Convergence in Macroeconomics: The Labor Wedge

2009 ◽  
Vol 1 (1) ◽  
pp. 280-297 ◽  
Author(s):  
Robert Shimer
Keyword(s):  
Job Search ◽  
Labor Market Outcomes ◽  
The United States ◽  
Competitive Market ◽  
Market Outcomes ◽  
Marginal Rate ◽  
Market Clearing ◽  
Macroeconomic Models ◽  
Marginal Rate Of Substitution ◽  
Labor Wedge

I review research on the behavior of the labor wedge, the ratio between the marginal rate of substitution of consumption for leisure and the marginal product of labor. According to competitive, market-clearing macroeconomic models, the ratio is easy to measure and should be equal to the sum of consumption and labor taxes. The observation that the wedge is higher in continental Europe than in the United States has proved useful for understanding the extent to which taxes can explain differences in labor market outcomes. The observation that the ratio rises during recessions suggests some failure of competitive, market-clearing macroeconomic models at business cycle frequencies. The latter observation has guided recent research, including work on sticky wage models and job search models. (JEL E24, E32, J64)

Immigration and Labor Market Outcomes in U.S. Metropolitan Areas

2019 ◽  
Vol 63 (4) ◽  
pp. 630-652
Author(s):  
Allen Hyde ◽  
Michael Wallace
Keyword(s):  
Labor Market ◽  
Labor Markets ◽  
Labor Market Outcomes ◽  
Economic Restructuring ◽  
The United States ◽  
Earnings Inequality ◽  
Demand Side ◽  
Least Squares Regression ◽  
Market Outcomes ◽  
The Relationship

Two broad orientations have motivated scholarship on the relationship between immigration and labor market outcomes in the United States. The first, the supply-side perspective, often focuses on how immigration affects a variety of outcomes such as unemployment, casualization, and earnings inequality. The second, the demand-side perspective, generally contends that these labor market outcomes result mainly from economic restructuring that subsequently attracts immigrants to labor markets. Previous studies have often reached divergent conclusions due to differing assumptions about the direction of causality in these relationships. In this paper, we use three-stage least squares regression, a technique that allows for nonrecursive relationships, to adjudicate the direction of causality between immigration and labor market outcomes. Using 2010 data for 366 U.S. metropolitan statistical areas, we find support for the demand-side perspective, or that economic restructuring results in higher unemployment, casualization, and earnings inequality, which subsequently increases levels of immigration in metropolitan labor markets.

The Child Left Behind: Parental Incarceration and Adult Human Capital in the United States

2019 ◽  
Vol 109 ◽  
pp. 199-203
Author(s):  
Laura E. Henkhaus
Keyword(s):  
United States ◽  
Degree Attainment ◽  
Labor Market Outcomes ◽  
The United States ◽  
Partial Identification ◽  
Parental Incarceration ◽  
Negative Effects ◽  
Market Outcomes ◽  
Left Behind ◽  
Nationally Representative

Exposure to parental incarceration is particularly prevalent in the United States, where about 7 percent of children have lived with a parent who was incarcerated. In this paper, I use nationally representative US data and apply partial identification methods to bound the likely effects of parental incarceration on education and labor market outcomes. Findings suggest that parental incarceration leads to substantially higher rates of high school dropout. Results provide some support for negative effects on likelihood of college degree attainment and employment in young adulthood. This work has important implications for criminal justice policy and social policies toward children.

scholarly journals Socioeconomic Attainment in the Ellis Island Era

2016 ◽  
Vol 40 (1) ◽  
pp. 147-181 ◽  
Author(s):  
Michael J. White ◽  
Erica Jade Mullen
Keyword(s):  
United States ◽  
First Generation ◽  
Labor Market Outcomes ◽  
The United States ◽  
Ordinary Least Squares ◽  
Foreign Born ◽  
Market Outcomes ◽  
Socioeconomic Attainment ◽  
Ellis Island ◽  
Socioeconomic Assimilation

Contemporary discussions of immigrant assimilation in the United States often take the experience of the late nineteenth and early twentieth centuries as a benchmark, yet significant gaps remain in our understanding of the generality and rate of immigrant progress during that era. Using four decades of Integrated Public Use Microdata Samples census microdata, we utilize both ordinary least squares microdata regression and double cohort methodology to examine socioeconomic assimilation across arrival cohort and country of origin during the Ellis Island era. Our results show, contrary to some writing, that while the first generation (the foreign born) exhibit decidedly inferior labor market outcomes, socioeconomic attainment (measured by Socio-Economic Index points) increased quickly with duration in the United States. Persons of the second generation and those of mixed parentage show much less penalty than immigrants. At the same time, we uncover differences in outcome by European region that do not disappear over the decades we examine.

