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application/pdf, With long-term employment and seniority-based payment, (enterprise) unions consist of Japanese employment practices. These practices had been highly praised for their efficienc yby many academic researchers. However, after the collapse of the bubble economy at the beginning of 1990s, these practices have been severely criticized as the most significant source of the economic downturn. Along with the continuing economic downturn, the Japanese employment practices have been declined and the unionization rate also has been decreased. Many people show the reasons why Japanese unions have been weakened for several decades and most of them seems plausible. In fact, in recent spring offensives, the government has strongly intervened the wage determination process in labor-management negotiations, demonstrating its clout and in contrast to it, unions haven’t have much of a presence. However, even in such situations, unions have no small social significance. For example, when we remember that unions have had a role to enable long-term employment not only to foster human resources but also to build and keep sound labor relations, we will easily find unions in Japan still have an important role. For the purpose stated above, we examine the influence of unions on wages in Japan taking into account factors related to corporate governance with the use of panel date on the firms listed on the first section of the Tokyo Stock Exchange. In creating variables concerning corporate governance, we focus on four attributes of corporate governance as follows: (1) owner management (2) management tenure, (3) foreign ownership, (4) financial institution ownership. First, we study whether unions as well as these four attributes of corporate governance respectively have influence on wages. Employing OLS with cluster standard errors, FE and RE, we show that unions and, both foreign and financial institution ownership have positive effects on wages. In the second step, we study the hypothesis that the magnitude of the influence of unions on wages varies depending on firm’s governance structure. Introducing interaction terms with unions, we obtain two results. The first one is that interaction terms with foreign ownership and those with financial institution ownership are positive with statistical significance even after controlling for the possibility of endogeneity problems by the use of IV and FE. The second is that interaction terms with owner management and those with management tenure are negative with statistical significance by the use of OLS, but they become statistically insignificant in the panel estimation. This may be because spurious correlations are incurred. From our obtained results, we confirm that unions still have influence on wages in Japan.

This paper presents new evidence on wage and price setting based on a survey of more than 300 Uruguayan firms in 2013. Most of the firms set prices considering costs and adding a profit margin; therefore, they have some degree of market power. The evidence indicates that price increases appear quite flexible in Uruguay (prices are downward rigid). Most of the firms adjust their prices without following a regular frequency which suggests that price changes in Uruguay are state-dependent, although wage changes are concentrated in January and July. Interestingly, the cost of credit is seen by companies as an irrelevant factor in explaining price increases. We also find that cost reduction is the principal strategy to a negative demand shock. Finally, the adjustment of prices to changes in wages is relatively fast, Este trabajo presenta nueva evidencia sobre fijación de precios y salarios en Uruguay en base a una encuesta a más de 300 empresas en 2013 La mayoría de las empresas fijan los precios teniendo en cuenta los costos y añadiendo un margen de beneficio; por lo tanto, tienen cierto grado de poder de mercado. La evidencia indica que los aumentos de precios parecen bastante flexibles en Uruguay (los precios son rígidos a la baja). La mayoría de las empresas ajustan sus precios sin seguir una frecuencia regular lo que sugiere que los cambios de precios en Uruguay son dependientes del estado (a pesar de que los cambios salariales se concentran en enero y julio). Curiosamente, el costo del crédito es visto por las empresas como un factor irrelevante en la explicación de los aumentos de precios. También encontramos que la reducción de costos es la principal estrategia de las empresas ante un shock de demanda negativo. Por último, el ajuste de los precios a los cambios en los salarios es relativamente rápido

In 1997, the French government put into effect a law that permanently exempted young French male citizens born after Jan 1, 1979 from mandatory military service while still requiring those born before that cutoff date to serve. This paper uses a regression discontinuity design to identify the effect of peacetime conscription on education and labor market outcomes. Results indicate that conscription eligibility induces a significant increase in years of education, which is consistent with conscription avoidance behavior. However, this increased education does not result in either an increase in graduation rates, or in employment and wages. Additional evidence shows conscription has no direct effect on earnings, suggesting that the returns to education induced by this policy was zero.

Real wage rises for the unskilled are one mechanism by which poor people can obtain rises in their incomes and a reduction in their economic vulnerability. In this paper it is shown that over a period in Ghana when measured poverty declined, 1988 to 1992, real wages for the unskilled rose, by about 11 per cent. Over the 1990s evidence from the manufacturing sector suggests substantial falls in the real wages of the unskilled, some 23-26 per cent between 1992 and 1998. In the longer term such wages are lower than those of the mid 1980s and approximately one-third the level of the early 1970s. Even if poverty can be reduced in this context, any fall in poverty will omit one of the most vulnerable groups of the working population. There is evidence that high rates of inflation and low investment are two factors explaining these falls in real wages.

This paper analyses and quantifies the effects of trade liberalisation and skill-biased technical change, both exogenous and trade-induced, on the skill premium and real wages of unskilled and skilled workers in the Mexican manufacturing sector, using industry- and firm-level data for 1984-1990 from the Encuesta Industrial Anual. The novelty of the paper lies in its strategy for identifying causality, which uses differences across industries over time in the relative price of machinery and equipment in the US as an instrument for skill-biased technical change. The effect of trade-induced SBTC on wages, and especially on wage inequality, appears substantial. The regressions show that trade liberalisation and changes in the relative price of equipment in the US, which induce exogenous SBTC in Mexico, explain one quarter of the increase in relative skilled wages between 1984 and 1990. This rise in the skill premium due to SBTC and trade liberalisation mainly reflect a rise in real skilled wages, although with some specifications it was amplified by a fall in the real wages of unskilled workers.

