Effects of Occupational Licensing and Unions on Labour Market Earnings in Canada

Using longitudinal data from the Canadian Survey of Labour and Income Dynamics from 1999 to 2011, the article compares the pay and benefits of licensed and unionized workers. In a cross section of respondents and using ordinary least squares estimates, it finds a pay premium of 0.155 log points for those with an occupational licence compared to those without one; the comparable union wage premium is slightly more than half, that is 0.085 log points. Fixed‐effects estimates go in the opposite direction (0.028 and 0.046 log points for licensing and unionization, respectively), suggesting the existence of unobservable factors correlated with licensing and union status. Unionized workers are more likely to access standard benefits, such as medical insurance and pension plans, but licensed workers benefit little from their licensing status in access to benefits. Finally, union workers are significantly less likely to receive incentive pay, such as profit sharing, while the association between occupational licensing and incentive pay is close to zero and statistically insignificant.     

The Labor‐Market Effects of Occupational Licensing Laws in Nursing

We study the labor‐market impacts of occupational licensing laws on nursing, an economically important occupation. States adopted licensing of registered and practical nurses at different times, which allows us to estimate the effects of licensing on wages and participation for each nursing profession. We find that licensure raised wages by 5 to 10 percent but there is no evidence that it reduced overall participation. Additionally, we show that licensure equalizes wages within the occupation with minority wages rising faster than nonminority wages; however, licensing had a negative but not statistically significant impact on the participation of minorities in nursing.     

Labor Market Outcomes of Persons with Mental Disorders

We present nationally representative estimates of unexplained employment and wage differentials between nondisabled persons and persons with mental disorders, a disabled group subject to exceptionally strong stigma. Estimates are provided for persons with mental disorders overall, and for subgroups of mood, anxiety, adjustment, and psychotic disorders. The results reveal distinctly different patterns of outcomes across subgroups, consistent with a severity gradient such that persons with adjustment disorders experience the most favorable outcomes, while persons with psychotic disorders experience the least favorable.     

The Prevalence and Effects of Occupational Licensing

Our study provides the first national analysis of the labour market implications of workers who are licensed by any agency of the government in the USA. Using a specially designed Gallup survey of a nationally representative sample of Americans, we provide an analysis of the influence of this form of occupational regulation. We find that 29 per cent of the workforce is required to hold a licence, which is a higher percentage than that found in other studies that rely on state‐level occupational licensing data or single states. Workers who have higher levels of education are more likely to work in jobs that require a licence. Union workers and government employees are more likely to have a licence requirement than are non‐union or private sector employees. Our multivariate estimates suggest that licensing has about the same quantitative impact on wages as do unions — that is about 15 per cent — and that being both licensed and in a union can increase wages by more than 24 per cent. However, unlike unions which reduce variance in wages, licensing does not significantly reduce wage dispersion for individuals in licensed jobs.     

Analyzing the Effects of Market and Resource Orientations on Innovative Outcomes in Times of Turbulence*

Innovation and new product success are often a core precursor to superior performance. Although research has examined the resource‐based view (RBV) and market orientation (MO) individually, limited research has evaluated and compared their effect on innovation and new product success in one study. Furthermore, relative to MO, comparatively less research has been conducted to evaluate the relationship between organizational learning (OL) and the RBV to examine their effects on a firm's ability to innovate and succeed. The purpose of this paper is to investigate the role of environmental variables (i.e., market turbulence and technological turbulence) on the relationship between two strategic orientations and performance and to extend a previous study. Specifically, it aims to evaluate whether a focus on the customer or the firm will impact innovation, product quality, new product success, financial performance, and customer value in settings of varying environmental turbulence. Data were collected from more than 200 senior executives. LISREL was applied to evaluate the relationships under examination. Interaction effects were assessed using a nested goodness‐of‐fit strategy using a multiple‐group solution. Results depicted significant relationships between organizational learning and both resource and market orientations. Significant relationships also emerged between each strategic orientation and various performance indicators. Interaction effects were observed for market turbulence on customer value and market orientation as well as for resource orientation (RO) on innovation in times of high technological turbulence. The paper concludes with a review of theoretical and managerial implications to stimulate further debate. These results suggest that managers seeking innovation and new product success cannot afford to ignore the environment and do so at their peril. The provision of customer value is essential for positive financial performance. Thus, management needs to monitor environmental contexts so that they are able to adjust their investment in market orientation and the requisite processes that enable its implementation. Conversely, the effects of RO on performance are more robust across industry conditions, presenting an alternative avenue for management to achieve market superiority. The paper concludes with a review of theoretical and managerial implications to stimulate further debate.     

The Impact of Amnesty on Labor Market Outcomes: A Panel Study Using the Legalized Population Survey

This article tests whether amnesty, a provision of the 1986 Immigration Reform and Control Act, affected the labor market outcomes of the legalized population. Using a quasi‐experimental framework, we find that employment fell, unemployment rose, and wage growth rates were higher for newly legalized men after the implementation of the amnesty program. For women, employment fell, transitions out of the workforce increased, and wages grew at a faster rate among the newly legalized population.     

Ranking the Factors that Affect Occupational Outcomes

By using Theil's entropy measure, which is an additively decomposable measure of inequality, one may rank the various factors that affect occupational outcomes. Using the 5 percent sample of the 1990 U.S. Census, I find that sex and education have the greatest impact on occupational outcomes, followed by full-time work status. Age, race, and ever-married status have little impact on occupational outcomes.     