Network-Based Job Search

2012 ◽  
Vol 41 (4) ◽  
Author(s):  
Gerhard Krug ◽  
Martina Rebien
Keyword(s):  
Social Networks ◽  
Labor Market ◽  
Theoretical Model ◽  
Propensity Score ◽  
Information Flow ◽  
Job Search ◽  
Unobserved Heterogeneity ◽  
Labor Market Outcomes ◽  
Causal Effects ◽  
Market Outcomes

SummaryUsing a search-theoretical model proposed by Montgomery (1992), we analyze the effects of information flow via social networks (friends, relatives, and other personal contacts) on monetary and non-monetary labor market outcomes. Propensity score matching on survey data from low-status unemployed respondents is used to identify causal effects. The analysis takes into account unobserved heterogeneity by applying Rosenbaum bounds. We show that the standard approach to investigating labor market outcomes in terms of how jobs are found is misleading. As an alternative, we propose focusing comparative analyses of labor market outcomes on how individuals search for jobs and, more particularly, on whether they search for jobs via social networks. Using this approach we find no evidence for causal effects on monetary outcomes such as wages and wage satisfaction. We also find no effects for non-monetary outcomes like job satisfaction.

scholarly journals Returns to Late Aged College Degrees

2018 ◽  
Vol 3 (5) ◽  
Author(s):  
Sally Wallace ◽  
Thomas Mroz ◽  
Alex Hathaway
Keyword(s):  
Labor Market ◽  
Labor Force ◽  
Labor Market Outcomes ◽  
College Education ◽  
State Level ◽  
The United States ◽  
Bachelor's Degree ◽  
Older Individuals ◽  
Market Outcomes ◽  
Individual Level

The benefits of a college education are well documented. However, the majority of existing research focuses on students who matriculate soon after high school graduation. There is little empirical evidence illustrating whether a college degree is similarly beneficial to those already in the workforce, particularly individuals over 50. Nonetheless, the coming years will see the dramatic growth of older individuals, many of whom will continue to be active in the labor force, and policymakers would benefit from effective strategies to improve the labor market outcomes of older individuals. This research proposes to evaluate the labor market outcomes of individuals in Georgia who obtain a bachelor’s degree at age 50 or older by merging state-level individual level labor force (Dpt of Labor) with individual level educational data from the University System of Georgia (USG). Specifically, we explore whether these later-age degrees result in employment opportunities with higher wages and increased retention in the labor force beyond the traditional retirement age of 65 than those who do not attain a bachelor’s degree.  The results will provide policymakers across the United States with information to make informed decisions regarding higher education incentives and policies for older students.

Labor Market Outcomes of Immigrant Women in the United States: 1970 to 1990

1998 ◽  
Vol 32 (1) ◽  
pp. 57-77 ◽  
Author(s):  
Robert F. Schoeni
Keyword(s):  
United States ◽  
Labor Market ◽  
Wage Gap ◽  
Immigrant Women ◽  
Labor Market Outcomes ◽  
The United States ◽  
The Philippines ◽  
Market Outcomes ◽  
The United Kingdom ◽  
Almost All

Forty-two percent of immigrant workers in the United States are women, yet almost all of the evidence on the economic performance of immigrants is based on analyses of men. This study begins to fill the void by examining differences in a wide array of labor market outcomes between U.S.-born and immigrant women, and among immigrant women born in different countries or regions of the world, using the 1970, 1980 and 1990 censuses. Immigrant women were less likely to participate in the labor force, and this gap increased to 7 percentage points by 1990. However, the share of self-employed and the number of weeks and hours worked among employed women were roughly the same for immigrants and natives throughout the 1970–1990 period. The gap in unemployment and weekly wages widened in favor of natives between 1970 and 1990, with a gap in median wages of 14 percent in 1990. However, immigrants born in the United Kingdom and Canada, Europe, Japan, Korea, China, the Philippines, and the Middle East have had steady or improved wages and unemployment relative to U.S.-born women. At the same time, immigrants from Mexico and Central America, who now represent one-quarter of all immigrant women, have experienced relatively high unemployment and low earnings, and these differences have increased, with the wage gap reaching 35 percent in 1990. Disparities in completed years of schooling can explain a substantial share of the differences in labor market outcomes.

Book Reviews

2013 ◽  
Vol 51 (2) ◽  
pp. 558-560
Keyword(s):  
Labor Market ◽  
Minimum Wage ◽  
Job Search ◽  
Labor Market Outcomes ◽  
Minimum Wages ◽  
New York University ◽  
Market Outcomes ◽  
Welfare Impacts ◽  
Wage Effects ◽  
The Impact

Etienne Wasmer of Sciences Po and LIEPP reviews, “The Minimum Wage and Labor Market Outcomes” by Christopher J. Flinn. The Econlit abstract of this book begins: “Presents a model based on search and bargaining to use in investigating the impact of a minimum wage on labor market outcomes. Discusses descriptive evidence on minimum wage effects; a model of minimum wage effects on labor market careers; labor market and welfare impacts of minimum wages; minimum wage effects on labor market outcomes—a selective survey; assessing the welfare impacts of actual changes in the minimum wage; econometric issues; model estimates and tests; optimal minimum wages; the on-the-job search; and heterogeneity. Flinn is Professor of Economics at New York University and Senior Research Fellow at Collegio Carlo Alberto.”

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