time out of work and skill depreciation this paper investigates the role of skill depreciation in the relationship between work interruptions and subsequent wages using swedish data from two waves 1994 and 1998 of the international adult literacy survey which included results of tests gauging respondents ability to read and make practical use of printed information the authors are able to analyze changes in individuals skills as a function of time out of work they find statistically strong evidence of a negative relationship between work interruptions and skills the analysis suggests that depreciation of general skills was economically important a full year of non employment for example was associated with a 5 percentile move down the skill distribution

globalization and the great u turn income inequality trends in 16 oecd countries the debate on the resurgence of income inequality in some advanced industrial societies has often focused on the impact of an increasingly integrated world economy typified by growing capital mobility heightened international competition and an increase in migration this study represents one of the first systematic cross national examinations of the role of globalization in the inequality u turn results indicate on the one hand that total inequality variation is principally affected by the percentage of the labor force in agriculture followed by the institutional factors union density and decommodification and only then by globalization on the other hand longitudinal variation in inequality while still dominated by the percentage of the labor force in agriculture is also principally affected by aspects of globalization such as southern import penetration and direct investment outflow and to a lesser extent by migration in other words globalization explains the longitudinal trend of inc

bad for business entrepreneurs and democracy in the arab world why do business communities in some developing countries support democratization whereas business communities in other developing countries continue to support authoritarian rule in an effort to a

fragmentation and multinational production abstract this paper examines the consequences of falling transport costs for intermediate goods and shows how this leads to the spatial fragmentation of production as firms divide their production between countries they become either vertical multinationals if upstream activities are labour intensive or horizontal multinationals if downstream activities are labour intensive in the former case the volume of world trade increases and in the latter it falls fragmentation need not narrow international factor price differences which depend on the factor intensity of the activities that relocate

the state and strategies of international adjustment all states are continuously in the process of adjusting to change in the political economy of international and national systems problems inherent in this adjustment process are a basic source of national behavior and international conflict the heuristic model presented in this paper provides systematic explanations for the strategic choices that states make in the adjustment process through the specification of the range of strategic options and of the formal interests of states new insights are gained concerning the articulation between national and international political economy empirical cases are drawn from the politics of energy adjustment in the 1970s

the effect of r d services offshoring on skilled employment firm evidence the offshoring of high tech services has greatly increased in recent years with consequences for firms demand for skilled employment in firms this paper specifically analyses the relationship between r d offshoring and the demand for r d employment using firm level data for spanish manufacturing and services companies during the period 2004 11 estimating different specifications with panel data techniques we find that this association is statistically positive in particular for services firms a 1 percentage point increase in r d offshoring raises the demand for researchers by about 11 per cent

wage curve analyses of establishment data from western germany using the iab establishment panel which is representative for western germany the authors find that establishment level wages reacted to variations in the regional unemployment rate the elasticity of wages with respect to unemployment they estimate was about 0 1 this responsiveness of the wage to regional variation is close to estimates found by other researchers using individual rather than establishment data for other countries and contradicts the view that germany s labor market largely due to the nature of collective bargaining in that country is relatively inflexible possible explanations for this finding are that the negotiated wage is treated like a minimum wage with firms deviating from it in order to increase work effort bargaining between firms and individual workers or between firms and works councils produces wage differences or collective agreements do not restrict firms to the extent that is often assumed

outsourcing imports and labour demand this paper examines the effects of purchased services and imported intermediate materials on the labour demand for different skills in german manufacturing sectors we derive and estimate a factor demand system based on the generalised box cox cost function nesting both the normalised quadratic and the translog functional form we find that the impacts of output and capital growth are more important in explaining the demand for heterogeneous labour than substitution effects between labour and non labour inputs similarly the increasing use of both imported materials and purchased services is a consequence of output growth rather than input substitution

why do big firms pay higher wages evidence from an international database abstract bigger firms pay higher wages this note reports tests of the hypothesis that this big firm premium bfp occurs because workers in big firms are more skilled we use the international adult literacy survey which gives richer skill measures than those typically available in labor market surveys to measure the bfp in nine countries with and without controls for worker skill the results show that the bfp is not as universal as is often suggested but in countries where it exists controlling for skills does little to reduce the size of the bfp