The paper measures real wages in St Petersburg, Moscow, and Kursk between 1853 and 1937 and compares them to real wages in Boston, Manchester, Bombay, and Cairo. Russian living standards grew little between 1853 and 1913 and were like Egypt and India. Wages in the UK and USA were 2.5 - 5 times greater. Real wages in Russia almost doubled between 1913 and 1928. When seen in a Russian perspective, this looks like a big advance; when seen internationally, it is much less so. Real wages dropped to their pre-War level between 1928 and 1937 during the industrialization drive.

In this paper the links from measures of consumption to welfare and well-being are discussed drawing on a study of changes in consumption in Ghana in the 1990s. It is argued that household consumption can act as an opportunity measure of welfare. The widespread distrust of such a welfare measure may be explicable, at least in part, by how misleading it can be if averages of welfare change are presented. In Ghana is has been argued that poverty fell based on a consumption measure of welfare. In this paper it is shown that the welfare measure can be presented informatively in terms of types of households. Doing this for Ghana over the period of the 1990s reveals that while on average per capita consumption rose across all percentiles of the distribution this was not true for farmers who are on average the poorest. We also show how it is possible to present results for household types where certain characteristics remain unchanged. We focus on education and household size. The falls in welfare for farmers nearly doubles if we control for education and household size while the overall rise in consumption per capita is reduced from 11 to 3 per cent per decade. Such simple empirical analysis shows how consumption can be used as an opportunity welfare measure and that a decrease in poverty does not imply at all that most people in the economy had greater opportunities.

This paper develops a framework for the analysis of how asymmetric information impacts on adverse selection and market efficiency. We adopt Akerlof's (1970) unit-demand model extended to a setting with multidimensional public and private information. Adverse selection and efficiency are defined quantitatively as real valued random variables. We characterize how public information disclosure and private information acquisition affect the relationship between adverse selection and efficiency. These results are applied to inform welfare and empirical analysis and, in an employer learning setting, to study the endogenous choice of information structures. Equilibrium information structures impose adverse selection efficiently. We show that this makes adverse selection hard to detect using standard positive correlation tests.

私たちは、本研究ノートで、1980年代に考察されるようになった心理ゲームをとりあげる。とりわけ、Matthew Rabin, “Incorporating Fairness into Game Theory and Economics,” American Economic Review, Vol. 83, No. 5, 1993, pp. 1281-1302を中心に検討する。伝統的ゲームでは、プレーヤーは、主として、物質的利得に動機付けられて行動するものとして分析されている。しかし、心理ゲームでは、伝統的ゲームに情緒的心理過程を組み込むことで、プレーヤーは、物質的利得（当該プレーヤーが相手プレーヤーの行動に対していだく信念）だけではなく、心理的利得（当該プレーヤーが相手プレーヤーの情緒的心理に対していだく信念）にも大きく依存すると考える。 Rabin（1993）は、心理的動機として公正概念を検討している。 • 伝統的ゲームに、心理的動機としての公正概念を反映させることを考えている。 － 人々は、自分を助けてくれる人を助けたいと思っている。 － 人々は、自分を傷つける人を罰したいと思っている。 さらに、心理的動機をモデルに反映させた結果は、ナッシュ均衡とは異なる新たな均衡が生じることを明らかにしている。 • 心理的動機をモデルに反映させた結果は、公正均衡（fairness equilibria）を生じることを明らかにしている。 － ある人が他のある人の物質的利得を最大化する相互最大（mutual-max）の結果は、公正均衡である可能性がある。 － ある人が他のある人の物質的利得を最小化する相互最小（mutual-min）の結果は、公正均衡である可能性がある。 － あらゆる相互最大のナッシュ均衡、あるいは、相互最小のナッシュ均衡は、公正均衡である可能性がある。 － 特に、自分が獲得する、あるいは、犠牲にする利得が小さいならば、相互最大の結果あるいは相互最小の結果の集合は、およそ、公正均衡である。 － また、自分が獲得する、あるいは、犠牲にする利得が大きいならば、ナッシュ均衡の集合は、およそ、公正均衡である。 本研究ノートでの私たちの視点は、あくまで、内発的動機付けのクラウディング・アウトを説明する有力な理論として、心理ゲームを検討することである。, 日本学術振興会の学術研究助成基金助成金の資金援助（課題番号：26380462）に深く感謝いたします。本研究ノートは、研究プロジェクトの遂行にあたり開催された研究会の報告資料（平成26年9月11日（木）於 広島大学）に加筆・修正したものである。

If being around smart people makes us smarter and more productive, what can regions do to attract smart people? This paper considers endogenous cultural amenities as a location factor for high-skilled workers. To overcome selection in the provision of cultural amenities, we exploit the variation in contemporaneous cultural amenities stemming from baroque opera houses in Germany that emerged during a time when the decision for an opera house was mainly determined by the ruler’s preferences and rarely by funding constraints. To assess spillovers from high-skilled workers attracted by cultural amenities, we use a 1-percent sample drawn from the population of all West German workers under social security during the period 1975-2010. This panel of individual observations allows us to compare wages of similar individuals who work in locations with different levels of high-skilled workers who are attracted by cultural amenities. To account for non-random selection of workers among cities, we use individual-location fixed effects. Our results show that cultural amenities are an important factor in the location decision of high-skilled workers. The positive effect of the local share of high-skilled workers on unskilled, skilled and high-skilled wages indicates strong and productive spillovers.

