geographic mobility race and wage differentials abstract this paper analyzes the relationship between geographic mobility and earnings we present an equilibrium search model that yields differences between the reservation wages of mobile and immobile workers the expected wages of mobile workers exceed those of immobile workers due to partial sorting across high and low paying firms an extension to visibly distinct groups with different immobile proportions yields statistical discrimination against immobile group members using combined displaced workers files we find that mobility positively affects earnings and partially explains racial and ethnic earnings differentials to test for statistical discrimination we estimate separate earnings functions for union and nonunion workers

small firms and the merger mania empirical research has found an average or even superior performance of small firms this seems to be at variance with the secular concentration process and the recurrent merger waves this paper tries to integrate size and merger research higher profitability of small firms is explained by their incentive structure and shorter decision lags but also by lower wages and higher individual risk premia their faster growth in the eighties was in addition fostered by diversification of demand miniaturization of technology and a need for flexibility under uncertainty the merger wave on the other hand does not necessarily prove that large firms are superior managers and shareholders may be seduced by stockmarket optimism a sizeable industry of banks agents and lawyers have their own interests in mergers mergers may be important in declining markets and for the acquisition of technology on average mergers do not improve efficiency profits or internal growth small and large firms serve different purposes performance depends on the market incentives and technology the establishment growth and closure of small firms as well as mergers are attempts to find the optimal organization for utility maximization in a world of severe uncertainty and diverse needs

long run estimates of technological change and scale economies in a dynamic framework australian permanent building societies 1974 1990 abstract this paper formulates and estimates a dynamic model to investigate the characteristics of the cost function of australian permanent building societies while the results suggest that the societies adjust costs quickly to long run levels the modelling of cost dynamics is shown to have a significant influence on estimates of scale economies and on the identification of the timing of shifts in the cost frontier and changes in the growth of total factor productivity

recent trends in the size structure of italian manufacturing firms this paper analyses the re emergence of small scale production which has characterised the more recent phase of industrial development in western countries providing updated evidence about the phenomenon and focussing in particular the attention on italy where it has been assuming peculiar relevance

strategic amnesty and credible immigration reform why do countries that impose employer sanctions to deter the illegal entry of foreign workers nevertheless grant amnesty to illegal immigrants in this article i provide a positive theory of amnesty provision in a model where the constrained optimal immigration reform involving the joint use of employer sanctions and border interdictions is time inconsistent in particular my framework demonstrates that host countries of immigration can enhance the credibility of their immigration reforms by binding their own hands and strategically granting a socially excessive amount of amnesty to illegal workers

return migration uncertainty and precautionary savings this paper presents a life cycle model where migrants determine re migration and consumption simultaneously in a stochastic environment whether precautionary savings of migrants are above or below those of natives is ambiguous in general the sign depends on the risk in host and home country labor markets and on the correlation of labor market shocks furthermore the effect of an uncertain environment on migration and re migration plans cannot be unambiguously signed for the general case it depends on the size of the wage differential as well as the relative risk the migrant exhibits in the two labor markets

the decline of dominant firms 1905 1929 the theory of dynamic limit pricing implies that a firm maximizes its wealth by gradually sacrificing its dominant market share we extend the theory by simulation methods to show that higher structural entry barriers generally result in both higher profits and a slower sacrifice of market share the model is applied to 42 once dominant firms in u s manufacturing to explain jointly the declines of their market shares and the profit rates earned during 1905 1929 the statistical results agree substantially with the hypothesis that these firms behaved consistently with maximizing their wealth through dynamic limit pricing

sale of visas a smuggler s final song is there a way of eliminating human smuggling we set up a model to simultaneously determine the provision of human smuggling services and the demand from would be migrants a visa selling policy may be successful at eliminating human smugglers by eroding their profits but it necessarily increases immigration in contrast re enforced repression decreases migration but uses the help of cartelized smugglers to overcome this trade off we study how legalisation and repression can be combined to eliminate human smuggling while controlling migration flows this policy mix also has the advantage that the funds raised by visa sales can be used to finance additional investments in border and internal controls employer sanctions and deportations simulations of the policy implications highlight the complementarities between repression and legalisation and call into question the current policies

consumption in the shadow of unemployment abstract by how much do employed households reduce their consumption when the aggregate unemployment rate rises in spain during the great recession a one point increase in the unemployment rate was related to a strong reduction in household consumption of more than 0 7 per equivalent adult this reduction is consistent with forward looking agents responding to downward revisions of their expectations on future income growth rates the shadow of unemployment using consumption panel data that include information on physical quantities we show that the drop in consumption expenditure was truly a reduction in quantities and not a switch to cheaper alternatives

immigration and prices this paper examines the behavior of prices following the unexpected arrival of a large number of immigrants from the former soviet union fsu to israel during 1990 i use store level price data on 915 consumer price index products to show that the increase in aggregate demand prompted by the arrival of the fsu immigration significantly reduced prices during 1990 when one controls for native population size and city and month effects a one percentage point increase in the ratio of immigrants to natives in a city decreases prices by 0 5 percentage point on average it is argued that this negative immigration effect is consistent with fsu immigrants the new consumers having higher price elasticities and lower search costs than the native population thus immigration can have a moderating effect on inflation through its direct effect on product markets and not only by increasing the supply of labor

