evaluating unemployment policies what do the underlying theories tell us the paper surveys unemployment policies for advanced market economies and evaluates them by examining the predictions of the underlying macroeconomic theories the basic idea is that for the most part different unemployment policy prescriptions rest on different macroeconomic theories and our confidence in the prescriptions should depend at least in part on theories ability to predict some salient stylized facts about unemployment behavior the paper considers four types of policies laissez faire demand management policies supply side policies and structural policies copyright 1995 by oxford university press

nominal wage contracts and the persistent effects of monetary policy we consider an efficiency wage model where wages affect turnover and firms choose optimal labor contracts under uncertainty about demand and productivity we show that there may be an equilibrium with nominal wage contracts where monetary shocks affect output furthermore monetary shocks have persistent effects on output because the previous state of the labor market affects the reemployment probability of quitting workers persistence increases if workers have bargaining power with endogenous policy a credibility problem arises naturally in the model equilibrium inflation increases with persistence but decreases with the natural rate of unemployment for given persistence

premiums to employment in larger establishments evidence from peru abstract examination of the employer size wage effect for males in urban peru suggests the following higher wages in larger establishments do not merely compensate for higher worker quality or inferior working conditions size differences in the use of rising wage tenure profiles cannot provide a market clearing explanation for the employer size wage effect unless workers are extremely impatient thus larger employers appear to pay premiums unionization explains none of the premiums and minimum wage compliance explains at best a small fraction shirking based efficiency wage explanations for premiums are implausible because peruvian job security legislation greatly inhibits dismissals in larger establishments explanations meriting further research involve the use of high wages to reduce turnover and to improve productivity enhancing morale

macroeconomic shocks in a dynamized model of the natural rate of unemployment at the microeconomic level this paper revises and broadens the theory of the equilibrium rate of unemployment the natural rate in a monetary model the authors begin by recreating steven salop s turnover model of the natural rate in its naturally intertemporal version useful findings on impact effects and the adjustment process at the individual firm necessarily excluded by the static version are shown to derive from the dynamized model at the macroeconomic level the authors then provide a general equilibrium analysis of some shocks showing how they drive the equilibrium unemployment rate and in varying ways also disturb the real rate of interest copyright 1992 by american economic association

on the sources of technological change assessing the evidence this paper uses a selective review of the economic literature on technological change to support four points that are important for interpreting and incorporating technological change into formal models of energy and the environment the review 1 supports the notion that no single source dominates the process of technological change it supports roles for rd 3 indicates that these spillovers are often indirect requiring own industry activities to utilize and 4 indicates that simple experience curve calibrations often used in formal models likely include a range of sources of technological change in addition to learning by doing some of which might not be induced by the sorts of policies typically considered in the climate context

rent sharing and collective bargaining coverage evidence from linked employer employee data using a linked employer employee data set this paper analyses the relationship between firm profitability and wages particular emphasis is given to the question of whether the sensitivity of wages to firm specific rents varies with collective bargaining coverage to address this issue we distinguish sector specific wage agreements firm specific wage agreements and wage determination without any bargaining coverage our findings indicate that individual wages are positively related to firm specific rents in the non union sector and under firm specific contracts industry wide wage contracts however seem to suppress firm level rent sharing while pooled ols estimates yield a positive correlation between wages and quasi rents under centralised contracts estimates accounting for unobserved individual and establishment heterogeneity point to a coefficient of zero differenced gmm estimates accounting for the endogeneity of our profitability measure even point to a negative relationship under centralised contracts

canadian jobs and firm size do smaller firms pay less even after controlling for observable workers characteristics and for occupation and industry specific effects a substantial wage differential remains between large and small firms what underlies the remaining wage differential is unclear direct evidence on pension plan coverage and on lay off rates by firm size is inconsistent with the bad working conditions hypothesis the union avoidance hypothesis does not seem to explain an important portion o f the wage differential as suggested by efficiency wage models part of the remaining wage differential may be due to firms heterogeneity similarly perhaps large firms pay higher wages simply partly beca use they employ workers with more unobserved abilities because differen t explanations of the wage differential may lead to different policy implications determining the source of the wage firm size effect is an important question for future research

the phillips curve as a long run phenomenon in a macroeconomic model with complex dynamics abstract in this paper we derive a phillips curve as the image of a chaotic attractor of the state variables of a non linear dynamical system describing the evolution of an economy this has two important consequences the phillips curve in our model is a true long run phenomenon but to exploit the apparent unemployment inflation trade off may require unrealistically complex policy measures the model is based on an overlapping generations non t tonnement approach involving temporary equilibria with stochastic rationing in each period and price adjustment between successive periods in this way we are able to obtain complex sequences of consistent allocations allowing for recurrent unemployment and inflation

migration and imperfect labor markets theory and cross country evidence from denmark germany and the uk we investigate the labor market effects of immigration in denmark germany and the uk three countries which are characterized by considerable differences in labor market institutions and welfare states institutions such as collective bargaining minimum wages employment protection and unemployment benefits affect the way in which wages respond to labor supply shocks and hence the labor market effects of immigration we employ a wage setting approach which assumes that wages decline with the unemployment rate albeit imperfectly we find that the wage and employment effects of immigration depend on wage flexibility and the composition of the labor supply shock in germany immigration involves only moderate wage but large unemployment effects since immigrants are concentrated in labor market segments with low wage flexibility the reverse is true for the uk and denmark

efficiency wages employment versus welfare this paper analyzes the effects of government policies in an efficiency wage model in such a model wages exceed market clearing rates firms may pay high wages for many reasons levine gives thirteen motivations for efficiency wages 12 in the model used here high wages prevent shirking by workers the model is similar to those of shapiro and stiglitz sparks fairris and alston and others 15 17 7 efficiency wage models are often viewed as providing the microeconomic foundations of involuntary unemployment and keynesian economics 1 2 unemployment is also emphasized in many discussions of government policies 3 4 11 a major example is that of johnson and layard 9 they find that a per capita employment subsidy financed by an ad valorem wage rate tax would reduce unemployment they conclude that this policy would benefit a country because of the employment effect 2 yet this paper shows that the employment effect is misleading here a policy that causes employment to rise fall also must cause income net of effort to fall rise so total welfare falls rises the policy implications discussed by johnson and layard and others are therefore reversed

productivity growth technical progress and efficiency change in industrialized countries this paper analyzes productivity growth in 17 oecd countries over the period 1979 1988 a nonparametric programming method activity analysis is used to compute malmquist productivity indexes these are decomposed into two component measures namely technical change and efficiency change we find that u s productivity growth is slightly higher than average all of which is due to technical change japan s productivity growth is the highest in the sample with almost half due to efficiency change jel c43 d24 in this paper we apply recently developed

efficiency wages revisited the internal reference perspective the missing wage rigidity in general equilibrium models of e ciency wages is an artifact of the external wage reference perspective conventionally adopted by the literature e ciency wage models based on an internal perspective in which the wage reference is made dependent on the flrm s ability to pay are capable of generating strong wage rigidity this paper makes the point in the context of the gift exchange framework originally proposed by akerlof 1982 jel classiflcation e24 e32 j50

a note on keynesian unemployment as a worker discipline device abstract keynesian sales constraints are introduced into a model with endogeneous wages and involuntary equilibrium umemployment the result is a lower real wage and a higher unemployment rate