We examine changes in inequality and instability of the combined earnings of married couples over the 1980-2009 period using two U.S. panel data sets: Social Security earnings data matched to Survey of Income and Program Participation panels (SIPP-SSA) and the Panel Study of Income Dynamics. Relative to male earnings inequality, the inequality of couples' earnings is both lower in levels and rises by a smaller amount. We also find that couples' earnings instability is lower in levels compared to male earnings instability and actually declines in the SIPP-SSA data. While wives' earnings played an important role in dampening the rise in inequality and year-to-year variation in resources at the family level, we find that marital sorting and coordination of labor supply decisions at the family level played a minor role. Comparing actual couples to randomly paired simulated couples, we find very similar trends in earnings inequality and instability.

実証研究の結果が示すように、プリンシパルの外在的インセンティブの導入は、しばしば、エージェントの内発的動機付けをクラウディング・アウト（あるいは、クラウディング・イン）させ、その結果、努力水準を不連続に低下（増加）させる。私たちは、内発的動機付けのクラウディング・アウト（あるいは、クラウディング・イン）を公式的に説明するため、そこで、まず、標準的経済理論のプリンシパル・エージェント・モデルに、外在的インセンティブ報酬から生じる選好だけではなく、内発的動機付けから生じる選好を組み込んだエージェントの効用概念を提示する。さらに、異なるタイプの動機付けから生じる満足に優先順位をつけることで総合的満足を最大にするBentham 的効用概念を活用する。この選好枠組みの下で、外在的インセンティブの導入が、異なるタイプの内発的動機付けの対象価値（あるいは、対象行為）の相対的重要性を変化させることが、内発的動機付けのクラウディング・アウト（あるいは、クラウディング・イン）を生じさせることを明らかにする。さらに、このモデル分析より、幾つかの試験的仮説を提示する。第一は、外在的インセンティブの導入が、内発的動機付けの対象価値（あるいは、対象行為）の相対的重要性を低下（増加）させるとき、内発的動機付けのクラウディング・アウト（あるいは、クラウディング・イン）を生じさせることである。第二は、エージェントに提示される外在的インセンティブが大きい程、内発的動機付けのクラウディング・アウト（あるいは、クラウディング・イン）が生じる可能性が高いことである。さらに、もう一つは、エージェントの内発的動機付けの共感度が中程度のとき、外在的インセンティブの導入が、内発的動機付けのクラウディング・アウト（あるいは、クラウディング・イン）を引き起こす可能性があることである。, 日本学術振興会の学術研究助成基金助成金の資金援助（課題番号：26380462）に深く感謝いたします。本研究ノートは、同研究プロジェクトの遂行にあたり開催された研究会の報告資料（平成27年10月20日於広島大学）に加筆・修正したものである。

Tax credits are a popular way to alleviate in‐work poverty. A common empirical assumption is that the benefit of the tax credit is borne solely by the claimant workers. However, economic theory suggests no particular reason why this should be the case. This paper investigates the impact of the Working Families' Tax Credit, introduced in the UK in 1999, on wages. Unlike similar tax credit policies, this tax credit was paid through employers rather than directly to workers, making it more salient to the employer. Using a novel identification strategy, we can separately identify the effect on wages associated with an increase in the amount of tax credit and that associated with the change in salience. We find evidence that: (1) through the salience mechanism the firm cuts the wage of claimant workers relative to similarly skilled nonclaimants by 30 percent of the tax credit, which is approximately 7 percent of the wage, and (2) there is a negative spillover effect onto the wages of claimant and nonclaimant workers of 1.7 percent, which is approximately 8 percent of the tax credit for claimant workers. Wages tax credits incidence salience I38 J30 H22 H23

This paper adds to the empirical literature on health as an important determinant of employment at older ages by exploring the role in the health-employment nexus of the wage rates of 50 to 64-year-old workers. To do so, we use individual-level panel data from the Survey of Health, Ageing and Retirement in Europe to estimate a system of equations for health, wages and employment. Our model also takes into account both the potential for measurement error in the health variable and selectivity issues related to the wage equation. We find that for men (women) a one-unit (one standard deviation) increase in health yields, on average, a 7 (8) percentage higher hourly wage rate, resulting in a 2 (4) percentage point higher employment probability. We also show a direct impact of health on employment: a similar increase in health raises the employment probability of men (women) by 16 (13) percentage points. As regards differences between European countries, our findings suggest that for all country groups, the mediating role of wages in the health-employment nexus is relatively small while the direct impact of health on employment is relatively large and rather similar. Overall, our findings indicate only a minor role for disability income policies likes wage subsidies to encourage the employment of (older) workers with health limitations, but an instrumental role for policy aimed at helping employers accommodate these workers on the job and keep them employed at older ages.

