does the gap in family friendly policies drive the family gap a segregation of the labour market into a family friendly and a non family friendly sector has the effect that women self select into the sectors depending on institutional constraints preferences for family friendly working conditions and expected wage differences we find that neglecting the sector dimension tends to understate the effect of birth related interruptions in both sectors the combined effect of a large depreciation effect and no recovery means that females in the non family friendly sector e g private sector are punished severely after childbirth in the family friendly sector e g public sector we find complete catch up

public sector wages and bureaucratic quality evidence from latin america the purpose of this paper is to present evidence on public private wage differential for a sample of latin american countries and to discuss the relationship between public private wage differentials and bureaucratic quality in the region the paper starts by estimating public private wage differentials for a sample of 17 latin american countries covering 88 percent of the population of the region next the paper looks at the relationship between bureaucratic quality and public private wage differentials and finds that while there is no correlation between average public sector wages and bureaucratic quality there is a positive correlation between bureaucratic quality and the degree

intergenerational class mobility in postwar japan this article uses mobility data from japan to 1 test the feather man jones hauser hypothesis that industrial societies share similar rats of intergenerational mobility and to 2 shed light on the debate about japanese exceptionalism japanese relative mibility rates show no systematically greater deviation from the postulated common pattern than do those of nine european nations regarding absolute mobility rates however an argument can be made for the distinctiveness of mobility patterns and processes of class formation and reproduction in japan

the estimation of wage gains and welfare gains in self selection models the authors modify the basic self sele ction model for the effects ofeducation training unions and other activities on wages by including heterogeneity of rewards to the activity i e diffe rences across individuals in the rate of return to the activity the authors sho w that such heterogeneity creates a new form of selectionbias they provide tes ts for its presence and draw out its implications for the wage and welfare gains to the activity an empirical application provides strong support for such hete rogeneityin one particular training program copyright 1987 by mit press

a switching regression model for wage determinants in the public and private sectors of a developing country governments in less developed countries face severe budgetary constraints given that public sector employment is a large part of modern sector employment the government wage bill h as come under increased scrutiny the central question is how do gove rnment wages compare with those in the private sector in this paper the authors develop and estimate a model to answer this question an important aspect of this model is the endogenous treatment of sector choice the estimation results full information maximum likelihood sound a strong warning against the use of ordinary least squares est imates that are based on sector specific samples data are from the i vory coast copyright 1988 by mit press

market transition industrialization and social mobility trends in postrevolution china1 this study examines trends in intergenerational class mobility in china by analyzing six comparable nationally representative surveys between 1996 and 2012 defying a simplistic unidirectional ac

compensating differentials and self selection an application to lawyers this paper models individual choice between two types of jobs as dependent on the difference in potential earnings and on preferences for nonpecuniary the model leads to simultaneous estimation of earnings and job choice functions in a manner that takes account of self selection of individuals into the sector of highest utility an application to lawyers choosing between private and public interest law casts doubt on the notion that public interest lawyers are accepting substantially lower earnings by virtue of their choice an impression derived from estimation of earnings functions without accounting for self selection the estimation technique also takes proper account of the choice based nature of the sample which appears to be important

comparative social mobility revisited models of convergence and divergence in 16 countries this paper reanalyzes 3 stratum intergenerational mobility classifications assembled by hazelrigg and garnier for men in 16 countries in the 1960s and 1970s log linear and log multiplicative models are used to compare mobility regimes and to estimate effects of industrialization educational enrollment social democracy and income inequality on immobility and other parameters of the mobility process several models of mobility fit the data equally well so criteria of plausibility and parsimony are applied to choose one model of stratum specific immobility and another model of vertical mobility with uniform immobility we find substantial similarity in mobility and immobility across countries but the exogenous variables do explain systematic differences among countries cross national variations are complex because most of the exogenous variables have different effects on different parameters of the mobility regime relative to other factors industrialization and education have weaker effects on mobility regimes than has usually been supposed

