why do suppliers charge larger buyers lower prices the phenomenon of input suppliers charging larger buyer firms relative to smaller buyer firms lower prices is commonly explained in terms of supplier economies of scale supplier competition for larger buyers and the larger bargaining power of larger buyers this paper provides an alternative explanation and shows that the observed direction of differential pricing can benefit the supplier by lowering the level of tacit collusion its buyers can sustain in their output market this result also provides a new mechanism through which a ban on price discrimination by input suppliers may lower consumer welfare

has work sharing worked in germany industry by industry basis in an attempt to raise employment whether this work sharing works is theoretically ambiguous i exploit the cross industry variation in standard hours reductions to examine their impact on actual hours worked wages and employment analysis of industry level data suggests that work sharing may have reduced employment in the period 1984 1994 using individual data from the german socio economic panel i substantiate the union claim of full wage compensation the hourly wage rose enough to offset the decline in actual hours worked

the employment effects of shorter working hours an application to japanese data this paper applies a simple model of hours employment and earnings to japanese manufacturing data and shows that a reduction in the number of standard hours is likely to increase overtime and reduce employment these findings are in line with recent theoretical developments and in contrast to the predictions of traditional analysis of hours and employment adjustment this difference is shown to be due to the treatment of the wage rate copyright 1989 by the london school of economics and political science

managing strategic inventories via manufacturer to consumer rebates manufacturer to consumer rebates are a staple of modern supply chains such rebates are typically viewed as a means of price discrimination because of partial redemption by consumers however the proliferation of universally redeemed instant rebates suggests the practice may be motivated by additional considerations an issue we tackle in this paper our results demonstrate that consumer rebates can be particularly useful when a supply chain encounters inefficiencies stemming from strategic inventory buildup by retailers wary of high wholesale prices a retailer may hold excess inventory to convey a lower willingness to pay in future interactions and thereby strategically undercut future wholesale prices as a retaliatory consequence the manufacturer sets high near term wholesale prices the pull promotion from consumer rebates encourages more timely retail sales and in doing so undercuts but does not eliminate the retailer s strategic inventories in other words the introduction of consumer rebates can serve as an enticement for retailers to sell not just for consumers to buy perhaps surprisingly we find that the manufacturer retailer and consumers alike all benefit from the use of rebates this despite the fact that the manufacturer uses the rebates in self interest and as a strategic weapon this paper was accepted by yossi aviv operations management

green goals and full employment are they compatible abstract two empirical correlations are studied one between economic growth and environmental impacts and the other between the lack of economic growth and unemployment it is demonstrated that at a global level economic growth is strongly correlated with environmental impacts and barriers to fast decoupling are large and numerous on the other hand low or negative growth is highly correlated with increasing unemployment in most market economies and strategies to change this lead to difficult questions and tradeoffs the coexistence of these two correlations which have rarely been studied together in the literature on green growth degrowth and a growth justifies ambivalence about growth to make key environmental goals compatible with full employment the decoupling of environmental impacts from economic output has to be accompanied by a reduction of dependence on growth in particular strategies to tackle unemployment without the need for growth several of which are studied in this article need much more attention in research and policy

why do manufacturers issue coupons an empirical analysis of breakfast cereals we explore the relationship between shelf prices and manufacturers coupons for 25 readyto eat breakfast cereals we find that shelf prices are lower during periods when coupons are available this result is inconsistent with static monopoly price discrimination under a broad range of assumptions we present evidence that is inconsistent with both dynamic theories of price discrimination and explanations of couponing based on the vertical relationship between manufacturers and retailers we find support for models of price discrimination in oligopoly settings as well as suggestions that firmwide incentives may induce managers to use coupons and price cuts simultaneously finally lagged coupons have a positive effect on current sales suggesting that coupons are used to induce repurchase

