Ann D. Velenchik

MORE BAD NEWS FOR SMOKERS? THE EFFECTS OF CIGARETTE SMOKING ON WAGES

Using National Longitudinal Survey of Youth data, the authors examine the effect of smoking on wages. Their analysis controls for differences in individual charaeteristics that may be correlated with both smoking and wages, including unobservable person-specific characteristics that are constant over time, and unobservable characteristics that are constant within a family. Estimates from alternative specifications indicate that smoking reduced wages by roughly 4–8%. Empirical tests of three potential explanations for this finding yield no conclusive results.

Government intervention, efficiency wages, and the employer size wage effect in Zimbabwe

Abstract This paper uses matched employer-employee data from a survey of 201 manufacturing firms and 1609 of their workers conducted in Zimbabwe in the summer of 1993. The results indicate that there is a substantial premium associated with employment in larger firms, and that this premium cannot be explained by differences in worker quality and job characteristics, nor is it eliminated by controlling for unionization, minimum wages or other forms of government intervention. The size premium is much larger for white collar than for blue collar workers. These differentials are also found to be substantially larger than those estimated for other developed and developing countries. The analysis uses the data about firm characteristics to explore a number of efficiency wage-based explanations of the size differential, and finds results which are consistent with, but not conclusive proof of, hiring, turnover, and morale based notions of efficiency wages.

The Case Method as a Strategy for Teaching Policy Analysis to Undergraduates.

The case method is presented as a means to motivate students in an introductory level undergraduate course in international economics to learn theory, to teach them to apply theory, to enhance their skills in the use of quantitative evidence, and to show them the limits of economic analysis in the study of policy issues.

Market power, firm performance and real wage growth in Zimbabwean manufacturing

Abstract This paper uses a two year panel of data on 600 Zimbabwean manufacturing workers and the employers to examine several aspects of the labor market response to the reforms introduced in the 1991 structural adjustment program. The analysis then uses this evidence to explore a number of hypotheses about the functioning of formal urban labor markets in Zimbabwe, with particular attention to the issue of rent sharing. First, as one would expect, liberalization of trade did indeed act to shift employment from import competing sectors to export sectors, although total manufacturing employment was basically unchanged. Second, real wages in manufacturing fell for most workers. Third, the pattern of wage changes across sectors and firms is consistent with a view of labor markets as noncompetitive. The evidence provides support for the idea that a rent-sharing process of wage determination, rather than one based on efficiency wages or government intervention, is an appropriate characterization of this labor market.

Consistent Comparisons Between Monopoly and Perfect Competition

Some inconsistencies in standard treatments of the perfect competition–monopoly welfare comparison are identified. A more consistent and productive pedagogical approach for courses in intermediate microeconomics is suggested.