the estimation of a joint wage hours labor supply model in this paper the standard cross sectional static model of labor supply is modified to make the wage endogenous and a joint wage hours model is estimated the econometric technique addresses the non linearity of the budget constraint by approximating the constraint by a series of discrete points the results show that the budget constraint is indeed nonlinear that hours affect the wage quadratically that true wage elasticities are lower as a result and that the model fits the hours distribution much better than the standard tobit model

public service employment and the public private wage differential in british regions successive forms of regional policy in the uk have sought to support the maintenance and creation of public sector employment opportunities in relatively disadvantaged regions nationally negotiated public sector pay rates mean that the private public pay gap is likely to be wider in lower demand regions this will be reinforced by the relative absence of private sector employment crowding out in such higher unemployment regions this paper investigates the association between private and public sector service employment using panel data for british regions and estimates regional public private wage differentials using british household panel survey data for 1991 to 1996 across britain private sector employment growth is weakly positively associated with higher public service employment growth but the association is stronger in scotland and the north of england the pattern of regional wage differentials found is consistent with lower crowding out in higher unemployment regions this suggests that reg

cagan s hypothesis and the first nationwide inflation of paper money in world history more than 25 years ago phillip cagan proposed the hypothesis that the demand for real cash balances depended mainly on the expected rate of inflation provided that the monetary sector was sufficiently isolated from changes in the real sector cagan 1956 to test his hypothesis cagan studied seven hyperinflations in modern europe during which variations in the real variables were negligible compared with the astronomical increases in prices it is well known that he got confirmatory results from his studies however until recently it has not been realized that the same hypothesis is also strongly supported by data from a very different socioeconomic context namely the first nationwide inflation of paper money in world history paper money was invented in china in the northern suing dynasty a d 960 1126 and widely used in the southern sung dynasty a d 1127 1278 the first inflation on a national scale occurred from around 1190 to the end of the dynasty when the monetary system collapsed in this inflation period available historical records do not suggest significant expansion of the economy or important changes in real income modern financial assets such as bonds and equities did

public sector wage policy and labor market equilibrium a structural model we develop and estimate a structural model that incorporates a sizable public sector in a labor market with search frictions the wage distribution and the employment rate in the public sector are taken as exogenous policy parameters overall wage distribution and employment rate are determined within the model taking into account the private sector s endogenous response to public sector employment policies job turnover is sector specific and transitions between sectors depend on the worker s decision to accept alternative employment in the same or different sector by comparing the value of employment in the current and prospective jobs the model is estimated on british data by a method of moments we use the model to simulate the impact of various counterfactual public sector wage and employment policies

would nonprofit workers accept to earn less evidence from france this article focuses on wage differentials between french nonprofit for profit and public sectors considering the public sector allows testing more extensively the labour donation theory preston 1989 the findings support this theory because nonprofit workers accept to earn significantly less than they would earn in the for profit and public sectors they also suggest differences in the motivations of workers in these sectors nonprofit workers are attracted to their work for reasons transcending material compensation

