the rise and fall of the washington consensus as a paradigm for developing countries abstract the introduction of the washington consensus involved not simply a swing from state led to market oriented policies but also a shift in the ways in which development problems were framed and in the types of explanation through which policies were justified key changes were the partial globalization of development policy analysis and a shift from historicism to ahistorical performance assessment the main challenge to this approach is a latent southern consensus which is apparent in the convergence between east asian developmentalism and latin american neostructuralism the demise of the washington consensus is inevitable because its methodology and ideology are in contradiction

is diversity detrimental ethnic fractionalization public goods provision and the historical legacies of stateness existing research has shown that highly diverse countries tend to provide less public goods this article argues by contrast that the relationship is spurious both contemporary ethnic heterogeneity and low public goods provision represent legacies of a weakly developed state capacity inherited from the past classical theories of state formation are then tested to show that favorable topography and climate high population densities as well as a history of warfare are conducive to state formation using an instrumental variable approach i show that previous ethnic diversity is not consistently an impediment to the formation of indigenous states and thus to contemporary public goods provision empirically this article uses three different measurements of public goods provision and data on pre colonial levels of state formation in asia and africa to test these various hypotheses

the origins of ethnolinguistic diversity this study explores the determinants of ethnolinguistic diversity within as well as across countries shedding light on its geographic origins the empirical analysis conducted across countries virtual countries and pairs of contiguous regions establishes that geographic variability captured by variation in regional land quality and elevation is a fundamental determinant of contemporary linguistic diversity the findings are consistent with the proposed hypothesis that differences in land endowments gave rise to location specific human capital leading to the formation of localized ethnicities jel j15 j24 z13

the effect of social security contributions on coverage and wages a gender perspective using a natural experiment from colombia author affiliation andres j vargas andres vargas ttu edu acknowledgment i would like to thank steve trejo dan hamermesh gerald oettinger jacqueline angel dan slesnick adriana kugler stefano farne two anonymous referees and seminar participants at the university of texas at austin the second conference on aging in the americas and texas tech university for their insightful and valuable comments i am also grateful to cesar caballero and alejandra corchuelo from the colombian national department of statistics dane for providing me with the data all remaining errors are mine 1 introductiontheoretically social security contributions are considered a benefit linked payroll tax because of the connection between the taxes paid by or on behalf of each worker and that individual s expected benefits hence with the presence of tax benefits linkages workers receive a higher compensation and the contributions are analogous to a price paid for a privately supplied commodity summers 1989 a general payroll tax on the other hand has no linkage to benefits for the individual taxpayer and therefore carries efficiency costs the benefit linkages of social security contributions depend on the extent to which workers perceive that they are getting the contributions back as benefits and on how much the individual values those benefits this depends in turn on the quality of the services offered by the entities financed by the tax if they are perceived as good employees will consider the contributions as a deferred compensation or insurance program and will accept a reduction in the net wage with no employment effects if they are perceived as bad the contributions will be considered as a pure tax with the corresponding effects on employment kesselman 1997 the objective of this article is to investigate from a gender and marital status perspective the effects of pension and health care contributions on the employment and wages of workers covered by social security regulations it is interesting to study colombia because the country implemented a large social security reform in 1993 that allows the identification the labor market effects of these contributions furthermore payments for pension and health care provisions amount to a quarter of the wage bill there this in conjunction with an 11 average contribution for other payroll taxes positions colombia as the country with the highest payroll tax rate in latin america the end of the 1980s and early 1990s was a period of deep structural transformations in latin america these reforms were part of efforts to liberalize economies and increase the participation of the market in the production and allocation of goods and services and were the product of the collapse most economies in the region experienced during the 1980s due to their mounting fiscal and monetary imbalances heckman and pages 2004 these large exogenous shifts in policy regimes offer very good case studies of the interaction between institutions and labor market outcomes the main reforms in colombia during this period included the approval of a new constitution key reforms to the labor market a major trade reform and liberalization in direct foreign investment more than two years after these reforms were put in place colombia implemented a social security reorganization that transformed the institutional framework for pension funds and health care provision law 100 of december 1993 regarding the health care regime the social security reform replaced the existing discretionary affiliation system that covered only the worker with a mandatory one that features a stricter prepayment system and covers also the family of the worker on the subject of pensions the reform introduced a fully funded social security system and gave the workers the choice between this new scheme of individual capitalization of public funds and the existing pay as you go system

mandate based health reform and the labor market evidence from the massachusetts reform we model the labor market impact of the key provisions of the national and massachusetts mandate based health reforms individual mandates employer mandates and subsidies we characterize the compensating differential for employer sponsored health insurance eshi and the welfare impact of reform in terms of sufficient statistics we compare welfare under mandate based reform to welfare in a counterfactual world where individuals do not value eshi relying on the massachusetts reform we find that jobs with eshi pay 2812 less annually somewhat less than the cost of eshi to employers accordingly the deadweight loss of mandate based health reform was approximately 8 percent of its potential size

political economy of agricultural policy in this article i focus on the findings from this study on the political economy of agricultural policy as they inform questions about the political economy of agricultural pricing primarily but not exclusively in developing countries to do so first i provide some background data on the comparative study i sketch the various stylized facts that were believed at the time and contrast them with the regularities that emerged from the comparative study finally i indicate some of the systematic empirical regularities and suggest the political economy conclusions which emerge from them

political economy of public policies insights from distortions to agricultural and food markets the agricultural and food sector is an ideal case for investigating the political economy of public policies many of the policy developments in this sector since the 1950s have been sudden and transformational while others have been gradual but persistent this paper reviews and synthesizes the literature on trends and fluctuations in market distortions and the political economy explanations that have been advanced based on a rich global data set covering a half century of evidence on commodities countries and policy instruments the paper identifies hypotheses that have been explored in the literature on the extent of market distortions and the conditions under which reform may be feasible