discrimination in an equilibrium search model i construct an equilibrium search model where some employers have a distaste for hiring minority workers and show that this bias results in economic discrimination against minority workers although only unprejudiced firms hire minority workers minority workers receive lower wages than workers not facing discrimination whenever any employers in the market have a distaste for minority workers one implication of the model is that gender or racial wage differentials understate the utility loss from discrimination in addition the wages of minority workers increase when their proportion increases in the labor market

long term effects of class size this article evaluates the long term effects of class size in primary school we use rich data from sweden and exploit variation in class size created by a maximum class size rule smaller classes in the last three years of primary school age 10 to 13 are beneficial for cognitive and noncognitive ability at age 13 and improve achievement at age 16 most important we find that smaller classes have positive effects on completed education wages and earnings at age 27 to 42 the estimated wage effect is large enough to pass a cost benefit test

the economic effect of immigration policies analyzing and simulating the u s case abstract in this paper we analyze the economic effects of different immigration policies using a model that incorporates economic and policy features crucial to understanding the migrant flows into the us we differentiate among the most relevant channels of immigration to the us family based employment based and undocumented moreover we explicitly account for earning incentives to migrate and for the role of immigrant networks in generating immigration opportunities hence we can analyze the effect of policy changes through those channels in our simulations comparing long run steady states highly skilled employment and unskilled immigrants generate larger surplus to us firms than natives do hence policies restricting their entry either directly or indirectly have a depressing effect on job creation and in turn on native labor markets our analysis gives new insights into the effect of policies as it accounts for the endogenous immigration response which is overlooked by most existing models

distributing the green cards permanent residency and personal income taxes after the immigration reform and control act of 1986 abstract we explore how permanent residency affects personal income tax participation and net personal income tax payments using variation from the immigration reform and control act of 1986 irca which authorized the largest u s amnesty to date we exploit the timing and geographic unevenness of irca s legalization programs alongside newly digitized data on personal income taxes in california home to the majority of applicants green cards induced the previously unauthorized to file state income tax returns at rates comparable to other california residents while the new returns generated little additional revenue through the end of the 1990s they did raise the incomes of families with children through new claims of the federal earned income tax credit

gender differences in the labor market impact of irca s amnesty provisions how to address the current record high number of unauthorized workers within our borders has been a hotly debated topic although a number of studies have examined the effect of employer sanctions bansak and raphael 2001 deborah a cobb clark clinton r shields and b lindsey lowell 1995 and border enforcement pia orrenius and madeline zavodny 2003 only a handful have examined the impact of amnesty on newly legalized immigrants sherrie a kossoudji and deborah a cobb clark 2002 neeraj kaushal 2006 while amnesty is being considered a current solution to immigration concerns the impact of past amnesty programs on the labor market outcomes and economic well being of immigrants has not been documented widely and the analysis has been limited largely to men in this paper we examine whether amnesty a provision of the 1986 immigration reform and control act irca affected the labor market outcomes and wages of the legalized population the analysis is carried out by gender to address male and female differences in labor supply and earnings legalization was intended to bring undocumented workers out of the shadows which may have affected their well being by reducing workplace vulnerabilities increasing job mobility and improving working conditions sherrie a kossoudji and cobb clark 2002 using data from the legalized population survey lps and a comparison sample from the 1979 national longitudinal survey of youth nlys79 we develop a quasi experimental framework to assess the impact of irca s amnesty provisions on the legalized population gender differences in the labor market impact of irca s amnesty provisions

using selection on observed variables to assess bias from unobservables when evaluating swan ganz catheterization distinguishing causal effects from correlations is a key objective of research regardless of field even in medicine controlled experiments are not always practical or ethical in economics and we suspect in most other fields identification strategies based upon observational data are rarely bulletproof in their landmark study a f connors et al 1996 use propensity score matching methods with an extremely rich set of demographic characteristics and health status measures to assess whether swan ganz catheterization 1c 2 a widely used device for monitoring intensive care unit icu patients raises or lowers mortality in their sample of icu patients they find that receiving c within the first 24 hours raises mortality rates casting serious doubt on the value of this procedure for critically ill patients jay bhattacharya azeem m shaikh and edward vytlacil 2007 2008 hereafter bsv observe that since c recipients are sicker on many observed dimensions propensity score matching which ignores selection on unobservables might overstate the negative consequences of c they apply a set of bounds estimators including an extension of shaikh and vytlacil 2004 that incorporates prior information that weekend applications of recent methodology in project evaluation

return migration and violence abstract there is reason to suspect that return migrants can reduce social violence in migrant prone regions of the world taking into account that recent research shows positive effects of return migration we consider that returners may reduce violence by contributing to social renewal and economic growth in their home communities we estimate the direct effects of return migration in the context of mexico a traditionally migrant country that has suffered record levels of violence in the past decade using data on homicide rates from 2456 municipalities for the 2011 2013 period and an instrumental variable bivariate tobit maximum likelihood approach we find that higher rates of return migration lead to a decline in local homicide rates we also show with a censored quantile instrumental variable cqiv model that municipalities in the bottom quartile of the homicide rate distribution benefit the most from return migration our work has important implications for crime reduction policies in developing countries and specifically in mexico where social violence has wreaked havoc on society in recent years

the central role of noise in evaluating interventions that use test scores to rank schools many programs reward or penalize schools based on students average performance mean reversion is a potentially serious hindrance to the evaluation of such interventions chile s 900 schools program p 900 allocated resources based on cutoffs in schools mean test scores this paper shows that transitory noise in average scores and mean reversion lead conventional estimation approaches to overstate the impacts of such programs it further shows how a regressiondiscontinuity design can be used to control for reversion biases it concludes that p 900 had significant effects on test score gains albeit much smaller than is widely believed

