Modern labor economics theory and public policyPDF电子书下载

CHAPTER 1 INTRODUCTION 1

The Labor Market 2

Labor Economics: Some Basic Concepts 2

Positive Economics 3

The Models and Predictions of Positive Economics 4

Normative Economics 7

Normative Economics and Government Policy 10

Efficiency versus Equity 11

Plan of the Text 12

Example 1.1 Positive Economics: What Does It Mean to “Understand”Behavior? 5

Review Questions 13

Problems 14

Selected Readings 15

Appendix 1A Statistical Testing of Labor Market Hypotheses 16

CHAPTER 2 OVERVIEW OF THE LABOR MARKET 25

The Labor Market: Definitions, Facts, and Trends 26

The Labor Force and Unemployment 27

Industries and Occupations: Adapting to Change 30

The Earnings of Labor 31

How the Labor Market Works 36

The Demand for Labor 37

The Supply of Labor 41

The Determination of the Wage 43

Applications of the Theory 48

Who Is Underpaid and Who Is Overpaid? 49

Unemployment and Responses to Technological Change across Countries 52

Example 2.1 Real Wages across Countries and Time: Big Macs per Hour Worked 34

Example 2.2 The Black Death and the Wages of Labor 47

Example 2.3 Forced Labor in Colonial Mozambique 51

Empirical Study Pay Levels and the Supply of Military Officers: Obtaining Sample Variation from Cross-Section Data 54

Review Questions 55

Problems 57

Selected Readings 58

CHAPTER 3 THE DEMAND FOR LABOR 59

Profit Maximization 60

Marginal Income from an Additional Unit of Input 61

Marginal Expense of an Added Input 62

The Short-Run Demand for Labor When Both Product and Labor Markets Are Competitive 63

A Critical Assumption: Declining MPL 64

From Profit Maximization to Labor Demand 65

The Demand for Labor in Competitive Markets When Other Inputs Can Be Varied 70

Labor Demand in the Long Run 70

More Than Two Inputs 73

Labor Demand When the Product Market Is Not Competitive 74

Maximizing Monopoly Profits 74

Do Monopolies Pay Higher Wages? 75

Policy Application: The Labor Market Effects of Employer Payroll Taxes and Wage Subsidies 76

Who Bears the Burden of a Payroll Tax? 76

Employment Subsidies as a Device to Help the Poor 78

Example 3.1 The Marginal Revenue Product of College Football Stars 63

Example 3.2 Coal Mining Wages and Capital Substitution 72

Empirical Study Do Women Pay for Employer-Funded Maternity Benefits? Using Cross-Section Data Over Time to Analyze “Differences in Differences” 80

Review Questions 83

Problems 84

Selected Readings 85

Appendix 3A Graphical Derivation of a Firm's Labor Demand Curve 86

CHAPTER 4 LABOR DEMAND ELASTICITIES 95

The Own-Wage Elasticity of Demand 96

The Hicks-Marshall Laws of Derived Demand 98

Estimates of Own-Wage Labor Demand Elasticities 101

Applying the Laws of Derived Demand: Inferential Analysis 103

The Cross-Wage Elasticity of Demand 105

Can the Laws of Derived Demand Be Applied to Cross-Elasticities? 106

Estimates Relating to Cross-Elasticities 108

Policy Application: Effects of Minimum Wage Laws 109

History and Description 109

Employment Effects: Theoretical Analysis 110

Employment Effects: Empirical Estimates 114

Does the Minimum Wage Fight Poverty? 116

“Living Wage” Laws 117

Applying Concepts of Labor Demand Elasticity to the Issue of Technological Change 118

Example 4.1 Why Are Union Wages So Different in Two Parts of the Trucking Industry? 104

Example 4.2 The Employment Effects of the First Federal Minimum Wage 115

Example 4.3 Gross Complementarity in the 19th Century Apparel Industry 120

Empirical Study Estimating the Labor Demand Curve: Time Series Data and Coping with “Simultaneity” 124

