Questions tagged [labor-economics]

Labor economics is the branch of microeconomics that studies labor markets and its peculiarities. Labor economists usually study topics such as career choice, returns to schooling, determinants of labor productivity, wages, gender and racial gaps.

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What are some examples of economic activities which require fewer hours of work today, than they used to? [closed]

General Question What are some examples of goods, or services, which require less labor to produce today (relatively speaking) than they required many years ago? Motivation/Justification I can think ...
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What is the probability of an unemployed worker receiving no job offer during a time period?

we are currently covering one sided search models and I had a question for you all. I kind of understand the raw calculus behind finding the probability of a job offer over a time interval h, but what ...
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107 views

Why are Americans at the top of nearly every field?

I live in India, and having spent several years in America before returning, I noticed that Americans dominate in nearly every sphere of human activity. For example, the US seems to be blessed with ...
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What is the meaning of “labor input” in the context of incentive theories?

In the article "Multitask Principal-Agent Analyses: Incentive Contracts, Asset Ownership, and Job Design" (Holmström and Milgrom, 1991) it is said that two identical agents ($i=1,2$) devote ...
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What quasi-experimental/econometric technique can I use to measure the impact of a policy using longtitudinal tax data?

I have two cohorts of workers with very similar characteristics (e.g. same demographic profile, skill level, industry) that were laid off at different points in time. Say one group was laid off ...
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28 views

How can a country develop the skills of its population and have them stay? [closed]

Suppose, I am a leader of a country, and a lot of my citizens go to the Gulf states (see 3.1, Page-09) to work as unskilled laborers. I see my population working abroad as laborers as a prestige ...
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1answer
43 views

Piketty's explanation of elasticity of substitution (from his book Capital in the 21st century)

I have some trouble following the explanation of the elasticity of substitution between capital and labor and its implications on p189. Take this part: The relevant question is whether the elasticity ...
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How can I obtain monthly unemployment by ethnicity by state for the US?

Grateful for any help, thoughts and direction.
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1answer
68 views

Economics perspective of connected workers

According to the Deloitte report published here, a connected worker is defined as someone whose working life is changing due to digital and other technologies. This is due to advancement of ...
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Dataset on university enrollment?

I'm looking for a dataset with stats on tertiary education enrollment in the US, per state, at least a couple decades back. I've searched but cannot seem to find anything. Could someone help me out?
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More than one Bellman Equation

I'm attending to my first dynamic optimization course, and what I don't fully graps yet is that sometimes we have to use more than one bellman equation. How do you realize that? I mean how do you know ...
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Convenient S-shaped production function (i.e. with IRS and DRS) to derive a discontinuous demand for labor

Let say that a firm produces a commodity using only one input (i.e. Labor if we suppose to be in the very short run). Then we have a general production function of the following form $y=f(L)$, for $L≥...
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Neutral technical progress

Recently I learnt that Cobb-Douglas production function has elasticity of substitution equal to 1, therefore it has neutral technical progress. Then Leontief production function has zero elasticity of ...
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Average ability conditioning on having accepted an offer

There is a continuum of workers between 0 and 1. These have ability $\alpha\sim U[0,2]$. A firm offers them a salary $v$ and has profits $$ \pi = (\rho \alpha-v) n(v) $$ where $n(v)$ is the fraction ...
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1answer
40 views

Price Changes in Factor and Product Markets

I think something is wrong in my reasoning, and I can't really find out what it is Lets say the supply of labor decreases in a market. That would mean that the wage rate would increase in that market....
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Are there any estimates for what percentage of the jobs lost this spring are “permanent” at least for the rest of the year?

In a "view from the helicopter" video by The Economist on the aftereffects of Covid-19, one of the editors says that it's very unlikely we'll see a return to normal this year e.g. in the restaurant ...
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Why labor-augmenting technological progress increases employment and wages?

My textbook says that advances in technology typically raise the marginal product of labor and shift the labor demand curve to the right and calls it labor-augmenting technological advances. The book ...
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Empirical Bayes Estimation

I would be greatful if You can give some advise regarding the following problems: As I reviewed some empirical papers, I learnt that most of them using relatively small number of observations for ...
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1answer
35 views

Under what BLS line do “people who want a job but haven’t searched in the last 12 months” show up?

I'm trying to understand how this CNN math was derived: This category — jobless people who “want a job now” but “did not search for work in the previous year” — has hovered around 3 million workers ...
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Does the income from a product or art count as passive income?

When a writer publishes his book, can we classify the income from the book as passive? Or another example, when a musician publishes his album, does the album generates passive income, making any form ...
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Unions, right to work laws [closed]

Can anyone explain what right to work laws are? along with any thoughts about unions. Do they actually benefit the worker and overall market? Thank you.
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Implications for Labour after a Productivity Shock, RBC Model

I am trying to understand the implication for labour after a one time productivity shock where $A_t$ follows a AR (1) process with persistence $\rho_A=0.95$. It is stated the following : labour ...
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1answer
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Constant Elasticity of Substitution (non-special cases)

I am trying to better understand the CES function: $$Y_{t}=C\left[\pi\left(A_{t}^{K} K_{t}\right)^{\frac{\sigma-1}{\sigma}}+(1-\pi)\left(A_{t}^{L} L_{t}\right)^{\frac{\sigma-1}{\sigma}}\right]^{\frac{...
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When do we have diminishing marginal returns to labor?

When we have a production function exhibiting constant returns to scale, with only labor and technology, why don't we have any diminishing marginal returns to labor?
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Reason for SMEs in the European Union employing the bulk of people?

Is there any specific reason why SMEs in the European Union employ the vast majority of people in general as well as in certain industries? Are they exempt from certain regulatory burdens such as ...
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Why is the velocity of money in an economy affected by the frequency in which the worker is paid (like weekly, bi-weekly, monthly, etc.)?