interview with edmund s phelps edmund s phelps has been mcvickar professor of political economy at columbia university in new york city new york since 1982 and director of the center on capitalism and society at columbia university s earth institute since 2001 in 2006 he was awarded the nobel memorial prize in economic science for his analysis of intertemporal tradeoffs in macroeconomic policy we interviewed professor phelps at his hotel in san francisco on january 3 2009 while attending the annual meeting of the allied social science associations

the efficiency of equity in organizational decision processes it is now widely accepted that rent seeking anne krueger 1974 or directly unproductive profit seeking jagdish bhagwati 1982 may cause inefficiencies in the context of public sector decisions the possibility that government decisions for example about taxes quotas franchises or standards may create or redistribute rents induces private parties to spend valuable resources to influence that distribution even when such expenditures carry no social benefit moreover the social cost of rent seeking can exceed the value of the resources spent trying to gain and protect rents for example because the fear of losing wealth through redistribution reduces the incentives for wealth creation treating rent seeking activities as characteristic of public sector decision processes ignores the fact that similar phenomena are to be found in firms unions and other private sector organizations our recent work milgrom 1988 our 1988 1990 papers attempts to identify the advantages of decision processes private or public that permit rent seeking and to incorporate these into a cost benefit analysis of optimal decision processes our work begins with an analysis of why rents and quasi rents arise in organizations and of the forms that the rent seeking they engender may take some measures to insulate the decision process from rent seeking such as limits on the provision of information by interested parties or restrictions on the range of options considered may degrade the quality of decisions especially by blocking the flow of valuable information optimal decision processes balance the costs of rent seeking against the value of information obtained several aspects of the rules affect the opportunities that members have to spend resources trying to alter the distribution of rents to ascertain the possibilities for rent seeking the analyst must ask questions like can the parties propose new initiatives at any time can they give volumes of testimony in a form of their own choosing can they appeal adverse decisions are decision makers obliged to respond to the parties initiatives is the range of actions that they can take in response relatively broad rather than being tightly constrained by property rights or other formal rules more affirmative answers to these questions lead to more opportunities or greater incentives for costly rent seeking as a kind of shorthand we call decision processes that have more of these elements more open processes the very elements that make a process open to rent seeking may also add flexibility and responsiveness helping to ensure that important ideas and proposals are fully considered from this perspective the benefits of openness can in principle be measured by a value of information calculation in the usual manner of statistical decision theory weighing the costs and benefits it follows that a more open process is more desirable when the rents available for redistribution are low and the value of the information that might be acquired is high conversely when the potential for redistribution is high and the value of information is low the optimal decision process is less open this kind of reasoning helps to illuminate the variations in the decision processes that are found in many organizations we have discussed a number of examples in our earlier work including the characteristics of personnel departments the contrasting patterns of decision making employment and compensation in u s and japanese firms professor of economics stanford university and jonathan b lovelace professor of economics graduate school of business stanford university stanford ca 94305 respectively this work was supported by the national science foundation

testing rent sharing using individualized measures of rent evidence from domestic helpers wing suen the market for resident domestic helpers offers a rare opportunity where the surplus from employment relationship can be quantitatively measured for each individual employee using the difference between employer s cost of time and employee s wage as a measure of rent it is found that wages for domestic helpers are positively related to rent however the apparent sharing of rent is better explained by matching than by efficiency wage models rent sharing is observed even in households where monitoring or turnover costs are low rent sharing is not observed among newly arrived foreign domestic helpers whose ability remains to be revealed jel j41 i introduction this article studies the pattern of wages for resident domestic helpers in hong kong no one would lure economists into paying attention to this arcane labor market were it not for one feature of the market for housework a measure of employment rent can be plausibly assigned to each individual employee having an individualized measure of rent at the worker level instead of a general measure at the firm level will shed considerable light on the large and growing literature of rent sharing in wage determination since 1975 the hong kong government has allowed the importation of foreign domestic helpers into the territory because of large wage differences between hong kong and some of its asian neighbors the program is highly popular the census and statistics department 1995 estimates that 92 700 households or 5 6 of all domestic households in hong kong employed domestic helpers in 1993 the figure is even more dramatic for high income households 44 of households with monthly income of over hk 50 000 had one or more domestic helpers 1 one consequence of the availability of market procured housework is that women who employ helpers have more time for market work in suen 1994 i estimate that the probability of labor force participation among married women who had domestic helpers is 22 percentage points higher than that for women without domestic help other things equal if hiring a helper enables a married woman to engage in market work then a plausible measure for the rent or surplus from this employment relationship is the difference between the woman s wage and her helper s wage if a woman with a domestic helper decides to stay home nonetheless the size of the surplus can be measured by the difference between the shadow value of leisure and the helper s wage wage information is readily available from census data and shadow wages can be estimated using standard techniques this article utilizes this rare opportunity to impute a measure of rent for each employer employee pair studying how the wages of domestic helpers vary wi th the magnitude of rent will provide direct evidence for rent sharing in the labor market there is a large literature which documents the fact that the characteristics of the employer such as industry affiliation and firm size are significantly correlated with the employees wages krueger and summers 19881 brown and medoff 1989 groshen 1991 helwege 1992 and many others offer convincing evidence that inter industry wage differentials and employer wage effects exist rent sharing is often invoked to account for such wage patterns however few studies in the literature offer a plausible account for the existence of or a measure for the size of the rent that is supposedly shared 2 at the industry level dickens and katz 1987 use variables such as concentration ratio capital labor ratio research and development expenditures and average rate of return on capital as covariates in wage equations these variables provide at best an indirect and error prone measure of employment rent campbell 1993 makes use of firm level characteristics instead of industry characteristics but t here is no information on profits in his firm level data

efficiency wage models of unemployment one view h lorne carmichael persistent wage rigidity and involuntary unemployment appear to be recurrent problems in most economies what could be preventing the wage adjustment necessary to clear the labor market many recent papers claim to have found the answer in efficiency wage models this paper surveys this literature and attempts to evaluate its accomplishments it concludes that the efficiency wage models fail to explain wage rigidity or persistent involuntary unemployment persistent involuntary unemployment of workers is a recurrent problem in labor markets all over the world unemployed workers seem unable to find work even though they are willing to accept lower wages than those being paid employed workers with similar skills what could be preventing wages from adjusting to clear these markets many recent papers known collectively as the efficiency wage literature now claim to have the answer this paper will survey the efficiency wage literature and critically evaluate some of its accomplishments efficiency wage models have already been examined by yellen 1984 katz 1986 and stiglitz 1987 and have received generally favorable reviews this paper is more critical its overall conclusion is that efficiency wage models provide some useful insights into the workings of the labor market but they do not provide a satisfactory account of wage rigidity or involuntary unemployment there are at least five separate versions of the efficiency wage model they share a common structure however and this is outlined in the first section of the paper this section also attempts to relate efficiency wage models to other recent models of unemployment section ii examines and criticizes the different approaches in detail section iii evaluates the achievements of this approach and suggests some directions for future work i a general efficiency wage model efficiency wage models as the name suggests are first of all models of wages they generate unemployment by showing that firms will sometimes want to set wages at non market clearing levels it is useful to begin therefore by reviewing how wages and employment are determined in some related models in a perfectly competitive labor market the wage for each type of labor is adjusted constantly to maintain equality of supply and demand overall employment fluctuates in response to demand changes as workers move up and down their labor supply curves unemployment is voluntary in that anyone who is not working prefers that state to employment at the going wage for people of his skills as well the value of a worker s marginal product is equal to the marginal value of his leisure so there are no unexploited wage bargains between unemployed workers and firms this model is successful in predicting the long term response of wages to shifts in demand and supply but it is clear that in the short run its depiction of voluntary unemployment and flexible wages is unrealistic a natural way to generate more realism is to assume that wages are inflexible in the short run in this case a reduction in demand away from a long run equilibrium will lead to rationing of jobs by employers as they attempt to stay on their labor demand curves the unemployment here is involuntary in that the unemployed would prefer to be working at the going wage and is inefficient in that there are lost gains from trade between these workers and firms the weakness of this model is that it is silent about the mechanism that keeps wages rigid unemployed workers who offer to work for less than the fixed wage ought to find work the early implicit contract models of azariadis 1975 baily 1974 and gordon 1974 provide one explanation for wage rigidity these models introduced the idea that wages can do more than just clear the market for labor wages in an implicit contract model are used to shift the risk generated by uncertain output market conditions from risk averse workers to the risk neutral firm

