The labor injunction and peonage—how changes in labor laws increased inequality during the Gilded Age

In this article, I seek to fill a gap in the literature by analyzing how central changes in labor laws shaped intrafirm power dynamics and thus income inequality during the Gilded Age and Progressive and New Eras. For the North, I look at the increasing activism of courts, to the detriment of many state and local legislatures, in creating and expanding the use of the labor injunction. For the South, I look at how the states, supported by the courts, created a system of peonage that directly affected large portions of southern labor and lasted well into the 20th century.     

Adam Smith’s division of labor and structural changes

This paper considers two different cases of division of labor: (i) the subdivision of different operations in order to produce a particular product in a given firm or plant; (ii) the specialization of firms in the same industry. Division of labor of the former type is limited by demand for output of a particular firm or plant, while division of labor of the latter type is limited by demand for the industry as a whole. It is argued that, in the case of an industry producing a homogenous product, an increase in the scale of production of any particular firm is likely to be associated with changes in the internal division of labor. In the case of inter-firm division of labor, decreasing unit costs may result from lateral disintegration. Finally, in the case of an industry producing a composite commodity (that is, a commodity composed of many different sub-commodities), firms’, disequilibrium behavior may lead to concentration of each firm to fewer sub-commodities, in the anticipation of the entry of new firms, or as a result of it.     

How much do immigration and trade affect labor market outcomes?

"This paper provides new estimates of the impact of immigration and trade on the U.S. labor market.... We examine the relation between economic outcomes for native workers and immigrant flows to regional labor markets.... We...use the factor proportions approach to examine the contributions of immigration and trade to recent changes in U.S. educational wage differentials and attempt to provide a broader assessment of the impact of immigration on the incomes of U.S. natives." Comments and discussion by John DiNardo, John M. Abowd, and others are included (pp. 68-85).     

The pull of inter-provincial migration of rural labor force and its influence on policy-making

As a social phenomenon closely related to development of economy, the population is always the focis of economists＇ attention. Based on the fifth census in 2001, this paper analyzes labor migration in Hubet Provtnce and establishes an econometric model to analyze the pull according to the push and pull theory,, which is the famous theory on the population flow and migration. It points out that the per capita consumption and the employment rate attract strongly the rural labors and makes a deep exploration into the ensuing problems. Such conclusion is a special reference to the decision-making of government. The government can provide some guidance to the rural labors according to the per capita consumption and the employment rate in order to avoid the futility of blind migration.     

Why is child labor illegal?

We present a theory of the emergence of laws restricting child labor or imposing mandatory education that is consistent with the fact that poor parents tend to oppose such laws. We find that if altruistic parents are unable to commit to educating their children, child-labor laws can increase the welfare of higher-income parents in an ex ante sense. On the basis of an empirical analysis of Latin-American household surveys, we demonstrate that per capita income in the country of residence has the predicted effect on child labor supply, even after controlling for other household characteristics.     

Does labor diversity promote entrepreneurship?

We find evidence that workforce educational diversity promotes entrepreneurial behavior of employees as well as the formation of new firms, whereas diversity in demographics hinders transitions to self-employment. Ethnic diversity favors entrepreneurship in financial and business services.     

Corporate pollution control strategies and labor demand: evidence from China’s manufacturing sector

The loss of employment is an essential issue that looms large in policy debates on pollution control. This paper estimates the impact of pollution reduction on labor demand in China’s manufacturing sector in the period 2001–2007. We conduct this research by using a sample with unbalanced panel data matched from two unique datasets of environmental statistics and an industrial economic database. Using the environmental performance of peer firms as the instrumental variable, our overall results show that improvements in environmental performance through reductions in \( SO _2\) emissions and COD emissions led to a statistically significant reduction in employment. On average, a 1% reduction in \( SO _2\) (COD) emissions causes a reduction in labor demand of approximately 0.018–0.019% (0.012–0.013%). We complement existing studies by carefully examining the impacts of firms’ different abatement strategies on labor demand. We find that pollution reduction through pollution prevention has substitutive effects on employment and that pollution reduction through pollution control at the end of the production process may require additional workers and thus has positive but not significant effects on labor demand. Finally, pollution control has heterogeneous effects on labor demand by different types of polluting firms (e.g., ownership, region, and industry).     