examining equality between public and private sector wage distributions i introduction institutional political and economic factors all contribute to the determination of public sector wages for example the public sector is almost the only place in many advanced economies where unions continue to have a significant presence and an influential voice in setting wages and conditions of work political factors such as desiring to be a good employer may also influence the public sector wage structure as a good employer governments may offer low skilled workers higher rates of pay than they might get in the private sector on the other hand the public sector may be adverse to paying very skilled workers high rates of pay if the public does not like to see public sector workers earning too much economic factors such as spending and tax receipt limits can also affect the wage structure in the public sector all of these factors could make the public sector labor market be less efficient than that of the private sector from an economic perspective if government workers are paid more than private sector workers ceteris paribus then taxes are being wasted if private sector workers are paid more than government workers governments cannot recruit and retain appropriately skilled and productive workers to make the wage structures comparable many countries use surveys to ascertain the prevailing earnings levels for jobs in the private sector that are similar to public sector jobs however as fogel and lewin 1974 and gregory 1990 point out these survey methods are fraught with biases that may affect comparability of wages indeed there is little empirical evidence that wages between the two sectors are equal bender 1998 and gregory and borland 1999 survey the current literature on public private wage differentials and report that most studies find that central governments pay more on average compared to the private sector even after controlling for differences in the productive characteristics of workers furthermore as elliott et al 1999 find comparability in pay is currently important in the debates over public sector pay reform particularly in europe the institutional and political factors outlined above are waning in importance and economic considerations are seemingly coming to the fore because of perceptions of the overpayment of public sector workers and the desire to cut government wage bills politicians in these countries are devising policies to align average rates of pay by slowing the relative rate of public sector wage growth the policies should be different however if wage distributions are not the same indeed there is some evidence that the distributions differ as found in the double imbalance concept articulated by schager 1993 katz and krueger 1993 and elliott and duffus 1996 this imbalance is characterized by public sector workers at the lower end of the occupational hierarchy receiving the largest wage premia and workers at the upper end earning less than their private sector counterparts if the distributions are incomparable ceteris paribus mandating equal average rates of pay growth will not ensure comparability policies aimed at realigning wage structures at the ends of the distribution should then be followed to promote comparability this article compares public and private sector wage distributions and examines the extent to which focusing exclusively on differences in mean wages obscures the true nature of the wage relativities data from the british social change and economic life initiative sceli are employed to investigate comparability this data set is well suited for a comparability study given the range of personal and job characteristics that control for differences in public and private sector jobs moreover the data were collected in 1986 before substantial reform of public sector pay in the united kingdom reviewed in bender and elliott 1999 this offers a test to see if the reform policies were appropriate to promote wage comparability

are low skill public sector workers really overpaid a quasi differenced panel data analysis public private sectoral wage differentials have been studied extensively using quantile regression techniques these typically find large public sector premiums at the bottom of the wage distribution this may imply that low skill workers are overpaid prompting concerns over efficiency we note several other potential explanations for this result and explicitly test whether the premium varies with skill using australian data we use a quasi differenced generalized method of moments gmm panel data model which has not been previously applied to this topic internationally unlike other available methods this technique identifies sectoral differences in returns to unobserved skill it also facilitates a decomposition of the wage gap into components explained by differences in returns to all observed and unobserved skills and by differences in their stock we find no evidence to suggest that the premium varies with skill one interpretation is that the compressed wage profile of the public sector ind

adaptive learning and the transition to fiat money this article explores some implications of adaptive learning for monetary evolution using a search theoretic framework that allows for media of exchange network effects adaptive learning precludes any voluntary transition to a fiat standard from a non monetary state of nature and can account for the historically observed tendency for fiat monetary standards to emerge only following the prior appearance of commodity money and the widespread employment of redeemable banknotes adaptive learning can also account for governments frequent resort to coercive measures to force a switch to fiat money and for their ability to affect such a switch even when doing so is not pareto optimal exchange media fall into the general category of products for which the utility that a user of the good derives from use of the good increases with the number of other agents using the good katz and shapiro 1985 p 424 there are two reasons for these positive network effects 1 indirect the more agents who employ a particular medium of exchange the more likely it is that prices will be quoted in terms of that medium of exchange i e that the medium of exchange will also serve as the economy s principle medium of account the costs of exchange are less for a medium of exchange that trades at par this indirect external effect is analogous to one encountered in computer hardware the more purchasers of a particular kind of hardware the more likely manufacturers of software are to supply compatible products 2 direct the more persons who use a particular exchange medium the better its quality or performance this direct network effect is analogous to one encountered in communications technologies such as telephones the analogy is especially close for fiat money which is useless to an isolated individual this article examines some ways in which media of exchange network effects influence the evolution of monetary standards and especially their role in determining both when and how a transition may occur from barter or commodity money to fiat money the approach taken here emphasises the role of adaptive learning where agents select exchange strategies that reflect static expectations concerning other agents preferred strategies although the exchange game agents play generally has multiple nash equilibria including one in which all agents accept fiat money adaptive learning precludes a spontaneous transition from barter to a fiat monetary standard even where a fiat standard would be welfare enhancing yet such learning does not rule out the spontaneous evolution of a commodity money standard or the eventual substitution of redeemable banknotes for commodity money readers familiar with the literature on network effects will recognise this