migration experience and earnings in the mexican labor market we present a theoretical and empirical analysis of the relationship between u s migration experience and earnings in the mexican labor market we use our model to analyze the effects of self selection and endogeneity on ols estimates of the return to migration experience in the mexican labor market under plausible assumptions ols estimates provide a lower bound on the true average return to migration experience among return migrants using mexican migration project mmp data we find a return to migration experience of about 2 2 percent per year our estimates are robust to the inclusion of proxies for unobserved skill a comparison with patterns in the 1995 mexican population and dwelling count suggests that our results are robust across data sets and are driven by a relationship between migration experience and wages not hours worked we also explore the plausibility of multiple mechanisms that could explain this relationship we find the most evidence for the theory that individuals are acquiring occupation specific work experience in the united states the return to a year of occupation specific migration experience is estimated to be as high as 8 7 percent for some occupations

an analysis of the correlates of discrimination facing young hispanic job seekers this study examines the extent and correlates of discrimination faced by young accented hispanic males in chicago and san diego using the outcomes of job applications by matched pairs of anglo and hispanic job seekers this is one of the first examples of audits being used in the labormarket area the audit methodology provides a powerful basis for examining discriminatory hiring practices because it permits direct comparison of hiring outcomes for pairs of anglo and hispanic jobseekers with similar labor market qualifications in this paper we first present differences in anglo hispanic success rates in filing applications obtaining interviews and obtaining jobs this builds on the descriptive analysis presented in harry cross et al 1990 we then focus on the correlates of differential success in obtaining interviews and in subsequent job acquisition i the audit methodology

immigration and international prices an initial assessment abstract using prices from a number of cities across the world during 1990 2006 this paper shows that there exists a negative impact of immigration on prices the estimated absolute elasticity of prices with respect to immigration is around 14 across specifications

the effects of dacamentation the impact of deferred action for childhood arrivals on unauthorized immigrants abstract as the largest immigration policy in 25 years deferred action for childhood arrivals daca made deportation relief and work authorization available to 1 7 million unauthorized immigrants this paper looks at how daca affects daca eligible immigrants labor market outcomes i use a difference in differences design for unauthorized immigrants near the criteria cutoffs for daca eligibility i find daca increases the likelihood of working by increasing labor force participation and decreasing the unemployment rate for daca eligible immigrants i also find daca increases the income of unauthorized immigrants in the bottom of the income distribution i find little evidence that daca affects the likelihood of attending school using these estimates daca moved 50 000 to 75 000 unauthorized immigrants into employment if the effects of deferred action for parents of americans and lawful permanent residents dapa are similar to daca then dapa could potentially move over 250 000 unauthorized immigrants into employment

effects of immigrant legalization on crime in the late 1970s rates of undocumented immigration into the united states began to increase dramatically fearing negative labor market and social effects congress passed the 1986 immigration reform and control act irca the primary purpose of the bill was to enhance the controls on the hiring of undocumented immigrants making it illegal to hire or recruit undocumented immigrants however the legislation also represented a near universal legalization of immigrants in the united states a group comprising almost three million people about 1 percent of the nation s population this paper examines the effects that the irca had on the commission of crime in the united states i provide estimates of the total effect of this legalization exploiting the large amount of variation in both the geographical distribution and the quasi random timing of the legalizations i find persistent decreases in crime of 3 percent to 5 percent primarily driven by a drop in property crimes this fall in crime is equivalent to 120 000 180 000 fewer violent and property crimes committed each year across the nation due to legalization moreover the declines in crime cannot be explained by existing trends economic conditions declines in drug crimes changes to police forces and prison populations or other common explanations of changes in crime rates during this period

the slave trade and the origins of mistrust in africa in a recent study nunn 2008 examines the long term impacts of africa s slave trade he finds that the slave trade which occurred over a period of more than 400 years had a significant negative effect on long term economic development although the article arguably identifies a negative causal relationship between the slave trade and income today the analysis is unable to establish the exact causal mechanisms underlying this reduced form relationship in this article we examine one of the channels through which the slave trade may affect economic development today combining contemporary individual level survey data with historical data on slave shipments by ethnic group we ask whether the slave trade caused a culture of mistrust to develop within africa initially slaves were captured primarily through state organized raids and warfare but as the trade progressed the environment of ubiquitous insecurity caused individuals to turn on others including friends and family members and to kidnap trick and sell each other into slavery sigismund wilhelm koelle 1854 p e h hair 1965 charles piot 1996 we hypothesize that in this environment a culture of mistrust may have evolved which may persist to this day we show that current differences in trust levels within africa can be traced back to the transatlantic and indian ocean slave trades combining contemporary individual level survey data with historical data on slave shipments by ethnic group we find that individuals whose ancestors were heavily raided during the slave trade are less trusting today evidence from a variety of identification strategies suggests that the relationship is causal examining causal mechanisms we show that most of the impact of the slave trade is through factors that are internal to the individual such as cultural norms beliefs and values jel j15 n57 z13

the perverse effects of partial labour market reform fixed term contracts in france we argue that the effects of a partial reform of employment protection by allowing firms to hire workers on fixed term contracts may be perverse the main effect may be high turnover in entry level jobs leading to higher not lower unemployment even if unemployment falls workers may be worse off going through many spells of unemployment and entry level jobs before obtaining a regular job considering french data for young workers since the early 1980s we conclude that the reforms have substantially increased turnover without a substantial reduction in unemployment duration if anything the effect on their welfare appears to have been negative