The primary goal of our paper is to quantify the importance of imperfect competition in the U.S. labor market by estimating the size of rents earned by American firms and workers from ongoing employment relationships. To this end, we construct a matched employeremployee panel data set by combining the universe of U.S. business and worker tax records for the period 2001-2015. Using this panel data, we describe several important features of the U.S. labor market, including the size of firm-specific wage premiums, the sorting of workers to firms, the production complementarities between high ability workers and productive firms, and the pass-through of firm and market shocks to workers’ wages. Guided by these empirical results, we develop, identify and estimate an equilibrium model of the labor market with two-sided heterogeneity where workers view firms as imperfect substitutes because of heterogeneous preferences over non-wage job characteristics. The model allows us to draw inference about imperfect competition, compensating differentials and rent sharing. We also use the model to quantify the relevance of non-wage job characteristics and imperfect competition for inequality and tax policy, to assess the economic determinants of worker sorting, and to offer a unifying explanation of key empirical features of the U.S. labor market I denne artikkelen kvantifiseres betydningen og omfanget av ufullkommen konkurranse i det amerikanske arbeidsmarkedet ved å estimere størrelsen på monopolprofitten som bedrifter og arbeidstakere tjener på løpende ansettelsesforhold. For dette formålet benytter vi administrative data med skatteopplysninger for samtlige amerikanske virksomheter og arbeidstakere i perioden 2001-2015 til å konstruere et paneldatasett med koblinger mellom arbeidstakere og arbeidsgivere. Vi beskriver og kvantifiserer flere viktige karakteristikker ved det amerikanske arbeidsmarkedet, som størrelsen på bedriftsspesifikke lønnspremier, sortering av arbeidstakere til bedrifter, produktivitetskomplementariteter mellom arbeidstakere og bedrifter, og overføringen av bedrifts- og markedsspesifikke sjokk til arbeidstakernes lønninger. Med utgangspunkt i disse empiriske resultatene utvikler, identifiserer og estimerer vi en likevektsmodell for et arbeidsmarked med tosidig heterogenitet, hvor arbeidstakerne ser på bedrifter som imperfekte substitutter på grunn av heterogene preferanser for ikke-pekuniære former for avlønning. Modellen tillater oss å trekke slutninger om graden av ufullkommen konkurranse, kompenserende lønnsforskjeller, og fordelingen av monopolprofitt mellom bedrifter og arbeidstakere. Videre bruker vi modellen til å kvantifisere betydningen av ikke-pekuniære former for avlønning og ufullkommen konkurranse for inntektsulikhet og skattepolitikk, til å studere de økonomiske mekanismene bak sorteringen av arbeidstakere til bedrifter, og til å utarbeide en helhetlig forklaring på sentrale empiriske kjennetegn ved det amerikanske arbeidsmarkedet.

Scientific freedom and openness are hallmarks of academia: relative to their counterparts in industry, academics maintain discretion over their research agenda and allow others to build on their discoveries. This paper examines the relationship between openness and freedom, building on recent models emphasizing that, from an economic perspective, freedom is the granting of control rights to researchers. Within this framework, openness of upstream research does not simply encourage higher levels of downstream exploitation. It also raises the incentives for additional upstream research by encouraging the establishment of entirely new research directions. In other words, within academia, restrictions on scientific openness (such as those created by formal intellectual property (IP)) may limit the diversity and experimentation of basic research itself. We test this hypothesis by examining a "natural experiment" in openness within the academic community: NIH agreements during the late 1990s that circumscribed IP restrictions for academics regarding certain genetically engineered mice. Using a sample of engineered mice that are linked to specific scientific papers (some affected by the NIH agreements and some not), we implement a differences-in-differences estimator to evaluate how the level and type of follow-on research using these mice changes after the NIH-induced increase in openness. We find a significant increase in the level of follow-on research. Moreover, this increase is driven by a substantial increase in the rate of exploration of more diverse research paths. Overall, our findings highlight a neglected cost of IP: reductions in the diversity of experimentation that follows from a single idea.

__Abstract__ We find that investor sentiment should affect a firm's employment policy in a world with moral hazard and noise traders. Consistent with the model's predictions, we show that higher sentiment among US investors leads to: (1) higher employment growth worldwide; (2) lower labor productivity, as the growth in employment is not matched by real value added growth; and (3) positive wage growth in countries with a greater proportion of high-skill labor, but negative wage growth otherwise. We also find evidence that sentiment induces greater labor instability during financial crises, which sheds new light on the view that financial development has a "dark side". Overall, the results suggest that sentiment has real effects, especially in countries that attract more foreign direct investments from the US and that are perceived as more popular among US investors.

Previous research has shown a detrimental effect of low task meaning on individual work output. This paper analyzes whether peer settings are able to counteract this negative effect of low task meaning. First, our results confirm that a low level of task meaning decreases individual output when working alone. However, this effect vanishes completely when working in the presence of a peer. Our analysis implies that organizing work in peer settings might be particularly beneficial in work environments with a low level of task meaning.

Distinguishing carefully between mobility across firms and across oc- cupations, this study provides causal estimates of the wage effects of mobility among graduates from apprenticeship in Germany. Our instrumental variables approach exploits variation in regional labor market characteristics. Pure firm changes and occupation-and-job changes after graduation from apprenticeship result in average wage losses, whereas an occupation change within the train- ing firm results in persistent wage gains. For the majority of cases a change of occupation involves a career progression. In contrast, for job switches the wage loss dominates.

A recent National Labor Relations Board ruling declared Northwestern football players employees and gave them the right to unionize. This ruling is part of ongoing scrutiny of The National Collegiate Athletic Association (NCAA's) model which labels college athletes as amateurs and limits player compensation to grant-in-aid (scholarships). Our paper estimates the marginal revenue product (MRP) of an elite college quarterback using revenue and game level playing data from eight and nine seasons, respectively. Similar to previous studies we show that MRP for elite quarterbacks far exceeds the average value of a scholarship. Our paper also provides two contributions by using a new quarterback rating system and creating an estimate of the expected value of a blue chip college quarterback recruit. The new system is the Total Quarterback Rating (QBR), a metric developed by the Stats & Information Group of ESPN. The measure has a strong win predictive ability and makes important adjustments to identify the quarterback's contribution. We find a one standard deviation increase in QBR adds about 3 wins per season, and each additional win increases a school's football revenue roughly $740,000 compared to the average quarterback, holding a variety of other determining factors constant, including school fixed effects. This suggests a superior quarterback to be worth millions of dollars a season. Teams recruit quarterbacks, however, ex-ante of the player revealing their college ability. Therefore, to estimate the value of a college recruit, we test for differences between quarterbacks rated as blue chip high school prospects and other QBs. We estimate that signing a blue chip quarterback is expected to produce roughly $429,000 dollars in total additional revenue for a college team compared to signing a non-blue chip quarterback. The results show that ex-post estimates of college player value may differ from ex-ante estimates due to the difficulty of predicting which high school players will excel in college.