a comparison of land use change models challenges and future developments abstract land demand is driven by an increasing population and changing consumption patterns when land is required land use changes luc are triggered causing several environmental and social impacts particularly topical is the assessment of indirect luc effects several methodological approaches have been proposed for carrying out the assessment in this paper we classified luc models for life cycle assessment lca applications into three main categories economic causal descriptive and normative models six models were selected as representative of these three categories and compared according to fifteen criteria covering modeling framework impact categories assessed and model transparency the results show that progresses have been made in the economic general equilibrium models and the causal descriptive models compared causal descriptive models appear more suitable for long term assessments in the lca context while the compared economic models are more suitable for short medium term assessments of luc consequences as luc dynamics involve interdisciplinary knowledge a combination of economic biophysical and statistical data is however required to achieve a robust assessment of complex luc dynamics there is still considerable scope for improving current luc models in particular there is room for improving precision of data identification of marginal land and inclusion of a broader range of impact categories current models mainly focus on ghg emission related impacts and rarely on other environmental impacts such as nutrient leaching biodiversity impacts and water resource depletion socio economic analyses of luc patterns are currently excluded from lca analysis preventing a holistic assessment of land occupation impacts

regional wage spillover in canada the persistently high unemployment rate of the atlantic region of canada may be a symptom of importation into the region of inappropriately high wage levels from other canadian regions a theoretical explanation for the existence of such interregional wage spillover is offered the hypothesis of spillover is empirically examined using data on the wage change provisions of individual contracts in the manufacturing sector possible econometric problems associated with contract data are examined and corrective measures taken results of the estimation support the hypothesis that wage spillover plays a role in the determination of atlantic region wages copyright 1987 by mit press

industry wage differentials and efficiency wages a dissenting view with south african evidence abstract does industry wage dispersion constitute evidence of either efficiency wages or rent sharing comparison of the industry wage premia of whites and africans in south africa casts doubt upon the rent extraction and the gift exchange explanations of the industry wage structure unions combined with union threats fail to explain the data other explanations unobserved ability compensating differentials and the shirking monitoring and turnover models are rejected here as they have been before remaining possibilities are expense preference theory and internal equity rules implications for future research are pointed out

toward a new conception of the environment competitiveness relationship accepting a fixed trade off between environmental regulation and competitiveness unnecessarily raises costs and slows down environmental progress studies finding high environmental compliance costs have traditionally focused on static cost impacts ignoring any offsetting productivity benefits from innovation they typically overestimated compliance costs neglected innovation offsets and disregarded the affected industry s initial competitiveness rather than simply adding to cost properly crafted environmental standards can trigger innovation offsets allowing companies to improve their resource productivity shifting the debate from pollution control to pollution prevention was a step forward it is now necessary to make the next step and focus on resource productivity

political connections and corporate environmental responsibility adopting or escaping abstract corporate environmental responsibility cer is increasingly viewed as an important business strategy by researchers investors and society as a whole while prior research has emphasized the role of social pressures firm specific factors as well as ceo characteristics in cer little attention has been paid to the impacts of political connections we propose a mechanism based framework to study how political connections affect firm s propensity to engage in cer using comprehensive environmental information disclosure data on china s listed firms augmented by unique data on political connections we find that political connections have a positive effect on cer this effect is more pronounced for state owned firms and in cities with stringent environmental regulations with respect to the channels through which political connections increase cer we further find that political connections help firms to receive government grants subsidies and tax reduction related to the environment protection and implement government environmental policies

capital subsidies versus labor subsidies a trade off between capital and employment this paper investigates regime switching in the response of u s output to a monetary policy action we find substantial statistically significant time variation in this response that corresponds to high response and low response regimes we then investigate whether the timing of the regime shifts are consistent with three particular manifestations of asymmetry by modeling the transition probabilities governing the switching process as functions of state variables we find strong evidence that policy actions taken during recessions have larger effects than those taken during expansions we find less evidence of asymmetry related to the direction or size of the policy action

monetary valuation in life cycle assessment a review abstract monetary valuation is the practice of converting measures of social and biophysical impacts into monetary units and is used to determine the economic value of non market goods i e goods for which no market exists it is applied in cost benefit analysis to enable the cross comparison between different impacts and or with other economic costs and benefits for this reason monetary valuation has a great potential to be applied also in life cycle assessment lca especially in the weighting phase however several challenges limit its diffusion in the field which resulted in only a few applications so far the authors have performed a review of different monetary valuation methods for use in lca firstly monetary valuation approaches methods and lca applications were identified secondly key features and the strengths and weaknesses of each monetary valuation method were determined finally monetary valuation methods and lca applications were evaluated according to a comprehensive set of criteria ranging from scientific foundation to uncertainty and complexity it was found that observed and revealed preference methods and the abatement cost method have limited applicability in lca whereas the choice experiment method and the budget constraint method are the best options for monetary valuation in lca

pay equality and industrial politics personnel managers often argue that equitable pay treatment manifested as wage compression is useful because it reduces disharmony among workers but it is far from obvious that a compressed salary structure is morale improving since better workers may feel disenchanted by this scheme however when workers rewards are based on relative comparisons salary compression reduces uncooperative behavior that is detrimental to the firm relative comparisons imply that some reference group must be selected the major result is that within the relevant groups some wage compression is efficient

does wage compression explain rigid money wages there is a literature on the causes of wage rigidity and there is a literature on within firm wage structures we use a survey of ceos to show that the two are interlinked in that the proposed explanations for the compression of wages within firms also provide an explanation for wage rigidity

efficiency productivity and environmental policy a case study of power generation in the eu this study uses the eu public power generating sector as a case study to investigate the environmental efficiency and productivity enhancing performance of the european union s co2 emissions trading scheme eu ets in its first phase using data envelopment analysis methods we measure the environmental efficiency and the productivity growth registered in public power generation across the eu over the 1996 2007 period in the second stage of our analysis we attempt to explain changes in productivity and efficiency over time using econometric techniques our analysis suggests two conclusions carbon pricing led to an increase in environmental efficiency and to a shift outwards of the technological frontier and the overly generous allocation of emission permits had a negative impact on both measures these results are shown to be robust to changes in controls and specifications