direct evidence on risk attitudes and migration geographic mobility is important for the functioning of labor markets because it brings labor resources to where they can be most efficiently used it has long been hypothesized that individuals migration propensities depend on their attitudes towards risk but the empirical evidence to the extent that it exists has been indirect in this paper we use newly available data from the german socio economic panel to measure directly the relationship between migration propensities and attitudes towards risk we find that individuals who are more willing to take risks are more likely to migrate between labor markets in germany this result is robust to stratifying by age sex education national origin and a variety of other demographic characteristics as well as to the level of aggregation used to define geographic mobility the effect is substantial relative to the unconditional migration propensity and compared to the conventional determinants of migration we also find that being more willing to take risks is more important for the extensive than for the intensive margin of migration

immigrants and the labor market this article examines skill gaps between immigrants and native born americans and generational progress achieved by different immigrant ethnic groups evidence of a widening skill gap is not strong while wage data show a pronounced fall in relative wages of recent immigrants significant independent contributors to that decline are a widening age gap and the increasing price of skill when attention shifts to legal migrants the evidence is that legal migrants are at a minimum keeping up with native born americans i find that the concern that educational generational progress among latino immigrants has lagged behind other immigrant ethnic groups is unfounded

the impact of temporary protected status on immigrants labor market outcomes the united states currently provides temporary protected status tps to more than 300 000 immigrants from selected countries tps is typically granted if dangerous conditions prevail in the home country due to armed conflict or a natural disaster individuals with tps cannot be deported and are allowed to stay and work in the united states temporarily despite the increased use of tps in recent years little is known about how tps affects labor market outcomes for beneficiaries most of whom are unauthorized prior to receiving tps this study examines how migrants from el salvador who are likely to have received tps fare in the labor market compared with other migrants the results suggest that tps eligibility leads to higher employment rates among women and higher earnings among men the results have implications for recent programs that allow some unauthorized immigrants to receive temporary permission to remain and work in the united states

mexico u s immigration effects of wages and border enforcement in this article i study how relative wages and border enforcement affect immigration from mexico to the u s to do this i develop a discrete choice dynamic programming model where people choose from a set of locations in both the u s and mexico while accounting for the location of one s spouse when making decisions i estimate the model using data on individual immigration decisions from the mexican migration project counterfactuals show that a 10 increase in mexican wages reduces migration rates and durations overall decreasing the number of years spent in the u s by about 5 a 50 increase in enforcement reduces migration rates and increases durations of stay in the u s and the overall effect is a 7 decrease in the number of years spent in the u s

temporary contracts and work family balance in a dual labor market a well established finding in the literature is that self employment enables mothers to accommodate work and family needs better than when they are engaged in organizational employment with this result in mind the authors investigate within a dual system of job protection if women under temporary contracts face greater work family conflicts than those under permanent contracts the authors use data on women s work and fertility histories from the spanish continuous sample of working histories to analyze whether women under temporary contracts transition to self employment upon motherhood more than those who are under permanent contracts analyses show that being under a temporary contract increases women s likelihood of transitioning to self employment upon childbirth supplementary analyses show that this is partly the result of voluntary transitions and not an employer s decision to terminate a temporary contract upon motherhood overall these findings reveal a hidden cost of temporary contracts the greater difficulty in balancing work and family

illegal immigration border enforcement and relative wages evidence from apprehensions at the u s mexico border we examine illegal immigration in the united states from mexico over the period 1976 1995 one challenge is that we do not observe the number of individuals that attempt to enter the united states illegally we only observe the number of individuals apprehended attempting to cross the u s mexico border illegally based on a simple migration model we postulate the existence of an apprehensions function which expresses apprehensions at the border as a function of illegal attempts to cross the border and u s border enforcement effort we find that a 10 decrease in the mexican real wage leads to a 7 5 to 8 8 increase in apprehensions at the border excerpt

technological change in large u s commercial banks this article examines technological change its relationship to firm size and its impact on the efficient scale of output and product mix for large u s commercial banks the results suggest that technological change lowered real costs by about one percent per year increased the cost minimizing scale of outputs and affected product mix the authors do not find support for the galbraith schumpeter hypothesis this suggests that the largest banks cannot use innovation alone to outpace smaller banks the major implications are that public policies allowing freer banking combinations do not necessarily run counter to the public interest copyright 1991 by university of chicago press

affirmative action in education evidence from engineering college admissions in india abstract this paper examines an affirmative action program for lower caste groups in engineering colleges in india we study both the targeting properties of the program and its implications for labor market outcomes we find that affirmative action successfully targets the financially disadvantaged the upper caste applicants that are displaced by affirmative action come from a richer economic background than the lower caste applicants that are displacing them targeting by caste however may lead to the exclusion of other disadvantaged groups for example caste based targeting reduces the overall number of females entering engineering colleges we find that despite poor entrance exam scores lower caste entrants obtain a positive return to admission our estimates however also suggest that these gains may come at an absolute cost because the income losses experienced by displaced upper caste applicants are larger than the income gains experienced by displacing lower caste students limited sample sizes in our preferred econometric specifications however prevent us from drawing strong conclusions from these labor market findings

