occupational choice and the process of development this paper models economic development as a process of institutional transformation by focusing on the interplay between agents occupational decisions and the distribution of wealth because of capital market imperfections poor agents choose working for a wage over self employment and wealthy agents become entrepreneurs who monitor workers only with sufficient inequality however will there be employment contracts otherwise there is either subsistence or self employment thus in static equilibrium the occupational structure depends on distribution since the latter is itself endogenous we demonstrate the robustness of this result by extending the model dynamically and studying examples in which initial wealth distributions have long run effects in one case the economy develops either widespread cottage industry self employment or factory production employment contracts depending on the initial distribution in the other example it develops into prosperity or stagnation

economic mobility and poverty dynamics in developing countries this study provides an introduction to this special issue of the journal of development studies on economic mobility and poverty dynamics in developing countries in addition to providing a conceptual framework it outlines how the contributions fit into the extant literature a series of regularities emerge across these studies the poor consist of those who are always poor poor at all dates and those who move in and out of poverty with the latter group tending to be strikingly large such movements in and out of poverty are apparent when looking at poverty in either absolute or relative terms changes in returns to endowments can be a potent source of increased incomes finally seemingly transitory shocks can have long term consequences the study concludes by drawing out the policy implications of these regularities

the impact of minimum wages on youth employment in portugal textabstractfrom january 1 1987 the legal minimum wage for workers aged 18 and 19 in portugal was uprated to the full adult rate generating a 49 3 increase between 1986 and 1987 in the legal minimum wage for this age group this shock is used as a natural experiment to evaluate the impact of the minimum wage change on teenagers employment by using a large firm level micro data set it is shown that by comparing the employment growth of 18 19 year old workers with their 20 25 year old counterparts one can identify the employment effects of the minimum wage hike the same comparisons are done with 30 35 year old workers this study finds that the rise in the minimum wage significantly reduced employment this conclusion is reinforced by evidence showing that these employment effects are concentrated in firms more likely to be affected by the change in the law

the macroeconomic consequences of raising the minimum wage capital accumulation employment and the wage distribution we study the quantitative impact of a rise in the minimum wage on macroeconomic outcomes such as employment the stock of capital and the distribution of wages our modeling framework is the large firm search and matching model our comparative statics are in line with previous empirical findings a moderate increase in the minimum wage barely affects employment while it compresses the wage distribution and generates positive spillovers on higher wages the model also predicts an increase in the stock of capital next we perform the policy experiment of introducing a 10 dollar minimum wage our results suggest large positive effects on capital 4 0 and output 1 8 with a decrease in employment by 2 8 the introduction of a 9 dollar minimum wage would instead produce similar effects on capital accumulation without harming employment

minimum wages and economic outcomes in europe abstract in this paper we review the arguments and consider evidence on the economic effects of minimum wages in europe we begin by outlining the systems of minimum wages that currently operate in european countries and then consider some evidence on the economic effects of minimum wages in four countries france the netherlands spain and the united kingdom we consider the relation between minimum wage floors and two economic outcomes employment and the distribution of income in working households we find little evidence that minimum wages have a bad effect on jobs and some evidence that they have an equalising impact on the distribution of income among families with someone in work

effects of the minimum wage on the employment status of youths an update the large decline in the relative value of the minimum wage during the 1980s makes that period a valuable one for identifying the impact of variation in the minimum wage on youth employment this study produces the robust finding that when the experience of the 1980s is included a 10 percent increase in the minimum wage is estimated to reduce teen employment by less than 1 percent the lower end of the range of previous estimates because this small employment effect is offset by a labor force withdrawal effect the study finds no discernible effect on measured unemployment the study also finds no apparent effect of the minimum wage on the employment of young adults aged 20 24

the effects of minimum wages on wage dispersion and employment evidence from the u k wages councils using data on wages council coverage from the united kingdom new earnings survey the authors examine the impact of mandated minimum wages on wage dispersion and employment in the united kingdom in the 1980s they find evidence that a dramatic decline in the toughness of the regulation imposed by the wages councils through the 1980s a decline that is in the level of the minimum wage relative to the average wage significantly contributed to widening wage dispersion over those years there is however no evidence of an increase in employment resulting from the weakening bite of the wages council minimum pay rates instead consistent with the conclusions of several recent u s studies the findings suggest that the minimum wage had either no effect or a positive effect on employment

poverty decline agricultural wages and non farm employment in rural india 1983 2004 the authors analyze five rounds of national sample survey data covering 1983 1987 8 1993 4 1999 0 and 2004 5 to explore the relationship between rural diversification and poverty poverty in rural india declined at a modest rate during this period the authors provide region level estimates that illustrate considerable geographic heterogeneity in this progress poverty estimates correlate well with region level data on changes in agricultural wage rates agricultural labor remains the preserve of the uneducated and also to a large extent of the scheduled castes and scheduled tribes although agricultural labor grew as a share of total economic activity over the first four rounds it had fallen back to the levels observed at the beginning of the survey period by 2004 this all india trajectory masks widely varying trends across states during this period the rural non farm sector grew modestly mainly between the last two survey rounds regular non farm employment remains largely associated with education levels and social status that are rare among the poor however casual labor and self employment in the non farm sector reveal greater involvement by disadvantaged groups in 2004 than in the preceding rounds the implication for poverty is not immediately clear the poor may be pushed into low return casual non farm activities due to lack of opportunities in the agricultural sector rather than being pulled by high returns offered by the non farm sector econometric estimates reveal that expansion of the non farm sector is associated with falling poverty via two routes a direct impact on poverty that is likely due to a pro poor marginal incidence of non farm employment expansion and an indirect impact attributable to the positive effect of non farm employment growth on agricultural wages the analysis also confirms the important contribution to rural poverty reduction from agricultural productivity availability of land and consumption levels in proximate urban areas

