Don Bellante

Are public sector workers more risk averse than private sector workers

Available evidence suggests that stability of employment is greater in the public sector than in the private sector. The value that individuals place on this stability depends on the individuals degree of risk aversion. Economic reasoning suggests that, other things equal, those individuals with a high degree of aversion to risk will be more likely than others to seek employment in the public sector. This paper tests that hypothesis through the use of probit analysis and a measure of risk aversion developed in the University of Michigans Panel Study of Income Dynamics. The results tend to confirm the hypothesis, implying that a policy of intersectoral equality of pay for comparable jobs would result in an excess supply of workers to the public sector.

Labor economics choice in labor markets

Labor economics choice in labor markets , Labor economics choice in labor markets , کتابخانه دیجیتالی دانشگاه علوم پزشکی و خدمات درمانی شهید بهشتی

A Multivariate Analysis of a Vocational Rehabilitation Program

This study estimates benefit-cost relationships for many subgroups of disabled persons, using regression analysis. The results sharply contradict the findings of a previous study, which suggested that low-productivity groups benefit as much, per dollar of expenditure, as do higher productivity groups. This study finds that, except for the variable of race, the relationship between rehabilitation outcome and variables such as age, sex, etc., are similar to the relationships often observed between these variables and labor market earnings of the general population. In short, high-productivity groups benefit most, per dollar of expenditure, from the provision of rehabilitation services.

Language ability, US labor market experience and the earnings of immigrants

This study examines the effect of English language ability and time spent in the USA on the earnings of immigrants. Earnings are examined for immigrants of eight broad ancestry areas. Earnings are compared to native‐born Americans of the same ancestry. The study is limited to males between the ages of 25 and 64, using the 1990 US Census 1 percent Public Use Microdata Sample. Substantial differences are found across ancestry groups. Relative earnings slightly but significantly improve with each year spent in the USA. Relative earnings are positively and significantly affected by English language mastery, but the affects of language mastery and years spent in the USA do not appear to significantly reinforce each other.

WORKER RESPONSE TO A MENU OF IMPLICIT CONTRACTS

The literature on implicit contracts between workers and firms suggests that workers face a variety of such contracts, allowing each to choose the optimal trade-off between earnings level and earnings stability. This study tests some implications of that theory through an examination of the risk behavior of individual heads of households. The data source is the University of Michigan Panel Study of Income Dynamics, which includes a measure of the workers taste for risk avoidance. Additionally, several predictions derived from Arrows postulate of increasing relative risk aversion are examined. The results confirm a tendency of risk-averse individuals to choose jobs offering lower wages and lower financial risk. The results also provide indirect support for Arrows postulate. The papers findings suggest that studies of the earnings effects of discrimination may possibly understate those effects, just as studies of the value of a human life may understate that value.

Agency costs, property rights, and the evolution of labor unions

Collective bargaining requires that an agent represent workers. This paper examines the implications for the trade union movement of the resulting agency costs. Without transferable rights in the union, union members lack the means and incentive to bring forth the innovative agent controls common to the modern corporation. Considerations of the bargaining strengths of employers and employees, each represented by an agent, provide an explanation of the simultaneous decline of private sector union membership (corporate share holders have been more successful at lowering agency costs) and growth of public sector union representation (where the union official, a “double agent,” serves the interest of both employee and bureaucratic employer).

Unanticipated Money Growth, Unemployment, Output and the Price Level in the United Kingdom: 1946-1977*

*We gratefully acknowledge the assistance of Michael Parkin, James MaKokha, John Jackson, Tim Deyak, Warren Weber and an anonymous referee. However, they are in no way responsible for remaining errors. The views in this paper do not necessarily reflect those of either the Federal Reserve Board or the Federal Reserve Bank of Atlanta. 1. The justification for a model such as (1) is given by Sargent [19].

Intra-regional wage variation and regional disparity in the relative earnings of blacks

Studies of the relative earnings of Blacks in the U.S. have found that the ratio of Black to White male earnings is lower in the South than in the rest of the U.S. In this paper, it is argued that the usual methods of estimating earnings ratios are distorted by the omission of variables that generate equalizing wage differences which are place-specific. The results support this contention. It is concluded that the Black-White earnings ratio is only about 2.5 percent lower in the South than outside the South. It is not significantly different for those with less than 16 years of work experience.

Hispanics and the Local Labour Market Earnings of Blacks

The effect of the relative supply of Hispanics on the relative earnings of Blacks in US labour markets is examined. The data source for the empirical estimates is the March 1988 Current Population Survey. The results support one of the key features of the Becker model of discrimination, namely, that the extent of discrimination is affected by relative supply. Results also indicated that an increase in the number of Hispanics in a local labour market will reduce the income of otherwise comparable Blacks. However, if the Black labour supply in a local labour market is sufficiently large, a given percentage increase in the relative supply of Blacks will have a more negative impact on average Black earnings than would the same percentage increase in the number of Hispanics.

Wage Dispersion: Why Are Similar Workers Paid Differently?

The article reviews the book “Wage Dispersion: Why Are Similar Workers Paid Differently?,” by Dale T. Mortensen.