When an agent is offered performance related pay, the incentive effect is not only determined by the shape of the incentive contract, but also by the probability of contract enforcement. We show that weaker enforcement may reduce the agent's effort, but lead to higher-powered incentive contracts. This creates a seemingly negative relationship between effort and performance pay.

A tanulmány a neoklasszikus közgazdaságtan alaptézisét, a szűkösségnek a termelésben játszott meghatározó szerepét teszi kritika tárgyává. Ehhez felvázolja a szűkösség és a felesleg mibenlétét, egymással való kapcsolatukat és a társadalom fejlődésében játszott szerepüket. Bemutatja, hogy a kisajátítással a szűkösség új formája jön létre, amelyet a feleslegre irányuló termelés táplál. A feleslegtermelés általános módjára vonatkozóan bevezeti a kezdeti előny és a kumulatív előnyszerzés, valamint az osztályfelesleg fogalmát. Rávilágít, hogy a kapitalizmusban a feleslegtermelés módja megváltozott, mert az előnybirtokosok szubjektív igényei helyett a piac specifikus törvényeinek rendelődik alá. Ennek következtében ma már elegendő osztályfelesleg termelődik ahhoz, hogy a szűkösség egyáltalában felszámolható legyen. Ennek szükségességét mutatja, hogy a feleslegtermelés a vele együtt járó szűkösségtermeléssel minduntalan megakad, és ilyenkor különösen kiélezi a gazdasági-társadalmi problémákat. Journal of Economic Literature (JEL) kód: B13, D01, D24, D31, J01, J30, K11, O1, P10., The study aims to criticize the basic thesis of mainstream economics that scarcity plays a determining role in production. To do so it outlines the essence of and relation between scarcity and surplus, and the role they play in the development of society. The author argues that scarcity is the result of appropriation of the means of production and of production that aims at surplus. With the general mode of the production of surplus, the study introduces the notion of initial advantage, cumulative advantage and class surplus. It highlights how the production of surplus has been changed under capitalism, where it has become subordinated to the specific rules of the market instead of the subjective needs of those who hold the benefits. Consequently the class surplus produced nowadays is enough to put an end to scarcity in general. The need to eliminate general scarcity is underlined by the fact that the production of surplus and the collateral production of scarcity halt from time to time and exacerbate existing socio-economic problems in times of crises.

It is a well-established view amongst economists that good-looking people have a better chance of employment and can earn more than those who are less physically attractive. A “beauty premium” is particularly apparent in jobs where there is a productivity gain associated with good looks, though this is different for women and men, and varies across countries. People also sort into occupations according to the relative returns to their physical characteristics; good-looking people take jobs where physical appearance is deemed important while less-attractive people steer away from them, or they are required to be more productive for the same wage.

The Bulgarian labour market adjustment during the economic crisis stands out by significant job losses, but at the same time strong average wage growth. The predominance of job cuts over wage cuts is most problematic for vulnerable groups, sectors and regions. Wage adjustments have hardly helped limiting unemployment. Strong increases in unit labour costs (ULC) and real effective exchange rates (REER) seem not (yet) to have eroded external competitiveness as exports have remained strong. This can be explained by economic convergence, lower wage growth in tradable sectors and possibly only temporarily favourable export price developments on world markets. Rapid wage growth is influenced by a combination of factors. At first sight the institutional features of the Bulgarian labour market seem rather flexible. Some factors only impact the statistical average even without actual wage increases (like job cuts being concentrated in low paid jobs and a reduction in undeclared wages). However, actual wages have probably also increased, impacted by convergence from the lowest wage levels in the EU, skills and regional mismatches. One of the key features identified in this paper is a unique system of hundreds of different minimum income thresholds across sectors and occupations applied for the calculation of social security taxes. These thresholds are set close to the average wages prevalent in the same sectors and occupations, especially for the low-wage segment where unemployment is also the highest. To minimise the negative implications for employment, the minimum social security thresholds might usefully be reviewed. Recalibration of the thresholds could be combined with a wider set of labour market measures (ALMPs, training and education policies) to improve the employability of crisis-hit employees.

Although the sectors and fraction of workers covered are small given the low rates of formality and urbanization in Sub-Saharan Africa (SSA), as the number of covered workers grows wage regulation will become increasingly significant. We find that higher minimum wage values are associated with higher GDP per capita. Importantly, however, we find that the minimum wage relative to the mean wage is higher in low income countries than in lower- and upper-middle income countries. Indeed, SSA as a whole reflects a bias towards a more aggressive minimum wage policy compared to the rest of the world. There is limited research on the employment effect of minimum wages in SSA, but the few findings are consistent with the broad summary of global research. By and large, introducing and raising the minimum wage has a small negative impact or no measurable negative impact. However, there is significant variation around this average finding – the employment elasticities are not constant nor linear. Where increases in a minimum wage are large and immediate, this can result in employment losses, but more modest increases usually have very little observably adverse effects and may have positive impacts on wages. The great variability in findings on employment could be due partly to the great variation in the detail of the minimum wage regimes and schedules country by country, but also by the variations in compliance. We find that higher Kaitz indices are associated with higher levels of non-compliance. The release of country-level earnings and employment data at regular intervals lies at the heart of a future country-focused minimum wage research agenda for Africa.

Based on the reduced form New Keynesian Wage Phillips Curve, we estimate wage rigidity and indexation at the aggregate level in several advanced countries for the 1985–2014 period. We document that the wage setting process is heterogenous among our sample of countries: nominal wage rigidities are more important in the United States, while wage indexation is dominant in European Countries. We also present evidence that indexation to past inflation has decrease as inflation stabilizes at lower levels. In addition, our results suggest that wage rigidity is not linked to the institutional environment at the macroeconomic level. Finally, we show that there is significant time variation in the estimated coefficients on the implied equation that is usually not taken into account in the theoretical literature.