trading mechanisms and stock returns an empirical investigation this paper examines the effects of the mechanism by which securities are traded on their price behavior we compare the behavior of open to open and close to close returns on nyse stocks given the differences in execution methods applied in the opening and closing transactions opening returns are found to exhibit greater dispersion greater deviations from normality and a more negative and significant autocorrelation pattern than closing returns we study the effects of the bid ask spread and the price adjustment process on the estimated return variances and covariances and discuss the associated biases we conclude that the trading mechanism has a significant effect on stock price behavior

long term impact of minimum wages on workers careers evidence from two decades of longitudinal linked employer employee data i acknowledge the support of the spanish ministry of the economy severo ochoa programme for centres of excellence in r d sev20150563 the aei spain and feder ue grant eco2016 76734 p

escaping poverty and becoming poor in 36 villages of central and western uganda abstract twenty four per cent of households in 36 village communities of central and western uganda have escaped from poverty over the past 25 years but another 15 per cent have simultaneously fallen into poverty a roughly equal number of households escaped from poverty in the first period ten to 25 years ago as in the second period the last ten years examined here however almost twice as many households fell into poverty during the second period as in the first period progress in poverty reduction has slowed down as a result multiple causes are associated with descent into poverty and these causes vary significantly between villages in the two different regions for nearly two thirds of all households in both regions however ill health and health related costs were a principal reason for descent into poverty escaping poverty is also associated with diverse causes which vary across the two regions compared to increases in urban employment however land related reasons have been more import

happy birthday you re fired the effects of an age dependent minimum wage on youth employment flows in the netherlands the dutch minimum wage for workers aged 15 to 23 is defined as a stepwise increasing function of a worker s calendar age using dutch administrative records the author shows that the birthday disc

slipping into and out of poverty the dynamics of spells this paper examines the dynamics of poverty previous analyses have examined either fluctuations in the male heads earnings or the frequency of poverty periods over a fixed time frame our approach depends on a definition of spells of poverty using this methodology we find that the majority of poor persons at any time are in the midst of a rather long spell of poverty the methodology also allows us to estimate that less than 40 percent of poverty spells begin because of a drop in the heads earnings while 60 percent of the spells end when the heads earnings increase thus researchers must focus on household formation decisions and on the behavior of secondary family members there has been a dramatic resurgence recently of discussion of the underclass the discussion is reminiscent of debates about poverty during the 1960s when the notions of a culture of poverty particularly as popularized by michael harrington s other america 1962 dominated both intellectual and policy thinking the idea of an underclass seems inconsistent however with much of the research on the dynamics of poverty during the 1970s that research using new longitudinal data seemed to show that the bulk of the poor were poor for only a few years the research also showed that the poor were a very heterogeneous group including a small minority of persistently poor the persistence of poverty is of interest both for understanding the phenomenon and for developing policy claims about dependency and separate life styles among the poor rest on assumptions about the long term nature of poverty questions

using regional variation in wages to measure the effects of the federal minimum wage the imposition of a national minimum wage standard provides a natural experiment in which the treatment effect varies across states depending on the fraction of workers initially earning less than the new minimum the author exploits this fact to evaluate the effect of the april 1990 increase in the federal minimum wage on teenagers wages employment and school enrollment comparisons of grouped and individual state data confirm that the rise in the minimum wage increased teenagers wages there is no evidence of corresponding losses in teenage employment or changes in teenage school enrollment

employment effects of minimum and subminimum wages panel data on state minimum wage laws using panel data on state minimum wage laws and economic conditions for the years 1973 89 the authors reevaluate existing evidence on the effects of a minimum wage on employment their estimates indicate that a 10 increase in the minimum wage causes a decline of 1 2 in employment among teenagers and a decline of 1 5 2 in employment for young adults similar to the ranges suggested by earlier time series studies the authors also find evidence that youth subminimum wage provisions enacted by state legislatures moderate the disemployment effects of minimum wages on teenagers

is economic growth increasing disparities a multidimensional analysis of poverty in the lao pdr between 2003 and 2013 abstractthe asian story of miraculous growth and poverty reduction has reinforced mainstream views of development that equate high and sustained economic growth with progress in human wellbeing but understanding development only in terms of economic growth is not sufficient this paper offers a different perspective on possible effects of laos s transition from a subsistence oriented economy to a market oriented economy we used a multidimensional poverty approach with panel data for the years between 2003 and 2013 findings suggest that benefits were not equally distributed 50 per cent of people moved in and out of poverty and the other half was either non poor 37 or always poor 13

is there a negative effect of minimum wages on youth employment in france abstract it is often claimed that the national minimum wage has been a major cause of unemployment in france however econometric studies using time series data have been unable to identify any substantial impact in this paper we analyse what happened to the employment of young persons using sectoral data following the 10 increase in the minimum wage that took place in june 1981 we find that there was a statistically significant negative effect on youth employment

consolidation fragmentation and market performance this paper studies the impact of market consolidation or fragmentation on its performance examining four alternative models of exchange a consolidated clearing house fragmented clearing houses a monopoly dealer market and an interdealer market the effects of the market mechanism on the expected quantity traded the price variance faced by individual traders the quality of market price signals the expected gains from trade and the exchange implementation costs are studied