economic success factors in spanish small retail businesses an analysis based on sector relative definitions the purpose of this study was to carry out a sectorial analysis of the strategic profile of successful small businesses in spanish retailing first a one dimensional statistical formalisation of the concept of small business was proposed based on yearly sales revenue and relative to the sector likewise some statistical formalisations of the concept of economic success were proposed based on profit margins and also relativised according to sector once a conceptual framework was established a sectorial model of strategic characterisation of successful small retailing firms was developed the results of applying these proposals to the spanish retail industry confirmed the importance of a sectorial approach as opposed to an overall analysis

tipping and the dynamics of segregation schelling dynamic models of segregation journal of mathematical sociology 1 1971 143 186 showed that extreme segregation can arise from social interactions in white preferences once the minority share in a neighborhood exceeds a tipping point all the whites leave we use regression discontinuity methods and census tract data from 1970 through 2000 to test for discontinuities in the dynamics of neighborhood racial composition we find strong evidence that white population flows exhibit tipping like behavior in most cities with a distribution of tipping points ranging from 5 to 20 minority share tipping is prevalent both in the suburbs and near existing minority enclaves in contrast to white population flows there is little evidence of nonlinearities in rents or housing prices around the tipping point tipping points are higher in cities where whites have more tolerant racial attitudes

selection on observed and unobserved variables assessing the effectiveness of catholic schools in this paper we measure the effect of catholic high school attendance on educational attainment and test scores because we do not have a good instrumental variable for catholic school attendance we develop new estimation methods based on the idea that the amount of selection on the observed explanatory variables in a model provides a guide to the amount of selection on the unobservables we also propose an informal way to assess selectivity bias based on measuring the ratio of selection on unobservables to selection on observables that would be required if one is to attribute the entire effect of catholic school attendance to selection bias we use our methods to estimate the effect of attending a catholic high school on a variety of outcomes our main conclusion is that catholic high schools substantially increase the probability of graduating from high school and more tentatively attending college we find little evidence of an effect on test scores

more evidence on the undercounting of small firm r d abstract drawing from the seo national survey on r d and innovation in the netherlands we argue that there must be an underrecording of small scale r d by orders of magnitude in the r d survey by the dutch central statistical office such underrecording holds for manufacturing and even more so for service firms this finding is confirmed by estimates based on records of firms receiving r d subsidies which we use as a third independent source in order to allow for international comparability of r d data the survey methods of the dutch central statistical office are similar to those in other oecd countries therefore our findings in the dutch manufacturing and service industries are likely to have an impact for the measurement of r d in other oecd countries the results have implications for our judgement about the famous schumpeterian hypotheses concerning the influence of firm size and market structure on r d

amnesty programs and the labor market outcomes of undocumented workers i investigate the effect of the 1997 nicaraguan adjustment and central american relief act nacara on employment and earnings of undocumented foreign born men from nicaragua cuba guatemala and el salvador who were eligible for amnesty under the act i find that nacara had a modest effect on the employment of these men raised their real wage by 3 percent and weekly earnings by 4 percent estimates show that nacara raised the wage of the target group without a high school degree by a statistically insignificant 1 percent and of those with high school or higher education by a statistically significant 5 percent

small business dynamics in europe this paper examines how the firm size distribution has shifted over the last two decades across a broad spectrum of european countries the evidence suggests that a shift away from large firms and towards small business has taken place particularly is the southern regions and in the high technology indutries

the demand for hours of labor direct evidence from california california s longstanding requirement that most women receive time and a half pay for workhours beyond eight in one day was extended to men in 1980 analyzing current population survey data from 1973 1985 and 1991 we find that this overtime penalty substantially reduced the amount of daily overtime worked by california men relative to men in other states comparisons that use women to control for california specific shocks show even stronger effects the estimates imply a price elasticity of demand for overtime hours of at least 20 5

not just a work permit eu citizenship and the consumption behavior of documented and undocumented immigrants this paper explores the impact of the 2007 european union enlargement on the consumption behavior of immigrant households using data from a unique italian survey and a difference in differences approach we find that the enlargement induced a significant consumption increase for the immigrant households from new member states both in the short and in the medium run this enlargement effect cannot be attributed to the mere legalization as it concerns both undocumented and documented immigrants albeit through different channels detailed information on immigrants legal status undocumented documented and sector of employment informal formal allows us to shed light on the exact mechanisms following the enlargement previously undocumented immigrants experienced an increase in the labor income by moving from the informal towards the formal economy whereas immigrants who were already working legally in italy benefitted from the increased probability of getting a permanent contract enhanced employment stability in turn reduced the uncertainty about future labor income leading to an increase in documented immigrants consumption expenditure

peer effects in program participation the influence of peers could play an important role in the take up of social programs however estimating peer effects has proven challenging given the problems of reflection correlated unobservables and endogenous group membership we overcome these identification issues in the context of paid paternity leave in norway using a regression discontinuity design our approach differs from existing literature which attempts to measure peer effects by exploiting random assignment to peer groups in contrast we study peer effects in naturally occurring peer groups but exploit random variation in the price of a social program for a subset of individuals fathers of children born after april 1 1993 in norway were eligible for one month of governmental paid paternity leave while fathers of children born before this cutoff were not there is a sharp increase in fathers taking paternity leave immediately after the reform with take up rising from 3 to 35 while this quasirandom variation changed the cost of paternity leave for some fathers and not others it did not directly affect the cost for the father s coworkers or brothers therefore any effect on the brother or the coworker can be attributed to the influence of the peer father in their network our key findings on peer effects are four fold first we find strong evidence for substantial peer effects of program participation in both workplace and family networks coworkers and brothers are 11 and 15 percentage points respectively more likely to take paternity leave if their peer father was induced to take up leave by the reform second the most likely mechanism is information transmission about costs and benefits including increased knowledge of how an employer will react third there is essential heterogeneity in the size of the peer effect depending on the strength of ties between peers highlighting the importance of duration intensity and frequency of social interactions fourth the estimated peer effect gets amplified over time with each subsequent birth exhibiting a snowball effect as the original peer father s influence cascades through a firm our findings demonstrate that peer effects can lead to long run equilibrium participation rates which are substantially higher than would otherwise be expected