Review Questions 127

Problems 128

Selected Readings 129

CHAPTER 5 FRICTIONS IN THE LABOR MARKET 130

Frictions on the Employee Side of the Market 131

The Law of One Price 131

Monopsonistic Labor Markets: A Definition 134

Profit Maximization under Monopsonistic Conditions 135

How Do Monopsonistic Firms Respond to Shifts in the Supply Curve? 139

Monopsonistic Conditions and the Employment Response to Minimum Wage Legislation 142

Job Search Costs and Other Labor Market Outcomes 143

Monopsonistic Conditions and the Relevance of the Competitive Model 145

Frictions on the Employer Side of the Market 146

Categories of Quasi-Fixed Costs 146

The Employment/ Hours Trade-Off 150

Training Investments 154

The Training Decision by Employers 154

The Types of Training 155

Training and Post-Training Wage Increases 156

Employer Training Investments and Recessionary Layoffs 158

Hiring Investments 159

The Use of Credentials 159

Internal Labor Markets 161

How Can the Employer Recoup Its Hiring Investments? 163

Example 5.1 Does Employment Protection Legislation Protect Workers? 147

Example 5.2 “Renting” Workers as a Way of Coping with Hiring Costs 152

Example 5.3 Why Do Temporary-Help Firms Provide Free General Skills Training? 160

Empirical Study What Explains Wage Differences for Workers Who Appear Similar? Using Panel Data to Deal with Unobserved Heterogeneity 162

Review Questions 164

Problems 165

Selected Readings 167

CHAPTER 6 SUPPLY OF LABOR TO THE ECONOMY: THE DECISION TO WORK 168

Trends in Labor Force Participation and Hours of Work 168

Labor Force Participation Rates 169

Hours of Work 171

A Theory of the Decision to Work 173

Some Basic Concepts 173

Analysis of the Labor/Leisure Choice 177

Empirical Findings on the Income and Substitution Effects 192

Policy Applications 195

Budget Constraints with “Spikes” 195

Programs with Net Wage Rates of Zero 198

Subsidy Programs with Positive Net Wage Rates 202

Example 6.1 The Labor Supply of New York City Taxi Drivers 177

Example 6.2 Do Large Inheritances Induce Labor Force Withdrawal? 187

Example 6.3 Daily Labor Supply at the Ballpark 193

Example 6.4 Labor Supply Effects of Income Tax Cuts 194

Example 6.5 Staying Around One's Kentucky Home: Workers' Compensation Benefits and the Return to Work 198

Example 6.6 Wartime Food Requisitions and Agricultural Work Incentives 205

Empirical Study Estimating the Income Effect Among Lottery Winners: The Search for “Exogeneity” 206

Review Questions 207

Problems 209

Selected Readings 210

CHAPTER 7 LABOR SUPPLY: HOUSEHOLD PRODUCTION, THE FAMILY,AND THE LIFE CYCLE 211

A Labor Supply Model That Incorporates Household Production 211

The Basic Model for an Individual: Similarities with the Labor-Leisure Model 212

The Basic Model for an Individual: Some New Implications 214

Joint Labor Supply Decisions within the Household 217

Specialization of Function 218

Do Both Partners Work for Pay? 219

The Joint Decision and Interdependent Productivity at Home 221

Labor Supply in Recessions: The “Discouraged” versus the“Added” Worker 221

Life Cycle Aspects of Labor Supply 225

The Substitution Effect and When to Work over a Lifetime 225

The Choice of Retirement Age 227

Policy Application: Child Care and Labor Supply 232

Child-Care Subsidies 232

Child Support Assurance 235

Example 7.1 Obesity and the Household Production Model 215

Example 7.2 Child Labor in Poor Countries 223

Example 7.3 How Does Labor Supply Respond to Housing Subsidies? 227

Empirical Study The Effects of Wage Increases on Labor Supply （and Sleep）:Time-Use Diary Data and Sample Selection Bias 238