structural and behavioural characteristics of informal service employment evidence from a survey in new delhi this article argues that at least two distinct categories within the informal sector informal services and informal manufacturing exhibit different structural and behavioural characteristics while some segments of informal manufacturing may indeed be dynamic as noted by some recent studies the hypothesis is tested for the informal service employment on the basis of a survey by the author in new delhi india it examines investment earnings returns to human capital socio economic characteristics and scope for upward mobility of informal service employment it finds formal education does not explain differences in earnings in the sample but background characteristics do earnings in the informal service sector are neither the lowest in the economy nor are they comparable to wages in the urban formal unskilled sector when differences between migrants and non migrants are taken into account on the basis of these results the paper reflects on the nature of growth and structural change in the indi

the switch from continuous to call auction trading in response to a large intraday price movement some european exchanges e g euronext frankfurt and madrid make use of a mechanism to moderate price volatility that was proposed by madhavan 1992 as preferable to a trading halt in times of market stress it consists of a temporary switch from continuous to call auction trading in an individual security whenever its price moves beyond predetermined limits this article studies whether this mechanism sharpens the information content of prices dampens volatility and normalizes trading volume and intensity taking intraday data for the madrid order driven continuous market i find post switch improvements in the information content of prices and reductions in volatility especially for thinly traded stocks trading volume and intensity peaked around auctions but soon returned to preevent levels

the irrelevance of national strategies rural poverty dynamics in states and regions of india 1993 2005 summary examining panel data for more than 13 000 rural indian households over the 12 year period 1993 94 to 2004 05 shows that two parallel and opposite flows regularly reconfigure the national stock of poverty some formerly poor people have escaped poverty concurrently some formerly non poor people have fallen into poverty these simultaneous inward and outward flows are asymmetric in terms of reasons one set of reasons is associated with the flow into poverty but a different set of reasons is associated with the flow out of poverty both sets of reasons vary considerably across and within states no factor matters consistently across all states of india standardized national policies do not represent the best use of available resources diverse threats and different opportunities must be identified and tackled at the sub national level

access to capital and agrarian production organisation there are two problems both universal that entrepreneurs in any economy must contend with firstly an agent generally has access only to a limited amount of working capital secondly workers hired by an agent are subject to moral hazard and this necessitates their supervision this paper models for an agrarian economy the constraints imposed on entrepreneurs activities by these two problems and endogenously determines the various organisational forms of production as well as the allocation of resources that will obtain with a simple model we endeavour to explain a diverse set of empirical observations pertaining to the less developed countries in terms of the general processes that determine the distribution of income among the various agents and the hierarchical relationships that develop among them agricultural production typically involves a period of several months between the time the inputs are purchased and the time the output is marketed access to working capital and hence to the credit market thus plays an important role in a farmer s production decisions the distribution of access to credit in turn tends to be an important determinant of income distribution in poor agrarian economies credit is invariably rationed according to the ability to offer collateral the amount of working capital a farmer can mobilise therefore depends on the amount of land he owns which is often a good proxy for his overall wealth and thus his ability to offer collateral further since hired hands have a propensity to shirk they need to be supervised and therefore the

effect of certified organic production systems on poverty among smallholder farmers empirical evidence from kenya summary this study evaluates the effect of certified organic production on poverty in smallholder production systems data was collected from cross sectional survey of local market oriented peri urban vegetable and rural honey producers in kenya poverty was measured using the multidimensional poverty methodology and endogenous switching probit model used to assess the effect of certified organic production on multidimensional poverty findings were that certified producers were less likely to be multidimensional poor compared to their counterfactual case of not participating in organic certification schemes additionally noncertified producers would be less likely to be poor if they were to participate in organic certification production

evaluating the minimum wage exemption of the long term unemployed in germany the authors evaluate the exemption of long term unemployed job seekers from germany s national minimum wage using linked survey and administrative micro data they rely on a regression discontinui

rural poverty dynamics in kenya structural declines and stochastic escapes we use panel survey data and household event histories to explore patterns of rural poverty dynamics in kenya over the period 2000 2009 we find substantial mobility across poverty categories using economic transition matrices drawing on asset based approaches we distinguish stochastic from structural poverty transitions few households successfully escaped poverty through asset accumulation up to 35 of the upwardly mobile while a large proportion of households up to 66 declining into poverty experienced structural transitions using household event histories we find significant differences across structural poverty transition classes in livelihood strategies household level shocks and other factors

the economics of poverty traps and persistent poverty empirical and policy implications the moral and economic imperatives to intervene in poverty traps motivate the identification of poverty traps and their structural causes so as to inform the design of appropriate policy responses however empirical identification remains challenging because of poverty traps complexity after reviewing mechanisms that can generate poverty traps we focus on one multiple financial market failures emphasising its heretofore underappreciated testable implications including specific behaviours that are rational only in the presence of a poverty trap we therefore recommend tests for these behaviours rather than more econometrically challenged efforts to directly test for poverty traps in estimated asset dynamics

triadic power relations in rural nepal abstract we generalise basu s model of triadic power for one landlord and multiple merchants the landlord s threat towards a labourer becomes credible in the original stage game for multiple landlords and merchants we generalise more recent solutions we estimate a reduced form of the model where equilibrium rural wages are a function of the number of landlords distance to merchants characteristics of the labourers and the distance to external markets we apply living standards measurement study data from nepal and find support for the triadic model in particular the influence via the merchants depends on the number of landlords