price advertising and coupons in a monopoly model the paper studies the pricing and advertising policies of a monopolist in a situation where consumers discover prices by costly search the monopolist is shown to choose between no advertising and large scale advertising this is shown to be optimal behavior even with decreasing returns to scale to advertising expenditures which would a priori argue for small advertising expenditures the optimal advertising policy is undertaken in conjunction with a pricing policy that is characterized by downwardly rigid prices flexibility with regard to realizations of a cost parameter is achieved via couponing which even though it is untargeted allows for discrimination between ex ante identical consumers i introduction the failure of some prices to react to changes in demand and supply conditions has always attracted the attention of economists price rigidities are important for two reasons first they may cause and or reflect inefficiencies in the allocation of resources and second if prices are rigid the consequent quantity adjustments may have important macroeconomic implications a related issue is the potential discrepancy between posted and actual transaction prices in particular given that the latter are sometimes significantly more flexible than the former for example retailers tend to post the prices recommended by the manufacturer even though they might be ready to offer discounts in low demand states in fact in some durable goods markets the listed price is simply the starting price in a bargaining process between the seller and individual buyers in this paper i argue that in some contexts firms find it optimal to set relatively rigid posted prices due to the costs of price advertising but can still achieve some degree of flexibility by sending out coupons to a fraction of consumers i start from the observation that in decentralized markets the transmission of price information from sellers to buyers is usually a costly activity consumers can engage in costly search to find out prices and firms can engage in costly advertising to disseminate price information more specifically i analyze a static monopoly model in which the seller after privately observing his unit production

the employment effects of a shorter working week labor organizations currently argue that reducing the standard working week will help lower the high unemployment of the 1980s opponents maintai n that this will increase labor costs and therefore not alleviate un employment this paper analyzes the employment effects of a cut in ho urs using the monopoly union and efficient bargaining models of the union and firm under various developments of the models the results are quite consistent a reduction in hours has employment effects th at are at best ambiguous and very often negative a puzzle remains as to why trade unions are pressing for shorter hours copyright 1987 by the review of economic studies limited

societal metabolism working hours and degrowth a comment on sorman and giampietro can we choose whether to degrow sorman and giampetro in this special issue argue that degrowth can only be forced upon us it will never be the outcome of voluntary or collective choice in this commentary i argue instead that although sooner or later we will have to degrow because of bio physical limitations we still have a choice of how to do it constructing a positive vision of degrowth as an inspirational political project that mobilizes citizens increases the likelihood of a prosperous way down i agree with the authors that in an energy scarce world we will have to work more to maintain the same level of material affluence but i contend that under conceivable conditions we might be equally happy with less work less energy and less material affluence a multi scalar analysis of societal metabolism is essential for the evaluation of degrowth policies and trajectories however unlike what sorman and giampietro suggest there is nothing in existing metabolic analyses that suggests that a prosperous degrowth trajectory is a priori impossible

asymmetric wholesale pricing theory and evidence asymmetric pricing or asymmetric price adjustment is the phenomenon where prices rise more readily than they fall we offer and provide empirical support for a new theory of asymmetric pricing in wholesale prices wholesale prices may adjust asymmetrically in the small but symmetrically in the large when retailers face cost of price adjustment such retailers will not adjust prices for small changes in their costs manufacturers then see a region of inelastic demand where small wholesale price changes do not translate into commensurate retail price changes the implication is asymmetrica small wholesale price increase is more profitable because manufacturers will not lose customers from higher retail prices yet a small decrease is less profitable because it will not lower retail prices hence there is no extra revenue from greater sales for larger changes this asymmetry in the behavior of wholesale price vanishes as the price adjustment cost is compensated by the increase in retailers revenue resulting from correspondingly large retail price changes we present a formal economic model of a channel with forward looking retailers and cost of price adjustment test the derived propositions on the behavior of manufacturer prices using a large supermarket scanner data set and find that the results are consistent with the predictions of our theory we then discuss the implications for asymmetric pricing channels and cost of price adjustment literatures as well as public policy

work sharing employment and wages the paper analyzes the effects of a reduction in working time on wages and employment with a monopoly union in general it is not clear in which directions these variables move but if employment and working time are perfect substitutes the effects are related to how working time has been determined initially the wage increases if initial working time is smaller than or equal to the trade union optimum whereas the result is unclear when it is larger in this case it is never optimal for a trade union to reduce both the wage and working time in response to a recessionary supply shock the analysis may help to explain varying attitudes towards work sharing in different countries

wages hours and overtime premia evidence from the british labor market unlike the united states britain has no national laws regulating overtime hour assignment or compensation using individual level data on male non managerial workers from the 1998 british new earnings survey the authors investigate relationships among the standard hourly wage rate hourly earnings including overtime the overtime premium and the length of overtime hours they find that when overtime is accounted for average hourly wage earnings are fairly uniform across firms in a given industry because firms paying below market level straight time wages tend to award above market level overtime premiums and conversely firms paying above market level straight time wages provide below market level overtime premiums