Review Questions 240

Problems 242

Selected Readings 244

CHAPTER 8 COMPENSATING WAGE DIFFERENTIALS AND LABOR MARKETS 245

Job Matching: The Role of Worker Preferences and Information 245

Individual Choice and Its Outcomes 246

Assumptions and Predictions 248

Empirical Tests for Compensating Wage Differentials 251

Hedonic Wage Theory and the Risk of Injury 252

Employee Considerations 253

Employer Considerations 255

The Matching of Employers and Employees 257

Normative Analysis: Occupational Safety and Health Regulation 261

Hedonic Wage Theory and Employee Benefits 266

Employee Preferences 266

Employer Preferences 268

The Joint Determination of Wages and Benefits 270

Example 8.1 Working on the Railroad: Making a Bad Job Good 252

Example 8.2 Parenthood, Occupational Choice, and Risk 259

Example 8.3 Indentured Servitude and Compensating Differentials 261

Empirical Study How Risky are Estimates of Compensating Wage Differentials for Risk? The “Errors in Variables” Problem 272

Review Questions 274

Problems 275

Selected Readings 276

Appendix 8A Compensating Wage Differentials and Layoffs 277

CHAPTER 9 INVESTMENTS IN HUMAN CAPITAL: EDUCATION AND TRAINING 282

Human Capital Investments: The Basic Model 284

The Concept of Present Value 284

Modeling the Human Capital Investment Decision 286

The Demand for a College Education 288

Weighing the Costs and Benefits of College 288

Predictions of the Theory 289

Market Responses to Changes in College Attendance 295

Education, Earnings, and Post-Schooling Investments in Human Capital 296

Average Earnings and Educational Level 296

On-the-Job Training and the Concavity of Age/Earnings Profiles 299

The Fanning Out of Age/Earnings Profiles 301

Women and the Acquisition of Human Capital 301

Is Education a Good Investment? 306

Is Education a Good Investment for Individuals? 306

Is Education a Good Social Investment? 309

Is Public Sector Training a Good Social Investment? 317

Example 9.1 War and Human Capital 283

Example 9.2 Can Language Affect Investment Behavior? 291

Example 9.3 Did the G.I.Bill Increase Educational Attainment for Returning World War Ⅱ Vets? 293

Example 9.4 Valuing a Human Asset: The Case of the Divorcing Doctor 307

Example 9.5 The Socially Optimal Level of Educational Investment 315

Empirical Study Estimating the Returns to Education Using a Sample of Twins: Coping with the Problem of Unobserved Differences in Ability 318

Review Questions 320

Problems 321

Selected Readings 322

Appendix 9A A “Cobweb” Model of Labor Market Adjustment 323

CHAPTER 10 WORKER MOBILITY: MIGRATION, IMMIGRATION, AND TURNOVER 327

The Determinants of Worker Mobility 328

Geographic Mobility 329

The Direction of Migratory Flows 329

Personal Characteristics of Movers 330

The Role of Distance 332

The Earnings Distribution in Sending Countries and International Migration 332

The Returns to International and Domestic Migration 334

Policy Application: Restricting Immigration 337

U.S.Immigration History 338

Naive Views of Immigration 341

An Analysis of the Gainers and Losers 343

Do the Overall Gains from Immigration Exceed the Losses? 349

Employee Turnover 352

Wage Effects 352

Effects of Employer Size 353

Gender Differences 354

Cyclical Effects 354

Employer Location 355

Is More Mobility Better? 355

Example 10.1 The Great Migration: Southern Blacks Move North 331

Example 10.2 Migration and One's Time Horizon 333

Example 10.3 The Mariel Boatlift and Its Effects on Miami's Wage and Unemployment Rates 348