implications of an index contingent trading mechanism this article analyzes a call market that enables conditioning not only on an asset price but also on an index a weighted average of stock prices that is determined simultaneously with the prices of all assets the authors compare two trading systems with and without index conditioning and find that in the system with index conditioning traders indeed use the facility of index conditioning there is more depth liquidity in the market price fluctuations around true values are lower expected trading costs of liquidity traders are lower and the expected utility of informed traders is lower than in a system without index conditioning copyright 1997 by university of chicago press

chronic and transitory poverty evidence from egypt 1997 99 abstract this paper uses a panel data of 347 households in egypt to measure changes in household consumption during 1997 99 and to identify causes behind the changes per capita consumption has decreased for the households during this time the decrease has not been dramatic but it has occurred at all points along the distribution over the two year period the number of households who have fallen into poverty is over twice as large as the number of households who have climbed out of poverty about two thirds of overall poverty is chronic average consumption over time is below the poverty line and almost half of all poor are always poor we use quantile regression methods to identify the factors that explain total chronic and transitory poverty while our analysis is able to document the extent of transitory poverty it performs relatively poorly in explaining the determinants of this type of poverty the predominantly chronic nature of poverty in our sample and our ability to identify associated characteristics strengthens the case for targeting antipoverty interventions such as food subsidies

the poor stay poor household asset poverty traps in rural semi arid india summary although identifying household level poverty dynamics would have important implications for poverty reduction policies empirical evidence is still scant this paper employs a novel semiparametric panel data estimator that combines the advantages of estimation methods in the existing literature and applies it to a uniquely long panel data set to examine poverty dynamics in three villages in rural semi arid india structural immobility is pervasive the currently poor are likely to remain poor suggesting a structural poverty trap while all households face static asset holdings higher castes larger landholders and more educated households are significantly less likely to be poor

measuring segregation of the poor evidence from india summary compared to the extensive literature on measurement of poverty the question of how the poor are distributed regionally has received less attention this paper fills the gap in the literature by providing a conceptual framework to measure inequality in the distribution of the poor a poverty segregation curve is used to compare a region s share of the poor population with its share in the overall population a unique contribution of the paper is formulating a generalized version of the poverty segregation curve unlike the segregation curve the generalized segregation curve also takes average poverty rates into account while ranking distributions thus the generalized segregation curve may rank a distribution with substantially lower poverty rates above a distribution with higher poverty rates when differences between their segregation curves are relatively small the segregation curves are used to analyze changes in the distribution of the poor in india since the economic reforms in the early 1990s poverty rates and shares among all states territories and districts in india are estimated using data from the national sample survey organization in 1994 2004 and 2010 in the decades following the reforms india witnessed high growth rates and declining poverty rates despite the reduction in poverty our analysis is the first to reveal that there was a significant rise in segregation of the poor over time some states had disproportionately high share of the poor compared to their share in the total population within states the extent of segregation was lower among some of the poorest states and higher in less poor states the generalized segregation curves show that the substantial decline in poverty rates since the reforms was not adequate to compensate the rise in segregation of the poor increase in segregation was also evident when the poor are identified as those who lacked education health and access to basic services reducing the segregation of the poor is important if india is to attain regionally balanced economic growth

stock market microstructure and return volatility evidence from italy abstract this paper studies the impact of the stock market microstructure on return volatility and on the value discovery process in the milan stock exchange the primary trading mechanism employed by this exchange is a call market which is usually preceded and followed by trading in a continuous market we find that the opening transaction in the continuous market has the highest volatility and that opening the market with the call transaction seems to produce relatively lower volatility in the closing transaction investors correct perceived errors or noise in the prices set at the call the implications of the results for market design are examined

is india s economic growth leaving the poor behind there has been much debate about how much india s poor have shared in the economic growth unleashed by economic reforms in the 1990s the authors argue that india has probably maintained its 1980s rate of poverty reduction in the 1990s however there is considerable diversity in performance across states this holds some important clues for understanding why economic growth has not done more for india s poor india s economic growth in the 1990s has not been occurring in the states where it would have the most impact on poverty nationally if not for the sectoral and geographic imbalance of growth the national rate of growth would have generated a rate of poverty reduction that was double india s historical trend rate states with relatively low levels of initial rural development and human capital development were not well suited to reduce poverty in response to economic growth the study s results are consistent with the view that achieving higher aggregate economic growth is only one element of an effective strategy for poverty reduction in india the sectoral and geographic composition of growth is also important as is the need to redress existing inequalities in human resource development and between rural and urban areas

disentangling the minimum wage puzzle an analysis of worker accessions and separations changes in the legislation in the mid 1980s in portugal provide remarkably good conditions for analysis of the employment effects of mandatory minimum wages as the minimum wage increased sharply for a very specific group of workers relying on a matched employer employee panel data set we model gross worker flows accessions and separations in continuing firms as well as in new firms and those going out of business using a count regression model applied to proportions employment trends for teenagers the affected group are contrasted to those of older workers before and after the raise in the youth minimum wage the major effect on teenagers of a rising minimum wage has been the reduction of separations from the employer which during the period under analysis has compensated for the reduction of accessions to new and continuing firms in this sense our results can reconcile some of the previous evidence in the empirical literature when analyzing the aggregate impact of the minimum wage on youth employment without decomposing it by type of worker flow jel d21 j23 j38

