Unemployment and Labor–market Reform: A Contract Theoretic Approach

Why do many democracies fail to reform their labor–market institutions? To answer this question we study the feasibility of reforms that include compensation to insiders for the removal of labor–market regulations. Under asymmetric information, a reformer who wants to buy the approval of voters has to pay them an informational rent in addition to the pure costs of compensation that would arise under symmetric information. In this setting, unemployment may be constrained Pareto–efficient. Labor–market reforms may fail politically because none of the reform packages proposed wins the approval of a majority of voters. We also discuss the role of capital taxation in a reform program. JEL classification: D70; E61; J68     

不同所有制企业的工资决定机制考察

本文通过1989—1997年教育回报率在不同所有制间的差异及其变化来考察中国的劳动力市场。利用CHNS数据分别估计国有企业、大型集体企业、小型集体企业以及私营企业的工资方程,结果表明教育回报率在民营部门增加得较为明显,在其他部门则没有增加的迹象。1997年,民营部门教育回报率明显高于其他部门,样本选择只能解释其中一部分差异,这表明民营经济工资决定机制与其他部门不同。     

Long-run costs of piecemeal reform: Wage inequality and returns to education in Vietnam

In this paper, we examine changes in wage structure and wage premia during Vietnam’s transition from command to market economy. Relative to other work in this literature, our paper is unique in that we identify the policies that lead to such changes. By examining skill premium trends along the two dimensions of particular importance to the transition—state or non-state firms, and traded or non-traded industries—we are able to separate the contribution of external liberalization to wage growth and rising skill premia from that of domestic labor market reforms, and to examine potential interactions between the two types of reform. The results point to the high cost of incomplete reform in Vietnam. Capital market segmentation creates a two-track market for skills, in which state sector workers earn high salaries while non-state workers face lower demand and lower compensation. Growth is reduced directly by diminished allocative efficiency and reduced incentives to acquire education, and indirectly by higher wage inequality and rents for workers with access to state jobs.     

A Cross-Country Comparison of Okun's Coefficient

In this paper Okun's law is tested for the G7 countries in order to compare the responsiveness of unemployment to economic growth. Cyclical unemployment and output are extracted using Harvey's structural time series model. Okun's coefficient is estimated by OLS, rolling OLS, and SUR. The coefficient seems to be highest for North America and lowest for Japan, a result that can be explained in terms of differences in labor market rigidities. The rising absolute value of the coefficients over time indicated by the results of rolling OLS is explained in terms of labor market reform.J. Comp. Econom.,June 1997,24(3), pp. 335–356. La Trobe University, Bundoora, Victoria 3083, Australia.     

Fertility Decisions and Gender Differences in Labor Turnover, Employment, and Wages

A striking observation of the U.S. and other labor markets is the weak position of women in terms of job attachment, employment, and earnings relative to men. We develop a model of fertility and labor market decisions to study the impact of fertility on gender differences in labor turnover, employment, and wages. In our framework, individuals search for jobs and accumulate general (experience) and specific (tenure) human capital when they work. They can also increase their wage by moving to a job of higher quality. Labor market decisions (e.g., job acceptance and job mobility) may differ across genders: females that give birth may decide to interrupt their labor market attachment in order to enjoy the value of staying at home with their children. The model economy is successfully calibrated to match aggregate statistics in terms of fertility, employment, and wages. We find that fertility decisions generate important gender differences in turnover rates, with long lasting effects in employment and wages. These differences in labor turnover account for almost all the U.S. gender wage gap that is attributed to labor market experience by Blau and Kahn (2000, Journal of Labor Economics15(1), 1–42). The model also implies a very small role of tenure capital in accounting for wage differences between males and females (gender gap), and between females with and without children (family gap). Journal of Economic Literature Classification Numbers: E24, J13, J21, J31.     

Understanding Changes in the Distribution and Redistribution of Income: A Unifying Decomposition Framework

In recent decades income inequality has increased in many developed countries but the role of tax and transfer reforms is often poorly understood. We propose a new method allowing for the decomposition of historical changes in income distribution and redistribution measures into: (i) the immediate effect of tax‐transfer policy reforms in the absence of behavioral responses; (ii) the effect of labor supply responses induced by these reforms; and (iii) a third component allowing us to explore the effect of changes in the distribution of a wide range of determinants, including the effect of employment changes not induced by policy reforms. The application of the decomposition to Australia reveals that the direct effect of tax‐transfer policy reforms accounts for half of the observed increase in income inequality between 1999 and 2008, while the increased dispersion of wages and capital incomes also played an important role.     