Example 10.4 Illegal Immigrants, Personal Discount Rates, and Crime 351

Empirical Study Do Political Refugees Invest More in Human Capital than Economic Immigrants? The Use of Synthetic Cohorts 356

Review Questions 358

Problems 359

Selected Readings 360

CHAPTER 11 PAY AND PRODUCTIVITY: WAGE DETERMINATION WITHIN THE FIRM 361

Motivating Workers: An Overview of the Fundamentals 363

The Employment Contract 363

Coping with Information Asymmetries 364

Motivating Workers 367

Motivating the Individual in a Group 369

Compensation Plans: Overview and Guide to the Rest of the Chapter 371

Productivity and the Basis of Yearly Pay 371

Employee Preferences 371

Employer Considerations 373

Productivity and the Level of Pay 379

Why Higher Pay Might Increase Worker Productivity 379

Efficiency Wages 381

Productivity and the Sequencing of Pay 382

Underpayment Followed by Overpayment 382

Promotion Tournaments 386

Career Concerns and Productivity 388

Applications of the Theory: Explaining Two Puzzles 390

Why Do Earnings Increase with Job Tenure? 390

Why Do Large Firms Pay More? 392

Example 11.1 The Wide Range of Possible Productivities: The Case of the Factory That Could Not Cut Output 362

Example 11.2 Calorie Consumption and the Type of Pay 368

Example 11.3 The Effects of Low Relative Pay on Worker Satisfaction 370

Example 11.4 Poor Group Incentives Doom the Shakers 375

Example 11.5 Did Henry Ford Pay Efficiency Wages? 380

Example 11.6 The “Rat Race” in Law Firms 388

Empirical Study Are Workers Willing to Pay for Fairness? Using Laboratory Experiments to Study Economic Behavior 394

Review Questions 396

Problems 397

Selected Readings 398

CHAPTER 12 GENDER, RACE, AND ETHNICITY IN THE LABOR MARKET 399

Measured and Unmeasured Sources of Earnings Differences 400

Earnings Differences by Gender 401

Earnings Differences between Black and White Americans 410

Earnings Differences by Ethnicity 416

Theories of Market Discrimination 418

Personal-Prejudice Models: Employer Discrimination 419

Personal-Prejudice Models: Customer Discrimination 424

Personal-Prejudice Models: Employee Discrimination 424

Statistical Discrimination 425

Noncompetitive Models of Discrimination 428

A Final Word on the Theories of Discrimination 432

Federal Programs to End Discrimination 432

Equal Pay Act of 1963 432

Title Ⅶ of the Civil Rights Act 433

The Federal Contract Compliance Program 437

Effectiveness of Federal Antidiscrimination Programs 439

Example 12.1 Bias in the Selection of Musicians by Symphony Orchestras 405

Example 12.2 Race Discrimination May “Strike” When Few Are Looking: The Case of Umpires in Major League Baseball 415

Example 12.3 Fear and Lathing in the Michigan Furniture Industry 426

Example 12.4 Comparable Worth and the University 436

Empirical Study Can We Catch Discriminators in the Act? The Use of Field Experiments in Identifying Labor Market Discrimination 440

Review Questions 443

Problems 444

Selected Readings 445

Appendix 12A Estimating Comparable-Worth Earnings Gaps: An Application of Regression Analysis 446

CHAPTER 13 UNIONS AND THE LABOR MARKET 450

Union Structure and Membership 451

International Comparisons of Unionism 451

The Legal Structure of Unions in the United States 453

Constraints on the Achievement of Union Objectives 457

The Monopoly-Union Model 459

The Efficient-Contracts Model 461

The Activities and Tools of Collective Bargaining 465

Union Membership: An Analysis of Demand and Supply 465

Union Actions to Alter the Labor Demand Curve 470

Bargaining and the Threat of Strikes 472

Bargaining in the Public Sector: The Threat of Arbitration 477

The Effects of Unions 480

The Theory of Union Wage Effects 481

Evidence of Union Wage Effects 484

Evidence of Union Total Compensation Effects 486

The Effects of Unions on Employment 487

The Effects of Unions on Productivity and Profits 488

Normative Analyses of Unions 489

Example 13.1 A Downward Sloping Demand Curve for Football Players? 458

Example 13.2 The Effects of Deregulation on Trucking and Airlines 469

Example 13.3 Permanent Replacement of Strikers 475

Empirical Study What Is the Gap Between Union and Nonunion Pay? The Importance of Replication in Producing Credible Estimates 492

