The Intriguing Relation Between Adult Minimum Wage and Child Labour

Because most parents send their children to work when compelled by poverty, one would expect a rise in adult wage to lower child labour. However, if the rise in wage is achieved by a minimum wage law, its impact can be intriguing. It can, for instance, cause some adults to be unemployed and send their children to work, which in turn displaces more adult labour and sends more children to work. The paper solves this process and predicts the incidence of child labour. It shows that, for appropriate parametric configurations, child labour may fall or rise as the adult minimum wage is raised.     

Employment and wage behaviour of industrial enterprises in transition economies: The cases of Poland and Czechoslovakia1

In this paper we use two very large panel datasets from Poland, 1988-90 and Czechoslovakia, 1990-1992 to explore the dynamics of employment and wage determination at the enterprise level in the early years of transition. The study is intended to assist in building a coherent picture of microeconomic adjustment in transition, a field which was not sufficiently explored in the early years of reform. We find that Polish firms were already to some extent responsive to market conditions pre-reform, notably to demand in determining employment. Czechoslovak firms, however, were largely unresponsive to such pressures in 1989-90. The elasticities rose significantly in both countries in the early years of reform, especially in Czechoslovakia which quickly attained initial Polish patterns of adjustment. Firms became much more responsive to sales and cost pressures in adjusting employment and to their own productivity in setting pay. Ownership effects in these early years were, however, much more modest, with state-owned firms adjusting employment more than their private counterparts, perhaps because over-manning was more serious in that sector.     

The Babu and the Boxwallah: Managerial Incentives and Government Intervention in a Developing Economy

In developing economies a firm's strategy is directed more often at the government than at other competing firms. As an initial step towards modeling such interactions this paper considers a situation where a government confronts a monopoly. The latter chooses price and maximizes profit and the former chooses a tax rate and maximizes tax revenue. The government and the monopoly can delegate the final decision-making to, respectively, a bureaucrat and a manager. The incentive equilibrium of the model is characterized. It is shown that this kind of industrial setting is likely to exhibit greater inefficiencies than that which arises in standard models.     

Locational choice for free trade zones: a comment

In this comment we derive conditions under which there are no equilibria for the models investigated by Miyagiwa (1993).     

Cardinal utility, utilitarianism, and a class of invariance axioms in welfare analysis

This paper examines some problems of utility measurement and interpersonal comparisons. The following theorem is first established for real-valued mappings on a set of real numbers, B: If the closure of B is an interval, then such a mapping is positive affine iff it is a first-difference preserving transformation. This theorem is used to axiomatize cardinal utility. Standard invariance axioms in social choice theory are interpreted in an alternative framework and this gives new results in axiomatizing utilitarianism. It is shown that the conflict between utilitarianism and Rawlsianism arises, in some sense, earlier than traditionally supposed.