Recession, high
job turnover and wage adjustments worked to prevent increased long-term and
structural unemployment. Most unemployment spells were short, muting the
effects on long-term and youth unemployment. Recent reforms boosted labor
supply and employment, targeting the young, elderly, and immigrants.
Employment recovered to its structural level around 2015 and has since
increased due to a favorable business cycle situation and structural reforms
(particularly increases in retirement age).
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Enforcement deters immigration but with
unintended consequences
Border enforcement of immigration laws raises the
costs of illegal immigration, while interior enforcement also lowers its
benefits. Used together, border and interior enforcement therefore reduce
the net benefits of illegal immigration and should lower the probability
that an individual will decide to illegally migrate. While empirical studies
find that border and interior enforcement serve as deterrents to illegal
immigration, immigration enforcement is costly and carries unintended
consequences, such as a decrease in circular migration, an increase in
smuggling, and higher prevalence of off-the-books employment and use of
fraudulent and falsified documents.
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Better educated parents invest more time and
money in their children, who are more successful in the labor market
Governments invest a lot of money in education,
so it is important to understand the benefits of this spending. One
essential aspect is that education can potentially make people better
parents and thus improve the educational and employment outcomes of their
children. Interventions that encourage the educational attainment of
children from poorer families will reduce inequality in current and future
generations. In addition to purely formal education, much less expensive
interventions to improve parenting skills, such as parental involvement
programs in schools, may also improve child development.
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Energy booms create widespread short-term
benefits for local workers, but appropriate policy requires consideration of
a broad array of factors
One of the primary considerations in policy
debates related to energy development is the projected effect of resource
extraction on local workers. These debates have become more common in recent
years because technological progress has enabled the extraction of
unconventional energy sources, such as shale gas and oil, spurring rapid
development in many areas. It is thus crucial to discuss the empirical
evidence on the effect of “energy booms” on local workers, considering both
the potential short- and long-term impacts, and the implications of this
evidence for public policy.
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Trade liberalization benefits better performing
firms and contributes to economic growth
There is evidence that better performing firms
tend to enter international markets. Internationally active firms are
larger, more productive, and pay higher wages than other firms in the same
industry. Positive performance effects of engaging in international activity
are found especially in firms from less advanced economies that interact
with partners from more advanced economies. Lowering barriers to the
international division of labor should therefore be part of any pro-growth
policy.
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Open science can enhance research credibility,
but only with the correct incentives
The open science and research transparency
movement aims to make the research process more visible and to strengthen
the credibility of results. Examples of open research practices include open
data, pre-registration, and replication. Open science proponents argue that
making data and codes publicly available enables researchers to evaluate the
truth of a claim and improve its credibility. Opponents often counter that
replications are costly and that open science efforts are not always
rewarded with publication of results.
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Keeping older workers in the workforce longer
not only doesn’t harm the employment of younger workers, but might actually
help both
The fiscal sustainability of state pensions is
a central concern of policymakers in nearly every advanced economy.
Policymakers have attempted to ensure the sustainability of these programs
in recent decades by raising retirement ages. However, there are concerns
that keeping older workers in the workforce for longer might have negative
consequences for younger workers. Since youth unemployment is a pressing
problem throughout advanced and developing countries, it is important to
consider the impact of these policies on the employment prospects of the
young.
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Selection and incentives in retirement plans
affect job transitions
The relationship between retirement plan type
and job mobility is more complex than typically considered. While
differences in plan features and benefit structure may directly affect
employees’ mobility decisions (“incentive effect”), the type of plan offered
may also affect the types of employees a given employer attracts (“selection
effect”), thereby affecting mobility through a second, indirect channel. At
the same time, some employees may not be able to accurately assess
differences between plan types due to limited financial literacy. These
factors have implications for policymakers and employers considering
retirement plan offerings.
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Despite major efforts at equal pay legislation,
gender pay inequality still exists—how can this be put right?
Despite equal pay legislation dating back 50
years, American women still earn 18% less than their male counterparts. In
the UK, with its Equal Pay Act of 1970, and France, which legislated in
1972, the gap is 17% and 10% respectively, and in Australia it remains
around 14%. Interestingly, the gender pay gap is relatively small for the
young but increases as men and women grow older. Similarly, it is large when
comparing married men and women, but smaller for singles. Just what can
explain these wage patterns? And what can governments do to speed up wage
convergence to close the gender pay gap? Clearly, the gender pay gap
continues to be an important policy issue.
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