Review Questions 494

Problems 495

Selected Readings 496

Appendix 13A Arbitration and the Bargaining Contract Zone 497

CHAPTER 14 UNEMPLOYMENT 502

A Stock-Flow Model of the Labor Market 504

Sources of Unemployment 505

Rates of Flow Affect Unemployment Levels 506

Frictional Unemployment 509

The Theory of Job Search 510

Effects of Unemployment Insurance Benefits 513

Structural Unemployment 517

Occupational and Regional Unemployment Rate Differences 517

International Differences in Long-Term Unemployment 519

Do Efficiency Wages Cause Structural Unemployment? 520

Demand-Deficient （Cyclical） Unemployment 523

Downward Wage Rigidity 523

Financing U.S.Unemployment Compensation 527

Seasonal Unemployment 529

When Do We Have Full Employment? 531

Defining the Natural Rate of Unemployment 531

Unemployment and Demographic Characteristics 532

What Is the Natural Rate? 533

Example 14.1 Is Unemployment Self-Perpetuating? 512

Example 14.2 Unemployment Insurance and Seasonal Unemployment:A Historical Perspective 530

Empirical Study Do Reemployment Bonuses Reduce Unemployment? The Results of Social Experiments 534

Review Questions 536

Problems 537

Selected Readings 538

CHAPTER 15 INEQUALITY IN EARNINGS 539

Measuring Inequality 540

Earnings Inequality Since 1980: Some Descriptive Data 543

The Increased Returns to Higher Education 547

Growth of Earnings Dispersion within Human-Capital Groups 548

The Underlying Causes of Growing Inequality 550

Changes in Supply 551

Changes in Demand: Technological Change 553

Changes in Demand: Earnings Instability 556

Changes in Institutional Forces 557

Example 15.1 Differences in Earnings Inequality across Developed Countries 547

Example 15.2 Changes in the Premium to Education at the Beginning of the Twentieth Century 549

Empirical Study Do Parents' Earnings Determine the Earnings of Their Children? The Use of Intergenerational Data in Studying Economic Mobility 558

Review Questions 559

Problems 561

Selected Readings 562

Appendix 15A Lorenz Curves and Gini Coefficients 563

CHAPTER 16 THE LABOR-MARKET EFFECTS OF INTERNATIONAL TRADE AND PRODUCTION SHARING 567

Why Does Trade Take Place? 568

Trade between Individuals and the Principle of Comparative Advantage 568

The Incentives for Trade across Different Countries 570

Effects of Trade on the Demand for Labor 574

Product Demand Shifts 575

Shifts in the Supply of Alternative Factors of Production 577

The Net Effect on Labor Demand 579

Will Wages Converge across Countries? 583

Policy Issues 585

Subsidizing Human-Capital Investments 586

Income Support Programs 587

Subsidized Employment 588

How Narrowly Should We Target Compensation? 589

Summary 592

Example 16.1 The Growth Effects of the Openness to Trade: Japan's Sudden Move to Openness in 1859 575

Example 16.2 Could a Quarter of American Jobs Be Offshored? Might Your Future Job Be among Them? 581

Empirical Study Evaluating European Active Labor Market Policies: The Use of Meta-Analysis 590

Review Questions 592

Problems 593

Selected Readings 594

Answers to Odd-Numbered Review Questions and Problems 595

Name Index 645

Subject Index 651