post 1500 population flows and the long run determinants of economic growth and inequality we construct a matrix showing the share of the year 2000 population in every country that is descended from people in different source countries in the year 1500 using this matrix we analyze how post 1500 migration has influenced the level of gdp per capita and within country income inequality in the world today indicators of early development such as early state history and the timing of transition to agriculture have much better predictive power for current gdp when one looks at the ancestors of the people who currently live in a country than when one considers the history on that country s territory without adjusting for migration measures of the ethnic or linguistic heterogeneity of a country s current population do not predict income inequality as well as measures of the ethnic or linguistic heterogeneity of the current population s ancestors an even better predictor of current inequality in a country is the variance of early development history of the country s inhabitants with ethnic groups originating in regions having longer histories of agriculture and organized states tending to be at the upper end of a country s income distribution however high within country variance of early development also predicts higher income per capita holding constant the average level of early development

input subsidy programs in sub saharan africa a synthesis of recent evidence input subsidy programs have once again become a major plank of agricultural development strategies in africa ten african governments spend roughly us 1 billion annually on input subsidy programs isps amounting to 28 6 of their public expenditures on agriculture this article reviews the microlevel evidence on isps undertaken since the mid 2000s we examine the characteristics of subsidy beneficiaries crop response rates to fertilizer application and their influence on the performance of subsidy programs the impacts of subsidy programs on national fertilizer use and the development of commercial input distribution systems and finally the impact of isps on food price levels and poverty rates the weight of the evidence indicates that the costs of the programs generally outweigh their benefits findings from other developing areas with a higher proportion of crop area under irrigation and with lower fertilizer prices factors that should provide higher returns to fertilizer subsidies than in africa indicate that at least a partial reallocation of expenditures from fertilizer subsidies to r d and infrastructure would provide higher returns to agricultural growth and poverty reduction however because isps enable governments to demonstrate tangible support to constituents they are likely to remain on the african landscape for the foreseeable future hence the study identifies ways in which benefits can be enhanced through changes in implementation modalities and complementary investments within a holistic agricultural intensification strategy among the most important of these are efforts to reduce the crowding out of commercial fertilizer distribution systems and programs to improve soil fertility to enable farmers to use fertilizer more efficiently the challenges associated with achieving these gains are likely to be formidable

how do stakeholder interactions influence national food security policy in the caribbean the case of saint lucia abstract increasingly multi stakeholder processes have been recognized as being necessary to the development of public policies seeking to promote systemic innovation in response to complex and multidimensional challenges such as household food security rural development and environmental change saint lucia a small island developing state located in the caribbean has been grappling with a wide range of agriculture food and nutrition security challenges with varying degrees of policy success recognizing the significance of the challenge this paper explores the nature of the stakeholder interactions surrounding the development of saint lucia s 2009 2015 national agricultural policy and considers some of the implications for food and agriculture related policy outcomes results reveal a general lack of supportive conditions for effective multi stakeholder processes including low stakeholder participation levels conflicting roles of different forms of social capital in the interactions between stakeholders and missing boundary organizations capable of facilitating a transition towards more flexible and adaptive institutions enhanced knowledge exchange and learning and greater trust among stakeholders in the policy network future avenues for research and development are subsequently identified

the consequences of the growth of health insurance premiums in the united states two thirds of the nonelderly population is covered by employerprovided health insurance ehi according to a kaiser family foundation national survey 2003 the cost of ehi has increased by over 59 percent since 2000 with no accompanying increase in the scale or scope of benefits these increases in health insurance premiums may have significant effects on labor markets including changes in the number of jobs hours worked per employee wages and compensation packages indeed it is possible that a significant portion of the increase in the uninsured population may be a consequence of employers shedding this benefit as health insurance premiums rise understanding how labor market characteristics affect adjustments to increased health insurance costs is of vital policy importance some proposals to cover the uninsured rely on employer mandates requiring employers to cover eligible workers other proposals provide tax credits for the purchase of non employer health insurance the effects of these proposals on employment wages and health insurance coverage will be driven by the elasticities of labor supply and demand institutional constraints on wages and compensation packages and how much workers value the increase in health insurance costs since employers provide such coverage voluntarily if workers fully value these benefits and are able to sort between firms based on their preferences then in the absence of other institutional constraints they will bear the cost of the increase via reduced wages with no accompanying change in employment employment costs or employee utility there are many reasons to believe however that firms are limited in their ability to offset increases in the price of health insurance premiums through lower compensation so that increases in the cost of providing health insurance may affect both employment and the structure of work identifying the magnitude of these effects empirically is difficult both because of data availability and because of multiple avenues for causality in this paper we uncover the causal effect of increases in the cost of benefits on labor market outcomes by exploiting an exogenous source of variation in the cost of providing health insurance the recent medical malpractice crisis in which malpractice costs for physicians grew dramatically in some states but not in others the growth in malpractice payments affects malpractice insurance premiums and health insurance premiums but it should not affect other aspects of employment see baicker and chandra 2005b using this source of variation we examine the effect of increases in health insurance premiums on employment patterns earnings and health insurance coverage we find that the cost of increases in health insurance premiums is borne in large part by workers through increased unemployment and also through decreased hours for those workers moved from full time jobs with benefits to parttime jobs without these results have strong implications for the distributional impact of health care reforms both authors economics department dartmouth college 6106 rockefeller hall hanover nh 03755 dartmouth medical school and national bureau of economic research e mails kbaicker dartmouth edu achandra dartmouth edu we thank alan garber seth seabury jonathan skinner and douglas staiger for helpful conversations that have influenced this research program and derek neal aaron yelowitz and conference participants at the berger conference for very insightful comments we are grateful for funding from nia p01 ag19783 02 the opinions in this paper are those of the authors and should not be attributed to the nia or nber 1 based on tabulations of population under age 65 from the march current population survey for 1988 2003 2 there is a wide literature estimating the wage fringe trade off a 1 increase in the value of fringes may be offset by a 1 reduction in wages or a 1 1 tax rate reduction for tax favored benefits for example jonathan gruber 1994 demonstrates that the passage of the pregnancy discrimination act in 1978 resulted in employers shifting the entire cost of the mandate onto employees