don t touch my road evidence from india on affirmative action and everyday discrimination summary this article investigates whether affirmative action in the form of electoral quotas affects group based discrimination the redistributive effect of quotas is subject to debate and their ultimate target is discrimination to identify the effect of electoral quotas i take advantage of their rotation across space and over time in india to proxy discrimination i use a measure of caste based exclusion from a public infrastructure namely streets in 2006 44 5 household members of the marginalized castes labeled scheduled castes sc still suffered from caste based exclusions i document that ongoing sc quotas reduce the likelihood of caste based exclusion for members of the scs by about one fifth the results also imply that the effect is not persistent it disappears with the end of the sc quota from a policy maker s perspective these results are mixed since electoral quotas do affect everyday discrimination even if the effect does not last these results are consistent with a temporary change in the behavior of members of the dominant castes after a one shot electoral quota these results are inconsistent with either a change in the stereotypes held by members of the dominant castes or a change in the aspirations of members of the lower castes

escaping poverty and becoming poor who gains who loses and why abstract different households have followed very different economic trajectories this study of 35 north indian villages shows members of 11 1 of 6 376 households in these villages have overcome poverty in the last 25 years while members of another 7 9 have fallen into poverty households escape from poverty is assisted by one set of factors but an entirely different set of factors is associated with households decline two distinct sets of policies are required thus one set to promote escape from poverty and another set to arrest decline into poverty poverty has some distinctly local antecedents a methodology for tracking changes in poverty at the local level is developed that community groups and others can use to assess change and examine causes

growth inequality and poverty looking beyond averages the evidence is compelling that the poor in developing countries do typically share in the gains from rising aggregate affluence and in the losses from aggregate contraction but how much do poor people share in growth do they gain more in some settings than others do some gain while others lose does pro poor growth mean more or less aggregate growth recent theories and evidence suggest some answers but deeper microeconomic empirical work is needed on growth and distributed change only then will we have a firm basis for identifying the specific policies and programs needed to complement and possibly modify growth oriented policies

employment and the introduction of a minimum wage in britain there has been and will continue to be a lot of controversy regarding the introduction of a minimum wage in britain much has been said about the economic effects of a minimum wage about the level at which it should or could be set about how other workers would be affected and about how a minimum wage may interact with the benefit system as the labour or liberal democrat parties will if they win the next election introduce a minimum wage it is evident that a clear and informed discussion of the economic effects is important most of the existing debate has concentrated on its impact on jobs and here the discussion varies from pure ideology to consideration of the statistical evidence the former is typified by the comments of a number of government ministers a recent example is that by ian lang the independent i3 september i995 who said that a minimum wage set at f4 i5 an hour would cost at least 950 000 jobs this comes from assuming large knock on effects from a minimum wage by asserting that the average worker would claim a pay increase of half the magnitude of the increase received by low paid workers when their pay is raised to the minimum and then that this wage increase has to transmit into job loss the qualitative prediction of job loss is of course entirely in line with orthodox models of the labour market which unambiguously predict that increases in minimum wages price workers out of jobs 1 it is also in line with the sentiments outlined in the recent oecd jobs study of i994 which stresses that minimum wages cause job loss in the member countries for example the jobs study argues that governments should ensure sufficient differentiation in wage rates by age and region to prevent the minimum wage from harming employment prospects for young people or low productivity regions oecd jobs study p 46 however a more recent body of work questions this conventional view quite a lot of empirical evidence has been accumulated in recent years that fails to find any evidence ofjob loss associated with minimum wages the emphasis seems to have shifted from how negative are the employment effects to is there an employment effect and in some circles what potential is there for a positive effect after a brief review of the history of minimum wages in britain we discuss this recent work in the next section of the paper on the

market microstructure and securities values evidence from the tel aviv stock exchange abstract this paper examines the value effects of improvements in the trading mechanism selected stocks on the tel aviv stock exchange were transferred gradually from a daily call auction to a mechanism where the call auction was followed by iterated continuous trading sessions this event was associated with a positive and permanent price appreciation the cumulative average market adjusted return over a period that started five days prior to the announcement and ended 30 days after the stocks started trading by the new method was approximately 5 5 in addition we find positive liquidity externalities spillovers across related stocks and improvements in the value discovery process due to the improved trading method finally there was a positive association between liquidity gains and price appreciation

poverty dynamics in rural orissa transitions in assets and occupations over generations abstractwe investigate whether historic land distribution determines stagnation or development of indian villages the empirical analysis is motivated by the banerjee and newman 1993 model of occupational choice and economic development family histories are collected for a random sample of 800 households households are classified into economic categories according to the assets occupations mix at present and at grandfather s time transitions are described and for a remote district explained by the historic village land distribution we also investigate the role of social identity and find that scheduled tribes are more likely trapped in poverty than scheduled castes

market behavior in a clearing house one of the most fundamental market mechanisms is the clearing house where orders are accumulated over time and the market is cleared periodically the issue addressed in this study is the statistical behavior of the market under this neutral mechanism in the framework of a tractable stochastic model which captures the underlying uncertainties and indivisibilities in the demand and supply schedules applying renewal theory we derive closed form results for the behavior of prices and quantities and pursue the implications of the possibility of no trade and the multiplicity of market clearing prices