I don't have any economics background, and was going though a course on Macroeconomics. I was solving the practice question here: https://mru.org/practice-questions/causes-inflation-practice-questions?...
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Taxes on Family leave pay

I don't know if this is the correct forum for this question, but do we have to pay taxes on checks from the government that were paid from taxes in the first place. For example, like Social security ...
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If the payroll tax were eliminated on incomes below $30000 what would happen?

If you canceled all payroll taxes below $30000 / $60000 single / married what would happen? I know that this could increase firm profits, or increase wages, or the number of jobs, or decrease prices ...
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1answer
23 views

Understanding distortions in investment in human capital

I am currently reading Economics of The Colour Bar by WH Hutt, and I'm having trouble understanding this bit he has written: “But when the price of any commodity is raised above the free market level, ...
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According to human capital theory, in which country will citizens be more likely to go to college?

Assume that in country A college tuition is 10,000 per year, citizens save 5% of their income for retirement, and there is a mandatory retirement age of 60 years old. In country B, the tuition for ...
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1answer
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What does Piketty mean by the C90/C10 ratio?

I am currently readings Piketty's "The Economics of Inequality", where he states in chapter 3: The P90/P10 wage ratio in the United States in the 1990s is 4.5, whereas it is “only” 3.2 in France (...
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107 views

How does capital accumulation raise the demand for labor

in "Artificial intelligence, Automation and Work" by Acemoglu and Restrepo, the authors write: Capital accumulation: As our framework in the next section clarifies, automation corresponds to an ...
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Using small area estimation to help measure wage estimates for cohorts (labor quality measure)

I am looking for research or information on uses of small area estimation for economic data. Are there any good resources that are available?
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What are the effects of abolishing the minimum wage?

There's this one guy out there, Peter Schiff, and he aired on Joe Rogan a while back. One part of the podcast really caught my attention, and it was when Schiff said that the minimum wage should be ...
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Why would overemployment mean that labor is used inefficiently?

If labor is being used efficiently, there is no excess unemployment or over employment. This phrase from Khan Academy struck me as quite strange. Why on Earth would over employment mean that labor ...
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1answer
91 views

Job search theory in discrete time

Let us assume that there is a labor who lives in discrete time universe and discounts future payoffs with the discount factor $b\in (0,1)$. And we assume that this labor is at period $t=0$ at first. ...
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Is there no equivalent exchange? [closed]

There is no equivalent exchange. I think it doesn't exist. The so-called equivalent exchange is imaginary. In exchange, one side always makes money while the other side loses money. For example, if ...
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2answers
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Can you take the moving average of quarterly data of an explanatory variable in a regression to smoothen noise and get more accurate coefficients?

I'm trying to use acceleration of quarterly data on household debt (the difference in the difference in debt) in a regression on unemployment (only concerned with correlation) but quarterly data is ...
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1answer
28 views

Breadwinners by class

I have a hypothesis that single-income families greatly increase as you get into the mid to upper middle class bracket. And that 2+ income sources are common in lower classes and also the extremely ...
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What is the economic interpretation of the solution of this optimal control problem?

I have the following optimal control problem $$\max_{c_t} \int^{\infty}_0 e^{-p_it}\ln(c_t(i))dt$$ subject to $$\dot{w_t}(i)=rw_t(i) -n_ic_t(i)$$ $$w_0(i)=w_0>0$$ I have some wealthy and ...
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1answer
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Value flow in economy - redefinition credit and money?

There are voices that there are already too much debt in the world (government, personal, government debt) and that can be the cause of the crisis. From the other hand the the only solution offered by ...
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1answer
60 views

How to test if the effect of one regressor entirely comes from other regressors?

I have a regression model that includes IQ test scores as the dependent variable; my own education, my father's education and my mother's education as independent variables. Suppose I want to know ...
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33 views

Question on Human Capital Accumulation Model by Acemoglu/Autor

I was reading the lecture notes by Acemoglu and Autor on Labour Economics. https://economics.mit.edu/files/4689 I was able to understand equations 1.1 to 1.8 of the notes; however, I am unable to ...
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21 views

Would households rather live in a world with or without the unemployment insurance?

Would households rather live in a world with or without the unemployment insurance? What is a good example of world in which unemployment insurance is seen as a benefit, and not a hindrance?
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Overlapping Generations Model Pension System Question

Part 1 Pension System OLG Model with pension system: Each individual lives up to two periods. The surviving probability at period 2 is p. At period 1, the young household consumes c1, saves s1, and ...
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income effect and substitution effect

Question:Assume no non-labor income, Alice's labor supply function is $h(w) =\frac{w}{16}$. Her preferences are given by $u(c, l) =\sqrt{c}+3l$. When the wage rate increases, Alice's labor supply ...
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Does recycling lead to fewer jobs?

Say I buy a glass bottle, I can either put it in the landfill or recycle it. My understanding is, glass will breakdown into sand. (Not sure how well though, since we sometimes find glass from Roman ...
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164 views

The relationship between profit and wages

It seems obvious that an individual company increases their profits when they reduce wages or increase automation or some such. But if wages fell universally because of this, wouldn't that decrease ...
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Okun coefficient interpretation

I'm wondering how to interpret Okun’s coefficient. Say you have $y^c = -1*u^c$. This means that a 1% increase in the cyclical unemployment gap will produce a 1% decrease in the cyclical output gap. ...
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Why are there no minimum wage entry level IT jobs

In the UK, I have not seen any graduate level IT jobs offering a starting salary below £20,000. At the same time, about 10% of computer science graduates are unemployed six months after graduation. ...

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