The causes and consequences of occupational segregation: a simultaneous equations approach

Lewis and Shorten (Applied Economics, 1991, 23, 167–77) have proposed that male and female earnings, male and female labour force participation rates and occupational segregation are simultaneously determined in the labour market. They estimate their model for Australia using 1981 Census data and find substantial evidence to support their hypothesis. However, there have been no subsequent studies to empirically test their hypothesis for other countries. In this paper their model for the United States using 1990 Census data is replicated. All but one of the coefficients on the endogenous variables have the same signs as those reported by Lewis and Shorten, which tends to support their model. The specification of Lewis and Shorten's model is tested and it is inappropriate for the US data. The model is then reformulated and re-estimated. The reformulated model also shows substantial evidence of simultaneity between occupational segregation and other labour market outcomes.     

Earnings differentials and household-income differentials in Hungary—Policies and practice

Since about 1970 it has been the policy of the Hungarian leaders to widen earnings differentials for incentive reasons and, simultaneously, to narrow household-income differentials for equity reasons. The two policies work in opposite direction.This paper analyzes the policies and their actual results. Hungary has managed indeed to considerably narrow income differentials due to rapid expansion of transfer payments. The introduction of the NEM in 1968 was marked by a widening of earnings differentials in order to increase economic efficiency. However, since 1973 an opposite development has taken hold for political reasons and is still going forward.     

Structure,conduct and performance: a simultaneous equations approach

A simultaneous equations framework is used to study the relationship between structure, conduct and performance in US manufacturing in the 1980s and 1990s. The paper expands on earlier structure-conduct-performance studies by using a lag structure to signify that structure, conduct and performance do not affect one another contemporaneously. Findings support some aspects of the traditional structure-conduct-performance model, but challenge others. First, the data suggest that industry structure does not depend on current industry performance. Second, little evidence is found that industry conduct, proxied by advertising, is affected by industry structure. Third, results show that industry performance does not depend on industry conduct, though it is sensitive to industry structure. The main findings are that (1) concentration does not depend on firm profitability, though profitability depends on concentration, (2) advertising follows a process that is independent of the factors considered here, and (3) advertising seems to have no effect on profitability.     

Wage differentials by sector and gender: a quantile analysis for the Spanish case

This paper analyses existing wage differentials between workers in the public and private sectors and by gender in Spain. This analysis is run throughout the entire earnings distribution and observed wage differentials are decomposed into a part explained by differences in productive characteristics and a part due to differences in returns to such characteristics. Our results show that public sector workers tend to earn higher wages than private employees, although most of this sector wage gap is due to better public workers’ productive characteristics. A wage premium in favour of men is also found in both the public and private sectors, with the gender wage gap greater at the top of the earnings distribution.     

Inter industry and occupational wage differentials in Italy

The vast literture on wage determination in the post-war era extensively documents the existence of large and persistent wage differentials among industries and workers of comparable skills. This paper addresses the issue of wage dispersion in the context of the Italian economy. The stability over time of industry relative wages confirme previous results obtained for the other countries. A wide class of earings equations is estimated using microdata for the Italian manufacturing industry. The results provide little evidence in support of the view that wage dispersion can be explained by either unmeasured workers' charcteristics or by compensating wage differentials. Conversely, the estimated pattern of industry-occupation wage differentials is consistent with the existence of rent sharing mechanisms and fairness considerations.     

The demand for cars and gasoline: A simultaneous approach

This paper develops and estimates a simple model of the demand and supply of cars and gasoline in Israel, focusing on an individual maximizing his life-time utility function under various constraints. Particular emphasis is placed on the transaction cost in a car purchase, and the fact that cars can be characterized by size and age factors which, in turn, affect running costs and maintenance costs. The empirical results show that a change in the price of gasoline (and/or the price of new cars) changes the structure of the stock of cars with respect to engine size.     

A simultaneous equations study of research and development intensity

This paper presents a simultaneous equations model of profitability, concentration, advertising, and research and development outlays. We find that research and development intensity tends to increase in more concentrated industries, although this effect is negated in industries where technological opportunities are excellent. Also, high levels of research and development may reduce concentration while tending to add to industry profitability. These results suggest that the government should not be concerned with the possibility of an adverse impact of market concentration on research and development, although the evidence suggests that certain high technology industries may be at a small risk.     

