DO OLDER WORKERS DROP OUT OF THE LABOUR MARKET? SOME RECENT BRITISH EVIDENCE

This paper demonstrates the significance of age and duration effects in the relationship between earnings and unemployment using two-step GMM estimation and UK county level data for 1984–1993.     

THE INFLUENCE OF VOLUNTEERS, DONATIONS AND PUBLIC SUBSIDIES ON THE WAGE LEVEL OF NONPROFIT WORKERS: EVIDENCE FROM AUSTRIAN MATCHED DATA

ABSTRACT ** :  In this article we add to the literature analyzing wages in the nonprofit sector by estimating a wage function based on employer-employee matched data for Austria. We concentrate on the influence of voluntary contributions on the wage level of paid workers. By using a quantile regression approach we find that the existence of volunteers reduces the wages of paid employees in nonprofit organizations. The number of volunteers does not have an influence on the wage level. Donations have a small but positive effect for higher income groups only. Public subsidies increase wages of all paid workers in a nonprofit organization.     

DETERMINANTS OF BANK ACQUISITION PREMIUMS: ISSUES AND EVIDENCE

The recent interstate bank merger phenomenon has received little attention in the literature. Specifically, existing studies fail to explain sufficiently the variation of premiums paid and fail to investigate adequately the bank merger wave in terms of its interstate banking context.
This study employs models with substantial overall explanatory levels. The interstate banking context proves to be very significant. First, the study considers and finds significant the effective date of a state's interstate statute in relation to a deal's announcement date. This contrasts sharply with other studies. Second, the study uses and also finds significant a binary variable distinguishing intrastate deals from interstate deals. The premiums paid for interstate market entry, on average, exceeded those paid for intrastate transactions. Third, including regional binary variables reveals a pattern of variation in pricing throughout the country. The Southeast, the study's base of comparison, exhibited the highest premium level.
Other significant determinants of premiums paid include profitability as measured by returns on equity, growth proxied by state deposit growth and future expected population growth, and charge-offs to total loans as an indicator of loan quality.     

RE-ESTIMATING FEMALE DOMESTIC WORK: BASED ON THE BRITISH SURVEY EVIDENCE FROM 1986–7

Jenkins and O'Leary (SJPE, 1997) estimated unpaid work using some of the variables collected in the 1986–7 SCEL Initiative. However, the discovery of low filial effects should be attributed to the specification of their model, especially to the inclusion of proxies for contemporaneous paid work aiming to capture population heterogeneity. It seems that the two researchers could have utilised other data from people's past work histories (which were also solicited in the survey) to construct alternative paid‐work proxies and avoid the simultaneity problem altogether. The introduction of such proxies preserves the structure of the Jenkins/O'Leary model, and yields both lower full‐time and part‐time employment effects on unpaid work, and higher children‐effects. In fact the children‐effects remain pronounced even if one drops all paid work regressors or introduces a non‐selection hazard from the probit on paid work participation, instead.     

THE DETERMINANTS OF EXPORT PERFORMANCE: EVIDENCE FOR MANUFACTURING PLANTS IN IRELAND AND NORTHERN IRELAND

The dramatic GDP and export growth of Ireland over the last decade forms a marked contrast with that of its nearest neighbour Northern Ireland. In Ireland, export volume growth averaged 15.5% p.a. from 1991 to 1999 compared with 6.3% from Northern Ireland. Using data on individual manufacturing plants this paper considers the determinants of export performance in the two areas. Larger, externally owned plants with higher skill levels are found to have the highest export propensities in both areas. Other influences (plant age, R&D, etc.) prove more strongly conditional on location, plant size, and ownership. Structural factors (e.g. ownership, industry) explain almost all of the difference in export propensity between larger plants in Northern Ireland and Ireland but only around one‐third of that between smaller plants. Significant differences are also evident between plants in terms of their sources of new technology. For indigenously owned plants, in‐house R&D is important. For externally owned plants, R&D conducted elsewhere in the group – typically outside Ireland and Northern Ireland – proves more significant. This external dependency and lower than expected export propensity on the part of small plants in Northern Ireland represent significant policy challenges for the future.     