the labor market effects of rising health insurance premiums we estimate the effect of rising health insurance premiums on wages employment and the distribution of part time and full time work using variation in medical malpractice payments driven by the recent medical malpractice crisis we estimate that a 10 increase in health insurance premiums reduces the aggregate probability of being employed by 1 2 percentage points reduces hours worked by 2 4 and increases the likelihood that a worker is employed only part time by 1 9 percentage points for workers covered by employer provided health insurance this increase in premiums results in an offsetting decrease in wages of 2 3

bankruptcy as implicit health insurance this paper examines the implicit health insurance that households receive from the ability to declare bankruptcy exploiting multiple sources of variation in asset exemption law i show that uninsured households with a greater financial cost of bankruptcy make higher out of pocket medical payments conditional on the amount of care received in turn i find that households with greater wealth at risk are more likely to hold health insurance the implicit insurance from bankruptcy distorts the insurance coverage decision using a microsimulation model i calculate that the optimal pigovian penalties are three quarters as large as the average penalties under the affordable care act

how do unemployment insurance and recall expectations affect on the job search among workers who receive advance notice of layoff this paper explores how advance notice of layoffs recall rehiring expectations and unemployment insurance ui benefits affected on the job search among a random sample of arizona ui recipients in 1975 76 the analysis which includes extensive controls for the characteristics of workers and their jobs indicates that pre unemployment search increased with length of notice and decreased with expected recall also among workers not expecting recall pre unemployment search decreased with the level of ui benefits available after layoff the authors argue that improved experience rating would encourage firms to give employees advance notice when layoffs are imminent and re employment bonuses for workers with zero or short unemployment spells would encourage early search

who pays for public employee health costs abstract we analyze the incidence of public employee health benefits because these benefits are negotiated through the political process relevant labor market institutions deviate significantly from the competitive private sector benchmark empirically we find that roughly 15 percent of the cost of recent benefit growth was passed onto school district employees through reductions in wages and salaries strong teachers unions were associated with relatively strong linkages between benefit growth and growth in total compensation our analysis is consistent with the view that the costs of public workers benefits are difficult to monitor contributing to benefit oriented and often under funded compensation schemes

workers should want to pay more for social security i introduction although economic theory cannot resolve all the controversies concerning social security simple supply and demand analysis can helpfully change the terms of the debate concerned with how the social security tax is divided between employers and workers defenders of the existing system typically argue that workers pay only half the tax 6 2 because as required by law the other half is paid by employers opponents of the existing system typically argue that workers pay all of the social security tax because their compensation is reduced by employers to offset their portion of the tax for example former house majority leader dick armey 2005 states that social security alone takes 12 4 percent of workers incomes that s more than most workers pay in income taxes in a reply to armey marilyn scheiner 2005 states that armey should have said that social security alone takes 6 2 percent of workers income the employer matches the employee s contribution for a total of 12 4 percent going into the social security coffers 1 the first thing economic analysis tells us about this debate is that both sides are wrong on the facts barring unlikely conditions the second and more interesting insight is that each side of the debate is making a claim that supports the position of the other side any student in an economic principles course should know that the distribution of a payroll tax burden depends on the relative elasticities of the labor demand and supply curves if the labor supply curve is very inelastic relative to the labor demand curve then most of the burden of a payroll tax will fall on the workers on the other hand if the labor demand curve is very inelastic relative to the labor supply curve most of the burden will fall on the employer so the debate over who bears most of the cost of the social security tax has to consider the relative elasticities of labor supply and demand what the social security legislation states about the distribution of the tax burden is completely irrelevant 2 this may seem to suggest that the opponents supporters of social security should argue that labor supply is less more elastic than labor demand because this implies that less most of the tax burden is borne by the employer but why should the desirability of social security depend on the distribution of the tax burden supposedly there are benefits from social security so its desirability should depend on how those benefits compare to the tax and how the net benefits are distributed even though labor supply and demand elasticities are relevant to the distribution of gains or losses from social security we shall see that the desirability of social security as measured by its net value and its benefits to workers is completely independent of those elasticities once we take into consideration the benefits of social security we find that when advocates and opponents argue over the incidence of the tax they have their arguments completely backward the strongest argument in favor of social security is that workers are paying more than its cost on the other hand the strongest argument against social security is that the burden of financing it falls mostly on employers if employers are paying most of the cost of social security then for the sake of workers it should be scrapped immediately ii social security and shifts in the labor supply and demand curves our argument is based on straightforward implications of labor supply and demand curves shifts in response to the costs and benefits of social security 3 we begin in figure 1 with labor supply curve s and labor demand curve d assumed relevant without before social security the vertical axis represents the monetary wage and the horizontal axis represents the quantity of labor the equilibrium wage and labor quantity are given by w sub b and l sub b respectively

dynamics of asymmetric conflict the case of the german milk conflict the german milk conflict developed when an emerging farmer association challenged the large incumbent in the wake of an insufficiently communicated policy change abolition of the milk quota the organizations represent opposing sides of a common policy debate market liberalization versus regulation the study analyzed the patterns between the two organizations and proposed a grounded theory of asymmetric conflict due to the elevated level of emotions during the conflict the study used a qualitative research approach based on 34 in depth interviews the analysis uncovered the interlocking patterns of simplification and emotionalization by the smaller association and rationalizing by the larger association results indicate how an active opponent can use policy changes to its advantage and how to prevent such a development recommendations based on the grounded theory developed such as implementing suitable communication strategies are transferable to a variety of changes and conflict situations in complex environments such as the food and agricultural sector