Wage Determination and Occupational Attainment in the Rural Industrial Sector of China

The development of China's rural township, village, and private enterprises (TVP), in which real wages have grown at around 11% per annum over the past decade, is one of the most remarkable achievements of China's economic reform. This achievement has taken place despite relatively rigid control of labor mobility and job assignment by local authorities. Individual firms, however, have considerable influence over wage determination. This study applies human capital theory to explore the wage setting process in this sector. It is found that the impact of both labor market experience and education reflect labor productivity rather than sociopolitical rules of wage setting. The paper employs a logit model to investigate the links between education and occupational attainment. The relationship between wages, education, and occupational attainment, for those who find jobs through their own efforts, is similar to that of western market economies. Although education does not affect wages of those assigned jobs it affects their occupational attainment.     

中国行业收入不平等问题的解析

进入新世纪以来,中国行业收入不平等有持续扩大的趋势。基于回归方程的Shap-ley分解结果表明,人力资本、所有制、资本投资、技术等因素对行业收入差距有显著影响,其中人力资本对行业收入差距的贡献约为45%,所有制的贡献在20%以上。因此在治理措施上,实施教育均等化,提高教育回报率,开放垄断行业的劳动力市场,推行劳资谈判制度可以有效缓解行业收入差距持续扩大的问题。     

西方劳资关系理论、实践及借鉴意义

劳资关系是建立在雇佣关系之上的代表雇主利益的经营者与员工之间复杂的互动关系。随着国有企业的改制,我国不同所有制企业的劳动关系或劳资关系正在朝着市场化的劳资关系发展。文章回顾和评述西方劳资关系的理论和实践,并从中得出对我国劳资关系管理的借鉴意义。     

中国地区工资水平差异的影响因素分析

本文运用模块数据和空间计量学的方法考察了中国改革开放以来影响地区工资水平及地区工资非均衡的各种政策体制因素和经济因素。实证结果表明,中国的地区工资水平及其差异既受制度变迁的影响又受市场机制的作用,具有典型的转型特征。具体而言,工资体制、对外开放、所有制改革、地方保护、教育水平和资本投入等因素对地区工资水平及其差异都有不同程度的影响作用。     

Economic development, growth of human capital, and the dynamics of the wage structure

In this paper I elucidate the sources of growth of human capital in the course of economic development. On the supply side (Section 1) I include the growth of family income, urbanization, the demographic transition, and the rising cost of time.The supply side alone cannot explain the continuous growth of human capital as it implies a self limiting decline in rates of return below those in alternative investments. Such declines are offset by growing demands for human capital in the labor market. Growth of demand for labor skills is a function of capital accumulation and of technological changes. Evidence on this hypothesis is summarized in Section 2 and on supply responses to growing demand for human capital in Section 3. Changes in the skill and wage structures in the labor market are an important part of the evidence.The reciprocal relation between economic growth and the growth of human capital is likely to be an important key to sustained economic growth. A caveat applies to indirect effects of economic growth on family instability, which may lead to a deterioration of childhood human capital in some sectors of society.     

Wages and Employment in China''s SOEs, 1980–1994: Corporatization, Market Development, and Insider Forces

Using firm-level panel data, we evaluate the importance of reform measures, market development, and insider forces in wage and employment determination in China's state sector. Initial output per worker is positively correlated with change in employment, and market wages are significantly associated with firm employment and wages in the later period. Both indicate development of the labor markets. Corporatization lowered wages by 11 to 15% and improved productivity by 6%. Finally, we find evidence that labor markets for managers and engineers have been developed more than those for production workers and that wage premiums for college graduates have increased dramatically since the late 1980's. J. Comp. Econom., December 1999, 27(4), pp. 702–729. IRIS, University of Maryland, College Park, Maryland 20742.     

Labor supply in urban China

Using labor supply responses from 10,560 urban Chinese workers, two-stage least squares estimations identify positive compensated wage effects and negative income effects that are, for the most part, statistically significant. The gross wage effects are mostly positive but they indicate relatively low uncompensated labor supply elasticities. The compensated wage effects are much larger; these may be important in assessing the labor market consequences of reform policies that monetize non-pecuniary benefits. The significance of labor supply responses depends on individual responsibilities within the family; the effects are largest for women and non-household heads. Journal of Comparative Economics 31 (4) (2003) 795–817.     

Real Minimum Wage and Growth Theory: Simulations and Some Policy Results

Abstract

A Solow type two‐sector growth model is used to examine several issues related to growth and unemployment in a minimum wage economy. By simulating the model, we demonstrate that given the same percentage increase in wage rate, an economy with a higher capital–labor ratio is more likely to decay. More importantly, a tariff policy reduces the unemployment periods by 92% provided that the current capital–labor ratio is one‐sixth of that of the steady state capital–labor ratio. We assume that the first best policy of uniform wage subsidy is not politically feasible.     