the effect of the minimum wage on the fast food industry using a longitudinal survey of fast food restaurants in texas the authors examine the impact of recent increases in the federal minimum wage on a low wage labor market less than 5 of fast food restaurants were using the new youth subminimum wage in july august 1991 even though the vast majority paid a starting wage below the new hourly minimum wage immediately before it became effective although some restaurants increased wages beyond the level needed to comply with higher minimum wages in both 1990 and 1991 those federal minimum wage increases greatly compressed the distribution of starting wages in the texas fast food industry two findings at variance with conventional predictions are that 1 employment increased more in those firms likely to have been most affected by the 1991 minimum wage increase than in other firms and 2 price changes were unrelated to mandated wage changes

production prices and poverty in rural india this paper challenges the view that increases in agricultural production have reduced poverty in rural india rural poverty is related directly to the consumer price index number for agricultural labourers and inversely to agricultural production the underlying time trend term indicates a residual rising trend in rural poverty after accounting for the influence of these two factors there are plausible though conjectural reasons for believing that to a significant extent the price factor as well as the variables implicit in the time trend term both derive their strength if not their existence from the nature of the growth processes which have generated the observed growth in agricultural production these results contradict ahluwalia s earlier conclusions even though they are themselves based on essentially the same data set

trading structure and overnight information a natural experiment from the tel aviv stock exchange abstract a unique data set from the tel aviv stock exchange tase is used to study the effect of trading mechanisms on stock return volatility the tase represents a natural experiment which allows separation of the overnight information effect from the trading mechanism effect the data span a time period in which the order of the trading mechanisms a sequential continuous mechanism and a call auction was switched since overnight information should impact opening prices equally across periods this affords an unparalleled opportunity to examine the trading mechanism effect without the confounding effect of the non trading period this paper finds that the null that opening variances equal closing variances cannot be rejected for either period further the tests cannot reject null that the ratio of opening to closing return variances is equal across periods this suggests that the trading mechanisms on the tase do not differ in their effect upon return volatility

the effect of minimum wage laws on the distribution of employment theory and evidence abstract recent research casts doubt on the view that minimum wage laws reduce employment we show that in a simple model of bilateral search with heterogeneous workers a minimum wage law increases employment however the increased competition from higher productivity workers makes lower productivity workers worse off without making higher productivity workers better off we provide evidence that minimum wage laws shift employment from adults to teenagers and students this raises concerns about the distributional consequences of minimum wages even when they increase employment

why has economic growth been more pro poor in some states of india than others abstract we use 20 household surveys for india s 15 major states spanning 1960 1994 to study how the sectoral composition of economic growth and initial conditions interact to influence how much growth reduced consumption poverty the elasticities of measured poverty to farm yields and development spending did not differ significantly across states but the elasticities of poverty to urban and rural non farm output varied appreciably and the differences were quantitatively important to the overall rate of poverty reduction states with higher elasticities did not experience higher rates of non farm growth the non farm growth process was more pro poor in states with initially higher literacy higher farm productivity higher rural living standards relative to urban areas lower landlessness and lower infant mortality

a reassessment of the new economics of the minimum wage literature with monthly data from the current population survey we estimate the employment effects of federal minimum wage increases using monthly current population survey cps data from 1979 through 1997 we find that the empirical differences in the new minimum wage literature based on cps data primarily can be traced to alternative methods of controlling for macroeconomic conditions we argue that the macroeconomic controls commonly included in models where no employment impact is found are inappropriate we consistently find a significant but modest negative relationship between minimum wage increases and teenage employment using alternative controls or allowing employer responses to the policy to occur with some delay

market quality changes in the london stock market this paper examines the impact that the introduction of a closing call auction had on market quality at the london stock exchange using estimates from the partial adjustment with noise model of amihud and mendelson amihud y mendelson h 1987 trading mechanisms and stock returns an empirical investigation journal of finance 42 533 553 we show that opening and closing market quality improved for participating stocks when we stratify our sample securities into five groups based on trading activity we find that the least active securities experience the greatest improvements to market quality a control sample of stocks are not characterized by discernable changes to market quality

health nutrition and economic development the relationship between health and economic development is explored focusing on nutrition based health indicators the spotlight is placed on the inter related feedbacks between the influence of health on productivity on one hand and the influence of income on health status on the other disentangling causality in these relationships has preoccupied much of the literature we evaluate different empirical strategies that have been adopted and assess the results there is now a body of evidence based on careful empirical studies that demonstrates a causal relationship between health and labor productivity there is also evidence that at least among the very poor additional income is spent on improved nutrition there are two issues that have received little attention although we argue they are likely to be very important first measurement of health is discussed in detail evidence is presented on how taking into account differences in the extent of measurement error is critical for interpreting the impact of health on wages the same theme emerges in studies of the effect of income on health specifically calorie intake the key role of non linearities in these relationships is highlighted and we demonstrate that a good deal of the variation in estimates of income elasticities of demand for calories can be ascribed to the role of measurement and functional form authors

the effect of tax heterogeneity on prices and volume around the ex dividend day evidence from the milan stock exchange to investigate the effect of taxation on stock price and trading volume around the ex dividend day we use the italian stock market where dividends on two classes of stock are taxed differently we find that the weighted average of investors tax rates is reflected in the ex day prices and the variance of the relative tax rate across investors is reflected in the volume of trades we also show that higher transaction costs result in higher ex dividend day excess returns and lower abnormal volume this finding is consistent with profit elimination activity by institutions and corporations article published by oxford university press on behalf of the society for financial studies in its journal the review of financial studies

