On-the-Job Training, Immigration Reform, and the True Wages of Native Male Workers

This study measures the Immigration Reform and Control Act's (IRCA) impact on the "true" earnings of native workers. True earnings include observed wages and compensation received in the form of on-the-job training (OJT). Using 1983–1992 NLSY data, we present evidence suggesting IRCA reduced the true wages of male natives most likely to be mistaken as unauthorized. Our findings suggest that Mexican Americans suffered the largest decline in post-IRCA OJT. It appears then that antidiscrimination policies following recent immigration reform have not fully protected some U.S. natives against unintended IRCA-related employment discrimination.     

Recent methodological studies on survey questioning

In this article an overview is presented of some 50 methodological studies on survey questioning, published from 1986 until 1987.     

Leasing as a Lottery: Implications for Rational Building Surges and Increasing Vacancies

An expanded inventory demand framework is developed that focuses on the impacts of changes in the local leasing environment. We model the lease-up process as a lottery in which changes in turnover or absorption affect the probability of winning the leasing lottery. In this context, builders rationally respond to transitory, not just permanent, changes in the local market. Hence, factors such as temporary shocks to tenant turnover affect the decision to build. The magnitude of turnover-induced cycles can vary across markets depending upon the vintage of the existing building stock, the local absorption rate and the rent elasticity of demand for space. This framework, which refocuses attention on the local determinants of the developer's decision to build, hopefully will prove fruitful in future empirical efforts to explain development and vacancy behavior during the past decade.     

A Stochastic Extension of the Miller-Modigliani Framework1

This paper deals with the problem of the financial valuation of a firm and its shares of stock with general financing policies in a partial equilibrium framework. the model assumes a time-dependent discount rate and a general stochastic environment in a discrete-time setting. the fundamental valuation approach under the assumption of risk neutrality is used to obtain the time path of share price, the number of outstanding shares, and the value of the firm. These are shown to be the unique conditional expectations of certain stochastic processes. A broad class of firms for which the solution formula yields finite-valued solutions is characterized. the results are extended to the non-risk-neutral case. A regularity condition, which is both necessary and sufficient for the share price to equal the capitalization of future dividends accruing to the share, is obtained. As a mathematical aside, it is shown in the appendix that in the absence of this condition, the so-called stream of dividends approach is meaningless in the sense that it does not yield any financial valuation.