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Martyn Andrews

The University of Manchester, Economics, Faculty Member

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Papers by Martyn Andrews

Der Einfluss von finanzieller Mitarbeiterbeteiligung auf die Entlohnung der Arbeitnehmer

We investigate the impact of financial partici- pation (profit-sharing and share ownership) on wo... more We investigate the impact of financial partici- pation (profit-sharing and share ownership) on workers' total compensation. Some workers' representatives have argued against the introduction of profit-sharing because they fear that profit-sharing would be a way for firms to reduce the marginal cost of hiring workers, while at the same time transferring some of the risk of variable profits from firms

High Wage Workers Match with High Wage Firms: Clear Evidence of the Effects of Limited Mobility Bias

Positive assortative matching implies that high productivity workers and firms match together. Ho... more Positive assortative matching implies that high productivity workers and firms match together. However, there is almost no evidence of a positive correlation between the worker and firm contributions in two-way fixed-effects wage equations. This could be the result of a bias caused by standard estimation error. Using German social security records we show that the effect of this bias is

More Hours, More Jobs? The Employment Effects of Longer Working Hours

Increases in standard hours have been a contentious policy issue in Germany. Whilst this might di... more Increases in standard hours have been a contentious policy issue in Germany. Whilst this might directly lead to a substitution of workers by hours, there may also be a positive employment effect due to reduced costs. Moreover, the response of firms differs between firms which offer overtime and those which do not. For a panel of German plants (2001-2006), we

Does Worksharing Work? Some Empirical Evidence from the IAB Panel

Recent policy debate in Europe suggests that a shorter workweek will lead to more jobs (workshari... more Recent policy debate in Europe suggests that a shorter workweek will lead to more jobs (worksharing). We derive and estimate a model where the firm employs two types of worker, some working overtime, the rest standard hours. Worksharing is not always a prediction of the theory. Using German establishment-level panel data (the IAB panel), 1993-1999, we find pro-worksharing effects in

Foreign-owned Plants and Job Security

We investigate the hypothesis that workers in foreign-owned establishments face greater job insec... more We investigate the hypothesis that workers in foreign-owned establishments face greater job insecurity. Using linked employer employee data from Germany, we examine whether foreign-owned establishments are more likely to exit production, and whether workers in foreign-owned establishments face higher separation rates, net of establishment exit. We find that, after controlling for the different characteristics of foreign and domestic establishments, foreign

The takeover and selection efiects of foreign ownership in Germany: an analysis using linked worker-flrm data

We use a linked employer-employee data set from Germany for the years 2000 and 2004 to estimate t... more We use a linked employer-employee data set from Germany for the years 2000 and 2004 to estimate the wage efiect of foreign-a-liates in (the former) East and West Germany. In addition, the wage efiects of the large number of West German a-liates which are located in East Germany are also considered. The implemented techniques allow us to control both for

Do foreign workers reduce trade barriers? Microeconomic evidence

by Martyn Andrews and Richard Upward

This paper provides evidence that the presence of foreign workers in plants increases the likelih... more This paper provides evidence that the presence of foreign workers in plants increases the likelihood that those plants will export their output. This informs both the macro literature on trade costs and the micro literature on plants' export behaviour. Using a rich linked employer-employee dataset, we identify the nationality of each worker in a large sample of German plants, and relate this to the exporting behaviour of that plant. We find a significant effect of worker nationality on exporting which is not driven by the industrial, occupational or locational concentration of migrants. The effect is much stronger for senior occupations, who are more likely to have a role in exporting decisions by the plant. The relationship is also stronger when we consider exports to particular regions and workers from those regions.

High wage workers and low wage firms : negative assortative matching or statistical artefact?

In the empirical literature on the estimation of firm and worker heterogeneity using linked emplo... more In the empirical literature on the estimation of firm and worker heterogeneity using linked employer-employee data, unobserved worker quality appears to be negatively correlated with unobserved firm quality. We investigate the possibility that this is simply caused by standard estimation error and develop formulae that show that the estimated correlation is biased downwards if there is true positive assortative matching and when any conditioning covariates are uncorrelated with the firm and worker fixed effects. This result applies to any two-way (or higher) error-components model estimated by fixed-effects methods. We apply these bias corrections to a large German linked employer-employee dataset. We find that although the biases can be considerable, they are not sufficiently large to remove the negative correlation entirely. Auf der Basis von zusammengefügten Betriebs- und Personendaten findet sich in der empirischen Literatur eine negative Korrelation zwischen den unbeobachteten ...

Practical estimation methods for linked employer-employee data

In this paper we develop an equilibrium search and matching model where two-person families as we... more In this paper we develop an equilibrium search and matching model where two-person families as well as singles participate in the labor market. We show that equilibrium entails wage dispersion among equally productive risk-averse workers. Marital status as well as spousal labor market status matters for wage outcomes. In general, employed members of two-person families receive higher wages than employed singles. The model is applied to a welfare analysis of alternative unemployment insurance systems, recognizing the role of spousal employment as a partial substitute for public insurance. The optimal system involves benefit differentiation based on marital status as well as spousal labor market status.

Testing theories of labour market matching

This paper estimates a model of two-sided search using micro-level data for a well-defined labour... more This paper estimates a model of two-sided search using micro-level data for a well-defined labour market. It examines the assumption of random matching and contrasts it with the stock-flow (or non-random) matching model of Coles and collaborators. Given a dataset of contacts, matches, and complete labour-market histories for both sides of the market, we estimate hazard functions for both (unemployed) job-seekers and vacancies. For job-seekers, the tests adds the stock of new vacancies to a standard job-seeker hazard which itself depends on the stocks of vacancies and unemployed. Our tentative results find very weak evidence of stock-flow matching.