影响非正规就业安全性的因素分析

非正规就业作为多种就业形式之一在促进中国经济增长、缓解日益严重的就业压力方面起着越来越重要的作用。但同时在当下劳动力市场中非正规就业的安全性却受到了严峻的挑战。影响非正规就业安全性的主要因素表现为非正规就业者贫乏的社会资本以及本身偏低的人力资本存量、强资本弱劳工的社会格局;歧视性的政策惯性;不完善的劳动力市场以及缺位的社会服务体系。     

Labor Market Segmentation and the Implications for Public Sector Retrenchment Programs

Despite the importance placed on reducing public sector employment in sub-Saharan Africa, remarkably little is known about the labor market transition paths of departing public sector workers. This paper uses household survey data from Conakry, Guinea to establish evidence of labor market segmentation between the wage and nonwage sectors. An empirical model of the unemployment durations experienced by departing public sector workers finds that transition paths vary significantly according to personal characteristics that also affect the resulting earnings opportunities in segmented labor markets. Particularly, there is a marked tendency of females to enter quickly the nonwage sector, relative to males, and a negative influence of severance payments on wage sector employment acceptance.J. Comp. Econom.,December 1997,25(3), pp. 385–402. Department of Agricultural and Applied Economics, Virginia Tech University, 208 Hutcheson Hall, Blacksburg, Virginia 24060-0401 and Cornell University, 3M28 Martha Van Rensselaer Hall, Ithaca, New York 14853.     

Economic Growth and Wage Stagnation in Peru: 1998–2012

From 1998 to 2012, the Peruvian economy exhibited rapid growth. Moreover, the composition of the labor force improved in terms of education and experience, two variables that are typically associated to higher human capital. The average worker in 2012 had a higher level of education and was one and a half years older than in 1998, reflecting the impact of the demographic transition. However, the average real wage was roughly constant. We show that a decline in the wage premium for education, and to a minor extent for experience, is responsible for the lack of growth in the average real wage. Had these two premia remained constant throughout the period of analysis, average labor earnings would have increased by about 2.6% per year, of which 0.7 percentage points are accounted for by the changes in the composition of the labor force in terms of age and education. We explore the role of the relative supply of workers with different levels of human capital as an explanation for the decline in the wage premium for education. Finally, we analyze the implications of these findings for some macroeconomic variables, as earnings and wage inequality, the labor share and total factor productivity.     

Minimum Wages and Firm Productivity: Evidence from Vietnamese Manufacturing Firms

ABSTRACT

This paper empirically examines the minimum-wage impact on firm productivity. Using a detailed Vietnamese firm-level dataset from 2010 through 2015, the regression results suggest that firms raise their labor productivity, total factor productivity, capital intensity and revenue in response to increased minimum wage standards. Firms that pay their workers below the minimum wage react more positively in raising their labor productivity than high-wage firms. Minimum wages has had a more pronounced impact on firms’ labor productivity, total factor productivity and capital intensity since the uniform wage rate was introduced for both domestic private and foreign-invested enterprises in 2012.     

Grime and Punishment: Job Insecurity and Wage Arrears in the Russian Federation

Using information from two complementary household survey data sets, we show that the dominant form of labor market adjustment in the Russian transition process has been the delayed receipt of wages. More than half the work force is experiencing some form of disruption of their pay. Wage arrears are found across the private, state, and budgetary sectors. Workers in the metropolitan center are less affected by delayed and incomplete wage payments than are workers in the provinces. There is less evidence that individual characteristics contribute much toward the incidence of wage arrears, but the persistence of arrears is concentrated on a subset of the working population. We show that workers can only exercise the exit option of a job quit from a firm not paying wages in full or on time if the outside labor market is sufficiently dynamic. J. Comp. Econom., December 1999, 27(4), pp. 595–617. Heriot-Watt University, Edinburgh EH14 4AS, United Kingdom, IZA, Bonn, Germany, and WDI, Ann Arbor, Michigan; Centre for Economic Performance, London School of Economics, London WC2AE 2AE, England, and Royal Holloway College, University of London, Egham, TW20 1TQ, England; School of Information Management and Systems, University of California, 102 South Hall, Berkeley, California 94720-4600.     

Welfare rules,business cycles,and employment dynamics among lone parents in Norway

How lone parents combine work and welfare in earning a living has long inspired discussion. Yet little is known of their actual labor market attachment, either over calendar time or during individual lifetimes. In this article we address both issues, first by studying Norwegian Labor Force Surveys to illuminate the labor force participation of lone parents during the last two decades and by comparing the trends revealed with similar developments among married and cohabiting parents. Next, we analyze individual labor market transitions, using longitudinal data from administrative registers. The analyses demonstrate large differences in the labor market behaviors of single and nonsingle parents in Norway, even when controlling for differences in human capital and care responsibilities. Shifting labor demand and welfare reforms that prioritize paid work have both affected the employment of lone parents, but favorable economic conditions seem to have played a larger role than stringent social policies in increasing their employment activity.