job recruitment networks and migration to cities in india abstract economists have focused on job search and supply side explanations for network effects in labour transactions this paper develops and tests an alternative explanation for the high prevalence of network based labour market entry in developing countries in our theoretical framework employers use employee networks as screening and incentive mechanisms to improve the quality of recruitment our framework suggests a negative relationship between network use and the skill intensity of jobs a positive association between economic activity and network use and a negative relationship between network use and pro labour legislation furthermore social identity effects are expected to intensify when compared to information sharing and other network mechanisms using data from an all india employment survey we implement a novel empirical strategy to test these relationships and find support for our demand side explanation

sectoral wage rigidity in the canadian and french economies abstract this paper estimates the degree of wage flexibility in seven french major sectors and 16 canadian manufacturing industries in order to test the predictions of efficiency wage theory and to compare the degree of wage flexibility with the u s we estimate industry wage flexibility with disaggregated phillips curves and find that efficiency wage theory explains the inter industry pattern of wage flexibility in france and canada quite well using previous estimates from the u s we find that wages are usually more flexible in french and canadian industries than in the corresponding u s industry and that the industries with the most flexible wages in france and canada tend to have the most flexible wages in the u s

a deep recession came with deep wage cuts abstract while economists historically have considered wages rigid downwards recent studies have shown that cuts in nominal wages are more common than previously thought the deep recession experienced in iceland in 2008 coupled with iceland s flexible labor market provided an extreme example of a labor market that experienced widespread and deep cuts in nominal wages data covering two fifths of the labor market showed that 80 of employees experienced a nominal cut in regular hourly wages between 2008 and 2010 the data was collected directly from organizations and excluded the effects of a change in hours worked nominal hourly wages for full time work were cut by 9 3 on average at the same time inflation measured 18

wage policies of a russian firm and the financial crisis of 1998 evidence from personnel data 1997 to 2002 the authors use a rich personnel data set from a russian firm for the years 1997 to 2002 to analyze how the firm adjusts wages and employment during this period in which local labor market conditions changed in the aftermath of the financial crisis in 1998 they relate the development of turnover and wages for various employment categories to alternative models of wage and employment determination the authors argue that the firm s behavior is consistent with the predictions of efficiency wage models of the shirking and turnover type

a review of unemployment the thick volume under review by richard layard stephen nickell and richard jackman is an extensive econometric and theoretical study using time series and cross section data of the central tendency of the unemployment rate and its fluctuations in 19 oecd countries since the mid 50s it thus joins the company of several recent macroeconometric studies of employment determination using international time series data of these it is easily the most far ranging study to date though in its microscopic examination of social legislation it has somehow neglected a range of macro factors right under its nose readers will find an abundance of arresting claims and provocative positions to keep the critical juices flowing for me the volume is significant not or hardly at all as an assemblage of particular modelings and findings but primarily as an early econometric expression of the paradigm shift we are now witnessing in macroeconomics once nearly made extinct by a neoclassical winter a school of economists are today furiously at work on unemployment considered as an equilibrium phenomenon springing from en

a model of the natural rate of unemployment since the publication of edmund phelps volume the new macroeconomics has treated the labor market as a dynamic process of rational search by unemployed workers for available vacancies wages are viewed as at least potentially flexible though free contracting between workers and firms may lead to fixed wages in the short run imperfect information is a crucial element of the theory for it implies both a need for contracting and a need for rational search rather than simple market clearing in each period a positive rate of frictional unemployment may exist in equilibrium denoted as the natural rate this unemployment is due to the frictions in the search process and imperfections in information rather than to any deficiency in aggregate demand milton friedman defined the natural rate as the level that would be ground out by the walrasian system of general equilibrium equations provided there is embedded in them the actual structural characteristics of the labor and commodity markets including market imperfections stochastic variability in demands and supplies the cost of gathering information about job vacancies and labor availabilities the costs of mobility and so on p 8 this paper reexamines the micro foundations of the natural rate in a model of labor market equilibrium in which turnover flows and imperfect information are explicitly considered workers may quit their current jobs to enter the unemployment pool in order to search among available vacancies for a more preferred position firms economize on turnover by an appropriate wage policy

local and personal networks in employment and the development of labor markets evidence from the cut flower industry in ethiopia summary we examine the roles of local and personal networks in the employment process and the emergence and development of the labor market in ethiopia s growing cut flower industry using primary survey data of 320 workers randomly sampled from all 64 farms we find that workers who were recruited informally using the social ties were paid less than the formally recruited workers at hiring however these workers quickly increased their productivity and the effect of social ties on wages disappeared over time further we find that the development of labor market for this newly emerged industry took place particularly within the industrial cluster

environmental regulations environmental governance efficiency and the green transformation of china s iron and steel enterprises abstract based on micro level enterprise panel data from 2005 to 2014 a slack based global data envelopment analysis dea model and a global malmquist luenberger index model are used to calculate the environmental governance efficiency ege of china s iron and steel enterprises ises then the different effects of two types of environmental regulation on ege of china s ises are analysed the results show that the overall level of ege for china s ises has remained low over the past 10 years the total factor environmental governance efficiency tfege presents a decreasing trend from 2005 to 2014 and the decline in tfege is mainly attributed to the technical progress change index gtpch moreover the bootstrap dea method is used for bias correction and the correction efficiency values are all within the confidence interval improving the accuracy of ege evaluation the regression analysis results show that different types of environmental regulations exert heterogeneous effects on tfege the relationship between market incentive environmental regulation and tfege has an inverted u shaped implying that although market incentive environmental regulation may improve the tfege in the short term continuously increasing this intensity would inhibit it however command control environmental regulation and tfege have a positive but not significant relationship

efficiency wages and economic growth abstract this paper examines the positive and normative implications of introducing efficiency wages into a standard growth model a number of useful findings are obtained under the empirically justifiable assumption that the elasticity of substitution between capital and labor is less than unity it is shown that an increase in thrift shifts downward the whole path of equilibrium unemployment to leave it permanently lower in the new steady state a level increase in the measure of as well as an increase in the rate of harrod neutral technical progress are contractionary for equilibrium employment the market economy underinvests

employment and wage strategies of the firm over a business cycle abstract by using control theory we analyze the behaviour of a firm which expects a demand cycle and occupies a monopsonistic position on the labour market consequently the relative wage rate is used as a tool for regulating the flow of applicants and the rate of quits of employees the dynamic wage policy is governed by the demand trend but the marginal propensity of workers to quit and the level of hiring costs are also relevant factors in setting the wage rate the recession period is characterized by a relative wage decrease associated with voluntary quits rather than firing however the wage rate starts increasing when demand is still declining and labour hoarded

the last word on the wage curve abstract since 1990 there has been extensive international research on the responsiveness of wages of individuals to changing local labour market conditions for many countries an inverse relationship between wages and local unemployment rates has been found in their book the wage curve blanchflower and oswald argued that the unemployment elasticity of pay is around 0 1 in most countries in a 1995 literature survey card referred to this striking empirical regularity as being close to an empirical law of economics nonetheless reported elasticities do vary even excluding outliers between about 0 5 and 0 1 there is also considerable heterogeneity among wage curve studies in terms of data and model specification this paper carries out meta analytic techniques on a sample of 208 elasticities derived from the literature to uncover the reasons for the differences in empirical results across studies several causes of variation are identified there is also clear evidence of downward publication bias in addition many reported t statistics are biased upwards due to the use of aggregate unemployment rates a maximum likelihood method and a trimming procedure are used to correct for these biases both methods give similar results for our sample an unbiased estimate of the wage curve elasticity at the means of study characteristics is about 0 07

