Fertility,Taxation and Family Policy*

Historically, there is clear evidence of an inverse relationship between female labour supply and fertility. However, the relationship across countries is now positive. Countries like Germany and Italy, with the lowest fertility, also have the lowest female participation rates. This paper analyses the extent to which this can be explained by public policy, in particular taxation and the system of child support. The results suggest that countries which have individual rather than joint taxation, and which support families through child care facilities rather than child payments, are likely to have both higher female labour supply and higher fertility.     

Government Deficit, Public Investment, and Public Capital in the Transition to an Aging Japan

This paper examines the effects of government deficits, public investment, and public capital on welfare in the transition to an aging Japan by applying a simulated general equilibrium growth model. One of the main results of this paper is that targeting only high economic growth would mislead us as to economic policies, and that a policy to reduce future government deficits is most preferable for almost all generations, even though a cut in future deficits must be followed by a decrease in public investment, thus a decrease in public capital in the future. J. Japan. Int. Econ., December 2002, 16(4), pp. 462–491. Faculty of Economics, Shiga University, Japan; and Management School, Imperial College, United Kingdom. © 2002 Elsevier Science (USA).Journal of Economic Literature Classification Numbers: H55, H54, H62, C68, J10.     

The devolution of HR to the line: Implications for perceptions of people management effectiveness

The devolution of human resource responsibilities from human resource managers to line managers is both a growing and global trend. A number of authors has suggested that there are positive as well as negative consequences of devolution. The current study conducted a survey of US human resource managers to explore the effect of devolution on human resource managers' perceptions of people management effectiveness in their organizations. Results revealed a positive effect of devolution on perceived people management effectiveness. However, this effect was qualified by an interaction between devolution and line support. Contrary to expectation, this interaction revealed that providing line managers with training and support for their human resource responsibilities had a greater positive impact on perceived effectiveness in organizations that had not devolved (non devolvers) compared to those that had (devolvers).     

Disciplining: A question of ethics?

The importance of evaluating a discipline system from an ethical perspective is considered. Disciplinary practices in contemporary organizations are frequently characterized by managers having to choose from among alternative courses of corrective action. Since the selected alternative may have serious consequences for the individuals involved, its rightness or wrongness is of concern. The pattern of these choices reflects the overall disciplinary practice of the organization, and is an issue that warrants attention from an ethical perspective. Basic schools of thought that influence contemporary discipline practices are discussed and suggestions are made for conducting an evaluation of the ethical nature of a discipline system.     

Costs of financial instability, household-sector balance sheets and consumption

Extant work on costs of financial instability focuses on fiscal costs and declines in aggregate GDP following banking crises. We estimate effects of banking and currency crises on consumption in 19 OECD countries, showing consumption plays an important role in the adjustment following a crisis, and effects are not captured solely by the impact of crises on standard consumption determinants, income and wealth. Additional effects, attributable to factors such as time-varying confidence, uncertainty and credit rationing, are aggravated by high and rising leverage, despite financial liberalisation easing liquidity constraints. High leverage implies that banking crises taking place now could have greater incidence than in the past.     

Seeding the clouds for industrial relations climate change in emerging economies

As manufacturing businesses increasingly move labor‐intensive production to emerging economies, it is important for international managers to understand the sociopolitical factors that shape the climate in which management and labor interact. We present a conceptual “weather map” of industrial relations climates and use indices to plot the climates of 33 emerging, 11 transition, and 21 developed economies. As hypothesized, emerging economies, compared with transition and developed economies, are characterized by a relatively adversarial industrial relations climate and a high incidence of industrial action. Implications for international managers and future research directions are discussed. © 2009 Wiley Periodicals, Inc.     

Group Formation in Risk-Sharing Arrangements

We study informal insurance within communities, explicitly recognizing the possibility that subgroups of individuals may destabilize insurance arrangements among the larger group. We therefore consider self-enforcing risk-sharing agreements that are robust not only to single-person deviations but also to potential deviations by subgroups. However, such deviations must be credible, in the sense that the subgroup must pass exactly the same test that we apply to the entire group; it must itself employ some self-enforcing risk-sharing agreement. We observe that the stability of subgroups is inimical to the stability of the group as a whole. Two surprising consequences of this analysis are that stable groups have (uniformly) bounded size, a result in sharp contrast to the individual-deviation problem, and that the degree of risk-sharing in a community is generally non-monotonic in the level of uncertainty or need for insurance in the community.     

On the dynamics of inequality

The dynamics of inequality are studied in a model of human capital accumulation with credit constraints. This model admits a multiplicity of steady state skill ratios that exhibit varying degrees of inequality across households. The main result studies equilibrium paths. It is shown that an equilibrium sequence of skill ratios must converge monotonically to the smallest steady state that exceeds the initial ratio for that sequence. Convergence is “gradual" in that the steady state is not achieved in finite time. On the other hand, if the initial skill ratio exceeds the largest steady state, convergence to a steady state is immediate.This paper is based on unpublished notes from 1990; see http://www.econ.nyu.edu/user/debraj/DevEcon/Notes/incdist.pdf. Two considerations suggest that these results may be worth reporting in print. First, the existence of a sizeable recent literature indicates that these relatively early notes may have value outside a filing cabinet or a private webpage. Second, Mukul Majumdar’s own research on economic growth with a nonconvex technology is an even earlier precursor to some of this literature, so the current outlet – a special issue in his honor – seems appropriate. Conversations with Glenn Loury simplified the proof of the main result. I thank Dilip Mookherjee for many useful discussions, and two anonymous referees for helpful comments on an earlier draft. Funding from the National Science Foundation under grant number 0241070 is acknowledged. This paper is dedicated with much affection and warm admiration to Mukul Majumdar – or to Mukulda, as I always think of him – on the occasion of his 60th birthday.     

Central city crime and suburban economic growth

This paper explores the relationship between inner-city crime patterns and suburban income growth, analysing data on 318 US counties for selected metropolitan statistical areas of 32 states within the United States from 1982 to 1997. The findings suggest that violent crime does seem to have a negative impact on close-in suburbs, with a less negative impact farther away from the central city (becoming positive at some point). While results are not as robust as we had hoped they are consistent with flight to further-out suburbs rather than migration to different metropolitan areas in response to urban crime.