immigration reform and the earnings of latino workers do employer sanctions cause discrimination this paper investigates whether employer sanctions for hiring undocumented workers introduced by the 1986 immigration reform and control act irca adversely affected the hourly earnings of latino workers in the southwestern u s we exploit the staggering of the sanctions and employee verification requirements across sectors to estimate this effect in particular irca s employer sanctions provisions were not extended to agricultural employers until two years after their imposition on non agricultural employers hence latino agricultural workers provide a control group against which to compare changes in the wages of latinos in non agricultural employment we find substantial pre post irca declines in the hourly earnings of latino non agricultural workers relative to latinos in agriculture this pattern however is considerably stronger for latino men than latina women we do not observe similar inter sectoral shifts in relative wages among non latino white workers in fact the relative wage changes for non latino white workers are of the opposite sign finally the pre post irca relative decline in latino non agricultural wages reverses the pre irca trend where we observe the relative earnings of latino non agricultural workers increasing

some essentials of a workable guest worker program a guest worker program provides an appealing way of addressing labor shortages in an advanced country it requires however that foreign workers are willing to return home when their work permit expires i examine how immigration policies enforcement measures and opportunities available in various markets at home and abroad affect the behavior of program participants welfare of a migrant who obeys the rules of the program is compared with that of workers who choose other options in order to define the conditions under which temporary migration is attractive to potential migrants and at the same time consistent with voluntary return

the effect of low skilled immigration on u s prices evidence from cpi data i exploit the large variation across u s cities and through time in the relative size of the low skilled immigrant population to estimate the causal effect of immigration on prices of nontraded goods and services using an instrumental variables strategy i find that at current immigration levels a 10 percent increase in the share of low skilled immigrants in the labor force decreases the price of immigrant intensive services such as housekeeping and gardening by 2 percent wage equations suggest that lower wages are a likely channel through which these effects take place however wage effects are significantly larger for low skilled immigrants than for low skilled natives implying that the two are imperfect substitutes

clicking on heaven s door the effect of immigrant legalization on crime we estimate the eect of legalization on the crime rate of immigrants by exploiting the italian policy framework as an ideal regression discontinuity design xed quotas of residence permits are available each year applications must be submitted electronically on specic click days and they are processed on a rst come rst served basis until the available quotas are exhausted by matching data on applicants including the timing of applications in milliseconds with restricted use criminal records for the year before and after click days we show that obtaining legal status reduces the probability of being reported for having committed a serious crime by 0 6 percentage points on average on a baseline crime rate of 1 percent this eect is driven by applicants that are allegedly employed by other immigrants as domestic workers but are most likely unemployed who exhibit the highest crime rate in the year before click days as well as the greatest reduction in crime after obtaining legal status by contrast applicants sponsored by rms exhibit a very low crime rate both before and after click days we conclude that undocumented immigrants confronting worse labor market opportunities are at a higher risk of committing crimes while they are also more responsive to legalization

the evolution of manufacturing technology and its impact on industrial structure an international study this paper shows that plant and firm size in manufacturing and especially in engineering industry in several western industrial countries has declined since the early 1970s two hypotheses explaining the decline are advanced one is de glomeration or specialization the divestiture of non core businesses in order to free up scarce resources particularly management time to defend and nurture core business activities the second hypothesis is that the emergence of new computer based technology has improved the quality and productivity of small and medium scale production relative to standardized mass production techniques which dominated previously

technical change organizational form and the structure of bank production of those technological characteristics related to the nature of competition among firms in an industry or market scale economies and technical change are especially important economies of scale are said to exist when an equiproportional increase in all inputs results in a greater than proportional increase in output or equivalently when an increase in output at constant input prices leads to a less than proportional increase in total costs thus average costs decline as output expands depending upon the extent to which costs decline as output increases regulation of the firms in the industry may be necessary l the literature analyzing scale economies in commercial banking is voluminous the early studies on scale economies in banking include those by benston 1965 1972 greenbaum 1967 murphy 1972 and bell and murphy 1968 more recent studies include those by benston hanweck and humphrey 1982 and clark 1984 2 this literature has established that mild scale economies exist in bank

immigrant and emigrant earnings a longitudinal study this paper analyzes the relationship between earnings and the extent of assimilation cohort quality change and return migration experienced by the foreign born population the study uses the longitudinal data available in the survey of natural and social scientists and engineers the analysis reveals that there was a sizable decline in the skills of this population over the last two decades in addition the study shows that return migration is more likely among immigrants who did not perform well in the u s labor market