the caste ethnic bases of poverty dynamics a longitudinal analysis of chronic and structural poverty in nepal this paper examines poverty dynamics and their socioeconomic determinants between 1996 and 2011 in nepal with chronic and structural poverty headcount ratios of around 17 per cent poverty is mostly transient and stochastic affecting up to four fifths of the population descriptively indigenous janajatis and lower caste hindus exhibit the highest rates of chronic and structural poverty panel data models suggest significant roles of human capital and household assets in determining poverty however with the evidence of caste ethnic penalty limited mostly to janajatis findings provide important insights into the structure and determinants of poverty dynamics helping to rethink policies to address them

measuring household livelihood security at the family and community level in the developing world abstract this paper highlights one of the recent attempts to measure progress at the family and community level the household livelihood security approach the objective of this approach and an experimental household livelihood security index is not national or even large scale subnational crosscomparison instead it is a participatory rapid community assessment technique that helps to identify the constraints to peoples well being its use is to help communities and their partners develop a profile of these constraints and to discuss and design effective programs to overcome the barriers to better health nutrition housing education and livelihood security this paper addresses the following themes a introduction b a brief progress measurement history c the household livelihood security approach d the household livelihood security index e how the index is used f future issues problems and prospects and g conclusions

why have some indian states done better than others at reducing rural poverty the unevenness of the rise in rural living standards in the various states of india since the 1950s allowed the authors to study the causes of poverty they modeled the evolution of average consumption and various poverty measures using pooled state level data for 1957 91 they found that poverty was reduced by higher agricultural yields above trend growth in nonfarm output and lower inflation rates but these factors only partly explain relative success and failure in reducing poverty initial conditions also mattered states that started the period with better infrastructure and human resources with more intense irrigation greater literacy and lower infant mortality rates had significantly greater long term rates of consumption growth and poverty reduction by and large the same variables that promoted growth in average consumption also helped reduce poverty the effects on poverty measures were partly redistributive in nature after controlling for inflation the authors found that some of the factors that helped reduce absolute poverty also improved distribution and none of the factors that reduced absolute poverty had adverse impacts on distribution in other words there was no sign of tradeoffs between growth and pro poor distribution

the effects of minimum bargained wages on earnings evidence from spain abstract this paper provides an empirical evaluation of the effects of spanish sectoral collective bargaining on wages for this purpose we use a sample of workers for whom bargained wage rates and earnings are available using a variant of the meyer and wise approach we are able to estimate wage gains due to minimum bargained wages and their employment effects the most relevant conclusion is that there is evidence of a sword of justice effect by unions but this is limited by non compliance among unskilled workers and the non binding nature of bargained wages for skilled workers

escaping and falling into poverty in india today the study examines the dynamic nature of movements into and out of poverty over a period when poverty has fallen substantially in india the analysis identifies people who escaped poverty and those who fell into it over the period 2005 to 2012 the analysis identifies people who escaped poverty and those who fell into it over the period 2005 to 2012 using panel data from the india human development survey for 2005 and 2012 we find that the risks of marginalized communities such as dalits and adivasis of falling into or remaining in poverty were higher than those for more privileged groups some but not all of these higher risks are explained by educational financial and social disadvantages of these groups in 2005 results from a logistic regression show that some factors that help people escape poverty differ from those that push people into it and that the strength of their effects varies

random competitive exchange price distributions and gains from trade abstract this paper studies the behavior of a competitive exchange under uncertain preferences and random indivisible endowments we obtain explicit closed form results for the price distribution and expected gains from trade both for case where the market is thin and the number of traders is low and for the asymptotic case where the number of traders tends to infinity we demonstrate that increasing the number of traders reduces price variability and increases the expected gains from trade and that increasing the variability of traders reservation prices increases price variability as well as the expected asymptotic gains from trade

vulnerability seasonality and poverty in ethiopia most studies examining the dynamics of welfare have found large fluctuations in consumption over relatively short periods suggesting substantial short run movements in and out of poverty the consequence is that cross section poverty research may not be able to identify the poor in this study we explore this short run variability further we use a data set on a panel of 1450 households in different communities in rural ethiopia surveyed thrice over 18 months on average year to year poverty is very similar however we find high variability in consumption and poverty over the seasons and year by year econometric analysis suggests that consumption is affected by idiosyncratic and common shocks including rainfall and household specific crop failure while households respond to seasonal incentives related to changing labour demand and prices the results imply that a larger number of households are vulnerable to shocks than implied by the standard poverty statistics while some of the non poor in the

why growth is not enough household poverty dynamics in northeast gujarat india despite high growth rates in gujarat exceeding 9 per cent per year over the decade of the 1990s poverty in 36 villages located in the northeastern part of this state has changed hardly at all in these villages 9 5 per cent of households escaped from poverty over the past 25 years but 6 3 per cent of households became poor at the same time escape and descent are not symmetric different reasons account for escaping poverty than those for declining into poverty growth alone is hardly sufficient to achieve poverty reduction on any significant scale public policies will be needed to address directly the separate causes for descent into poverty