This paper presents a New Keynesian (NK) model that is extended to differentiate between straight time and overtime work. The model proposes that the New Keynesian Phillips curve (NKPC) should be estimated with marginal cost measured in terms of overtime labor; the resulting coefficient estimates are in accordance with theory and statistically significant for the hybrid NKPC (which allows for backward-looking price setters) but not for the purely forward-looking NKPC. In the hybrid model, backward-looking behavior is found to be predominant. The paper also shows that the incorporation of employment frictions (predetermined employment and convex adjustment costs) in NK models helps reconcile the frequent price changes found in the microdata with the degree of sluggishness in inflation adjustment to output changes at the macro level. © 2014 The President and Fellows of Harvard College and the Massachusetts Institute of Technology

This article presents a study of the influences on the factors that shape wage adjustments. The cost of living, comparability with other firms' wages, the fulfilment of collective agreements at sector level, the need to recruit and retain employees, the performance of the organisation, and the climate of industrial relations are included as factors of interest. The analysis was carried out using a sample of Spanish manufacturing plants. Our results show that the structural characteristics of the establishment such as its size or foreign ownership, as well as the wage setting arrangements and trade unions, play a role in explaining the importance of the factors mentioned in shaping wage adjustments. The human resource management policies adopted by the employer seem to be less relevant, although the qualification of workers and the use of pay for performance have a significant impact on the process of wage adjustment.

The converging roles of men and women are among the grandest advances in society and the economy in the last century. These aspects of the grand gender convergence are figurative chapters in a history of gender roles. But what must the “last” chapter contain for there to be equality in the labor market? The answer may come as a surprise. The solution does not (necessarily) have to involve government intervention and it need not make men more responsible in the home (although that wouldn't hurt). But it must involve changes in the labor market, especially how jobs are structured and remunerated to enhance temporal flexibility. The gender gap in pay would be considerably reduced and might vanish altogether if firms did not have an incentive to disproportionately reward individuals who labored long hours and worked particular hours. Such change has taken off in various sectors, such as technology, science, and health, but is less apparent in the corporate, financial, and legal worlds. (JEL J3, J16, J22, J24, J31, J33, N3)

There is a large literature showing that the self-employed underreport their income to tax authorities. In this paper, we quantify the extent to which the self-employed also systematically underreport their income in U.S. household surveys. To do so, we use the Engel curve describing the relationship between income and expenditures of wage and salary workers to infer the actual income, and thus the reporting gap, of the self-employed based on their reported expenditures. We find that the self-employed underreport their income by about 30 percent. This result is remarkably robust across data sources and alternative model specifications. Failing to account for such income underreporting leads to biased conclusions. We document this bias in existing measures of earnings differentials, wealth differentials, precautionary savings, lifecycle earnings profiles, and earnings variation across MSAs. Our results show that it is naive for researchers to take it for granted that individuals will provide unbiased information to household surveys given their demonstrated tendency of providing distorted reports of the same information to other administrative sources.

Turkey experienced a financial crisis in 2000–2001, which led to significant financial reforms. The reforms resulted in a switch to a floating exchange rate, granted greater central bank independence and pursuit of a more credible monetary policy. Investigation of the channels of monetary policy in both periods finds that monetary policy's output effects have been strengthened considerably by the reforms. In the pre-crisis period, monetary policy was highly inflationary, while in the post-crisis period, monetary policy targets low inflation and has become a tool for output stabilization. These results support the importance of central bank independence and a credible policy.

The article presents the micro data on intangibles for Slovenia during the period 1994–2005 using an augmented method by Corrado et al. and analyses the role of intangibles in the Slovenian economy during the transition. By examining the organisational, information and communication technologies (ICT) and research and development (R&D) component of intangibles, we observe a decrease in the value of R&D capital that was to some extent offset by an increase in the value of ICT capital. We find that organisational workers had higher productivity than the average worker. The dynamic of change was gradual during the transition. The capitalisation of intangibles implied an average 4.5% increase of gross domestic product (GDP) for the new member states. Nonetheless, a worrying convergence can be observed between the tangible and the intangible capital. One can thus expect the intangibles have an important role in the future growth in Slovenia and across the European countries, but only if proper attention is devoted to them in terms of policy measures and regulation.

The level of compliance with minimum wage laws often depends on factors specific to each labor market. In most developing countries, a substantial share of workers still earns less than the legal minimum. Enforcement has not kept up with growth in regulations to protect workers from low wages and poor working conditions. Several institutional structures shape enforcement, including the role of labor inspectors and approaches to compliance, and these and other variables can be analyzed to explore their effects on the level of minimum wage violations.

The micro- and macroeconomic effects of the declining power of trade unions have been hotly debated by economists and policymakers, although the empirical evidence does little to suggest that the impact of union decline on economic aggregates and firm performance is an overwhelming cause for concern. That said, the association of declining union power with rising earnings inequality and the loss of an important source of dialogue between workers and their firms have proven more worrisome if no less contentious. Causality issues dog the former association and while the diminution in representative voice seems indisputable any depiction of the non-union workplace as an authoritarian “bleak house” is more caricature than reality.

