Allocating Jobs under a Minimum Wage: Queues vs. Lotteries*

In this paper we provide a simple diagrammatic technique for incorporating variable labour supply into the specific factors model We then use the framework to analyze the positive and normative effects of a minimum wage both with a broadly based employment lottery (on-the-job search) and with an employment queue (the Harris-Todaro case). We discover that with a given minimum wage replacing the queue with a lottery may be welfare reducing.     

Collective Bargaining Coverage of Union Members and Nonmembers in the Public Sector

Arguably, models of union status and union wage effects in the public sector should' consider workers in three categories: not covered, covered nonmember, and covered member. Estimates show that stronger union security laws are associated with higher percentages of covered members and nonmembers, that right-to-work laws do not affect union coverage or membership relative to where no union security law exists, and that the wages of covered members are higher than those for covered non-members.     

MATCHING OWN PRICES,RIVALS' PRICES OR BOTH?*

Many retailers promise that they will not be undersold by rivals and extend their promise to include their own future prices. That is, many retailers combine elements of both price‐matching guarantees and retroactive most‐favored‐customer clauses. This is puzzling because the extant literature has shown that each practice independently has the potential to facilitate supracompetitive prices, and thus one might think the two practices are substitutes. In this paper, we show that price‐matching guarantees and most‐favored‐customer clauses complement each other when offered unilaterally by a single firm and can lead to higher prices than either one could have facilitated by itself.     

Alternative Hypotheses Concerning Depreciation of Buildings

Ball, Walker and Whittred (1979) reported that companies receiving audit qualifications for non-compliance with the requirement to depreciate buildings earned higher than expected returns at the time of the release of the qualification. This paper examines the possibility that this result could be due to cash-flow effects related to the decision not to comply with the depreciation requirement. The results generally support the view that there are cash-flow effects associated with a company's decision not to depreciate buildings.     

A Framework for Setting Retirement Savings Goals

The purpose of this paper is to develop a framework for calculating savings needed to meet retirement goals under a variety of alternative assumptions about the economic and institutional environment. A “base case” that incorporates a zero real rate of interest serves as a starting point; next, differences resulting from a positive interest rate are examined. The analysis is further modified to take into account the effects of inflation, the role of Individual Retirement Accounts (IRAs), and possible future changes in tax laws. Throughout, the goal is to evaluate how best to plan for a smooth, regular consumption level before and after retirement and to adjust savings programs for changes in one's situation or expectations. The framework provided herein is expected to be useful to consumer educators and financial counselors concerned with helping individuals to meet their retirement goals.     

The Evolution of Consolidated Financial Reporting in Australia

This paper reviews the history of financial reporting by corporate groups in Australia, and in particular, the States of New South Wales and Victoria. Changes in Statutory and Stock Exchange rules governing consolidated reporting are described and the financial reporting practices of Australian holding companies between 1930 and 1962 are surveyed. The evidence indicates that (a) while the practice was not widespread, some Australian holding companies supplemented their financial statements with consolidated financial statements prior to the incorporation of such a requirement in either legislation or Stock Exchange listing requirements; (b) the influence of Stock Exchanges on the evolution of this practice is somewhat less than that previously attributed to it; and (c) the rapid spread of this form of reporting in an essentially unregulated environment (N.S. W.) coincided with the development of a market for public debt securities.     

Family Background and the Propensity for Self‐Employment

Empirical analysis shows that men with self‐employed fathers and higher parental incomes are more likely to be self‐employed, the impact of paternal self‐employment is leveraged by higher family income, and self‐employment is more likely when the father worked in an occupation with task requirements similar to those of an independent business. The idea that the paternal self‐employment effect is attributable to sons following their fathers into occupations inherently more or less conducive to self‐employment is not supported.