does aid matter measuring the effect of student aid on college attendance and completion does student aid increase college attendance or simply subsidize costs for infra marginal students settling the question empirically is a challenge because aid is correlated with many characteristics that influence educational investment decisions a shift in financial aid policy that affects some youth but not others can provide an identifying source of variation in aid in 1982 congress eliminated the social security student benefit program which at its peak provided grants totaling 3 7 billion a year to one out of ten college students using the death of a parent as a proxy for social security beneficiary status i find that offering 1 000 1998 of grant aid increases educational attainment by about 0 16 years and the probability of attending college by four percentage points the elasticities of attendance and completed years of college with respect to schooling costs are 0 7 to 0 8 the evidence suggests that aid has a threshold effect a student who has crossed the hurdle of college entry with the assistance of aid is more likely to continue schooling later in life than one who has never attempted college this is consistent with a model in which there are fixed costs of college entry finally a cost benefit analysis indicates that the aid program examined by this paper was a cost effective use of government resources this abstract was borrowed from another version of this item

nondisclosure as a contract remedy explaining the advance notice puzzle prior theoretical work predicts an underprovision of advance notice contracts stemming from their enforcement costs in the present model it is rather the fundamental inability of workers to alienate their right to quit taken in conjunction with parameters central to job separation decisions that jointly determine the mix of notice and no notice contracts observed in equilibrium not all equilibrium contracts are efficient but there is no underprovision of notice mandating notice cannot improve on joint value and indeed may reduce it furthermore although a mandate can be merely redistributive there are cases in which it harms all parties

ethnic diversity social sanctions and public goods in kenya abstract this paper examines ethnic diversity and local public goods in rural western kenya the identification strategy relies on the stable historically determined patterns of ethnic land settlement ethnic diversity is associated with lower primary school funding and worse school facilities and there is suggestive evidence that it leads to poor water well maintenance the theoretical model illustrates how inability to impose social sanctions in diverse communities leads to collective action failures and we find that school committees in diverse areas do impose fewer sanctions on defaulting parents we relate these results to the literature on social capital and economic development and discuss implications for decentralization in less developed countries

collective action in diverse sierra leone communities scholars have identified ethnic divisions as a leading cause of underdevelopment due partially to their adverse effects on public goods we investigate this issue in post war sierra leone one of the world s poorest and most ethnically diverse countries to address concerns over endogenous local ethnic composition we use an instrumental variables strategy using earlier census data on ethnicity and include several historical and geographic covariates perhaps surprisingly we find that local diversity is not associated with worse public goods provision across multiple outcomes and specifications with precisely estimated zeros we investigate the role of historical factors in generating the findings

history social divisions and public goods in rural india we examine the influence of three historically important sources of social divisions on the availability of public goods in rural india colonial power landowner peasant relations as determined by the land tenure system and social fragmentation based on the hindu caste system and the presence of sizable religious minorities using data on public goods from 1991 we find that regions that were under british colonial power in the pre independence period and those where agrarian power was concentrated in the hands of landlords have lower access to these goods as do areas with high levels of social fragmentation jel h41 p16

community composition and collective action analyzing initial mail response to the 2000 census this paper analyzes how community heterogeneity influences resident decisions to undertake actions generating public benefits the decision in question is completing and returning the 2000 census questionnaire an action which secures a significant amount of federal grants for the community the model developed to explain this action allows members of societal groups to differentially value public benefits that accrue to other group members racial generational and socioeconomic class heterogeneity all predict significantly lower response rates at the county level the potential for endogenous sorting into heterogeneous counties implies that the magnitude of true behavioral effects exceeds these estimates

the family gap for young women in the united states and britain can maternity leave make a difference in the united states and britain there is a family gap between the wages of mothers and other women differential returns to marital and parental status explain 40 50 of the gender gap another 30 40 is explained by women s lower levels of work experience and lower returns to experience taking advantage of quasi experiments in job protected maternity leave in the united states and britain this article finds that women who had leave coverage and returned to work after childbirth received a wage premium that offset the negative wage effects of children

the changing role of government in financing health care an international perspective this paper explores the changing role of government involvement in health care financing policy outside the united states it provides a review of the economics literature in this area to elucidate the implications of recent policy changes on efficiency costs and quality our review reveals that there has been some convergence in policies adopted across countries to improve financing incentives and encourage efficient use of health services in the case of risk pooling all countries with competing pools experience similar difficulties with selection and are adopting more sophisticated forms of risk adjustment in the case of hospital competition the key drivers of success appear to be what is competed on and measurable rather than whether the system is public or private in the case of both the success of performance related pay for providers and issues resulting from wait times evidence differs within and across jurisdictions however the evidence does suggest that some governments have effectively reduced wait times when they have chosen explicitly to focus on achieving this goal many countries are exploring new ways of generating revenues for health care to enable them to cope with significant cost growth but there is little evidence to suggest that collection mechanisms alone are effective in managing the cost or quality of care jel h51 i11 i18