estimating the natural rate of unemployment and testing the natural rate hypothesis how should one measure the natural rate of unemployment this paper proposes a systems procedure as an alternative to nairu the natural rate is treated as an unobserved state variable in a system that includes measurement equations for the unemployment rate the rate of wage growth and the rate of inflation the model is derived from a version of the wage bargaining model of blanchard and embodies a version of the natural rate hypothesis the model is estimated by embedding the kalman filter within the full information maximum likelihood procedure for us data the estimated model implies substantial post war variation in the natural rate and a negative but weak effect of inflation surprises on unemployment copyright 1999 john wiley sons ltd

okun s micro macro system a review article prices and quantities is the brilliant and disturbing last work of arthur m okun 1928 1980 for more than a decade okun was the foremost practitioner of macroeconomics in the united states his critical intelligence at both the theoretical and empirical ends of economics was unsurpassed these facts were virtually a manufacturer s warranty that the book whatever its argumentation and evidence would be significant we want to know what okun thought but this background was no guarantee of an important treatise and it must have taken some courage to venture a big theoretical work in an accessible style on urgent questions in fact okun has delivered a creative and virtuosic study in economic theory the book s contribution is to provide a complete description of an economy in which rational economic agents consider the distributional consequences of wage and price decisions the perspective adopted one which is winning growing favor of late is contract theoretic because they wish to economize on their costly transactions with one another people trade repeatedly with the same agent so trust and fidelity to understandings are important the ensuing analysis lodges some basic dissents from the informational expectational paradigm developed over the last score of years it is particularly stimulating and troubling on the main policy controversy of the decade the question of disinflation

do firms pay efficiency wages evidence with data at the firm level this study tests the efficiency wage hypothesis by estimating wage and quit equations with data from the employment opportunity pilot project survey of firms an efficiency wage model is derived that predicts effects of turnover costs and unemployment on wages as functions of first and second derivatives from the quit equation the model is tested by examining the relationships between the coefficients in the wage and quit equations the results are generally favorable to efficiency wage theory other important findings are that firm characteristics raising workers productivity tend to raise wages and that a rise in turnover costs reduces quits

on reputation a microfoundation of contract enforcement and price rigidity we study the impact of reputational incentives in markets characterised by moral hazard problems social preferences have been shown to enhance contract enforcement in these markets while at the same time generating considerable wage and price rigidity reputation powerfully amplifies the positive effects of social preferences on contract enforcement by increasing contract efficiency substantially this effect is however associated with a considerable bilateralisation of market interactions suggesting that it may aggravate price rigidities surprisingly reputation in fact weakens the wage and price rigidities arising from social preferences thus in markets characterised by moral hazard reputational incentives unambiguously increase mutually beneficial exchanges reduce rents and render markets more responsive to supply and demand shocks

pollution abatement activities and traditional productivity abstract this study models the joint production of good and bad output production and calculates traditional productivity when bad output production is regulated and when it is unregulated we apply this model to data for u s coal fired electric power plants for 1985 1995 and compare rates of productivity and technical change to gain an understanding of the association between pollution abatement activities and traditional rates of productivity and technical change while traditional productivity and technical change associated with abatement activities decline we conclude they are not statistically significant

efficiency wages partial wage rigidity and money nonneutrality the efficiency wage theory is generally regarded as a plausible explanation as to why wages do not fall to clear labor markets in the presence of involuntary unemployment at the current stage of its development not much is said concerning the role of nominal money and the fluctuations in aggregate employment and output adopting the efficiency wage theory this paper uses the idea of partial rigidity of wages in an attempt to explain why changes in money supply and other demand management policies can cause fluctuations in aggregate employment and output

efficiency wages combining the shirking and turnover cost models abstract this short paper attempts to combine the shirking and turnover cost models into a composite model that captures the main features of each our main result is that in equilibrium the elasticity of effort with respect to the wage will equal the elasticity of the average cost of labour with respect to the wage this is a generalisation of earlier models since this condition simplifies to the familiar solow condition if turnover is independent of the wage and simplifies to the condition that the wage is chosen to minimise the average cost of labour if shirking effects are absent we provide an example that shows how the shirking and turnover cost models are complements rather than substitutes since the impact on wages of one type of efficiency wage effect is stronger when the other type of efficiency wage effect is also present

decomposition of the environmental inefficiency of the meta frontier with undesirable output abstract in this paper we present an alternative analysis framework to evaluate the effects of technology heterogeneities and undesirable output on environmental efficiency measurement the proposed framework combines the directional distance function and a meta frontier analysis it can be used to measure efficiency improvements brought about by enhanced technical management and technological advances for demonstration purposes we used the framework to measure the environmental efficiency in 90 countries worldwide for the 2003 2007 period the results showed that when the meta technology set is used as the evaluation basis the average environmental efficiency of high competitiveness countries is greater than that of lower middle low and upper middle competitiveness countries the upper middle competitiveness countries perform worse than the lower middle and low competitiveness countries because of the excessive labor force usage and carbon dioxide emissions in these countries we also found that the environmental inefficiency of the meta frontier for high competitiveness countries can be attributed to managerial failure in the production process whereas that for upper middle lower middle and low competitiveness countries can be attributed to technological differences

imperfect information credit markets and unemployment this paper describes how imperfect information in both capital and labor markets can in a context of maximizing firms and perfectly flexible prices and wages give rise to cyclical variations in unemployment whose character closely resembles that of observed business cycles this abstract was borrowed from another version of this item

theoretical foundations for sticky wages abstract the paper compares three different types of theoretical explanation of sticky wages they are implicit contracts efficiency wage models and insider outsider models it then reconsiders keynes rationale for sticky wages which focuses on relative wage issues finally the paper considers possible directions for future research

observed and unobserved heterogeneity in stochastic frontier models an application to the electricity distribution industry in this study we combine different possibilities to model firm level heterogeneity in stochastic frontier analysis we show that both observed and unobserved heterogeneities cause serious biases in inefficiency results modelling observed and unobserved heterogeneities treat individual firms in different ways and even though the expected mean inefficiency scores in both cases diminish the firm level efficiency rank orders turn out to be very different the best fit with the data is obtained by modelling unobserved heterogeneity through randomizing frontier parameters and at the same time explicitly modelling the observed heterogeneity into the inefficiency distribution these results are obtained by using data from finnish electricity distribution utilities and the results are relevant in relation to electricity distribution pricing and regulation

labor subsidies and just cause employment laws in an efficiency wage model efficiency wage models differ from standard labor market models in that wages do not necessarily clear markets wages act as devices to encourage work effort or more generally to increase productivity firms set their wages above the market clearing level and there is involuntary unemployment there are several reasons firms set wages high one is that this may increase employee morale and so lead to greater effort as observed by solow 12 salop notes that high wages may reduce labor turnover and so allow the firms to avoid turnover costs 10 high wages may also reduce the workers incentive to shirk on the job if shirking increases the chance of losing an attractive position see shapiro and stiglitz 11 akerlof and yellen give examples of other motivations for efficiency wages 1 this article uses a shirking model to discuss optimal government policies economists have placed little emphasis on government policies in such models shapiro and stiglitz do discuss employment subsidies and unemployment benefits 11 2 an employment subsidy or a reduction in unemployment compensation increases employment in their basic model as in most shirking models a suboptimal employment level is the main distortion so the two policies can increase efficiency 3 if firms choose minimum acceptable effort levels to ask of their workers as in this paper there is a second distortion both the employment and the effort levels are too low to be optimal employment subsidies still lead to greater employment but also lead to a reduction in effort these policies reduce one distortion while making the other more severe the net effect on efficiency is ambiguous section ii presents the model section iii considers the welfare effects of unemployment compensation two subsidies and just cause employment laws these two subsidies are wagerate subsidies paid based on the total wage bill and employment subsidies paid per worker

