​​​​​​​​​​Essays on Labor and Banking

• Author / Creator

  Ning,Yuanyuan

• The thesis is composed of two parts including three chapters. The first two chapters study the wage gap between immigrants and natives in Canada as well as wage structure of immigrants and natives. The third chapter is on the subject of the bank loan-deposit spreads and business cycles. The first chapter explores the wage gap between immigrants and native-born full-time workers in Canada applying OLS regression, quantile regression, and decomposition method. There are three main findings. First, wage disadvantage relative to natives for the recent arrivals is larger than the earlier arrivals in the Canada. The presence of sizable “cohort effects” indicates that newly arrived with a much larger wage deficit is in contrast to earlier immigrant cohorts with premium wages. Second, the second generation of immigrants performs not only better than the first generation but also the third generation. Third, changing place of birth of the successive immigrants from US & Europe to Asia accounts for the notable expansion of the wage gap for immigrants. In addition, the wage gap at the bottom quantile is larger than at the top quantile. The decomposition of wage gap also indicates that the wage prices widen the wage gap. The second chapter examines the wage structure of immigrants and natives in Canada through exploring the effect of immigration on the wage of native-born men as well as scrutinizing wage inequality. There are three findings. First, wage effect of immigrants on natives is diverse according to various groups. Increased immigration dwindles the wages of young workers and university group of native-born men. Moreover, immigrants have more discernible negative effects on the second generation than the third generation for the university group. Second, recent immigrants make the larger effect on earlier immigrants than natives, specifically, immigrants diminish the relative wage of the high school dropout of earlier immigrants, not that of natives. Recent immigrants have substantially more negative effect on high school dropout of US & European earlier immigrants. Third, the counterfactual analysis highlights that the lower-tail 50/10 overall or residual wage inequality diminishes, whereas upper-tail 90/50 wage inequality expands for natives from 1990-1995 to 2000-2005. The upper tail overall or residual wage inequality expansion is larger than lower tail wage inequality for natives during whole period 1990 to 2005, which is converse to immigrants. Price effects are the principal factor to the increase in the upper tail and lower tail wage inequality, but labor force composition exerts a substantially paramount effect on the lower tail overall wage inequality if the labor force composition had remained the same as in 1990. Further, demand shift analysis confirms the findings of wage effect and wage inequality examination. The third chapter studies the behavior across business cycles of representative bank loan-deposit spreads and their components for Canada, Italy, Germany, the Netherlands, Switzerland, the United Kingdom, and the United States. A main finding is that the loan rate (adjusted for movements in overall market interest rates) in most countries is countercyclical, consistent with “financial accelerator” theories of the business cycle. Another main finding is that historically in the continental European countries the spreads between savings-deposit and time-deposit rates and overall market interest rates were large and markedly counter-cyclical, and much more so than in the English-speaking countries. This is consistent with banks in these countries exploiting market power over “core deposits” systematically across business cycles, possibly to buffer cyclical shocks to banks’ borrowers. However, the levels and cyclical properties of spreads across the two groups of countries have largely converged in the past two decades.

• Subjects / Keywords

  • Wage structure
  • Inequality
  • Bank loan and deposit spreads
  • Wage gap

• Graduation date

  Fall 2017

• Type of Item

  Thesis

• Degree

  Doctor of Philosophy

• DOI

  https://doi.org/10.7939/R3JQ0T831

• License

  This thesis is made available by the University of Alberta Libraries with permission of the copyright owner solely for non-commercial purposes. This thesis, or any portion thereof, may not otherwise be copied or reproduced without the written consent of the copyright owner, except to the extent permitted by Canadian copyright law.