infertility insurance mandates and fertility infertility is considered by the medical community to be a disease of the reproductive system it currently affects over 6 million individuals and one in ten couples cannot conceive without medical assistance the psychological effects of infertility have been compared to the effects of other diseases such as cancer and heart disease e g anne t fidler and judith bernstein 1999 and the financial costs of treatment can be quite large however only 25 percent of all health plan sponsors provide coverage for infertility services in response to a perceived need for coverage legislation was introduced at the federal level in 2003 that would require health plans to provide infertility benefits as the fraction of the population affected by infertility continues to rise there are likely to be continued efforts to mandate coverage understanding the costs and benefits of these policies thus becomes increasingly important the first component of a full analysis is to determine whether these mandates will actually have an effect on fertility by reducing the price of infertility treatment one might expect to see an increase in utilization of treatments this could be true if the mandate expands access to individuals who previously could not afford treatment or if individuals who were previously receiving treatment now choose to consume higher quantities or a higher quality of treatment however it is also possible that these mandates have no effect on access or on treatment consumed but simply provide windfall gains to those individuals who would have purchased treatment in the absence of insurance coverage finally mandates may also have dynamic effects on the timing of births individuals could seek treatment earlier which is beneficial from a medical perspective alternatively individuals could further delay childbearing with the knowledge that they will ultimately be covered in this paper i ask the first order question of whether the mandated insurance coverage of infertility treatment has affected birth rates as of 2003 15 states have enacted some form of infertility insurance mandate using a differencein differences approach i exploit variation in the enactment of mandates both across states and over time and identify control groups that should not have been affected by infertility coverage my results suggest that the mandates increase firstbirth rates for women over age 35 by 32 percent

u turns and full circles two decades of agricultural reform in malawi 1981 2000 abstract this paper traces the evolution of malawi s agricultural policy over the past two decades during this period the world bank has played a key role in shaping policy reform through its adjustment loans three distinct reform phases can be identified 1981 87 when policy was dominated by the dogmatism of the world bank s pricist and state minimalist policies 1988 94 when a more flexible position was taken by both the bank and the malawi government both of whom acknowledged the structuralist critique of earlier policies and 1994 to the present when the reform process in agriculture became more politicized and a schism developed between the bank and the government this latter period is used to illustrate some of the unresolved policy issues pertaining to similar low income agrarian economies

the long term effects of africa s slave trades can part of africa s current underdevelopment be explained by its slave trades to explore this question i use data from shipping records and historical documents reporting slave ethnicities to construct estimates of the number of slaves exported from each country during africa s slave trades i find a robust negative relationship between the number of slaves exported from a country and current economic performance to better understand if the relationship is causal i examine the historical evidence on selection into the slave trades and use instrumental variables together the evidence suggests that the slave trades have had an adverse effect on economic development

reimbursing health plans and health providers efficiency in production versus selection the tradeoff between an insurer s or medical provider s incentives to select good risks and to produce efficiently is governed by the supply price analog to the demand price tradeoff between moral hazard and risk aversion under a variety of models the optimum supply price is a mixture of capitation and fee for service payments empirical literature shows that pure capitation payment leaves strong incentives for selection that are acted upon the presence of contracting costs in a rothschild stiglitz model means a limited pooling equilibrium can exist and that poor risks will not be at their preferred outcome

the costs of wrongful discharge laws we estimate the effects on employment and wages of wrongful discharge protections adopted by u s state courts during the last three decades we find robust evidence that one wrongful discharge doctrine the implied contract exception reduced state employment rates by 0 8 to 1 7 the initial impact is largest for female and less educated workers those who change jobs frequently while the longer term effect is greater for older and more educated workers those most likely to litigate by contrast we find no robust employment or wage effects of two other widely recognized wrongful discharge laws the public policy and good faith exceptions i introduction w hat is the price of protection this paper estimates the social costs in possibly lower employment and wages of common law protections designed to protect american workers from wrongful discharge economic the ory suggests that employment protection is a double edged sword it provides employment security to incumbent work ers but makes employers reluctant to hire leading to a less flexible labor market with potentially lower employment and wages it is frequently argued that the stagnant employment performance of many european economies during the 1980s and 1990s eurosclerosis can be attributed in part to the significant employment protection given european workers see lazear 1990 and blanchard and wolfers 1999 krueger and pischke 1998 provide a contrasting view among the obstacles to testing this hypothesis is the difficulty of making reliable inferences using cross country comparisons in this paper we study the effects of employment protec tion in the united states numerous scholars have examined the effects of american federal employment laws on em ployment and unemployment acemoglu and angrist 2001 deleire 2000 and jolls and prescott 2004 present evidence that the americans with disabilities act ada decreased employment of disabled persons oyer and schaefer 2000 2002 conclude that the federal civil rights act of 1991 increased the frequency of mass layoffs and raised the returns to experience for workers who have a downward sloping age litigation profile hahn todd and van der klaauw 2001 also evaluate the costs of federal antidiscrimination laws a major hurdle for each of these studies is that these federal statutes apply all at once to the entire country this makes it difficult to separate the effects of the statute from all other changes occurring simulta neously cf donohue 1998 donohue and heckman

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

the worker adjustment and retraining notification act effects on notice provision the worker adjustment and retraining notification act warn of 1988 requires that covered firms provide affected employees with 60 days advance notice of plant closings and large scale layoffs the authors use data from the three most recent displaced worker surveys to compare the extent of notice under voluntary 1983 88 and mandatory 1989 91 notice regimes they find that the legislation has had at most a small impact on the provision of notice of the length stipulated under the act this non event is at least partially due to the liberal firm size and layoff thresholds for determining coverage under warn

who pays the high health costs of older workers evidence from prostate cancer screening mandates between 1992 and 2009 30 us states adopted laws mandating that health insurance plans cover screenings for prostate cancer because prostate cancer screenings are used almost exclusively by men over age 50 these mandates raise the cost of insuring older men relative to other groups this article uses a triple difference empirical strategy to take advantage of this quasi random natural experiment in raising the cost of employing older workers using integrated public use microdata series data from the march supplement of the current population survey i find that the increased cost of insuring older workers results in their receiving 2 8 lower hourly wages being 2 less likely to be employed and being 0 7 less likely to have employer sponsored health insurance

state mandated benefits and employer provided health insurance abstract one popular explanation for the low rate of employee health insurance coverage is the presence of numerous state regulations which mandate that group health insurance plans must include certain benefits by raising the minimum cost of providing any health insurance coverage these mandated benefits make it impossible for firms which would have desired to offer minimal health insurance at a low cost to do so i use data on insurance coverage among employees in small firms to investigate whether this problem is an important cause of employee non insurance i find that mandates have little effect on the rate of insurance coverage this finding is robust to a variety of specifications of the regulations i also find that this lack of an effect may be because mandates are not binding since most firms appear to offer these benefits even in the absence of regulation