Regional and gender differentials in the persistence of unemployment in Europe

The persistence of unemployment increased during the recent great recession in many European countries, although with diversified impacts. We therefore analyse such impacts in four European countries – Italy, Spain, France and the UK – which represent different institutional frameworks and may reflect the so-called continental European and Anglo-Saxon frameworks. We analyse the determinants of unemployment persistence using individual-level data from the European Union Statistics on Income and Living Conditions (EU-SILC) panel for the period 2007–2013. These data enable us to take into account initial conditions and state dependence in addition to individual and household characteristics. We focus on gender and regional effects, which have a strong impact on the persistence in the state of unemployment. We find that gender gap is significant in Italy and the UK, implying that male workers show a higher probability of remaining unemployed. In Italy, such a pattern is due to the worsening of male workers’ conditions during the crisis, whereas in the UK, male workers show higher unemployment rates than women. Regional effects are significant in all countries analysed and underline a relevant structural factor that should be addressed on policy grounds in Europe. Such effects are greater in Spain and Italy.     

Economic transition and gender differentials in wages and productivity: Evidence from Chinese manufacturing enterprises

We use firm-level data to analyze male–female wage differences in Chinese industry in the late 1990s. Our estimates indicate that employers' discrimination against women was not a significant source of the gender wage gap in Chinese state-owned enterprises. Instead, we find that the relative wage of unskilled female to male workers was higher than their relative productivity. This result indicates that unskilled female workers in the state sector had historically received wage premiums and consequently accounted for a disproportionate share of the sector's labor surplus.     

An analysis of occupational upgrading differentials between black and white males

The racial occupational mobility gap is examined by applying a decomposition methodology to logistic functions. Results indicate that approximately one-third of the mobility gap between black and white male workers is due to differences in average characteristics (the endowment effect). The residual difference accounts for the remaining two-thirds. Formal education is found to be a major component of both the endowment effect and the resdiual difference. The ‘returns’ to tenure with a firm, overall labour market experience and marriage reduce the mobility gap in favour of black workers.     

A simultaneous equations model of the educational process

This paper models the educational process as a system of six simultaneous equations. The endogenous variables include a student's achievement, motivation, expectations, efficacy, and perceived parents' and teachers' expectations. The model also includes forty-eight individual, home, peer, teacher, and school exogenous variables. Using a sample of over sixteen thousand twelfth grade students from the Equality of Educational Opportunity survey, we estimate the model by two-stage least squares and present the reduced form and structural form equations. We find that many educational outputs jointly determine one another. Also, the results suggest that school and teacher variables have important effects on educational outcomes.     

A simultaneous equations model of finance and growth: FIML estimates for India

In the relationship between economic growth and financial development, it is generally conceded that both variables are likely to be interdependent. However, no attempt has been made so far to estimate a simultaneous equations model to test whether finance causes growth or vice versa. This article uses the Full Information Maximum Likelihood (FIML) method to estimate a two equations model of growth and finance for India to determine the strength of this interdependence. Our results show that Financial Developments (FD) have a small but significant permanent growth effect. However, there is no evidence to support the view that ‘where enterprise leads, finance follows’.     

Leverage,managerial monitoring and firm valuation: A simultaneous equation approach

The paper examines how leverage and managerial ownership relate to firm valuation. It is argued that both leverage (which serves as an external monitoring function) and managerial ownership (which serves as an internal monitoring function) affect firm value, while internal monitoring by managers and external monitoring through debt were viewed as substitutes or complements. After controlling for the effect of exogenous variables, the results reveal the existence of a substitution monitoring effect between debt and the managerial group. Additionally, firm valuation is found to exert a significant influence on managerial ownership and vice versa. Robustness tests indicate a weak but growing role of bank debt as a disciplinary mechanism.     