gender differentials in the payoff to schooling in rural china this article examines the gender differential in the payoff to schooling in rural china the analyses are based on a framework provided by the over education required education under education literature and the decomposition developed by chiswick and miller 2008 it shows that the payoff to correctly matched education in rural china is much higher for females than for males associated with this the wage penalty where workers are under qualified in their occupation is greater for females than for males over educated females however are advantaged compared with their male counterparts these findings are interpreted using the explanations offered for the gender differential in the payoff to schooling in the growing literature on earnings determination in china

do dutch dentists extract monopoly rents we exploit lottery determined admission to dental school to estimate the payoffs to the study of dentistry in the netherlands using data from up to 22 years after the lottery we find that in most years after graduation dentists earn around 50 000 euros more than they would earn in their next best profession the payoff is larger for men than for women but does not vary with high school gpa the large payoffs cannot be attributed to longer working hours larger investments while studying opportunity costs and direct costs or unpleasant aspects of working as a dentist a plausible explanation is that dentists earn a monopoly rent results from regressions of dentists earnings on dentists density are consistent with this as are the facts that the supply of dentists in the netherlands is low and that the payoff does not vary with high school gpa

a modified switching regression model for earnings differentials between the public and private using dutch 1986 data the wage differentials between public sector and private sector workers are investigated by employing a variation of the switching regression model this model imposes fewer identification restrictions on the parameters of the model than the standard switching regression model the estimation results show that some categories of public sector workers earn substantially less than private sector workers copyright 1993 by mit press

hyperinflations their origins development and termination abstract this paper summarizes and critically surveys research on hyperinflation appraisal and review of the literature considers the origins development termination and the lessons to be learned from hyperinflations the historical evidence as well as the econometric evidence is analyzed it is concluded that while the lessons to be learned from such episodes perhaps have been overstated a number of useful implications may be derived from studying hyperinflations such as an understanding of the forces which link monetary and fiscal policies to inflation and policy makers role in influencing individuals expectations

public and private sector wages of male workers in germany we analyze several statistical assumptions used in empirical models on public private sector wage structures based on data for germany which contain a large range of background variables usually not available in other studies we investigate the sensitivity of results to various specification and identification assumptions the standard switching regression model is extended to allow for endogeneity of education level experience and hours worked these extensions lead to considerably different parameter estimates we compare conditional and unconditional wage differentials between the public and the private sector for the various specifications these differentials are sensitive to identification assumptions but robust across specifications which do and do not allow for endogeneity of education experience and hours worked

public and private sector wages in the netherlands there is much debate in the netherlands about underpayment of public sector workers relative to private sector workers in this paper we analyze the wage structures in both sectors using an endogenous switching regression model unlike previous dutch studies we find that the earnings prospects of public sector workers are better in the public sector than in the private sector for private sector workers we find the exact opposite their earnings prospects are better in the private sector moreover the allocation over sectors points to comparative advantages

modern hyper and high inflations since 1947 hyperinflations by cagan s definition in market economies have been rare much more common have been longer inflationary processes with inflation rates above 100 percent per annum based on a sample of 133 countries and using the 100 percent threshold as the basis for a definition of very high inflation episodes this paper examines the main characteristics of such inflations among other things we find that i close to 20 percent of countries have experienced inflation above 100 percent per annum ii higher inflation tends to be more unstable iii in high inflation countries the relationship between the fiscal balance and seigniorage is strong both in the short and long run iv inflation inertia decreases as average inflation rises v high inflation is associated with poor macroeconomic performance and vi stabilizations from high inflation that rely on the exchange rate as the nominal anchor are expansionary