employment effects of payroll taxes an empirical test for germany this study tests to what degree the incidence of payroll taxes in germany is on employment and whether in consequence payroll taxes in particular social insurance contributions are the culprit behind the growing unemployment problem using industry level data for 18 years 1977 1994 a system of five dynamic factor demand equations is estimated various simulations indicate that the employment effects of payroll taxes are minimal

mechanization in ghana emerging demand and the search for alternative supply models influential studies in the 1980s and early 1990s drew on the boserup ruthenberg theories of farming systems evolution to argue that african countries were not yet ready for widespread agricultural mechanization through applying the theories of farming systems evolution and of induced innovation in technical change this paper shows that demand for certain mechanized farming operations particularly plowing has emerged even among smallholders suggesting that supply issues may now be the main constraint to successful mechanization we therefore adopt a supply chain approach to analyze two types of mechanization practices in ghana i e a recent state led mechanization program and the private sector led service hiring market against an international perspective by drawing on three asian supply models we identify two major flaws in existing policies first the agricultural mechanization service centers that the government promotes fail to use tractors services with sufficient intensity second direct importation of agricultural machinery by the government inhibits imports of appropriate and affordable machinery in contrast the development of mechanized service hiring market in which medium and large scale farmers who are tractor owners provide hiring out services to small scale farmers represents a promising model for sustainable mechanization in ghana this private sector led second model is consistent with international experiences

labor market effects of employer provided health insurance i introduction increasing health insurance coverage is arguably an important policy goal the congressional budget office 2003 estimates that in 1998 20 30 million americans had no health insurance for the entire year approximately 40 million were uninsured at a specific point in time in the year and nearly 60 million were without coverage some time during the year most individuals who have health insurance in the united states obtain it through their employer in 1999 65 8 of nonelderly americans had employer provided insurance also called group insurance or employer sponsored insurance either through their own employer or through the employer of another household member see gruber 2001 employer provided insurance plans generally have lower premiums and offer more benefits than individual insurance plans health insurance providers can offer cheaper and better plans to company employees for at least two reasons first the average administrative cost of such plans is lower than individual plans second employment based plans are typically subject to less adverse selection than individual plans particularly so for large employers furthermore the tax subsidy afforded employment based health insurance renders the effective consumer price substantially lower than the cost see pauly 1986 and gruber 2001 together these various factors give a strong incentive for employers to offer and employees to accept coverage as part of their employment contract as employer provided insurance is by far the most prevalent form of coverage in the private sector policy makers look for further expansion of this base as a way to insure the uninsured while avoiding direct public financing as a way to increase employer based health insurance coverage some states either have or are considering government mandates that require employers to provide insurance to certain types of workers 1 the state of hawaii requires private sector employers to offer health insurance to all workers who work for more than 20 h a week and requires these workers to have insurance the state of california is currently considering a similar mandate there is a considerable interest from policy makers on the effects of such mandates on labor market outcomes in this study we report on an experiment that was designed to provide some insights about possible effects of alternative health insurance regulations on the competitive labor market with a particular focus on mandates since we only considered a competitive market setting with complete contracts and no wage rigidities our results may not be directly applicable to all labor market situations 2 however the study provides useful insights about the interaction of health insurance benefit provision wages and employment structure for labor markets where the competitive wage setting and the complete contracts assumptions are reasonable with these limitations in mind our results can be also generalized to other types of employer provided fringe benefits such as paid vacations or pension plans as any government intervention health insurance regulation may affect the labor market theory predicts that in perfectly competitive labor markets health insurance creates no distortionary effects on the labor market equilibrium as long as the coverage is not mandated and there are no wage rigidities 3 all workers who value insurance above its cost of provision are offered insurance and accept it the wages are adjusted downward see rosen 1986 and gruber 2000 summers 1989 used a simple supply and demand analysis to show that the effect of increases in premiums on equilibrium labor hours and wage depends both on the elasticity of labor demand and labor supply and on how fully workers value changes in the cost of health insurance if the demand or the supply of labor is completely inelastic or if workers fully value the insurance then an increase in the premium would result in an equal decrease shift in wages

the incidence of mandated maternity benefits i consider the labor market effects of mandates which raise the costs of employing a demographically identifiable group the efficiency of these policies will be largely dependent on the extent to which their costs are shifted to group specific wages i study several state and federal mandates which stipulated that childbirth be covered comprehensively in health insurance plans raising the relative cost of insuring women of childbearing age i find substantial shifting of the costs of these mandates to the wages of the targeted group correspondingly i find little effect on total labor input for that group jel 118 j32 h51 in an era of tight fiscal budget constraints mandating employer provision of workplace benefits to employees is an attractive means for a government to finance its policy agenda consequently in recent years there has been a growth of interest in mandated benefits as a tool of social policy for example the centerpiece of president bill clinton s health care proposal is mandated employer provision of health insurance and more than 20 states have man

the incidence of payroll taxation evidence from chile i provide new evidence on the incidence of payroll taxation by examining the experience of chile before and after the privatization of its social security system this policy change led to a sharp exogenous reduction in the payroll tax burden on chilean firms on average payroll tax rates fell by 25 over 6 years using data from a census of manufacturing firms i estimate that the incidence of payroll taxation is fully on wages with no effect on employment this finding is robust to a variety of empirical approaches to the problem of measurement error in firm level measures of taxes worker