OUTPUT,PRODUCTIVITY AND WAGES IN THE BRITISH COAL INDUSTRY BEFORE 1914: A MODEL WITH EVIDENCE FROM THE DURHAM REGION*

This paper proposes a model of productivity and wages in the Durham coal industry during 1882–1914. The model predicts a negative relationship between wages and productivity which derives from the industrys production function and wage-setting arrange- ments and does not require or imply a ‘leisure preference’ by miners. It is also suggested that predicted effects of some variables on productivity are different from those proposed by previous investigators. Using modern time-series methods on data for output per worker and per shift, it is shown that the two measures essentially reflect predicted effects on output and productivity respectively.     

THE REGIONAL AGGLOMERATION IMPACAT OF JUST-I-TIME INPUT LINLAGES: EVIDENCE FROM THE SCOTTISH ELECTONICS INDUSTRY

There is no clear consensus as yet concerning the possible regional agglomeration impacts of Japanese Just-In-Time manufacturing techniques. This paper attempts to provide a theoretical structure to discussing such questions and then uses a logit model to analyse evidence from the Scottish Electronics Industry. The results provide support to the suggestion not only that the adoption of such techniques within the UK will encourage the shortening of input linkages, but also that this phenmenon is not restricted purely to the case of the automotive industry.     

THE LABOUR MARKET IMPACT OF THE UK DISABILITY DISCRIMINATION ACT: EVIDENCE FROM THE REPEAL OF THE SMALL FIRM EXEMPTION

This paper uses data from the Quarterly Labour Force Survey in the UK (1997–2006) and changes in the coverage of the Disability Discrimination Act (DDA), that result from the removal of the small firm exemption, to assess the labour market impact of the legislation. The data support a narrowing of the employment gap between the disabled and non‐disabled over the post DDA period. However, the evidence based on small firms does not support this being a direct result of the employment provisions of the DDA.     

IMMIGRATION UNEMPLOYMENT RELATIONSHIP: THE EVIDENCE FROM CANADA*

This paper examines the relationship between unemployment and immigration in Canada. The bi‐directional causality test finds no evidence of a significant effect of Canadian immigration on unemployment. Cointegration tests indicate that there is no observed increase in aggregate unemployment due to immigration in the long run. The results from the causality test based on the vector error correction model confirm that, in the short run, past unemployment does cause (less) immigration but not vice versa. There is also a long‐run positive relationship among per‐capita GDP, immigration rate and real wages. The results indicate that, in the short‐run, more immigration is possibly associated with attractive Canadian immigration policies, and in the long‐run, as the labour market adjusts, Canadian‐born workers are likely to benefit from increased migration.     

THE IMPACT OF GOVERNMENT EXPENDITURE ON GROWTH: EMPIRICAL EVIDENCE FROM A HETEROGENEOUS PANEL

This paper investigates the impact of government expenditure on growth, in a heterogeneous panel, for a sample of developing countries. Using generalized method of moments techniques, we show that countries with substantial government current expenditure have strong growth effects, which vary considerably across the nations.     

THE DETERMINANTS OF ILLEGAL DRUG USE

An extensive set of self-reported survey data exists on illegal drug use. The survey data show that drug use is quite frequent among the younger adult population, relatively infrequent among those of high-school age, and rare among middle-aged and older adults. Drug use varies by occupational category in ways that are difficult to rationalize. This study utilizes a model in which an individual's time is allocated among labor, non-drug consumption, leisure, and drug use, where the individual is cognizant of the effect of drug use on his wages. The study analyzes comparative static results and then uses data from the National Longitudinal Survey of Youth to estimate a probit model of the individual decision to use drugs. The findings of the study are that non-economic factors dominate the decision for both harder drugs and drugs more broadly defined. One must consider this finding tentative, however, since usable drug price data were not available.     

DETERMINANTS OF THE SAVING RATE: AN INTERNATIONAL COMPARISON

Economists have extensively analyzed the interactions between economic-demographic factors and saving. Fertility rates and the dependency ratio have received considerable attention, but the effect of life expectancy improvements have not been analyzed explicitly. This paper provides an added dimension to the existing literature by empirically examining the role of life expectancy as a determinant of saving. Recent data demonstrate that life expectancy is a statistically significant and quantitatively important factor affecting less developed countries' saving performance. One must consider human capital investments when assessing population growth's impact on saving. The analysis here is one of few that incorporate human capital in defining saving. The overall results are sensitive to level of development and regional diversity .     