war and local collective action in sierra leone abstract we study the brutal 1991 2002 sierra leone civil war using nationally representative household data on conflict experiences postwar economic outcomes local politics and collective action individuals whose households directly experienced more intense war violence are robustly more likely to attend community meetings more likely to join local political and community groups and more likely to vote tests using prewar controls and alternative samples suggest that selection into victimization is unlikely to be driving the results more speculatively the findings could help partially explain the rapid postwar political and economic recoveries observed in sierra leone and after several other recent african civil wars

mergers and technical efficiency in spanish savings banks a stochastic distance function approach abstract the aim of this paper is to test the temporal variation of technical efficiency of spanish savings banks during the period 1985 1998 furthermore we test whether merged and non merged firms have different levels and temporal patterns of technical efficiency a stochastic output distance function r w shephard theory of cost and production functions princeton university press princeton nj is employed to accommodate multiple output technology the distance function provides the advantage that it does not need information about prices so it can accommodate the multi product nature of the financial sector only using the quantities as data an important point when the assumptions about perfectly competitive markets are unlikely to be met the temporal variation of efficiency is modeled extending the battese and coelli journal of productivity analysis 3 1992 153 169 approach in two ways relaxing the monotonicity of the temporal variation pattern of the efficiency term and allowing for different patterns of efficiency change between merged and non merged firms

turnover in u s agricultural labor markets agricultural workers move in and out of agriculture frequently migration between types of jobs takes relatively little time legal female workers tend to stay out of the u s labor market longer once they stop being employed and their access to jobs outside of agriculture is more limited than that of their male counterparts predictions made when the 1986 immigration reform and control act was passed that granting people amnesty would induce most of them to leave agriculture were incorrect copyright 2002 oxford university press

the effect of naturalization on wage growth a panel study of young male immigrants for young male immigrants naturalization facilitates assimilation into the u s labor market following naturalization immigrants gain access to public sector white collar and union jobs and wage growth accelerates consistent with removal of employment barriers the faster wage growth of immigrants who naturalize might alternatively result from greater human capital investment prior to naturalization stemming from a long term commitment to u s labor markets but there is no evidence that wage growth accelerates or the distribution of jobs improves until citizenship is attained finally the gains from naturalization are greater for immigrants from less developed countries and persist when we control for unobserved productivity

crime and economic incentives we explore the role that economic incentives particularly changes in wages at the bottom end of the wage distribution play in determining crime rates we use data on the police force areas of england and wales between 1975 and 1996 and find relative falls in the wages of low wage workers lead to increases in crime we carry out a number of experiments with different wage measures including a wage measure that accounts for the effects of changes in the composition of employment these reinforce the picture of a strong association between the low wage labor market and crime the result that incentives play a central role is reinforced further by the strong impact on crime of deterrence measures and of a measure of the returns to crime

immigration reform and farm labor markets farmers throughout the united states report a shortage of workers at the same time there are proposals to strengthen the enforcement of existing immigration laws in this paper we develop an equilibrium approach to examine the impact of removing undocumented workers from the california agricultural labor market and to infer whether there is evidence of shortages using individual worker data we find evidence that is consistent with a persistent shortage in some sub sectors of the california farm labor market further we conduct counter factual policy simulations over a range of possible policy alternatives and find that removing 50 all undocumented farm workers from the state would lead to an increase in wages of over 22

coming out of the shadows learning about legal status and wages from the legalized population the 1986 immigration reform and control act irca granted amnesty to approximately 1 7 million long term unauthorized workers in an effort to bring them out of the shadows and improve their labor market opportunities an analysis of wages using panel data for a sample of legalized men provides evidence that wage determinants are structurally different after amnesty for them but not for the comparison group as measured during the same time periods the wage penalty for being unauthorized is estimated to range from 14 to 24 the wage benefit of legalization under irca was approximately 6

the effect of language training on immigrants economic integration empirical evidence from france abstract we examine the impact of language training on the economic integration of immigrants in france the assignment to this training offered by the french ministry of the interior depends mainly on a precise rule the training is provided if the test score of an initial language exam is below a certain threshold this eligibility rule creates a discontinuity in the relation between the test result and the variables of interest which is used to estimate the causal effect of language training through the method of regression discontinuity design we find that the number of assigned hours of training significantly increases labor force participation of the treated individuals the language classes appear to have a larger effect for individuals with higher levels of education while there is no robust differential effect by type of migration gender or age our estimated coefficients are remarkably similar when we rely on local linear regressions using the optimal bandwidth with few observations around the threshold and when we control parametrically for a polynomial of the forcing variable and use the whole estimation sample we conclude with a discussion of the candidate mechanisms for the improved labor market participation of immigrants

the economics of immigration this literature review concerns the impact of immigration on the economy of the host country focusing on the experience of the united states the emphasis is on the period from the 1970s to the 1990s the author shows that research earlier in this period generally concluded that the economic effects of immigration were positive but that more recent research on later migrations have generally concluded that immigration may be having an adverse effect on the earnings of native unskilled workers and be placing an increased burden on welfare programs the importance of such economic analysis for the formulation of appropriate migration policies is stressed

achieving the dream the effect of irca on immigrant youth postsecondary educational access this paper contributes to the existing literature on the effect of legal status on educational access among immigrant youth in the united states the immigration reform and control act irca of 1986 granted amnesty to undocumented immigrants who entered the united states before 1982 using a difference in differences framework i analyze the effect of this large amnesty program on immigrant youth s postsecondary educational access my main finding shows that immigrant youths who were granted amnesty under irca are more likely to enroll in postsecondary education