empirical determinants of intertemporal choice abstract we provide new evidence on the empirical determinants of intertemporal financial decisions we use an exogenously imposed choice affecting nearly all croatian retirees to study characteristics associated with choosing a larger deferred stream of payments over a smaller more immediate payment individuals are more willing to defer if they have higher incomes and are not liquidity constrained have a longer time horizon because of better health and longer life expectancy and have stronger bequest motives individuals who expect currency devaluation or political risk to reduce the value of future income are more likely to take the earlier income stream

rethinking legal taxonomies for the gig economy both tax law and employment law incentivize engagers of labour to structure their workforce as a crowd of self employed micro entrepreneurs recent technological change and the rise of the gig economy have made it easier for agents to respond to these incentives contributing to an increase in self employment in this article we review the evidence on the rise of the gig economy in the uk and lay out a set of key principles to guide the reform of tax and employment law to better enable policy to meet its underlying objectives

ethnoracial homogeneity and public outcomes the non effects of diversity how does ethnoracial demography relate to public goods provision many studies find support for the hypothesis that diversity is related to inefficient outcomes by comparing diverse and homogeneous communities we distinguish between homogeneity of dominant and disadvantaged groups and argue that it is often impossible to identify the effects of diversity due to its collinearity with the share of disadvantaged groups to disentangle the effects of these variables we study new data from brazilian municipalities while it is possible to interpret the prima facie negative correlation between diversity and public goods as supportive of the prominent deficit hypothesis a closer analysis reveals that in fact more homogeneous afro descendant communities have lower provision while we cannot rule out that diversity is consequential in other contexts our results cast doubt on the reliability of previous findings related to the benefits of local ethnoracial homogeneity for public outcomes

the political effects of agricultural subsidies in africa evidence from malawi across sub saharan africa agricultural subsidy programs have again become a common strategy for combatting rural poverty increasing agricultural production and reducing food insecurity despite a large literature examining subsidies effects on output and welfare little is known about their political effects this paper examines malawi s agricultural input subsidy programme one of the largest and most expensive programs implemented which was launched by the government in 2005 we examine whether the incumbent party the democratic progressive party headed by president bingu wa mutharika benefited from malawi s subsidy program by examining a longitudinal dataset of 1 846 rural malawians interviewed in 2008 and again in 2010 the individual level data show no evidence that the subsidy program was targeted to mutharika s co ethnics or co partisans our analysis further demonstrates that the subsidy program increased support for the incumbent party these results suggest that even when parties are unable or unwilling to target distributional programs at the local level they may nonetheless derive political benefits as anti poverty programs including agricultural subsidies to small scale farmers become increasingly common across the continent our results suggest that they may help to explain patterns of party affiliation and vote choice particularly where traditional patterns of partisan affiliation related to ethnic or regional identities weaken

job security provisions and employment european countries have enacted various job security provisions over the last 30 years employers are required to pay workers on separation or to give advance notice of termination in anything less than a perfectly functioning market there are effects of the provisions on employment incumbents are more likely to retain their jobs but new workers are less likely to be hired an examination of the european data suggests that severance pay requirements reduce employment

the political economy of policies for smallholder agriculture summary as the experience of the 20th century has shown implementing policies that increase agricultural productivity among smallholders is a particularly promising strategy to achieve pro poor growth however history also reveals major political challenges to adopting this strategy the paper compares the experience of asian countries that were able to launch a smallholder based green revolution with the experience of african countries that are still struggling with this goal it then reviews the political economy literature to identify the factors that account for these divergent experiences finally the paper develops a conceptual framework to guide empirical research to close the knowledge gaps identified by the review

tribal mobilization fragmented groups and public goods provision in jordan diversity has been blamed for poor public goods provision in a number of different contexts it is associated with reduced spending on services meager rates of tax collection and poor policies i argue in this article however that in semidemocratic or authoritarian countries where political parties are weak diversity can be an important source of electoral competition leading to better services in diverse communities where multiple identity groups are politically mobilized candidates are forced to seek the support of voters outside of their group who are more likely to vote based on qualifications than on group affiliation resulting in better public officials who provide superior services moreover i find internal group fragmentation to be important in understanding the impact of heterogeneity on public goods provision candidates in areas where only one identity group is politically mobilized but where that group is politically fragmented will also seek votes from other groups within the comm

heterogeneity and the effect of mental health parity mandates on the labor market health insurance benefit mandates are believed to have adverse effects on the labor market but efforts to document such effects for mental health parity mandates have had limited success i show that one reason for this failure is that the association between parity mandates and labor market outcomes vary with mental distress accounting for this heterogeneity i find adverse labor market effects for non distressed individuals but favorable effects for moderately distressed individuals and individuals with a moderately distressed family member on net i conclude that the mandates are welfare increasing for moderately distressed workers and their families but may be welfare decreasing for non distressed individuals

the effects of expanding the generosity of the statutory sickness insurance system summary this article evaluates an expansion of employer mandated sick leave from 80 to 100 of forgone gross wages in germany we employ and compare parametric difference in difference did matching did and mixed approaches overall workplace absences increased by at least 10 or 1 day per worker per year we show that taking partial compliance into account increases coefficient estimates further heterogeneity in response behavior was of great importance there is no evidence that the increase in sick leave improved employee health a finding that supports a shirking explanation finally we provide evidence on potential labor market adjustments to the reform copyright 2013 john wiley sons ltd

explaining price policy bias in agriculture the calculus of support maximizing politicians a model is developed to explain observed patterns of policy intervention in agriculture we analyze the interaction between political support seeking politicians and supportsupplying citizens society consists of a rural and urban group we determine the effects on transfers of relative group size disparities in income endowments between groups and the deadweight loss of redistribution the framework advanced is an alternative to that of the interest group model and is used to explain for example why the export sectors in developing countries are taxed more and why the united kingdom is less adamant for higher price supports than germany