COMMON STOCHASTIC TRENDS: EVIDENCE FROM THE LONDON METAL EXCHANGE

Recent evidence from cointegration theory points towards the efficiency of the London Metal Exchange. We show that on theoretical grounds this evidence could be misleading. We also conduct multivariate and univariate unit roots tests on prices of three different metals, namely: copper, lead and zinc. The price data are seasonal and unadjusted quarterly data from the London Metal Exchange and they cover the period from 1972.1–1987.4. The evidence presented here supports the presence of common stochastic trends in metal price movements.     

FINANCIAL INNOVATION AND THE DEMAND FOR MONEY: EVIDENCE FROM THE PHILIPPINES

This paper tests whether financial innovations in the Philippines distorted the long-run relation between real money balances, income and interest rates. Using data for the monetary base, M1 and M3 over the period 1980–1998, we cannot reject the hypothesis that there does not exist a standard money demand relation between M1 and M3, real income and interest rates. However, when we allow for the impact of financial innovations, this finding is reversed for M1. Estimates of ECM models for these measures also show that financial innovations impacted real money balances for M1, but not M3. This evidence supports the Philippine central bank's choice of a monetary aggregate as its policy instrument to achieve its policy objectives. [E41, E58]     

THE FOOTBALL PLAYERS' LABOR MARKET: EMPIRICAL EVIDENCE FROM THE MAJOR EUROPEAN LEAGUES

The growing economic importance of professional football and the recent fundamental changes in the regulatory regime governing the football players' labor market together with the availability of detailed information on player salaries, transfer fees and contract lengths have convinced an increasing number of economists from all over Europe to devote their attention to the operation of that particular market. The following paper reviews the available evidence on the various dimensions of that market (remuneration, transfers, contracts and mobility) and points out some promising directions for further research.     

EXPORTING AND PRODUCTIVITY GROWTH: EVIDENCE FROM THE TAIWAN ELECTRONICS PLANTS

This paper uses propensity score matching techniques and ordinary least square regressions to examine the relationship between exporting and productivity growth in the Taiwan electronics industry. Using data from three census years, we find that plants with higher productivity growth tend to enter the export market, supporting the self‐selection mechanism. The evidence of learning‐by‐exporting is mixed, however. While the plants exporting throughout the sample period show small differences in productivity growth from non‐exporters in the downturn period, continuing exporters outperform non‐exporters in the upturn period. Thus, our results suggest that the direction of causality mainly runs from productivity to exporting rather than vice versa.     

THE SPOT MARKET MATTERS: EVIDENCE ON IMPLICIT CONTRACTS FROM BRITAIN

Based on the methodology of Beaudry and DiNardo (1991) , this paper investigates the relative importance of the spot market and implicit contracts in the determination of British real wages. Empirical work is carried out separately for males and females with individual-level data taken from the New Earnings Survey Panel for the years 1976–2001. In contrast to previous studies that used North American data, the spot market is found to be more important than implicit contracts in determining real wages, although we do find some support for contracting effects. Further evidence is provided through the analysis of individual wage sequences. These suggest that the downwardly rigid wage sequences implied by implicit contracts with costless worker mobility are not prevalent in Britain.     

THE TIME‐SERIES PROPERTIES OF UK INFLATION: EVIDENCE FROM AGGREGATE AND DISAGGREGATE DATA

This paper contrasts the time‐series properties of aggregate and disaggregate UK inflation. While aggregate inflation is found to be non‐stationary, unit root rejection frequencies are increasing when we use more disaggregate data. Structural break analysis suggests that structural shifts in monetary policy could alter inflation persistence. Additionally, panel evidence indicates that the unit root hypothesis can be rejected for sectoral inflation rates. Finally, we compare the persistence properties of UK inflation, finding statistically significant differences between aggregate and disaggregate series. Our analysis suggests that aggregation matters, which has important implications for econometric analysis and the conduct of monetary policy.