biased technical change and the malmquist productivity index the malmquist productivity index has many attractive features one is that it can be epxressed as the product of a technical efficiency change index and a technical change index in this paper we express the technical change index as the product of a magnitude index and a bias index we then express the bias index as the product of an output bias index and an input bias index and we state conditions under which each bias index makes no contribution to productivity change

on the informational content of wage offers this article investigates signaling and screening roles of wage offers in a single play matching model with two sided unobservable characteristics it generates the following predictions as matching equilibrium outcomes i good jobs offer premia if high quality worker population is large ii bad jobs pay compensating differentials if the proportion of good jobs to low quality workers is large iii all firms may offer a pooling wage in markets dominated by high quality workers and firms or iv gresham s law prevails good types withdraw if bad types dominate the population the screening signaling motive thus has the potential of explaining a variety of wage patterns

industrial energy efficiency with co2 emissions in china a nonparametric analysis abstract global awareness on energy security and climate change has created much interest in assessing economy wide energy efficiency performance a number of previous studies have contributed to evaluate energy efficiency performance using different analytical techniques among which data envelopment analysis dea has recently received increasing attention most of dea related energy efficiency studies do not consider undesirable outputs such as co 2 emissions in their modeling framework which may lead to biased energy efficiency values within a joint production framework of desirable and undesirable outputs in this paper we construct both static and dynamic energy efficiency performance indexes for measuring industrial energy efficiency performance by using several environmental dea models with co 2 emissions the dynamic energy efficiency performance indexes have further been decomposed into two contributing components we finally apply the indexes proposed to assess the industrial energy efficiency performance of different provinces in china over time our empirical study shows that the energy efficiency improvement in china s industrial sector was mainly driven by technological improvement

human capital vs signalling explanations of wages increases wages by directly increasing the worker s productivity this learning explanation is usually associated with human capital theory however it seems unlikely that learning explains all the wage differences associated with schooling and work history better educated workers are not a random sample of workers they have lower propensities to quit or to be absent are less likely to smoke drink or use illicit drugs and are generally healthier it is unlikely that employers make full use of differences in propensities to quit or to be absent or sick when hiring workers these characteristics are often not directly observed and the americans with disabilities act precludes firms from using either poor health or the likelihood of future sickness as a hiring criterion unless it is directly related to job performance however if low levels of education are associated with these unfavorable employee characteristics and employers are allowed to take education into account when hiring workers we would expect employers to favor better educated workers as a means of reducing their costs of sickness and job turnover in turn students will take these hiring criteria into account when deciding how long to stay in school students will choose a length of schooling to signal their ability to employers and employers will demand a minimum level of schooling

common elements of efficiency wage theories what relevance for developing countries conventional labour economics argues that wages are determined by supply and demand and that the typical firm is a wage taker efficiency wage theories state that wages are endogenous to a firm s own optimising behaviour and that the wage rate determines the labour productivity these theories raise questions regarding the effectiveness of expenditure reducing and expenditure switching adjustment policies this article reviews the theoretical and empirical literature on efficiency wages it examines alternative models highlights the emphasis of empirical research towards industrial countries and points out the need for a test based on the major implications of the theory

equilibrium wage distributions the observation that different firms charge different prices for what appears to be the same commodity or pay different wages for what appears to be equivalent labour has long been explained in economics by a reference to imperfect information this paper is concerned with characterising market equilibrium with imperfect information we do not present a general theory rather we develop in some detail an example of importance in its own right imperfect information in the labour market several properties of our example in particular the existence of equilibria with price wage dispersion unemployment excess supply of labour positive profits multiple equilibria and the nonoptimality or some of all of the equilibria are of more general validity other results may not be this paper is concerned with two kinds of imperfect information a individuals may not know the wage paid in any particular firm or whether there is a vacancy in any particular firm until they apply for a job 1 b there are several characteristics besides the wage rate associated with a job which are important to the individual some like the normal length of a work week become known when the individual applies for the job information about other characteristics e g personalities of colleagues is acquired only gradually there is one important difference between the two kinds of imperfect in

a neoclassical perspective on budget deficits i n the 1988 presidential campaign virtually every serious candidate spoke of the urgent need to trim government budget deficits public opinion polls have identified federal deficits as a key economic issue second only to unemployment while many economists are relieved by what they perceive to be a long overdue political response to a critical economic problem others regard the fuss as much ado about nothing it is indeed remarkable that economists can disagree so severely over an issue which commands such a uniform reaction from laymen of widely different ideologies and political affiliations generally speaking there are three schools of thought concerning the economic effects of budget deficits neoclassical keynesian and ricardian before proceeding further it is useful to review the basic structure and implications of each paradigm the neoclassical paradigm envisions farsighted individuals planning consumption over their own life cycles budget deficits raise total lifetime consumption by shifting taxes to subsequent generations if economic resources are fully employed increased consumption necessarily implies decreased saving interest rates must then rise to bring capital markets into balance thus persistent deficits crowd out private capital accumulation in the current economic environment most economists would agree that these consequences would be highly detrimental

relative wage positions and quit behavior evidence from linked employer employee data the authors analyze the importance of relative wage positions within firms in western germany in the context of individual quit decisions as an inverse measure of job satisfaction using a linked employer employee data set liab for the years 1996 2005 whose sample consists of full time male prime age workers in western germany without college degrees they ascertain whether workers find status or signal effects stronger motivators for quit decisions they find that workers with higher relative wage positions within their firms are on average more likely to quit their jobs than those with lower relative wage positions and that workers who experience a loss in their relative wage positions are also more likely to accept a wage cut associated with their job transition overall results suggest that a signal effect is on average stronger than a status effect

equilibrium incentive contracts and efficiency wages we analyze the optimal efficiency wage contract when output is contractible but firms neither observe the workers effort nor their match specific productivity firms offer wage contracts that optimally trade off effort and wage costs as a result employed workers enjoy rents which in turn creates unemployment nonetheless the incentive power of the equilibrium wage contract is constrained efficient in the absence of taxes and unemployment benefits we also show that more high powered incentive contracts tend to be associated with higher equilibrium unemployment rates jel e24 j30 j41

effort observability and worker productivity towards an explanation of economic dualism this paper suggests an explanation of the wage and productivity differentials between formal and informal sectors in developing countries this explanation is based on differences in the observability of effort that arise from technological differences such as size of operation the authors argue that observability of effort is lower in the formal sector and then show that under reasonable conditions this leads to higher wages and higher effort productivity this is because with lower observability the marginal cost of effort is lower when existing employees are induced to work harder than when more workers are hired explanations for intersectoral differences in factor intensities and sector specific unemployment rates also follow from the authors basic assumptions copyright 1989 by royal economic society

oligopsony and the distribution of wages we propose a simple model of wage dispersion arising from oligopsonistic competition in the labor market our model has workers who are equally able but who have heterogeneous preferences for non wage characteristics while employers have heterogeneous productivity characteristics we completely and explicitly solve for the equilibrium wage distribution and show that inside and outside forces interact in wage determination this interaction generates spillover effects of minimum wages in a manner which is consistent with the empirical evidence