war and local collective action in sierra leone a comment on the use of coefficient stability approaches abstract in a study of the effect of civil war exposure on local collective action outcomes in sierra leone bellows and miguel 2009 employ a coefficient stability approach to assess the importance of omitted variable bias building on altonji et al 2005a here we clarify the econometric assumptions underlying bellows and miguel 2009 and extend their analysis using data on dependent variable reliability ratios and the method developed in oster 2015

a general index of technical change this paper outlines a procedure for estimating a general index of technical change within the context of a quite general production technology specifically when panel data are available for firms in an industry time specific dummies can be combined in a nonlinear estimation procedure to yield a general index of technical change that may be both nonneutral and scale augmenting this approach offers numerous advantages over the traditional time trend representation of technical change for example the general index can serve as the basis for analysis of the determinants of technical change results for a sample of 30 electric utilities over the period 1951 78 show that the productivity decline of the 1970s can be attributed primarily to sulphur oxide restrictions and secularly declining capacity utilization due to rapidly increasing peak load demands

on estimating the effects of immigrant legalization do u s agricultural workers really benefit the question of whether legalization affects immigrants economic returns has been the focus of many empirical studies in recent decades results have consistently shown that there are significant wage differences between legal and illegal workers however the validity of such findings has been questioned given the lack of good identification strategies to account for omitted variables in this article we propose using techniques designed to address the issue of selection into treatment based to some degree on unobservables our results suggest that lower skill levels not discrimination explain differences in immigrants economic outcomes in recent decades the united states has experienced a substantial increase in the number of undocumented immigrants entering the country as well as documented immigrants overstaying their legally permitted time passel 2005 according to estimates provided by passel and cohn 2009 the united states is now home to approximately 12 million unauthorized immigrants this phenomenon has caused dramatic changes in the agricultural workforce with the ratio between undocumented and legal farm workers rising from only 16 in the period 1989 92 to 36 in 1993 95 and 50 in 1998 2000 iway emerson and walters 2006 in an attempt to control this flow of illegal immigrants the u s government proposed several changes to its immigration policy it not only increased border security but also introduced sanctions for u s employers that hire unauthorized workers and launched several amnesty programs such as the 1986 immigration reform and control act irca and the comprehensive immigration reform act of 2006 cira both of which allow agricultural workers to acquire legal permanent residence status

immigration policy and employment assimilation in the united states we examine the impact of immigration policy on the employment propensity and assimilation of immigrants using a pooled cross section of the 1994 2004 current population surveys cps the results are generally consistent with positive immigrant employment assimilation a blinder oaxaca style decomposition shows that the foreign born obtain more employment primarily through human capital acquisition and changes in labour market conditions rather than higher returns to observable skills as sometimes seen in wage studies in addition our analysis suggests that immigration policies may influence both labour demand and supply incentives and are associated with structural shifts in the labour market

trends in the well being of american women 1970 1995 this paper examines the trends in the well being of american women over the last 25 years a time of significant changes in the relative economic status of women and in the labor market as a whole a broad range of indicators are considered to capture changes in women s well being in the family as well as in the labor market for virtually all age and education groups substantial evidence is obtained of rising gender equality in labor market outcomes notably labor force participation wages and occupational distributions broad evidence is also found of greater gender parity within married couple families as the housework time of husbands increased relative to wives and the relative wages of wives rose compared to their husbands however parallel to the recent evidence of the declining labor market position of lower skilled men there has been a similar deterioration in the economic status of less educated women especially high school dropouts their labor force participation rates and wages have risen at a much slower pace than those of more highly educated women while their incidence of single headship has increased much more rapidly these findings for less educated women serve to underscore the widening gap between more and less skilled americans of both sexes as well as to emphasize its broad dimensions

remittances and temporary migration in this paper we study the remittance behavior of immigrants and how it relates to temporary versus permanent migration plans we use a unique data source that provides unusual detail on remittances and return plans and follows the same household over time our data allows us also to distinguish between different purposes of remittances we analyze the association between individual and household characteristics and the geographic location of the family as well as return plans and remittances the panel nature of our data allows us to condition on household fixed effects to address measurement error and reverse causality we use an instrumental variable estimator our results show that changes in return plans are related to large changes in remittance flows

the great mexican emigration abstract in this paper we examine net emigration from mexico over the period 1960 to 2000 the data are consistent with labor supply shocks having made a substantial contribution to mexican emigration accounting for two fifths of mexican labor flows to the united states over the last two decades of the twentieth century net emigration rates by mexican state birth year cohort display a strong positive correlation with the initial size of the mexican cohort relative to the corresponding u s cohort in states with long histories of emigration the effects of cohort size on emigration are relatively strong consistent with the existence of preexisting networks

how do banks adjust to changing input prices a dynamic analysis of u s commercial banks before and after the crisis abstract the 2000 2013 period was characterized by substantial regulatory monetary and technological change especially after the onset of the global financial crisis this study assesses the total impact of these policy shifts and technological changes on u s commercial banks short run and long run substitution elasticities an endogenous break test divides the sample into a pre crisis period and a post crisis period during the former period banks inputs tend to be inelastic substitutes after the onset of the crisis particularly the long run substitutability of most input factors decreases to even lower levels due to changes in both cost technology and economic conditions at the same time banks response to input price changes becomes more sluggish hence especially after the onset of the crisis banks have little flexibility regarding input factor usage and are thus sensitive to input price changes from a cost perspective