the effects of inflation and real wages on employment this paper considers the effects of inflation on employment the absence of index linked loans and the possibility that errors are committed in times of inflation lead to a higher probability of bankruptcy during inflation if firms care about bankruptcy this implies a lower level of employment empirical results confirming this are presented and suggest that higher inflation has substantially contributed to the fall in employment in the united kingdom the authors also demonstrate that a negative real wage elasticity is not robust to changes in specification copyright 1987 by the review of economic studies limited

habit prisoner s dilemma and americans welfare cost of working much more than europeans europeans work much less than americans some studies claim this is due to high taxes in europe which would benefit by adopting us tax rates and work time others find that taxes have little or no impact on work time i examine the hypothesis that americans would benefit by reducing work time to europe s level empirical and experimental studies show utility falls as other people s income rises due to its historical experience europe is able to internalize this and other negative externalities by restricting work time through minimum vacation time and maximum weekly work hours while the us is not resulting in a prisoner s dilemma overworking trap equilibrium a simple model and work time data are used to derive the us welfare gain from reducing work time to europe s level findings are i parameter values are consistent with experimental results on the relative impact of own and other people s income ii the welfare gain s present value is about 120 percent of annual welfare and iii even if europe s policy reduces work time excessively it does remain beneficial as long as the reduction is less than twice the optimal one

the 35 hour workweek in france straightjacket or welfare improvement workweek reduction laws may be beneficial if market interactions do not fully take into account the preferences reflected in declining secular trends in working hours the most recent law in france shortened the workweek from 39 to 35 hours in 2000 for large firms and in 2002 for small firms analysing differences between large and small firm employees before and after the law we find that aggregate employment was unaffected but labour turnover increased as firms shed workers who became more expensive survey responses indicate that the welfare impact of the law was different across groups of workers women but not men may have benefited from coordination to a shorter workweek and there is also evidence of negative welfare effects for managers possibly due to the law s administrative burden marcello estevao and filipa sa

hourly wages and working time in the dutch market sector 1962 1995 this article analyses the joint behaviour of hourly wages and standard hours in the netherlands with respect to the development of full time hours to different hypotheses are suggested work sharing or productivity sharing under the work sharing hypothesis high unemployment would lead to reduced hours whereas under productivity sharing increased productivity leads to higher wages or reduced hours the evidence is in favour of the productivity hypothesis there is no direct impact of unemployment on the evolution of hours moreover although reduced hours tend to increase hourly wages in the short run this is not the case in the long run

the economics of degrowth economic degrowth is ecologically desirable and possibly inevitable but under what conditions can it become socially sustainable how can we have full employment and economic stability without growth what will happen to public spending and to public debt how would production be organised in a degrowing economy and under what plausible socio political conditions could such grand changes happen standard economic theories and models ignore these questions for them economic growth is an axiomatic necessity this article reviews recent contributions in the economics of degrowth and identifies research avenues for ecological economists

shadow economies size causes and consequences using various methods the size of the shadow economy in 76 developing transition and oecd countries is estimated average size varies from 12 percent of gdp for oecd countries to 23 percent for transition countries and 39 percent for developing countries increasing taxation and social security contributions combined with rising state regulations are driving forces for the increase of the shadow economy especially in oecd countries according to some findings corruption has a positive impact on the size of the shadow economy and a growing shadow economy has a negative effect on official gdp growth

working time regulation in a search economy with worker moral hazard abstract this paper analyzes the consequences of a working time reduction within an integrated shirking matching model under laissez faire workers and employers bargain over wages and working hours when unemployment is high the no shirking condition is binding and the number of working hours is lower than the level that would be negotiated in the absence of unobservable shirking in this case a work sharing policy increases aggregate employment at the opposite for low unemployment countries the no shirking condition does not bind and a working time regulation always worsens the labour market situation

cost pass through and inverse demand curvature in vertical relationships with upstream and downstream competition this paper provides two characterizations of the retailer s markup relative to the manufacturer s markup in vertical relationships with homogeneous manufacturers and homogeneous retailers we first show that retailer s relative markup is equal to the ratio of the retail pass through to the wholesale pass through multiplied by the number of manufacturers relative to the number of retailers we then provide its expression in terms of the inverse demand curvature