A capable wife: couple’s joint decisions on labor supply and family chores

This study investigates how spousal employment status affects personal employment decisions and the division of family chores. We apply Bresnahan and Reiss (J Econom 48(1):57–81, 1991) empirical cooperative game model to estimate household aggregate preference for a dual-earner family, extending their model to identify the individual preferences of husbands and wives by using the share of family chores as an empirical proxy for individual indirect disutilities. Using data from Taiwan, we show that an average household in the sample does not prefer a dual-earner family. The estimates of individual preferences indicate that this aversion comes mainly from the husbands. These results suggest that the gender gap in labor force participation and earnings has reduced at a faster rate than the social norm change toward the role of women in Taiwan.     

Parental education, labor market experience and earnings: New wine in an old bottle?

Evidence from US data suggests that increases in parental education significantly steepen the slope of male experience-earnings profiles during early career years, other things equal.     

No education,no good jobs? Evidence on the relationship between education and labor market segmentation

This paper assesses labor market segmentation across formal and informal salaried jobs and self-employment in three Latin American and three transition countries. It looks separately at the markets for skilled and unskilled labor, inquiring if segmentation is an exclusive feature of the latter. Longitudinal data are used to assess wage differentials and mobility patterns across jobs. To study mobility, the paper compares observed transitions with a new benchmark measure of mobility under no segmentation. It finds evidence of a formal wage premium relative to informal salaried jobs in the three Latin American countries, but not in transition economies. It also finds evidence of extensive mobility across these two types of jobs in all countries, particularly from informal salaried to formal jobs. These patterns are suggestive of a preference for formal over informal salaried jobs in all countries. In contrast, there is little mobility between self-employment and formal salaried jobs, suggesting the existence of barriers to this type of mobility or a strong assortative matching according to workers’ individual preferences. Lastly, for both wage differentials and mobility, there is no statistical difference across skill levels, indicating that the markets for skilled and unskilled labor are similarly affected by segmentation.     

The impact of targeting policy on spouses’ demand for public goods,labor supplies and sharing rule

This paper studies the impact of targeted unconditional cash transfers on the spouses’ demand for public goods, labor supplies and sharing of resources. We estimate a collective labor supply model with distributional factors which is extended to include preferences over marketable public goods (including child goods). In this way, unlike previous research, we consider the impact of such transfers on the intrahousehold allocation of resources and distinguish between the labeling and recipient effects. We exploit the UK experience and find evidence in favor of the collective model with separable preferences over labor supplies and public goods. This finding implies a recipient effect and not a labeling effect of child benefits. Given the household’s unearned income, the bigger the wife’s bargaining power, the more the resources allocated to public goods (including child goods) and the wife’s private consumption. The results can be useful in the design of family policy which aims to improve the relative welfare of children within the family and alleviate any intrahousehold consumption inequalities.     

Self-managed market socialism with “free mobility of labor”

In 1934 Breit and Lange presented a model of a socialist market economy in which workers had a right to be employed by self-managed firms. The interest of this model lies in particular in the fact that it eliminates two possible flaws of Myrian-type socialism: differentiation in per capita earnings across self-managed firms and involuntary unemployment. Analogous features can be found in Herztka's 19th-century model of market socialism. The purpose of the paper is to analyze an economy with free mobility of labor (Herztka's expression for the right of workers to employment) both from the point of view of X- as well as of allocative efficiency. Finally the possibility of a partial application of the right to employment principle in a capitalist economy is considered.     