Two literatures exist concerning cross-border merger activity's impact on domestic wages: one focusing on positive spillover-effects; the other focusing on negative bargaining-effects. Motivated by scarce theoretical scholarship spanning these literatures, we nest both mechanisms in a single conceptual framework. Considering the separate phenomena of inward and outward cross-border merger activity, our theoretical model generates three formal propositions: cross-border mergers can lead to wage increases via positive spillover-effects; and negative bargaining-effects are relatively more dominant when union market power is high, and when merging firms exhibit relatedness. Employing US firm-level panel data on wages combined with industry-level data on unionization and merger activity (covering 1989-2001), we find support for our propositions as inward and outward cross-border merger activity generate positive spillovers to wages, but are more likely to generate firm-level wage decreases when unionization rates are high and when cross-border merger activity is characterized as horizontal. Accordingly, future research on how cross-border mergers affect domestic wages should be mindful that both spillover and bargaining effects are at play, and that the degree of union market-power and the relatedness of cross-border merger activity are critical in determining which effect dominates. (authors' abstract)

Dieser Beitrag untersucht empirisch die ökonomischen Bestimmungsgründe des nach wie vor bestehenden Lohnunterschieds zwischen Ost- und Westdeutschland. Durch die Verwendung eines Mikrodatensatzes, welcher Angaben zur Personen- und Betriebsebene über die Zeit enthält, und die Anwendung neuer ökonometrischer Methoden ergeben sich zum Teil unerwartete neue Einsichten in die Thematik. Im Ergebnis zeigt sich, dass auf der Ebene der Betriebe nur die unterschiedliche Branchenstruktur zwischen Ost- und Westdeutschland einen bedeutsamen Teil des Lohndifferenzials erklärt. Entgegen der weit verbreiteten Erwartung haben die durchschnittlich kleineren Betriebe, die geringere Verbreitung von Betriebsräten oder die lückenhaftere Abdeckung von Tarifverträgen in Ostdeutschland in Summe nur einen statistisch vernachlässigbaren Einfluss.

This paper examines the consequences of rapid disinflation for downward wage rigidities in two emerging countries, Brazil and Uruguay. Although wage rigidities are altered by disinflation, in neither of the two countries does price stability eliminate frictions in wage-setting mechanisms. In a context of individual wage negotiations and weak unions, disinflation in Uruguay puts an end to its history of indexation, but strong resistance to nominal wage cuts emerges. In strongly unionized Brazil, wage indexation is highly persistent, but the introduction of inflation targeting by the Central Bank in 1999 moves the focal point of wage negotiations to expected inflation. Financial support from the Government of Catalonia (contract no. 2009SGR189 and the XREPP) and the Government of Spain (through the SFLAC TF and ECO2011-28822 Grant) is gratefully acknowledged.

In an experiment with professionals from the financial services sector, we investigate the impact of a team incentive scheme on the recommendation quality of investment products when advisors benefit from advising lower quality products. Experimental results reveal that, when group affiliation is strong, inferior products are recommended significantly more often under team incentives than under individual incentives.

We propose a novel experimental design to study counterproductive behaviour in a principal agent setting. The design allows us to study and derive clean measures of different forms of counterproductive behaviour in a controlled but non obtrusive manner. We ask participants to complete a specific task (identify euro coins) and report their output. Participants can engage in various forms of counterproductive behaviour, none of them being offered to them explicitly. They can make mistakes in the identification task, lie in their report or even steal coins. We present an application of the design to study the effects of different pay schemes (competition, fixed pay and piece rate) on counterproductive behaviour. On average counterproductive behaviour amounts to 10 percent of the average productivity, almost all arising through mistakes and overreporting of output. We find essentially no evidence of theft. Moreover, we find that both productive and counterproductive behaviour are significantly higher under competition than under the two other pay schemes., Working papers series, ISSN 2628-1724, 2012, Heft 18

The paper estimates the household labor earning process using the March Current Population Survey 1968–2011. GMM estimates confirm that the results in Storesletten et al. (2004) still hold in a much larger data set over a longer period. The persistent idiosyncratic risk is strongly countercyclical, with an annual auto-correlation equal to .973 and an standard deviation that increases by 72.5% (from .090 to .156) as the macroeconomy moves from peak to trough.

Globalisation has introduced a system of production where flexible work contract or sub-contracting and ‘putting-out’ system of production is becoming a general practice. Either as cost reduction strategy or as businesses strategy production is being out sourced and consequently a set of workers have emerged which is known as ‘home based workers (HBW)’ or ‘home workers’ or ‘outworkers’. NCEUS (2007) highlighted the importance of estimating and knowing the conditions of work of home workers. Information about these home based workers has been limited till recently due to definitional issues and data limitations. Delhi Group has clarified many definitional issues and NSS 66th round, (2009-10) has provided relevant data to know details of these home based workers. This paper focuses on women home based workers as they constitute the largest part and are characterised by worst employment conditions. NSS has launched another round (68th) of unemployment-employment survey for year 2011-12, still 66th round is much more important in regard to home based workers due to the fact that 68th round has dropped many of question on sub-contracting. Therefore, this paper relies on 66th round data only. This paper is basically an attempt to look at state wise pattern in women home based workers. It shows that there are considerable state level variations. There is state like Assam with close to half and Punjab with slightly above 10 per cent of their women home based workers working under any form of subcontracting. This paper looks at industrial distribution of these women home based workers and it is shown that there are certain industrial groups where share of home based women workers is higher than non home based workers. Thus we have fair reason to agree with NCEUS (2007) that these workers are a special category and they need specific policies to redress their situation.

Selon les estimations de l’auteur, une hausse de 1 % du taux de chômage régional s’accompagne d’une baisse de 1,5 % des salaires réels moyens en France. Une plus importante rigidité salariale semble cependant avoir freiné l’ajustement des salaires entre 2009 et 2011.

