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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Measures on the composition of the unemployed by educational attainment in the US
I am trying to find statistics on the profile of unemployed individuals in the U.S. categorized by educational attainment. I have found statistics on the unemployment rate for each education group (e....
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Did online learning affect the returns to education?
I am interested to know if online learning during the pandemic affected the returns to university education. Anecdotally, education quality suffered from online learning, I wonder if this harmed ...
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Competitive equilibrium for an economy with a consumer and a producer
A representative agent’s preference over consumption $(c)$ and labour supply $(l)$ is given by the utility function $$ u(c_D, l_S)= c_D^a .(24-l_S)^{1-a}$$
Production of the consumption good $c$ is ...
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labor supply model
Consider a concave utility function $u(c, l)$ where $c$ represents consumption good and $l$
represents labour supply (working hours, to be precise). While utility increases as level of consumption ...
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Why did Heckman sample selection models fall out of fashion?
Nowadays most people run wage regressions conditional on being employed rather than using Heckman selection models. So what are its drawbacks and why did this approach fall out of fashion?
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Is there a long-run tradeoff between inflation and unemployment?
In most first-year undergrad macroeconomics courses, students are taught about the Phillips curve and how whilst there may exist a tradeoff between inflation and unemployment in the short-run, there ...
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Changes in TFP and wage rates across firms
Assume that you have two firms, firm A and firm B. Firm A faces the
production function:
$$
Y_{A}=A_{A}F\left(K_{A},L_{A}\right)
$$
and firm B faces:
$$
Y_{B}=A_{B}F\left(K_{B},L_{B}\right)
$$
Factors ...
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Combining 990 and 990-EZ Data
I've collected 990 and 990-EZ data from the IRS's Annual Extract of Tax-Exempt Organization Financial Data on American Federation of Musicians locals. The data are split about half and half between ...
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Derive Value Functions in Job Search Model
I am reading a paper using the common job search framework, which has functions $\begin{aligned}
&V_{r}\left(e_{r}\right)=w_{r}-e_{r}+\beta\left(q V_{u}+(1-q) V_{r}\left(e_{r}\right)\right) \\
&...
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What value does a worker whose job could be automated provide to society?
Has anyone calculated the global benefit of non-workers on government assistance and found their contribution to be less than the assistance they were provided? I'm looking for scientific studies ...
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Job Market Signaling w/Continuous Ability
I am currently trying to brush up on job signaling models for the upcoming semester, and came across this old exam question. There are no solutions to the question (that I am aware of), and I'm having ...
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Insights from Labor Demand Research
A few years ago during my PhD, I remember listening to a provocative keynote talk at a conference by Francis Kramarz who criticized the progress in labor demand research. He summarizes his opinion in ...
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Comparative statics when price of an input increases
Let us assume a very basic model of profit maximization of firms,
wherein their output depends on labour and capital:
$$
Y=f\left(K,L\right)=K^{\alpha}L^{1-\alpha}
$$
Their aim is to maximize profits,
...
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Salop (1979) model for labor markets
Can the Salop (1979) model also be applied to labor markets or is there any reason why it should not be?
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Is there sound economic reasoning behind the assertion that automation will not lead to mass unemployment?
Many people are optimistic that for every job eliminated by automation, new jobs will be created so that people will always find work that pays them a reasonable wage. Is there sound economic ...
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Examples efficiency wage papers using observational data
In one answer in this great discussion on efficiency wages it is claimed the reason that efficiency wages fell out of fashion is that we can't measure it in normal data. I agree that it is difficult ...
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Are there any general rules that can be used to assess the consequences of a significant minimum wage increase in a country's economy?
Quite recently the EU Parliament discussed upon a new draft EU law that will ensure a minimum level of wage protection in all member states.
The minimum relative to average wages of full-time workers ...
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Why do oil-rich countries need expats?
In particular, why did/do the smaller states in the GCC need expats in their country? Ignoring the history of the country prior to oil discovery (which can be approximated for many of the smaller GCC ...
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Cobb-Douglas Production Function - Finding units of labour to maximise production
Given production function $f(L,K)=16L^\frac{1}{4}K^\frac{3}{4}$, where each unit of labour costs £50 and each unit of capital costs £100 and you have a budget of £500,000. Find the number of units of ...
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Consistent estimation of fixed effects
Estimating firm fixed effects is very popular in labor economics.
I wonder why this is legit? The estimates shouldn't be consistent, the more firms we have the more parameters we have to estimate.
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Wages are lower than 30 years ago in Italy, why?
Recently I've seen some statistics about wage growth in the European Union in the last 30 years and surprisingly, Italy is the only country with a negative value.
So, what is the root of this problem? ...
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What is the author trying to imply in this sentence? what is employment per unit of capital?
"The usage of extra machinery does not cause unemployment since, employment per unit of capital is large in labor-intensive products that the country exports and the vast world market allows ...
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A Simple Question about Labor Capital Ratios
I do not have much training in macroeconomics, so I want to know if this statement is accurate:
"A \$30M dollar decrease in lending to businesses leads to a $45M decrease in aggregate labor ...
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Does only search-and-matching predict bunching around minimum wage?
I heard a comment that search and matching models are empirically more valid than job-posting (even though the predictions are very similar) because with posting it is not possible to rationalize the ...
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US minimum wage beyond $15 per hour
Current policy debate among US lawmakers includes proposals for raising the minimum wage nationwide to \$15.
It is currently \$7.25 by federal statute, which is the amount in effect except in states ...
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How to combine two different populations from two different surveys?
