Employment,schooling and productivity growth

Summary This paper presents an empirical analysis of labour demand and labour productivity growth in The Netherlands. Assuming an aggregate production function with as factors capital and 3 types of labour, distinguished by educational attainment, cost minimization leads to a set of 3 labour demand relations to be estimated on time series data. Using the estimates and the implied elasticities, aggregate labour productivity growth is decomposed into factor substitution, autonomous factors, labour time shortening, economies of scale, utilization rates and the increased educational level of the working population. The contributions of substitution, utilization rates and education appear to be substantial, notably in the seventies.

List of symbols

Variables a _i Efficiency index of skill leveli - C production - h _i working-time index for skill leveli - g _i steady-state growth rate of skill leveli - K capital stock - L _i employment volume of skill leveli - L _i ^* desired level of labour skill leveli - p output price - p ^* desired output price - s _i ^* long-run static labour shares in the production value - p _k rental price of capital - P index of total factor productivity - P _l index of labour productivity - u _i utilization rate of skill leveli - u _k utilization rate of capital - w _i wage rate for skill leveli - y production volume - y _yij Hicks partial elasticities of complementarity - _i steady-state cost share of skill leveli - _k Bk steady-state cost share of capital - _f lf highest level price index in cost function nesting - _g 4 intermediate level price index in cost function nesting - _h 4 lowest level price index in cost function nesting - _i steady-state relative wage share of skill leveli - _ij Allen partial elasticities of substitution Parameters d _i l adjustment speed of skill leveli - d _p price adjustment speed - M mark-up on marginal costs - scale elasticity of production - _i distribution parameter in cost function,i = 3, g - _i distribution parameter in cost function,i = k, h - _i distribution parameter in cost function,i =1, 2 - _i autonomous labour productivity growth for skill leveli - _i cost share of skill level in base year - _f production cost index in base year - _i hours elasticity in labour efficiency index - group elasticity of substitution betweenL ₃ and (K, (L ₁,L ₂)) - _g Og group elasticity of substitution betweenK and (L ₁,L ₂) - _h 6h group elasticity of substitution betweenL ₁ andL ₂ We would like to thank B. Downey, G.M.M. Gelauff, A. Nieuwenhuis, J.M.M. Ritzen, J.C. Siebrand and an unknown referee for helpful comments on earlier drafts.     

The structural and economic implications of urbanization

"This study surveys the policy issues associated with urbanization following the abolition of the pass laws [in South Africa]. The demographic background is briefly sketched. Using neo-classical analysis as a starting point, particular attention is paid to the present inefficiencies of city form associated with segregation. It is argued that current planning procedures are in danger of perpetuating or even worsening the situation. Obstacles to employment generation are considered and transport, local government and housing issues are discussed. On every front, urbanization policy is unstable and, even in the short term, there will be pressures to change it."     

Around-the-clock medical coverage

Marrying workers' compensation and health insurance plans to reduce administrative workloads and get a firm grip on expenses. Can it work?     

Pitfalls and opportunities for environmental marketers

Issues such as global warming, ozone depletion, insufficient landfill capacity, and excess packaging are foremost on the minds of consumers. Companies face a myriad of environmental challenges, but they also recognize the opportunities to be gained by implementing responsible marketing action plans.     

On the scope of hydraulic macroeconomics: Some reflections on Alan Coddington's Keynesian Economics

Summary The questions which Alan Coddington's posthumous bookKeynesian Economics brings to the fore as well as the thought-provoking (rather than fully acceptable) answers it provides make it worthy of being taken up for further analysis and discussion. This review article is intended to be one possible contribution in this respect. It focuses on the way Coddington's book deals with subjectivist approaches in economics and criticises it for going astray in this respect by adopting a mistaken view on the proper method of economics and giving a mistaken interpretation of both Keynesian economics and the economics of Keynes.I am indebted to L. H. Hoogduin, I. M. Kirzner, J. A. Kregel, S. K. Kuipers, J.A.H. Maks, J. Muysken and J. Pen for their valuable comments and discussion on an earlier version of this paper. Of course, they cannot be blamed for any remaining errors.A. Coddington,Keynesian Economics: The Search for First Principles, George Allen and Unwin, London, etc., 1983. Pp. 129. £ 9.95     

Ecology and development

There is an increasing realization, world‐wide and in Southern Africa, that conservation and development are compatible.

Because human communities in the less developed rural areas are dependent on a renewable group of resources, including soil, water and forests, it is imperative that land use systems that protect these resources are introduced.

The predominance of subsistence agriculture in these areas is the most difficult syndrome of under‐development. An overall rural development strategy is required that integrates human development with resources management Where the population carrying capacity of the land has already been exceeded, a process of rapid villagization/urbanization is required. Village/urban growth and agricultural development require a carefully co‐ordinated programme of land capability analysis and planning, as well as active investment in infrastructure and the introduction of appropriate technologies and institutions.