The process of economic globalisation and liberalisation during the last two decades has reshaped the labour norms in India. As a result, the share of the informal workers in total employment has increased tremendously. During this period, a significant part of the incremental employment is being generated in the unorganised sector, where working conditions are far away from being satisfactory. Most of these workers are poor and vulnerable. Even after two decades of growth in the country, the quality of employment has been deteriorating which has led to a huge gap in productive employment. In this perspective, in this paper, an attempt has been made to explore such deficits among different types of workers as well as various sectors and regions of the economy. It has been observed that this gap is wider in the sectors/states where the informality quotient is higher. The workers in these sectors/states are largely poor and vulnerable and have no access to social security benefits while they are the neediest one. We can observe a strong positive association between the poverty of the workers (deficit in productive employment) and lack of social security. Therefore, it is suggested that on the one hand, there should be strong steps to remove (or reduce) the deficit in productive employment in every sector and region of the economy and on the other hand, the poor workers should be adequately covered with some social security benefits and for any poverty removal strategy, there should be due emphasis on provision of certain social protection to these workers.

We consider a model with on-the-job search where current wages depend only on current aggregate labor market conditions and idiosyncratic match-specific productivities. We show theoretically that the model replicates the findings in Bils (1985) and Beaudry and DiNardo (1991) on the history dependence in wages. We develop a method to measure match qualities in the data and show empirically that various variables summarizing past aggregate labor market conditions have explanatory power for current wages only because they are correlated with match qualities. They lose any predictive power once match qualities are accounted for. (JEL E3, E24, J3)

Democracy and democratisation are associated with higher manufacturing wages. However, classifying a country as democratic does not highlight what institutional characteristics (if any) may be leading to higher wages within democracies. In order to shed light on this issue, this paper uses a dataset that “decomposes” democracy into six different governance indicators in a panel of 84 countries over the period 1996 to 2009. The evidence suggests that in poor and middle-income countries, greater voice and accountability as well as rule of law will lead to increments in manufacturing wages. It is argued that these characteristics increase wages by allowing for freedom of association and assembly as well as by encouraging greater respect for labour laws. The paper also uncovers some evidence to suggest that greater voice and accountability and rule of law can lead to a fall in wages in more developed nations. It is argued that since more developed countries are undergoing a process of deindustrialisation, more democratic wage bargaining activities will lead to faster downward adjustment of manufacturing wages.

Daten zur Produktionsstruktur der Welt, die aus Input-Output-Tabellen entnommen werden, zeigen, dass der ausländische Wertschöpfungsanteil, der in deutschen Exporten steckt, zwischen 1995 und 2008 von 13,5 auf 20% gestiegen ist. Somit ist für Deutschland der langfristige Trend zur Basarökonomie ungebrochen. Zwar konnte man in der Wirtschaftskrise 2009 einen Rückgang des Trends beobachten – die ausländische Wertschöpfung im Export ging auf 18% zurück –, aber das ist vermutlich nur ein temporärer Effekt. Vorleistungen aus China und den mittel- und osteuropäischen Ländern gewinnen für deutsche Exporte im Verarbeitenden Gewerbe immer stärker an Bedeutung.

This paper examines the impact of the Dutch R&D tax incentive scheme on the wages of R&D workers. We construct firm specific R&D tax credit rates that vary over time following variations in the Dutch R&D tax incentive program. Using instrumental variables we estimate a wage-sharing model with an unbalanced firm-level panel data covering the period 1997-2004. The elasticity of the R&D wage with respect to the fraction of the wage supported by the fiscal incentives scheme is estimated at 0.2 in the short run and 0.24 in the long run. (C) 2013 Elsevier B.V. All rights reserved.

Integration processes in Europe resulted in intensification of migration flows. Immigrants account now for a large share of population in many European countries. A point of view that immigrants take jobs form natives is quite widespread. The European Monitoring Centre on Racism and Xenophobia published a special analysis of the attitudes towards minorities in EU countries Eurobarometer 2000. They found that one in two EU citizens worry about competing with immigrants for the same vacancies and afraid of losing their jobs because of presence of foreign workers. Different measures and institutions which protect native workers have nevertheless an ambiguous effect. On the one hand labor protective institutions such as minimal wage, replacement rate or firing restrictions will protect existing workers and reduce a firing rate. On the other hand, firms will take into consideration these additional costs of firing and will be less likely to employ new workers. At the same time, it is argued that immigrants are probably less likely to be covered by these institutions. These facts imply that protective institutions cover mostly natives and therefore make immigration labor force comparatively less costly. Labor market protection may therefore amplify a negative effect of immigrants on native employment if it exists.This paper attempts to evaluate the effect of immigration in flow on employment level of natives and reveal whether this effect changes in different institutional environments using EU-countries data. In addition to static specification it uses a dynamic specification to draw conclusions about long-term and short-term effects separately. The results show no long-run effect of immigration inflow. Short-term effect of is found to be positive. Protective labor market institutions fulfill their function of protecting existing workers.The results are also different for men and women.

The economic management requires strictly measuring the costs, as a starting point in calculating the selling price, in choosing the best production alternative, in substantiating the resource consumption. Any entity will seek to maximize profits and minimize costs. Not in all circumstances does an increase in the size of the companies reduces costs and achieves savings. It all depends on the efficiency evolution of the used inputs. The economic entity may use the following ways to reduce production costs: laying in prod factors at the lowest price possible, reducing stocks, reducing specific raw materials consumption, reducing operation costs and improving the equipment’s usage degree etc.

The negative relationship between wages and unemployment, embodied within the so-called wage curve, has an extensive literature and has been referred to as ‘an empirical law of economics’. However there are newer alternative theories that seek to explain the variation in wages without reference to unemployment rates, namely Urban Economics (UE) and New Economic Geography (NEG). The present paper considers the relative success of non-nested models of wage determination from the perspective of Great Britain’s 408 local authorities over the period 1998-2010.