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

using alsace moselle local laws to build a difference in differences estimation strategy of the employment effects of the 35 hour workweek regulation in france france s 1998 implementation of the 35 hour workweek has been one of the greatest regulatory shocks on labor markets few studies evaluate the impact of this regulation because of a lack of identification strategies for historical reasons due to the way alsace moselle was returned to france in 1918 the implementation of france s 35 hour workweek was less stringent in that region than in the rest of the country which is confirmed by double and triple differences yet it shows no significant difference in employment with the rest of france which casts doubt on the effectiveness of this regulation

the impact of protective measures for female workers policies designed to protect female workers have controversial effects on labor market outcomes both in theory and in practice the analysis uses repeated cross sections of household survey data for taiwan to estimate the impact of working hours restrictions and maternity benefits differential coverage across industrial sectors and demographic groups provides a unique opportunity to identify the impact of both policies in a single natural experiment framework while working hours restrictions have a negative impact on women s actual hours worked and employment maternity benefits increase these labor inputs implying that women value the opportunity to return to jobs they might otherwise have to leave

relicensing as a secondary market strategy secondary markets in the information technology industry where used or refurbished equipment is traded have been growing steadily for original equipment manufacturers oems in this industry the importance of secondary markets has grown in parallel not only as a source of revenue but also because of their impact on these firms competitive advantage and market strategy recent articles in the press have severely criticized some oems who are perceived to be actively trying to eliminate the secondary market for their products other oems have policies that enhance their secondary markets the goal of this paper is to understand how an oem s incentives and optimal strategies vis a vis the secondary market are shaped contingent on her relative competitive advantage product characteristics and consumer preferences the critical trade off that we examine is whether the indirect benefit from maintaining an active secondary market the resale value effect can outweigh the potentially negative effect of the sales of used products at the expense of new product sales the cannibalization effect to that end we develop a durable good model where the oem can directly affect the resale value of her product through a relicensing fee charged to the buyer of the refurbished equipment we analyze the oem s strategy in both the monopoly and the duopoly cases characterize the optimal relicensing fee set by the oem and draw conclusions on the conditions that favor stimulating or deterring the secondary market this paper was accepted by candace a yano operations and supply chain management

estimating compensating wage differentials using voluntary job changes evidence from germany the author develops a model predicting that in a labor market that attaches a wage premium to jobs with a disamenity a compensating wage differential the premium s upper bound will be defined by the average wage change of voluntary job movers whose consumption of the disamenity rises as a result of their move its lower bound by the wage change of those whose consumption of the disamenity falls these predictions will not hold if as predicted by a segmented labor market model the labor market attaches a wage penalty to workplace disamenities using longitudinal data on job characteristics and wages in germany in 1984 2001 the author estimates the market returns to four workplace disamenities heavy workload job insecurity poor hours regulation and a mismatch between skills possessed and skills required the results broadly support the existence of compensating differentials in the german labor market

aggregate impacts of a gift of time lee jungmin kawaguchi daiji hamermesh daniel s december 2011 aggregate impacts of a gift of time reports cambridgenational bureau of economic research nber working paper series 17649 33

profitable pricing when market segments overlap in this paper we analyze profitable pricing strategies when market segments overlap overlapping markets are segments that are not perfectly sealed and leakage between them can occur different consumers are assumed to incur possibly different transaction costs if they choose to purchase in the low price market a monopolist seller knows the distribution of transaction costs across consumers and must choose an optimal pricing strategy in particular the monopolist must decide whether to charge a single price or to price differentiate conditions are derived under which price differentiation will be the most profitable strategy when price differentiation is optimal the equilibrium amount of leakage is determined endogenously unlike the standard economics textbook model of price discrimination in which zero leakage is determined exogenously and is usually given as a necessary condition for price discrimination we show that zero leakage is not necessary for differential pricing to be optimal and that

a theory of channel price promotions manufacturers can stimulate sales by a temporary wholesale price reduction for the retailer a rebate directed toward consumers or a combination of both the trade offs between these price promotions are analyzed providing insights about their roles profitability and welfare properties retailers rebates are also studied while price discrimination is a common explanation for rebates to consumers when a product is sold through a distribution channel the manufacturer may also use rebates to motivate retail participation in the promotion this explains why rebates may be offered even when all consumers use them and price discrimination does not occur copyright 1991 by american economic association

how working time reduction affects jobs and wages in 1996 by law the maximum standard workweek in portugal was reduced from 44 h to 40 h we find that for workers involved this change reduced the job separation rate and increased hourly wages keeping monthly earnings approximately constant the working hours reduction also affected workers working less than 40 h per week they were more likely to lose their job

