Negishi–Solow efficiency wages, unemployment insurance and dynamic deterministic indeterminacy

This paper introduces efficiency wages designed to provide workers with incentives to make appropriate effort levels, and involuntary unemployment, along the pioneering lines of Negishi (1979) , Solow (1979) and Shapiro and Stiglitz (1984) , in a dynamic model involving heterogeneous agents and financial constraints as in Woodford (1986) and Grandmont et al. (1998) . Effort varies continuously while there is unemployment insurance funded out of taxation of labor incomes. Increasing unemployment insurance is beneficial to employment along the deterministic stationary state, and can even in some cases lead to a Pareto welfare improvement for all agents, through general equilibrium effects, by generating higher individual real labour incomes, hence larger consumptions of employed and unemployed workers, and thus higher production. In contrast, the local (in)determinacy properties of the stationary state are opposite to those obtained in the competitive specification of the model: local determinacy (indeterminacy) occurs for elasticities of capital-efficient labor substitution lower (larger) than a quite small bound. Increasing unemployment insurance is more likely to lead to local indeterminacy and, therefore, to generate dynamic inefficiencies due to the corresponding expectations coordination failures.     

促进再就业视角下重构我国失业保险制度

我国现行失业保险制度本身及运行存在许多问题,如法律效力低、立法原则模糊、法律实施不力、内容脱离当前国情、促进再就业功能低弱等。本文试图以促进再就业为导向,重构我国失业保险制度,以期对具体实践有所帮助。     

对扩大我国失业保险覆盖面问题的探析

党的十七大报告提出,要加快建设覆盖城乡居民的社会保障体系。失业保险是社会保障制度中的一个重要环节。当前我国的失业保险覆盖面存在一些问题,限制了失业保险功能的发挥。文章在对失业保险覆盖面狭窄进行深入分析的基础上,对扩大失业保险覆盖面的问题进行探讨。     

The efficiency of the dutch labour market in matching unemployment and vacancies

Summary A matching function specifies the relationship between the flow of filled job vacancies and the stocks of unemployed and job vacancies. This paper specifies and estimates the matching function of the Dutch labour market. It appears that this matching function is best described by a Cobb-Douglas function with constant returns to scale and coefficients of 0.4 on unemployment and 0.6 on vacancies. The matching function shifted at the end of the sixties and remained quite stable afterwards. This indicates that with a higher level of unemployment and lower level of job vacancies the Dutch labour market today is as efficient in generating a flow of filled vacancies as it was in the seventies.The author wishes to thank Frank den Butter, Bernard Compaijen, Geert Ridder, Klaas Arie Springer and anonymous referees for their comments on a previous version of this article.     

Jobs with different wage determination mechanisms, social efficiency and unemployment

The purpose of this paper is to construct a theoretical framework for the labor market, which is composed of a variety of jobs with different wage determination mechanisms. We identify an equilibrium in which some firms post a wage and others bargain with workers. This paper shows that the proportion of firms adopting wage bargaining in a decentralized equilibrium is below the socially optimal level. We identify policies to increase this proportion and to improve social efficiency. Furthermore, we examine the impact of those policies on unemployment. The results of this study will determine the direction of employment policy on the labor market with various employment styles.     

Unemployment duration and unemployment insurance: a comparative analysis based on Scandinavian micro data

Based on pooled register data from Norway and Sweden, we findthat differences in unemployment duration patterns reflect dissimilaritiesin unemployment insurance (UI) systems in a way that convincinglyestablishes the link between economic incentives and job searchbehaviour. Specifically, UI benefits are relatively more generousfor low-income workers in Sweden than in Norway, leading torelatively longer unemployment spells for low-income workersin Sweden. Based on the between-countries variation in replacementratios, we find that the elasticity of the outflow rate frominsured unemployment with respect to the replacement ratio isapproximately one in Norway and 0.5 in Sweden.     

Equity and efficiency as components of a social welfare function

An income distribution-based abbreviated social welfare function is an increasing function of equity and efficiency. When inequality is of relative type, we characterize variants of the Atkinson–Kolm–Sen and the Shorrocks abbreviated welfare functions, where the variation results from the existence of a corresponding trade-off parameter, and in each case if the parameter becomes one the two forms coincide. When the value of the parameter increases, equity gains more weight in the equity–efficiency trade-off. For absolute inequality, we characterize the Blackorby–Donaldson–Kolm welfare function. Some implications of the lexicographic-type equity used in the paper are also considered.     

On technical efficiency of China's insurance industry after WTO accession

China joined the WTO in 2001 and has to fully open up its insurance market to foreign competitors by 2006. However, the domestic insurance market is overwhelmingly dominated by a few large state-owned or state-controlled firms. As the market is still underdeveloped and the demand for insurance is rising exponentially, there exists huge potential, opportunities as well as challenges for non-state, foreign and joint-venture insurance companies. Efficiency is a key concern of policy makers to encourage further development of the insurance industry. This paper focuses on this important issue. It uses a panel data set of 22 firms over the period 1999–2004 to evaluate their efficiency scores by applying a DEA approach and decompose the productivity growth into technical efficiency improvement and technological progress by constructing a Malmquist Index. It then employs an econometric model to identify the key determinants of efficiency. The empirical results suggest the direction of how to improve firm efficiency. It is found that firm size, ownership structure, mode of business and human capital are important factors affecting firm performance. The results shed important light on policy design and implementations on future development of the insurance industry with WTO obligations.     

Overpopulation and unemployment in Zimbabwe

The size of Zimbabwe's African population has grown dramatically over the past 50 years, with 5.7 children on average being born per woman. The following factors are responsible for the rapid population growth in Zimbabwe: the country's economic prosperity during the period of the Central African Federation from 1953 to 1963, and its successful food policy before and after independence; the success of the health system, also in both periods; and the fact that women have not been incorporated into the economy as wage-earners. A brief historical overview is presented, followed by sections on the food policy and health system, reasons for the persistence of large families, and the relationship between wage-earning by women and the birth rate. The author also describes some of the problems caused by overpopulation. Engaging more women in regular wage-earning employment is the key to controlling the birth rate in Zimbabwe. Current government policies encouraging female employment in government services and the economy in general, along with the expansion of contraceptive services, could influence female fertility over the long term.     

Skills and unemployment

This article attempts to spell out the links which are assumed to exist between skills and unemployment. It is argued that the claims made for the beneficial effects of raising the skill levels of the workforce have been exaggerated. The author then goes on to indicate some of the other factors which influence unemployment levels, and sketches the relevance of this to local economic initiatives.     

Analysis of hospital technical efficiency in China: Effect of health insurance reform

This paper investigates the regional hospital efficiency in China during the 2002–2008 period, especially for how the health insurance reform of New Rural Cooperative Medical System (NRCMS) impacts on efficiency. Adopting the non-parametric technique of data envelopment analysis (DEA) to handle the feature of multiple outputs and undesirable outputs in the hospital industry, empirical estimates indicate that hospital efficiency is moderate that increased slightly from 0.6777 to 0.8098 during the sample period. However, it ranges widely from 0.396 to 1 across provinces. The regression analysis on examining determinants of efficiency suggests that a higher proportion of for-profit hospital and high quality hospital is helpful to enhance technical efficiency. We find a negative relationship between government subsidy and efficiency for coastal regions. While technical efficiency varies considerable across provinces, there is no significant difference between coastal and non-coastal regions being found, after controlling for other variables. Crucially, the medical reform of NRCMS overall has a significant efficiency-enhancing effect, particularly for non-coastal regions, ceteris paribus. It highlights the effectiveness of NRCMS on promoting medical service accessibility for rural residents.