unequal but fluid social mobility in chile in comparative perspective a major finding in comparative mobility research is the high similarity across countries and the lack of association between mobility and other national attributes with one exception higher inequality seems to be associated with lower mobility evidence for the mobility inequality link is however inconclusive largely because most mobility studies have been conducted in advanced countries with relatively similar levels of inequality this article introduces chile to the comparative project as the 10th most unequal country in the world chile is an adjudicative case if high inequality results in lower mobility chile should be significantly more rigid than its industrialized peers this hypothesis is disproved by the analysis despite vast economic inequality chile is as fluid if not more so than the much more equal industrialized nations furthermore there is no evidence of a decline in mobility as the result of the increase in inequality during the market oriented transformation of the country

nonprofit and proprietary sector behavior wage differentials among lawyers this paper focuses on earnings differentials in the for profit and private nonprofit sectors with specific reference to lawyers an earnings equation for private lawyers is estimated and is used to predict what the nonprofit sector public interest lawyers could earn in the private sector the finding is that the public interest lawyers are paid substantially less that they know this and that the financial sacrifice is permanent next a job choice equation is estimated which suggests that those lawyers who choose public interest work have different preferences from those who choose private law practices the difference may help to account for the willingness of the public interest lawyers to accept lower monetary rewards further research is needed to determine whether the differences found for lawyers in the two sectors are also found in other industries and whether such differences are found only at the level of management or at lower levels the goal is improved understanding of behavioral diff

estimation of optimal human capital accumulation parameters for the netherlands abstract using the theory of optimal investments in human capital in general and rosen s 1975 1976 version of it in particular we tried to model and explain aggregate life cycle income profiles for the netherlands in 1965 1972 and 1979 the model allowed us to estimate and impute human capital accumulation parameters and paths changes in rates of return depreciation rates the value of the human capital stock and of lifetime human wealth could be identified and compared for the sample years it was found that in terms of some of these parameters public sector employees gained compared with private sector employees and employees with higher vocational training gained ground over university trained employees

the central government private sector wage differential since ehrenberg and schwarz 1986 there has been a plethora of articles investigating the relationship between public and private sector wages this article examines part of this post 1986 literature by reviewing articles that examine central government private sector wage differentials in sum most articles find that there is a premium paid to central government workers although the premium has declined in recent years in developing countries however the differential is usually negative women and minorities tend to do better in the public sector relative to their private sector counterparts the evidence on union premiums between sectors is mixed although the premium tends to be higher in the private sector however public sector union workers do not do much better than private sector union members the magnitude of all of the wage differentials discussed are sensitive to the estimation technique and data source used the most common explanation for the public sector wage premium is economic rent accruing to government workers although the public sector wage determination literature suggests that the differential is due to returns to political and vote producing activities not relevant in the private sector

field of study earnings and self selection why do individuals choose different types of post secondary education and what are the labor market consequences of those choices we show that answering these questions is difficult because individuals choose between several unordered alternatives even with a valid instrument for every type of education instrumental variables estimation of the payoffs require information about individuals ranking of education types or strong additional assumptions like constant effects or restrictive preferences these identification results motivate and guide our empirical analysis of the choice of and payoff to field of study our context is norway s post secondary education system where a centralized admission process covers almost all universities and colleges this process creates credible instruments from discontinuities which effectively randomize applicants near unpredictable admission cutoffs into different fields of study at the same time it provides us with strategy proof measures of individuals ranking of fields taken together this allows us to estimate the payoffs to different fields while correcting for selection bias and keeping the next best alternatives as measured at the time of application fixed we find that different fields have widely different payoffs even after accounting for institutional differences and quality of peer groups for many fields the payoffs rival the college wage premiums suggesting the choice of field is potentially as important as the decision to enroll in college the estimated payoffs are consistent with individuals choosing fields in which they have comparative advantage we also test and reject assumptions of constant effects or restrictive preferences suggesting that information on next best alternatives is essential to identify payoffs to field of study