welfare costs of sticky wages when effort can respond abstract we examine the impact of wage stickiness when employment has an effort as well as hours dimension despite wages being predetermined the labor market clears through the effort margin consequently welfare costs of wage stickiness are potentially much much smaller

a decision theoretic model of innovation technology transfer and trade we analyse a dynamic north south model of innovation technology transfer and trade northern firms conduct r d using labour which has alternative uses producing in the r d sector or a nontraded good sector since technology transfer prevents the north from fully appropriating benefits of r d the optimal rate of innovation for either profit maximizing firms or a utility maximizing northern planner is less than globally optimal an increased transfer rate intensifies competition of lower wage southern workers with northern workers in production so profit maximizing northern firms irrespective of their number or cooperation in r d reallocate labour toward r d

price discrimination through a distribution channel theory and evidence price discrimination practices are common but they typically are analyzed in a framework in which firms sell directly to end users louis phlips 1981 richard schmalensee 1981 hal varian 1985 gerstner and holthausen 1986 this direct channel framework is valid for service industries such as entertainment and travel where senior citizens buy reduced price tickets to musical concerts and children receive discounts on airfares and movietheater tickets in the packaged goods and durable goods industries however manufacturers sell to retailers who sell to consumers in indirect channels like these price discrimination occurs when manufacturers target pull discounts1 to price conscious consumers in the form of coupons and rebates consumers who do not use these discounts pay higher net prices because manufacturers cannot dictate consumer prices to retailers analysis of price discrimination ought to take into account the pricing behavior of retailers michael katz 1987 gerstner and hess 1991 while some researchers have studied coupons as a means for price discrimination william levedahl 1984 chakravarthi narasimhan 1984 they have done so in a direct channel context and have ignored the role of retailers or other middlemen in the pricing and couponing process in this paper we study price discrimination within a channel of distribution consisting of a single manufacturer and competitive retailers in the model the manufacturer pricediscriminates using a pull discount targeted at consumers with low reservation prices to reduce the net price these consumers pay for the product some consumers with higher reservation prices who self select not to use the discount pay the full retail price for the product the manufacturer chooses the wholesale price for the firm s product and the size of the price discriminating pull discount taking as given the markup percentage used by retailers joint determination of the manufacturer discount and retail markup is also considered the paper s major finding is that a higher retail markup percentage influences the manufacturer to use price discrimination in a less intensive way i e to reduce the size of the equilibrium pull discount as well as the wholesale price the intuition behind this result is as follows the greater the retail markup percentage for a given wholesale price the greater will be the retail price the greater the retail price the larger the pull discount will have to be to keep the low reservation price consumers in the market but the manufacturer bears the entire cost of the discount and a larger discount induces more nontargeted customers to use it these two effects make price discrimination less profitable when markup percentage increases so the manufacturer reduces its pull discount and in gerstner graduate school of management university of california davis ca 95616 and department of economics haifa university haifa 31999 israel hess department of business administration university of illinois champaign il 61820 holthausen department of economics north carolina state university box 7507 raleigh nc 27695 we thank alastair hall jeongwen chiang randy cooke and nick ruotolo for their comments and assistance 1manufacturers who distribute products through retailers use push or pull techniques to increase sales under push manufacturers offer inducements to retailers when consumers shop for the product the retailer has an incentive to promote the brand thus pushing it through to consumers under pull manufacturers offer incentives such as coupons or rebates directly to consumers the manufacturers hope that demand will be pulled through the channel by consumers asking retailers for the promoted brand

pricing and rebate strategies for an e shop with a cashback website abstract a cashback website cw is a type of reward website that pays its members a rebate when they purchase goods via affiliate links the website receives a commission from an e shop when a customer makes a purchase by following a link instead of visiting the e shop directly with the rapid rise in e shops cws are becoming increasingly popular however these cws value to e shops is still somewhat unclear in both theory and practice to clarify the process we consider a system in which an e shop sells a product to consumers and a cw provides the link to the e shop based on consumers utility we develop a model to study the value of the cw to the e shop in both centralized and decentralized settings and demonstrate and compare the two parties optimal strategies and their corresponding profits in both settings our main findings are as follows 1 the cw can always bring the e shop more profits whether the setting is centralized or decentralized by playing the role of price discrimination 2 in contrast to the centralized setting the decentralized setting does not lead to a higher sales price in many cases it offers a lower sales price which is opposite of the case typically seen in traditional supply chain literature 3 compared with the decentralized setting the centralized setting does not allow all consumers to have more consumer surplus which again differs from traditional supply chain literature but rather yields more total profit to the system which implies that it is better for the e shop to have its own cw than to use a third party cw 4 the degree of decrease in utility for consumers who buy via the cw significantly influences both parties pricing strategies more interesting is that a smaller degree of decrease in utility for consumers who buy via the cw is always beneficial to the e shop but may be detrimental to the cw