Why do job-seeker and vacancy hazards slope downwards? Estimating a two-sidedsearch model of the labour market

In this paper we provide the first microeconometric estimates of the hazards to matching on both ... more In this paper we provide the first microeconometric estimates of the hazards to matching on both sides of a labour market, decomposed into their constituent parts. Namely, the rate at which job-seekers and vacancies contact each other, and the probability that these contacts result in a match. This allows us to determine whether it becomes harder for agents to match as time passes because they receive fewer contacts or because contacts are less likely to be successful.

Policy Review Section

Regional Studies, 1993

In this issue of the Policy Review Section, Keith Shaw of the Department of Economics and Governm... more In this issue of the Policy Review Section, Keith Shaw of the Department of Economics and Government, University of Northumbria at Newcastle, drawing on experience in the North East of England examines the value of the “urban growth coalition” model and the concept of “new urban corporatism” in explaining the power structure underlying contemporary urban regeneration strategies. In the second

The impact of financial participation on workers' compensation

Zeitschrift für ArbeitsmarktForschung, 2010

Erratum to: The impact of financial participation on workers' compensation

Zeitschrift für ArbeitsmarktForschung, 2010

We investigate the impact of financial participation (profit-sharing and share ownership) on work... more We investigate the impact of financial participation (profit-sharing and share ownership) on workers' welfare in terms of the level and the variance of workers' total compensation. A widespread finding is that financial participation is associated with higher productivity. But some workers' representatives have argued against the introduction of profit sharing because they fear that profit sharing would be a way for firms to reduce the marginal cost of hiring workers, while at the same time transferring some of the risk of variable profits from firms to workers. In addition, Lemieux, MacLeod & Parent (2009) have recently provided evidence that the increasing use of performance pay in the US has resulted in greater wage inequality amongst workers who receive performance pay. We provide detailed evidence on the relationship between the use of financial participation schemes and total worker compensation using a large panel of German plants linked to data on the workers in those plants.

Estimating Youth Training Wage Differentials during and after Training

Oxford Economic Papers-new Series, 1999

The authors compare wages between school leavers who participate in government-funded youth train... more The authors compare wages between school leavers who participate in government-funded youth training and those who do not. Using a subset of all school leavers in Lancashire between 1988 and 1991, they find that wage differentials are large and negative for all types of participant when training. Once training finishes, differentials are small but still negative. There is no evidence

MATCHING THE DEMAND FOR AND SUPPLY OF TRAINING IN THE SCHOOL-TO-WORK TRANSITION

The Economic Journal, 2002

This empirical paper investigates skill formation in the youth labour market. Using eventhistory ... more This empirical paper investigates skill formation in the youth labour market. Using eventhistory data collected from the administrative records of Lancashire Careers Service, we model training preferences' formed at school by young people and`training destinations', ie the occupation of the ®rst job/training scheme. We also model the duration of the individual's ®rst unemployment spell. Competing risks models with¯exible piece-wise linear baseline hazards and unobserved heterogeneity are estimated. There is evidence of occupational segregation by gender and an excess demand for general training. Outcomes are mainly determined by examination performance, ethnicity and whether disadvantaged.

Disclosure Regulation and Accounting Education in the UK: Moving Towards Corporate Accountability 252 and Transparency

Social Responsibility Journal, 2006

This paper was motivated by the current debate over the voluntary approach to environmental discl... more This paper was motivated by the current debate over the voluntary approach to environmental disclosures in corporate annual reports and assesses the effectiveness of the current policy of voluntarism in the UK. A brief review of the relevant theories, which explain why managers might choose to voluntarily provide environmental responsibility information to parties outside the organisation, is presented. With this

DOES WORKSHARING WORK? SOME EMPIRICAL EVIDENCE FROM THE IAB-ESTABLISHMENT PANEL

Scottish Journal of Political Economy, 2005

The takeover and selection effects of foreign-owned establishments: an analysis using linked employer–employee data

Review of World Economics, 2009

We use a linked employer-employee data set from Germany to estimate the wage effect of foreignaff... more We use a linked employer-employee data set from Germany to estimate the wage effect of foreignaffiliates in (the former) East and West Germany. In addition, the wage effects of the large number of West German affiliates which are located in East Germany are also considered. The implemented techniques allow us to control both for worker-and plant-level unobserved components of earnings. We find large selection effects both in terms of worker-and firm unobserved components of wages. The selection effect is larger for East German plants. Once the selection effect is taken into account, the genuine takeover effect is small and in some cases insignificantly different from zero. In contrast to the selection effect, the takeover effect is slightly larger in West Germany, where it amounts to 2.7%.

Foreign-owned plants and job security

Review of World Economics, 2012

We investigate the hypothesis that workers in foreign-owned establishments face greater job insec... more We investigate the hypothesis that workers in foreign-owned establishments face greater job insecurity. Using linked employer employee data from Germany, we examine whether foreign-owned establishments are more likely to exit production, and whether workers in foreign-owned establishments face higher separation rates, net of establishment exit. We find that, after controlling for the different characteristics of foreign and domestic establishments, foreign establishments have higher exit rates and higher separation rates, but the effect is quantitatively small. In contrast, foreign-owned establishments which do not export appear to have considerably higher exit rates and separation rates.