Spectrum Licensing,Policy Instruments and Market Entry

Competition policy attempts to address the potential for market failure by encouraging competition in service markets. Often, in wireless communication service markets, national regulatory authorities seek to encourage entry via the spectrum assignment process. Instruments used include the assignment mode (auction or beauty contest), setting aside licenses and providing bidding (price and quantity) credits for potential entrants, and making more licenses (spectrum blocks) available than there are incumbent firms (excess licenses). The empirical analysis assesses the effectiveness of these policy instruments on encouraging entry. The econometric results show that the probability of entry is enhanced by using auction assignments and excess licenses. Furthermore, quantity, but not price, concessions encourage entry.     

Postgraduate Education and Labor Market Outcomes: An Empirical Analysis Using Micro Data from Japan

Using a large micro dataset from Japan, this paper provides evidence on the relationship between postgraduate education and labor‐market outcomes. According to the analysis, the key findings include: (1) The employment‐to‐population rates of females and elderly people with postgraduate educations are higher than those with undergraduate educations. (2) The postgraduate wage premium relative to undergraduates is approximately 30–40 percent, which is similar in magnitude for male and female workers. (3) The wage reduction after age 60 is less for workers with a postgraduate education. (4) The private rate of return to postgraduate education exceeds 10 percent.     

Occupational and Internal Labor Markets in Japan

The distinction between internal and occupational labor markets requires the development of informative indicators that go beyond standard measures such as firm size, which are too vague. This article develops an alternative measure, based on the comparison between firm-specific and occupation-specific tenure, and applies it to Japanese occupational data. We believe that the proposed measure is useful not only in classifying different occupations according to the degree of labor market internalization but also in documenting changes over time in job definition, "reengineering" of the corporation, and the like.     

LDC Labor Markets: Applications of Internal Labor Market Theory

This article does not attempt, nor has it delivered, a complete theory for the labor market in Egypt, let alone for LDC labor markets in general. The macro-model developed here serves mainly to demonstrate the diaculties involved in formulating macro-theories for LDC labor markets that, while necessarily simple, can still claim realism when confronted with certain fundamental “stylized h t s. Our considerations have, moreover, been limited to LDCs with mixed economies, using Egypt as the example. Hence, large-scale modern industry was assumed to belong to the public sector which then emerges as the country dominant, nonagricultural employer. Agriculture is the second large and relatively homogeneous sector, in Egypt dominated by small holdings. In-between we find the private, nonagricultural sector, overwhelmingly dominated by small-scale enterprises with large numbers of the self-employed, and with trade as the most important single activity. Labor is (in Egypt) generally unorganized or enrolled in government-controlled unions, active mainly in the public sector and without much real say in matters of wages and salaries. It is in this specific institutional setting that I have tried to discuss the application of internal labor market theory. This theory has, to the best of my understanding, nothing to offer by way of explaining public sector behavior (which is of crucial importance for wage and employment formation in a mixed economy). However, adapted to the circumstances, internal labor market theory goes a long way toward explaining wages and employment in agriculture and the “informal” small-scale sector. Our considerations, tentative though they are, do not point to any single, dominant labor market mechanism that could form the basis for a simple macro-theory. Wage flexibility differs greatly between sectors, overstaEng may be a more important phenomenon than unemployment in some activities, and unemployment may be of both the voluntary and involuntary variety, with withdrawals from the labor market related to well-defined reserve wages, and open unemployment related to internal labor market behavior. These considerations are based more on loose impressions than on solid facts. Further theorizing may be needed, but the development of labor market theory for LDCs has undoubtedly reached a point where progress depends critically upon painstaking empirical studies of basic labor market institutions such as employment and wage forms and responses, bargaining procedures, and conditions of both labor and output markets for small private enterprises in particular countries. Considerable work has been done in India but even here much remains for investigation. Studies of specific countries may, even for LDCs in rapid, turbulent transformation, disclose ongoing changes in institutions that for a full understanding of the labor market may be more important than the institutions themselves. Existing wage theory has little to offer for the analysis of such institutional change, but something may be learned from the American institutional school in labor economics whose leading exponent we are paying homage to with these papers.     

Licensing Exam Difficulty and Entry Salaries in the US Market for Lawyers

This article provides evidence of a correlation between licensing exam difficulty and salaries in a regulated profession. Exam difficulty is positively correlated with salaries across states and over time, both at the aggregate and individual state levels. The magnitude of this correlation is substantial: a 1 per cent increase in exam difficulty implies a 1.7 per cent increase in median entry‐level salaries. Exam difficulty does not significantly affect the inter‐quartile difference in salaries.     

The Effects of Occupational Licensing: Evidence from Business‐Level Data

Occupational licensing currently affects more than 1,000 occupations in the United States. I use confidential US Census Bureau business micro‐data to shed light on the effect of occupational licensing in cosmetology on key market outcomes and study its effect on the providers of occupational training. Occupational licensing regulation does not seem to affect the equilibrium number of practitioners or prices of services to consumers, but is associated with significantly lower practitioner entry and exit rates. I further find states with more stringent licensing requirements to have more instructors and a larger median size of training facilities, suggesting possible barriers to entry for the training schools. Instructors, however, do not earn more in such states.