employment and distributional effects of restricting working time we study the employment and distributional effects of regulating reducing working time in a general equilibrium model with search matching frictions job creation entails fixed costs but existing jobs are subject to diminishing returns we characterize the equilibrium in the de regulated economy where firms and individual workers freely negotiate wages and hours then we consider the effects of a legislation restricting the maximum working time while we let wages respond endogenously employment effects are sensitive to the representation of preferences in our benchmark small reductions in working time starting from the laissez faire equilibrium solution always result in a small increase in the equilibrium employment while larger reductions reduce employment the regulation benefits workers both unemployed and employed even if wages decrease and even in cases where employment falls but reduces profits and output

the nature and causes of unemployment in the federal republic of germany since the seventies an empirical investigation the leading economic problem of our time is the high and persistent level of unemployment as of early 1985 there are no signs that the severity of unemployment will weaken within the near future this paper discusses first some basic developments of labour supply and labour demand in the federal republic of germany frg the composition of the labour supply and the structure of the labour demand for persons and hours worked as well as the dynamics of the unemployment pool the next section reviews very briefly some empirical findings explaining the rise in the nairu where we make the distinction between the no shock and the actual nairu following suggestions put by the organizers of the conference we then elaborate on the employment function in the empirically oriented literature most employment functions use labour services i e total hours worked as the dependent variable thus assuming homogeneity of labour demand with respect to jobs and working hours in the german political arena however the distinction between persons employed and hours worked is particularly important first it figures in the employment aims of labour unions who request reductions in weekly working hours in order to induce higher manning second the distinction arises in the context of overtime work for it has been suggested that the reduction in overtime to standard working hours could create more than 1 million new jobs in germany we present some estimated labour demand functions which take into account these two dimensions of labour demand jobs and hours and which are used to elaborate on the direction and magnitude of the employment effects of reductions in wage costs and increases in overtime premia

contesting time international comparisons of employee control of working time the authors hypothesize that three broad factors affect the degree of workers control over the timing and the total hours of their work the institutional and regulatory environment within the country labor market conditions and management and labor union strategies drawing from their interviews in 2000 with managers public sector policy makers and administrators and union leaders as well as from previous literature they illustrate how these factors actually affected working time and employee control over working time in the united states australia japan germany italy the netherlands and sweden their comparative analysis shows that in some countries employers and labor unions negotiated contracts that increased employee control over working time and provided employers with greater flexibility in others employee control over working time remained unevenly distributed across the occupational spectrum

hours of work and the fair labor standards act a study of retail and wholesale trade 1938 1950 when the fair labor standards act was first implemented a 5 reduction in the length of the standard workweek reduced by at least 18 the proportion of men and women working more than 40 hours per week this analysis based on monthly time series data from 1935 41 bls surveys and individual level data from the 1940 and 1950 censuses shows that the act s impact was larger in the south where the proportion of men and women working over 40 hours fell by 23 and 43 respectively than in the north because of much lower pre act wages in the south than in the north the minimum wage provisions of the act were much more binding in the south southern employers were less able than northern employers to adjust straight time wages in response to the act s overtime provisions