false promise or false premise the experience of food and input market reform in eastern and southern africa abstract the literature on the effects of agricultural market reform in africa is sharply divided and inconsistent this article attempts to reconcile opposing viewpoints on the effects of food and input market policy reform in eastern and southern africa drawing from studies of ethiopia kenya malawi zambia and zimbabwe we argue that a major source of the controversy stems from assumptions that countries have actually moved to a liberalized market environment we find that many of the most fundamental elements of the reform programs either remain unimplemented were reversed within several years or were implemented in such a way as to negate private sector investment incentives a framework is developed for explaining why some countries have been able to liberalize their food and fertilizer markets while others have not these findings have implications for how donor assistance and policy oriented research can more constructively contribute to an improved policy environment

a theory of competition among pressure groups for political influence this paper presents a theory of competition among pressure groups for political influence political equilibrium depends on the efficiency of each group in producing pressure the effect of additional pressure on their influence the number of persons in different groups and the deadweight cost of taxes and subsidies an increase in deadweight costs discourages pressure by subsidized groups and encourages pressure by taxpayers this analysis unifies the view that governments correct market failures with the view that they favor the politically powerful both are produced by the competition for political favors

donors and domestic policy makers two worlds in agricultural policy making in recent decades many developing countries have moved from taxing their agricultural sector to subsidizing it a phenomenon referred to as overshooting using ghana and uganda as case study countries this study aims to contribute to explaining this phenomenon by examining the role of policy beliefs the study is based on the advocacy coalition framework and relies on discourse analysis as analytical method in depth interviews with policy actors in both countries served as empirical basis a quantitative analysis of the transcripts was used to identify different discourse coalitions and a qualitative analysis was conducted to examine the discourses and identify their underlying policy beliefs the paper identified far reaching differences in the agricultural policy beliefs between domestic policy makers and donors regarding the question what does it actually take to develop small holder agriculture the evidence from this analysis highlights the role that divergent policy beliefs can play in influencing agricultural policy choices

economic versus cultural differences forms of ethnic diversity and public goods provision groups between group inequality bgi we show that elf cultural fractionalization cf and bgi measure different things and that the choice between them has an important impact on our understanding of which countries are most ethnically diverse furthermore empirical tests reveal that bgi has a large robust and negative relationship with public goods provision whereas cf elf and overall inequality do not diversity is widely held to make governance more difficult such diversity is associated with low production of public goods poor economic growth and high levels of corruption violence and civil conflict but diversity hardly sentences a country to poor political and economic outcomes latvia for example has better governance indicators than brazil and zambia has better governance indicators than nigeria even though these pairs of countries have similar levels of ethnolinguistic fractionalization elf why then do some countries cope more successfully with ethnic diversity than others this article addresses this question by focusing on the

a positive theory of agricultural protection the present paper analyses the political economy of agricultural protection in a general equilibrium framework rational politicians offer protectionist policies in return for political support from their constituency individuals in the economy have different factor endowments politicians exploit these differences in establishing redistributive policies when maximizing political support changes in economic variables such as the urban rural income gap capital intensity the share of agriculture in total output and total employment and the share of food in consumer expenditures affect the political equilibrium policy the analysis concludes that the observed correlation between economic development and agricultural protection is caused by a multiplicity of factors

the response of wages to protective labor legislation evidence from canada using micro data from the 1986 87 canadian labour market activity survey the author examines the wage effect of laws requiring advance notice of layoffs and in some cases also requiring severance payments to laid off workers the results suggest that incumbent workers protected by advance notice and severance pay laws were able to extract higher wages than were incumbent workers unprotected by such laws there is evidence however that the ultimate wage effect differed by workers union status starting wages of nonunion workers appear to have fallen to offset the subsequent wage increase indicating that nonunion workers may pay for advance notice and severance pay laws whereas union workers who were protected by such laws seem to have been able to exploit their bargaining position to increase their lifetime earnings

who pays for obesity evidence from health insurance benefit mandates is there an obesity externality in the late 1990s and early 2000s many state governments began requiring health insurance plans to cover treatments for diabetes using difference in difference analysis of restricted geocode data from the 1979 national longitudinal survey of youth to compare wages across states with and without diabetes mandates i find that obese people pay for all of their own increased health costs in the form of lower wages rather than passing them on to employers insurers and co workers

the economic consequences of parental leave mandates lessons from europe this study investigates the economic consequences of rights to paid parental leave in nine european countries over the 1969 through 1993 period since women use virtually all parental leave in most nations men constitute a reasonable comparison group and most of the analysis examines how changes in paid leave affect the gap between female and male labor market outcomes the employment to populations ratios of women in their prime childbearing years are also compared with those of corresponding aged men and older females parental leave is associated with increases in women s employment but with reductions in their relative wages at extended durations

health insurance market reform and employee compensation the case of pure community rating in new york abstract pure community rating which was enacted to improve access to health insurance in new york s small group market in 1993 prevents carriers from charging different premiums based on the ages of a firm s workers if small firms were adjusting compensation packages prior to reform to offset higher health care costs of older workers then community rating could lead to greater relative wages for older workers post reform and not necessarily induce adverse selection that results in changes in who is insured i present evidence showing that relative wages of older workers in small firms increased in comparison with other states and with large firms within new york following reform

pension reform and gender gaps in latin america what are the policy options abstract several latin american countries have implemented structural reforms in their social security pension systems these reforms have modified the traditional public pay as you go defined benefit payg db schemes introducing multipillar systems where fully funded defined contribution ff dc schemes play an important role gender gaps in coverage and benefits under pagy db and ff dc schemes have been one of the policy issues missing in most of the reforms in part because it has been certainly underresearched in the literature this paper studies the sources of pension gender gaps and provides the pros and cons of a set of policy options that may contribute to overcoming the gaps found in both schemes these policies are divided on the one hand into specific policies that directly affect the determination of pension benefits by modifying formula design or eligibility conditions and on the other hand policies that indirectly affect the level of benefits and the likelihood of being entitled to them by changing incentives in labor market conditions