evolution and human nature from an economic perspective on individual decision making human beings have three key characteristics preferences beliefs and rationality beliefs are the probabilities with which people think various outcomes will occur conditional on information that might be available preferences are the rankings over the set of gambles that are based on such beliefs over the outcomes rationality is the extent to which people succeed in choosing optimal actions in the light of their beliefs and preferences and the extent to which their beliefs are appropriately modified by their information economists typically impose only rather weak assumptions on preferences for example preferences are taken to be transitive and sometimes less explicitly exogenous and unchanging stronger assumptions are typically imposed on preferences in specific contexts however for example preferences over time might be represented by an additively separable function with constant rate of discount despite widespread recognition that this case is a special one further attitudes to risk are often represented by the expected utility theorem which rests on assumptions that are strong if also appealing the assumptions made on rationality in particular are usually very strong that is rationality in economic models usually entails the exact optimization of preferences and modification of beliefs in accordance with bayes theorem the economist s basic picture of preferences beliefs and rationality has been subject to challenges from a growing number of empirical anomalies the proposed explanations of these anomalies involve relaxing the assumptions that economists make on these preferences beliefs or rationality for example preferences

volatility information and double versus walrasian auction pricing in us and japanese futures markets abstract this study empirically examines volatility in us and japanese commodity futures markets the us futures market comex is double auction with continuous trading whereas the japanese futures market tocom was walrasian with discrete trading until april 1991 we find intraday volatility for gold futures contracts to be significantly higher on comex than tocom throughout the sample period and is attributable to differences in information flows and market micro structures evidence is also provided that exchange volume conveys information both within and across markets which is consistent with the french and roll 1986 french k r roll r 1986 stock return variances the arrival of information and the reaction of traders journal of financial economics 17 5 26 private information based rational trading model finally daily variance and autocorrelation estimates within comex are consistent with the extant literature on equity markets

price formation on stock exchanges the evolution of trading within the day prior analyses of prices of the nyse and other exchanges find that transitory price volatility is greater at the open of trading than at the close we extend this line of research by using 40 years of hourly dow jones 65 composite price index data to estimate transitory volatility throughout the trading day our results indicate that transitory volatility steadily declines during the trading day we find a similar intraday decline in transitory volatility for a 2 1 2 year sample of the individual firms in the dow jones 30 industrials index the results are consistent with the hypothesis that trading aids price formation and do not support the argument that particular trading mechanisms are the source of greater volatility at the open of trading article published by oxford university press on behalf of the society for financial studies in its journal the review of financial studies

the feasibility of an index contingent trading mechanism auction or call trading systems are used in many stock exchanges an essential problem in the application of these systems is that orders in one security cannot be conditioned on prices of other securities this paper proposes and analyzes the feasibility of an index contingent trading system in this system limit orders may be conditioned on an index any weighted average of the security prices that is determined simultaneously with the prices in addition to the asset price without any assumptions about traders behavior it is shown that under a reasonable restriction on the structure of the limit orders there is a unique solution vector of prices to any set of orders in all securities moreover the paper presents a quick and simple algorithm that converges to the solution this algorithm is based on an extension of the current mechanisms therefore it can be implemented easily in any computerized auction system

the effects of minimum wages on employment theory and evidence from britain recent work on the economic effects of minimum wages has stressed that the standard economic model where increases in minimum wages depress employment is not supported by empirical work in some labor markets we present a general theoretical model whereby employers have some degree of monopsony power which allows minimum wages to have the conventional negative impact on employment but which also allows for a neutral or positive impact studying the industry based british wages councils between 1975 and 1992 we find that minimum wages significantly compress the distribution of earnings but do not have a negative impact on employment

mixed fortunes a study of poverty mobility among small farm households in chile 1968 86 this study is based on a panel sample of small farm households drawn from eight rural communities in chile interviewed in 1968 and 1986 the incidence and intensity of poverty based on primary income increased over this period however after including earnings from the minimum employment programmes and public transfers both the headcount ratio and squared poverty gap fell markedly between the two surveys mobility analysis showed more households moving out of than into poverty of those households who became impoverished around half may have suffered a transitory decline in income in 1986 the other half experienced pauperisation as a result of investing in projects with negative rates of return investing in the accumulation of human capital by their children sustaining a large rise in the household s dependency ratio or suffering political discrimination in the labour market per capita income was positively related to schooling of the household head in 1968 land ownership in 1986 and living in

coping and resilience during the food fuel and financial crises how and how well have people with low incomes been coping with global economic volatility since 2008 this question is addressed through a synthesis of qualitative research in 17 countries on how selected groups of people coped with the local effects of the global food fuel and financial crises from 2008 2011 the data are a uniquely large body of qualitative evidence that afford insights into how people affected by a common global economic shock coped as it transmitted to their diverse social and economic contexts the paper describes and categorizes the impacts of coping responses used analyzing the distribution of the costs of coping the effects on social and gender relations and the sources of support including public policy non state support and informal social support the paper is organized as follows section one gives introduction section two sets out conceptual approaches to analyzing crisis coping section three describes the approach setting out the methodological advantages and limitations section four describes and categorizes the impacts and coping responses section five analyzes sources and types of support identified by the research section six draws concludes

comment on david neumark and william wascher employment effects of minimum and subminimum wages panel data on state minimum wage laws in their article published in the minimum wage research symposium in the october 1992 issue of this journal industrial and laborrelations review volume 45 number 1 pp 55 81 david neumark and william wascher claim to find empirical support for three propositions 1 a higher minimum wage leads to a lower teenage employmentpopulation rate 2 the effect of the minimum wage on employment can be seen within a year but becomes stronger after two years and 3 in states with legal subminimum wages a significant fraction of teenage employees are paid a subminimum wage and the availability of a subminimum wage blunts the disemployment effect of the minimum wage the same symposium contains three papers by us that present empirical evidence suggesting conclusions opposite those of neumark and wascher 1 since neumark and