are workers paid their marginal products status is like coase s social costs a reciprocal phenomenon given that one person s gain in status can occur only at the expense of a loss in status for others and that workers are free to choose their coworkers it follows that the competitive wage structure within a firm must be one in which individual wage differences understate individual differences in marginal products the purpose of this paper is to examine a variety of empirical evidence that relates to this proposition about the firm s internal wage structure the paper is organized as follows section i briefly summarizes the theoretical considerations that govern competitive wage determination when status matters to people and firms are viewed as voluntary associations of workers section ii then confronts the predictions of section i by examining pay and productivity schedules for a group of sales occupations for which these schedules are relatively easily observed section ii also examines the relationship between wages and productivity for a sample of university professors an occupation in which individual productivity differences are for a variety of obvious reasons relatively more difficult to measure all of the evidence examined is consistent with the hypothesis that within firms wage rates vary substantially less than do individual productivity values section iii discusses additional observations and evidence that bear on this same hypothesis it suggests that the implicit market for status may strongly influence the ways in which firms are organized to carry out the tasks they perform section iv concludes by considering the claim that egalitarian internal wage structures arise because of equity considerations it argues that the concept of equity appears very closely linked to the concept of status and suggests a strategy for assigning monetaty value to the equity considerations that so often dominate public policy decisions

social networks and inequality abstract about half of all vacancies are filled through networks of personal contact we consider the arrow loury conjecture that such labor market networks exacerbate inequality our central result is that referral networks display threshold behavior above a critical density of referrals qualified workers at all levels of the network are recruited with probability one below the threshold the probability of referral falls exponentially and workers low in the hierarchy are hired with probability zero an underclass emerges

the link between ability and specialization an explanation for observed correlations between wages and mobility rates wage levels and turnover rates are negatively correlated across types of employment and this fact is often interpreted as evidence that high wage jobs are rationed a simple training model illustrates however that this correlation may arise because able workers have an incentive to choose highly specialized jobs in any job the most able workers possess the most valuable stocks of specific skills and therefore face the highest mobility costs thus able workers may have a comparative advantage in specialized employments data from the national longitudinal survey of youth provide an opportunity to evaluate the merits of the training model developed here data on worker training and mobility provide support for several implications of the model the model also provides new ways to interpret existing results in the literature on interindustry wage differentials

land use and land use changes in life cycle assessment green modelling or black boxing the assessment of land uses and land use changes luluc impacts has become increasingly complex sophisticated modelling tools such as life cycle assessment lca are employed to capture both direct and indirect damages however quantitative assessments are often incomplete dominated by environmental aspects land uses are a multidisciplinary matter and environmental and sustainable development policies intertwine yet lcas mostly focus on environmental impacts excluding socioeconomic implications of land occupation this paper investigates the limitations of current luluc modelling practices in lca common lca assumptions harbor value choices reflect a post positivist epistemology that are often non transparent to e g policymakers they particularly influence the definition of the functional unit the reference system and system boundaries among other lca methodological choices consequently results informing land policies may be biased towards determined development strategies or hide indirect effects and socioeconomic damages caused by large scale land acquisitions such as violation of tenure rights speculation and displacement quantitative assessments of luluc impacts are certainly useful but should holistically encompass both direct and indirect impacts concerning the environmental and the social science dimension of luluc an epistemological shift towards a dialectic approach would facilitate the integration of multiple tools and methods and a critical interpretation of results

energy efficiency and policy in swedish pulp and paper mills a data envelopment analysis approach the paper provides an empirical assessment of the electricity efficiency improvement potential in the swedish pulp and paper industry by employing data envelopment analysis dea and mill specific input and output data for the years 1995 2000 and 2005 the empirical results are discussed in relation to the reported outcomes of the swedish voluntary energy efficiency programme pfe the estimated electricity efficiency gap is relatively stable over the time period it equals roughly 1 twh per year for the sample mills and this is three times higher than the corresponding self reported electricity savings in pfe this result is largely a reflection of the fact that in the pulp and paper industry electricity efficiency improvements are typically embodied in the diffusion of new capital equipment and there is a risk that some of the reported measures in pfe simply constitute an inefficient speed up of capital turnover the above does not preclude though that many other measures in pfe may have addressed some relevant market failures and barriers in the energy efficiency market overall the analysis suggests that future energy efficiency programs could plausibly be better targeted at explicitly promoting technological progress as well as at addressing the most important information and behaviour related failures

worker inflow outflow and churning linked employer employee data from finnish business sector is used in analysing worker turnover the data set is an unbalanced panel with over 219 000 observations in 1991 97 the churning excess worker turnover worker inflow and worker outflow rates are explained by plant and employee characteristics the probabilities of observing non zero churning inflow and outflow rates increase with plant size the magnitudes of the non zero churning and inflow rates depend positively on size but the magnitude of outflow rate depends negatively on size high wage plants have low turnover plants with large within plant variation in wages have high turnover average tenure of employees has a negative impact on turnover high plant employment growth increases churning and separation but reduces hiring in the next year also controlled are average age and education of employees shares of women and homeowners among employees foreign ownership ownership changes and regional unemployment

cyclical variations in wage differentials and unemployment this paper attempts to reformulate in a general equilibrium framework reder s model which explains cyclical variations in wage differentials and their general tendencies to narrow specifically i focus on the three aspects of his model the microeconomic behavior of a firm under imperfect information about labor quality the mechanism of the economy creating unemployment and the interaction between wage differentials and unemployment i also explore its implications for the macroeconomic issues on the characteristics of current unemployment and the question of why aggregate employment fluctuates

carbon taxation in russia prospects for a double dividend and improved energy efficiency russia is not only one of the world s major sources of carbon based energy coal oil and gas but is also one the most intensive users of energy furthermore russia accounts for a disproportionately large share of global carbon dioxide emissions some 5 to 6 of global carbon dioxide emissions eia 2011a it has been estimated world bank 2008 that russia could reduce its use of primary energy use by 45 with consequent economic and environmental benefits high energy and carbon intensity of the russia economy is inter alia explained by low energy prices due to high export taxes as well as administrative regulation of domestic prices of gas and electricity and low environmental taxes carbon taxes are one such pigouvian tax and they would address concerns on several fronts simultaneously in the short to medium term they would inter alia lead to lower ghg emissions and encourage the diffusion of more energy efficient technologies in the longer term the increased cost of energy inputs is expected to induce technological progress in this analysis the macroeconomic and sectoral effects of carbon taxes on the russia economy are examined this analysis addresses the following objectives i to test the double dividend hypothesis under perfect and imperfect competition in output markets to analyse ii the incidence of carbon taxes iii impacts on sectoral competitiveness iv effects on income equity and v interactions of carbon taxes with other taxes a computable single country multi sector comparative static cge model is employed russland verfugt nicht nur uber einen der grosten vorrate an kohlenstoffbasierter energie wie kohle rohol und gas sondern ist auch einer der grosten energieverbraucher daruber hinaus ist russland fur einen uberproportional grosen anteil von kohlendioxid emission etwa 5 bis 6 der weltweiten kohlendioxidemission verantwortlich mit der einfuhrung einer kohlendioxidsteuer konnten gleichzeitig unterschiedliche wirkungen erzielt werden kurz und mittelfristig wurden kohlenstoffsteuern sowohl zu einer reduzierung von treibhausgasemissionen als auch zur einfuhrung von energieeffizienteren technologien fuhren langfristig wird erwartet dass hohe energiekosten den anreiz zur entwicklung und zur investition in energiesparenden technischen fortschritt erhohen die vorliegende arbeit analysiert und bewertet die makrookonomischen und sektoralen auswirkungen einer einfuhrung von kohlenstoffsteuern auf die russische wirtschaft die ziele der arbeit bestehen darin die hypothese der doppelten dividende fur den fall des vollkommenen und des unvollkommenen wettbewerbs auf gutermarkten zu uberprufen und die inzidenz einer kohlenstoffsteuer ihre auswirkungen auf die sektorale wettbewerbsfahigkeit ihre auswirkungen auf die einkommensverteilung und die interaktion von kohlenstoffsteuern mit anderen steuern zu analysieren und zu bewerten als methodischer ansatz wurde ein single country und multi sektor model gewahlt