Wage discrimination,occupational segregation and visible minorities in Canada

The earnings gap between each of Whites, Asians, and Blacks is decomposed into the effects on earnings of productivity-related characteristics, wage discrimination and occupational segregation. Unlike previous Canadian studies, this paper analyses the relative economic position of both immigrant and native-born visible minorities and explicitly incorporates the effect of discrimination in occupational attainment on the earnings gap. The results indicate that policies aimed at increasing the ethnic representation across occupational categories would be effective only for Black men. Anti-discrimination legislation aimed at decreasing the earnings gap between visible minority and White women should have a dual focus: they should aim at reducing the inter-occupational wage discrimination; they should provide training programs to extend the career ladders confronting ethnic minority women.     

Macroeconomic outcomes,collective bargaining and intersectoral productivity differentials: a panel approach

Using a sample of 19 advanced countries from 1990 to 2014 and an Arellano–Bover/Blundell–Bond linear dynamic GMM estimator along with a bootstrap-based bias correction fixed effects estimator for dynamic panels, the paper examines the macroeconomic impact of collective bargaining structures in a context of varying intersectoral heterogeneity in productivity growth among the exposed and sheltered sectors of the economy. Results show a dampening impact of pattern and centralized bargaining structures on unemployment. However, strong domestic demand is a key precondition for such a favourable effect to materialize. Uncoordinated and centralized bargaining structures are the most efficient in terms of labour cost restraint while industry bargaining moderates labour cost growth as intersectoral productivity differentials widen.     

Female earnings and the divorce rate: a simultaneous equations model

Economists have contributed a great deal of research, both theoretical and empirical, to the study of marital formation and dissolution. Many empirical examinations of marriage and divorce rates exist based on Becker's seminal contributions to the literature. All of these divorce studies are single equation models, with female earnings assumed exogenous. As discussed by Becker (1981), however, causality may run in the opposite direction as well: the divorce rate may influence female earnings. This paper estimates a simultaneous equations model in which divorce rates and female earnings are the jointly endogenous variables. Data are by state, for 1960, 1970, 1980 and 1990. The state-wide divorce rate equation is an extension of Waters and Ressler (1999), and the specification of a state-wide earnings equation follows standard human capital theory. The specification of joint endogeneity between female earnings and the divorce rate allows valid inferences to be made regarding the effect of female earnings on divorce for the first time. Most previous single equation studies of divorce have found that increases in female earnings significantly increase divorce rates. A simultaneous equations model will allow inferences to be made regarding the possibility of joint determination, which may cause a reevaluation of previous results.     

Online networks,social interaction and segregation: an evolutionary approach

There is growing evidence that face-to-face interaction is declining in many countries, exacerbating the phenomenon of social isolation. On the other hand, social interaction through online networking sites is steeply rising. To analyze these societal dynamics, we have built an evolutionary game model in which agents can choose between three strategies of social participation: 1) interaction via both online social networks and face-to-face encounters; 2) interaction by exclusive means of face-to-face encounters; 3) opting out from both forms of participation in pursuit of social isolation. We illustrate the dynamics of interaction among these three types of agent that the model predicts, in light of the empirical evidence provided by previous literature. We then assess their welfare implications. We show that when online interaction is less gratifying than offline encounters, the dynamics of agents’ rational choices of interaction will lead to the extinction of the sub-population of online networks users, thereby making Facebook and similar platforms disappear in the long run. Furthermore, we show that the higher the propensity for discrimination of those who interact via online social networks and via face-to-face encounters (i.e., their preference for the interaction with agents of their same type), the greater the probability will be that they all will end up choosing social isolation in the long run, making society fall into a “social poverty trap”.     

The use of quantile regressions in estimating gender wage differentials: a case study of the Philippines

Quantile regressions are used to analyse the size, components, and nature of the gender-earnings differentials as well as the returns to education by gender in the Philippines, over the entire conditional distribution of earnings, using data from the 1999 APIS survey. This approach allows more focused conclusions about the nature of gender-earnings differentials. Incorporating the quantile regression approach to the Oaxaca–Blinder decomposition allows the localization of gender discrimination to particular quantiles of the earnings distribution and permits more targeted policy intervention.