rebates inventories and intertemporal price discrimination richard p saba we demonstrate that universally redeemed rebates can increase manufacturer profits by reducing the incentives of downstream retailers to hoard inventories when optimal wholesale prices vary predictably over time by bypassing retailers and making direct contracts with buyers the manufacturer can increase the variations in effective prices paid by consumers without concomitantly creating larger incentives for retailers to hold inventories during profitable high demand periods manufacturer revenues are ordinarily constrained by competition from retailer inventories thus limiting profits however by selectively offering rebates to consumers while maintaining high wholesale prices low demand periods can be accommodated without inducing retailer hoarding jel d4 l1 general motors corp is emptying its bag of marketing tricks in an all out effort to force its u s market share back up to 30 of light vehicle sales that is good news for gm customers because the manufacturer is offering financing at less than 1 or cash rebates of as much as 3 000 a vehicle wall street journal sept 16 1998 i introduction we tackle a fundamental economic question if general motors or any manufacturer wants to increase unit sales why does the necessary price cut occur indirectly in the form of a rebate it is well known that in cases of perfect competition or monopoly a tax or subsidy on buyers is equivalent to the same tax or subsidy on sellers in that each leads to the same net prices and the same equilibrium quantities a rebate is effectively a subsidy offered to the buyer whereas a cut in the wholesale price is effectively a subsidy to the seller under conditions of perfect competition or monopoly a manufacturer should be able to achieve identical outcomes in either of the two ways the challenge is to explain why rebates or coupons are used redemption of coupons and rebates is costly to both consumers and issuers while a price cut of equivalent size can be implemented at a much lower cost one would expect the price reduction strategy to dominate the strategy of issuing coupons or rebates to all buyers yet it apparently does not throughout the 1990s for example chrysler ford and general motors consistently offered a more extensive array of consumer oriented indirect price cuts via rebates than dealer incentive programs 1 the most common explanation for the use of rebates and coupons is that they enable either manufacturers or retailers who possess some monopoly power to engage in third degree price discrimination 2 consumers whose reservation prices lie below the price charged by the manufacturer or retailer are induced to purchase the item by a sufficiently large rebate or coupon yet certain aspects of the practice of offering coupons and rebates are inconsistent with the standard price discrimination explanation rebates often are given automatically to all customers at the time of purchase purchasers of automobiles and other big ticket items are given the option of applying the rebate to their down payment or receiving the cash as noted by hanley 1987 and higgins 1989 sellers of less costly items recenfly have started providing instant rebates or on package coupons which can easily be used by all buyers at the time of purchase these innovations have dramatically lowered redemption costs for consumers and boosted redemption rates 3 moreover bowman 1980 demonstrates that holding redemption costs constant there is a positive relationship between the size of the coupon rebate and the likelihood of consumer redemption the implication of this empirical regularity is expressed succinctly by gerstner and hess 1991b p 5 while price discrimination is a reasonable exp lanation for cents off coupons for dollars off rebates such as those given by manufacturers of household appliances it is not

testing the effectiveness of the french work sharing reform a forecasting approach the macroeconomic impact of the french work sharing reform of 2000 a reduction of standard working hours in combination with wage subsidies is analysed using a vector error correction model vecm for several labour market variables as well as inflation and output out of sample forecasts for 2000 2001 are produced a comparison of these forecasts which serve as a benchmark simulation without structural shifts to the realized values with shifts suggests significant beneficial employment effects of the policy mix other shifts were absent and thus cannot explain the outcome output productivity hourly labour costs and inflation are only transitorily affected or not at all

working time regulation in france from 1996 to 2012 france which is often seen as an unusual country with a rigid 35 hour working week has experienced massive changes in its regulation of working time in recent decades including a progressive removal of 35 hour working week laws these changes have affected and continue to affect workplace organisation working conditions job creation productivity and wages the 35 hour working week policy represents a reduction in working time as well as a complex package that restructured french labour law and that opened up a great deal of space for social bargaining this paper provides a comprehensive analysis of the evolution of working time regulation and its political roots it discusses the studies evaluating the 35 hour working week and examines some of the basic consequences of reversing this policy since 2002 it also highlights unexplored lines of research on this topic

effects of reduction in working hours on a model with job creation and job destruction this article shows how with certain modifications to a standard real business cycle rbc model and with certain qualified responses in the short and long term a policy of reduction in the number of working hours can have positive effects on activity and employment the modifications required to bring about these results include specification of the working day existence of the creation and destruction of employment and differentiation between inactivity and unemployment results reveal that any measures taken to reduce the number of working hours must take into consideration the productivity levels of working hours to thus ensure that the consequences of such a policy are positive not only for employment but also in all other macroeconomic variables

work sharing during the great depression did the president s reemployment agreement promote reemployment the president s reemployment agreement pra of 1933 directed firms to reduce workweeks during the great depression so existing jobs could be spread into additional employment opportunities similar work sharing policies have recently been implemented across europe in hopes of reducing unemployment i find that ceteris paribus the work sharing aspects of the pra created nearly 2 5 million new employment opportunities in around four months however the programme also required firms to raise hourly wage rates offsetting close to half of these gains furthermore most of the remaining employment gains were wiped out after cartel oriented industry specific codes of fair competition supplanted the pra