editorial does good marketing cause bad unemployment questionable methods for increasing nominal wages reduce real wages i e buying power by creating inflation shortages lower quality and long term unemployment to increase real wages i e the ability to buy more economic principles prescribe increasing productivity i e greater output from less input in contrast marketing principles prescribes increasing the value of output i e greater customer benefits through innovation beyond increasing real wages innovation spawns new occupations better matching individuals with skills and providing greater nonmonetary benefits i e job satisfaction unfortunately threatened entrenched incumbents often solicit protectionist legislation claiming negative externalities e g short term unemployment lower wages and burdens on society innovation does require labor to move from inferior to superior organizations i e unemployment however protectionism only delays and dramatically aggravates the inevitable trauma associated with progress as worker skills firm practices and buyer welfare fall further behind recent attacks demonizing wal mart e g the dubious vlasic pickle claim epitomize this situation they are archaic vanilla protectionism menacing both imperiled consumers and every consumer driven business

interindustry wage differentials and efficiency wages some canadian evidence using the 1986 labour market activity survey as their major source of data the authors estimate interindustry wage differentials in canada at the one and two digit levels of industry aggregation for various types of workers the major findings are that substantial interindustry wage differentials exist and are relatively stable over time that the pattern of interindustry wage differentials is very similar for different kinds of workers and that these differentials cannot be explained easily by compensating factors the differentials seem to be consistent with the rent sharing explanations of the labor market such as those based on the notion of efficiency wages

information and economic analysis a perspective ten years ago i delivered a paper before this group with the title information and economic analysis i chose the title deliberately i did not call the subject on which i was speaking the economics of information because to do so would have been to suggest that my topic like the economics of agriculture or the economics of industry or the economics of labour represented another branch of specialisation within economics i wanted to suggest that informational considerations were in fact central to the analysis of a wide variety of phenomena that they constituted a central part of the foundations of economic analysis at the time though economists had long paid lip service to the importance of information there was little formal literature the last decade has seen a burgeoning of the literature it has become to the late 7o s and early 8o s what growth theory was to the early 6o s and it has been greeted with some of the same scepticism there seems to be a myriad ofspecial cases and few general principles the little examples are often contrasted unfavourably with the generality of general equilibrium theory what have we learned have diminishing returns set in are there fruitful directions for future research and if so what are they these are the questions which i wish to address here the work of the past decade has made i think a fundamental and lasting contribution to economic analysis the contributions have been both negative and positive we have learned that much of what we believed before is of only limited validity that the traditional competitive equilibrium analysis though having the superficial appearance of generality in terms of superscripts and subscripts is indeed not very general the theory is not robust to slight alterations in the informational assumptions it is but a special and not very plausible example among the possible set of informational assumptions which can be employed to characterise an economy at the same time the theory has been able to provide insights into phenomena about which the traditional model had nothing to say or which seemed inconsistent or inexplicable within the competitive paradigm it has provided some of the micro foundations for macro economics it has provided the basis of a new theory of the firm of a new new welfare economics and of a theory of economic organisation including a comparison of economic

effects on unemployment of reduced working time in an economy where firms set wages the paper considers an economy where firms set wages balancing the direct benefit of low wages with the indirect cost of low wages relative to other firms leading to high quit rates and therefore high training costs reducing the institutionally given working time makes the importance of training costs increase thus making firms more concerned about keeping quit rates low the effect is increased unemployment as a consequence of reduced working time the effect on hourly and yearly wages is uncertain although increased hourly wages seem to be the most plausible case

carbon intensity in production and the effects of climate policy evidence from swedish industry we analyze carbon intensity performance at firm level and the effectiveness of the swedish co2 tax carbon intensity performance is derived from a production technology and measured as changes in t

human capital and voluntary unemployment there are numerous complementary arguments which partially explain the natural rate of unemployment salop 1979 and shapiro and stiglitz 1984 have shown that some equilibrium unemployment can be involuntary mortensen 1970 and diamond 1981 explain equilibrium unemployment of the voluntary search type the purpose of this paper is to add to the understanding of voluntary unemployment by examining human capital accumulation the basic idea is a simple one each worker is assumed to enter the labor force with an initial endowment of human capital each worker s endowment is conformable to a particular industry and is of lesser productive value elsewhere if the worker gains employment in the industry where his capital is conformable he adds to it by learning by doing if he is unemployed or works elsewhere the initial human capital endowment depreciates if the depreciation rate is greater when the individual is employed in an alternative non conformable industry than when he is unemployed then periods of voluntary unemployment may arise from intertemporal expected utility maximization an islands type parable might be useful in explaining how these circumstances can arise consider industries and their labor pools to be separated as if on islands on joining the labor force individual workers first go to the island where their human capital is conformable if an individual gains employment he acquires more human capital by learning by doing if he is unemployed but remains on the island he receives full information about any technological or organizational changes in the production process furthermore interaction with his fellow islanders constantly reaffirms his knowledge and understanding of the production process if the individual shifts to another island to work he receives imperfect information about the industry where his human capital is conformable hence his human capital will depreciate at a faster rate whilst these arguments may describe a phenomenon which is contemporaneously unimportant in a full intertemporal context they may be substantial even a small quantity of human capital retained today can have significant implications over a lifetime

environmental investment and firm performance a network approach abstract this study examines the role of investment in environmental production practices for both environmental performance and energy efficiency over time we employ a network dea approach that links successive production technologies through intertemporal investment decisions with a period by period estimation this allows us to estimate energy efficiency and environmental performance separately as well as productivity change and its associated decompositions into efficiency change and technology change incorporating a network model also allows us to account for both short term environmental management practices and long term environmental investments in each of our productivity measures we apply this framework to a panel of detailed plant level production data for swedish manufacturing firms covering the years 2002 2008

government intervention efficiency wages and the employer size wage effect in zimbabwe abstract this paper uses matched employer employee data from a survey of 201 manufacturing firms and 1609 of their workers conducted in zimbabwe in the summer of 1993 the results indicate that there is a substantial premium associated with employment in larger firms and that this premium cannot be explained by differences in worker quality and job characteristics nor is it eliminated by controlling for unionization minimum wages or other forms of government intervention the size premium is much larger for white collar than for blue collar workers these differentials are also found to be substantially larger than those estimated for other developed and developing countries the analysis uses the data about firm characteristics to explore a number of efficiency wage based explanations of the size differential and finds results which are consistent with but not conclusive proof of hiring turnover and morale based notions of efficiency wages