I have 2 surveys, each is representative of different populations living in the same country:
Survey 1 – Survey of Peruvians living in Peru
Survey 2- Survey of Venezuelans living in Peru.
Each survey ...
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Labor market discrimination - help me understand this passage in call-back study
I'm reading up on discrimination in the labor market. In this study by Bertrand & Mullainathan (2004) they note the following:
Perhaps the skills of African-Americans are discounted because ...
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Variance Decomposition of Wage Equation
I am reading two recent papers studying between-firm and within-firm wage inequality, Barth et al 2016 (hereafter BBDF) and Song et al 2019 (hereafter SPGBV). I am confused by the different variance ...
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What is being meant by "cohort-specific fixed effect for each state of birth" in Card&Krueger(1992)? What does the following equation mean?
I am referring to this paper on school quality and returns to schooling. The econometric specification has been described by eqn (1) on page 4.
The authors have taken "cohort specific fixed ...
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Nonlinear Least-Squares Estimation in Practice
I am reading Jeong, Kim, Manovskii 2015 and in the paper they apply "a nonlinear least-squares method" to estimate a log-wage equation, , where $D, \Pi$, all $\lambda$s $\theta$s, and $\...
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Doraszelski and Jaumandreu (2018) Intuition
Doraszelski and Jaumandreu (2018) estimate a CES production function with two forms of productivity shocks (1) labor augmenting and (2) Hicks neutral. They claim that the increase in labor augmenting ...
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Nash Bargain VS. Rubinstein Game with Outside Option
I am reading a paper, Kessier & Lulfesmann 2006, and find that its main result totally depends on that the model setting is based on a Rubinstein game with outside option rather than a Nash ...
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Literature recommendation
Classic economic theory suggests people earn wages according to their productivity. Over time CEO's, directors, managers and the like seem to earn more relative to the 'normal worker'. Lets call this ...
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Event study by Kleven
I was reading the following paper by Henrik Kleven et al.
https://www.henrikkleven.com/uploads/3/7/3/1/37310663/kleven-landais-sogaard_nber-w24219_jan2018.pdf
The estimate the child penalty on wage ...
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Is the pooling equilibrium profit maximising for the firm?
Is the pooling equilibrium profit maximising for the firm?
I understand that when there are no ways for the firm to distinguish among highly productive and low productive worker the best the firm can ...
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What does it mean "non-Walrasian" or "quasi-Walrasian"?
In a recent NBER workshop, Robert Hall started a discussion with his first slide summarizing the macro literature.
I am not very familiar with either DMP model or New Keynesian model and have no idea ...
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What impact does the paid vacation leave have on labor productivity?
I'm asking just one question (it's in bold). If you treat any sentence with a question mark as another question and thus violating the policy on "focusedness", please steer clear of the text ...
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Solve the Ben-Porath Model (Optimal Control Problem)
Suppose we have a Ben-Porath style human capital investment model, in which the representative agent maximize her lifetime earnings: $$V(h, a)=\max \int_{a}^{R} e^{-r(t-a)}\left[ w h(t)(1-n(t))-px(t)\...
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Basic question i guess
I'm not in economics, I'm actually studying sociology and I'm doing a subject about labor economics. I'm reading an article that talks about automation and says "The employment impact of ...
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Lab experiments of labour markets
I have been searching for papers that conduct lab experiments simulating a labour market, that means for a minimum there are both participants taking the role of firms, and participants taking the ...
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Can the theory of the second best mathematically justify labor unions in some scenarios?
An EPI page says:
Some economists and policymakers might express unease at the view that the downsides of one deviation from “competitive” markets (either labor market frictions or market ...
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Is egyptology a pyramid scheme: Self-perpetuating university programs
My friend got a degree in egyptology, but can’t get a job, So he’s paying more money to get a Phd, so he can work teaching other people egyptology. In his case college is literally a pyramid scheme.
...
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Do Human Resources use information on applicants' child rearing effort as a signal
In Spence's Job Market Signaling paper (a non-paywalled version is available here) firms observe applicants' educational investment. From these signals the firms glean information on the "type&...
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Lecture notes competitive labor market with minimum wage
Can somebody recommend lecture notes that derive competitive labour market model equilibrium with minimum wages? This has been surprisingly hard to find, because most lecture notes use minimum wages ...
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CES First order Condition with two labour types
I am struggling to derive a first order in this model with Cobb-Douglas production function and CES labour aggregator with two types labour (here male and female, but could be equally low and high ...
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When can one drop time subscripts? Example from Angrist and Kugler (2003)
Not the first time I am asking myself, but in this paper they actually start with a time dependent maximisation problem and then drop all time subscripts.
Background: They have profit maximisation ...
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Denominator for the Labor Force Participation By group
I want to check that I am using the correct definition for labor force participation rates by gender or income group. For instance, if we have the following:
1- Working age population of 800 people, ...
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Deriving aggregate output from labor demand and supply
I was reading the following paper:
http://eml.berkeley.edu//~moretti/growth.pdf
I got stuck at equation (7)
The firm's production function is $Y_{i}=A_{i}L_{i}^{\alpha}K_{i}^{\eta}T_{i}^{1-\alpha-\eta}...
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How to compute elasticity of substitution in labor market of blacks and whites using experience-education groups?
I'm reading "Competition in the Promised Land – Black Migrants in Northern Cities and Labor Markets", by Leah Boustan, and I'm trying to understand her computation of black and white ...
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Sunk costs - Book value and Market value
i try to understand the concept of sunk cost and how we compute sunk costs when there is a difference between book and market value.
For example, if the book value of assets is ...
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