Brain waste? Educated immigrants in the US labor market

This paper investigates the occupational placement of immigrants in the US labor market using census data. We find striking differences among highly educated immigrants from different countries, even after we control for individuals' age, experience and level of education. With some exceptions, educated immigrants from Latin American and Eastern European countries are more likely to end up in unskilled jobs than immigrants from Asia and industrial countries. A large part of the variation can be explained by attributes of the country of origin that influence the quality of human capital, such as expenditure on tertiary education and the use of English as a medium of instruction. These findings suggest that “underplaced” migrants suffer primarily from low (or poorly transferable) skills rather than skill underutilization. The selection effects of US immigration policy also play an important role in explaining cross-country variation. The observed under-placement of educated migrants might be alleviated if home and host countries cooperate by sharing information on labor market conditions and work toward the recognition of qualifications.     

How does female labor force participation impact on housing values?

Female labor force participation (FLFP) and household wealth are two main topics of interests to economists for long time. The objective of this study is to investigate the response of housing values, household wealth, to female labor force participation using panel level data in the U.S. states. We develop static and dynamic estimation models using state-level data in the U.S. from 2005 to 2013. The results show the FLFP rate and per capita income have a strong positive effect on housing values, while the number of units per capita has a negative effect on housing values in the state. We find that a 10% increase in FLFP will result in an increase of about 12.5% on housing values. Additionally, increasing per capita income by 10% on average will cause housing values to rise by 9%, however, a 10% rise in the number of units per capita will decrease housing values by 30%. The results assist economists and policy makers in assessing policies to optimize decisions in labor market and housing market.     

Who is afraid of capital mobility? on taxation of labor income and the level of public services in an open economy

This paper deals with the effects of international capital mobility on the taxation of labor income and on the size of the public sector. It employs a model of the labor market where national trade unions set the wage level in their country and national governments set the tax rate of a proportional labor-income tax. The tax revenues are used to finance a public good and unemployment benefits. In this model, competition between the national trade unions caused by international capital mobility leads to full employment, and the governments supply the public good on the first best level. As no unemployment benefits have to be financed, the tax on labor income may decline with the introduction of capital mobility. These tax cuts may even overcompensate the unions for the wage decline.     

Will knowing diabetes affect labor income? Evidence from a natural experiment

This paper analyzes the impact of diabetes awareness on labor income using data from a natural experiment in China. We find that diabetes in general leads to a 16.3% decrease in annual income after people being diagnosed, and the adverse impact is heterogeneous across different populations.     

Do international labor standards contribute to the persistence of the child-labor problem?

In recent years, a number of governments and consumer groups in rich countries have tried to discourage the use of child-labor in poor countries through measures such as product boycotts and the imposition of international labor standards. The purported objective of such measures is to reduce the incidence of child-labor in developing countries and thereby improve children’s welfare. In this paper, we examine the effects of such policies from a political-economy perspective. We show that these types of international action on child-labor tend to lower domestic political support within developing countries for banning child-labor. Hence, international labor standards and product boycotts may delay the ultimate eradication of child-labor.     

Are long-term wage elasticities of labor supply more negative than short-term ones?

Standard models imply that the wage-elasticity of labor supply is more negative the longer a wage change lasts. I observe decreasing daily hours during short-term wage increases, but not during a long-term one: daily income goals adjusted in the long-term.     

Is product boycott a good idea for controlling child labor? A theoretical investigation

A popular form of action to curb child labor and uphold international labor standards in general is a ‘product boycott’ by consumers. There are labeling agencies that inform us if, for instance, a carpet or a hand-stitched soccer ball is free of child labor. The presence of a consumer boycott will typically mean that products tainted by child labor will command a lower price on the market than ones certified to be untainted. It is popularly presumed that such consumer activism is desirable. The paper formally investigates this presumption and shows that consumer product boycotts can, in a wide class of situations, have an adverse reaction that causes child labor to rise rather than fall. This happens under weak and plausible assumptions. Hence, there has to be much greater caution in the use of consumer activism, and one has to have much more detailed information about the context where child labor occurs, before using a boycott.