industrial shift skill mismatch and income inequality a decomposition analysis of changing distributions in the oslo region this paper examines changing income inequality in the oslo region between 1993 and 2000 adopting a decomposition approach the analysis reveals that both earnings inequality and post tax inequalit

some models for estimating technical and scale inefficiencies in data envelopment analysis in management contexts mathematical programming is usually used to evaluate a collection of possible alternative courses of action en route to selecting one which is best in this capacity mathematical programming serves as a planning aid to management data envelopment analysis reverses this role and employs mathematical programming to obtain ex post facto evaluations of the relative efficiency of management accomplishments however they may have been planned or executed mathematical programming is thereby extended for use as a tool for control and evaluation of past accomplishments as well as a tool to aid in planning future activities the ccr ratio form introduced by charnes cooper and rhodes as part of their data envelopment analysis approach comprehends both technical and scale inefficiencies via the optimal value of the ratio form as obtained directly from the data without requiring a priori specification of weights and or explicit delineation of assumed functional forms of relations between inputs and outputs a separation into technical and scale efficiencies is accomplished by the methods developed in this paper without altering the latter conditions for use of dea directly on observational data technical inefficiencies are identified with failures to achieve best possible output levels and or usage of excessive amounts of inputs methods for identifying and correcting the magnitudes of these inefficiencies as supplied in prior work are illustrated in the present paper a new separate variable is introduced which makes it possible to determine whether operations were conducted in regions of increasing constant or decreasing returns to scale in multiple input and multiple output situations the results are discussed and related not only to classical single output economics but also to more modern versions of economics which are identified with contestable market theories

equilibrium unemployment with outsourcing and wage solidarity under labour market imperfections abstract we evaluate the effects of outsourcing and wage solidarity on wage formation and equilibrium unemployment in a heterogeneous labour market where wages are determined by a monopoly labour union we find that outsourcing promotes the wage dispersion between the high and low skilled workers when the labour union adopts a solidaristic wage policy it will dampen this tendency further higher outsourcing will increase equilibrium unemployment among the high skilled workers whereas it will reduce it among the low skilled workers overall outsourcing will reduce economy wide equilibrium unemployment under the reasonable condition that the proportion of high skilled workers is sufficiently low

the price of wealth business and state in labor remittance and oil economies this article contrasts the effects of state controlled oil revenues and privately controlled labor remittances on institutional development state capacity and businessgovernment relations in saudi arabia and the yemen arab republic these two countries represent extreme cases of dependence on external capital in deeply divided societies presided over by fragile emerging bureaucracies by tracing the two cases through a pattern of economic boom 1973 83 and recession 1983 87 the study demonstrates that the type volume and control of capital inflows decisively influence the relative development of the bureaucracy s extractive distributive and regulatory capacities and affect the ability of the state to respond to economic crisis in both cases external capital inflows precipitated the decline of extractive institutions however oil revenues and labor remittances had divergent effects on businessgovernment relations and this circumscribed the state s ability to implement austerity programs during the recession during the crisis the saudi government s efforts to cut subsidies to the private sector and to implement extractive policies were blocked by the state sponsored merchant class in contrast the yemeni government instituted a thoroughgoing austerity package that targeted the independent merchant class in both cases external capital inflows did not augment the efficacy of those that controlled them these paradoxical outcomes are explained by tracing the different effects of oil revenues and labor remittances on the distribution of economic opportunity in the public and private sectors and the resulting effects on the regional tribal and sectarian composition of the bureaucracy and the commercial class

large firms and within firm occupational reallocation abstract this paper considers the equilibrium interaction between within firm and across firm reallocation in the presence of labor market frictions while a sizable literature has investigated frictional labor markets it has ignored within firm mobility nonetheless every year a sizable fraction of workers switch occupations without changing firms employees in large firms can sample from a larger selection and across firm mobility is replaced by within firm mobility bringing together within and across firm reallocation along with labor market frictions naturally accounts for the observed differences in worker flows and wages across firms of different sizes

intra european imbalances adjustment and growth in the eurozone this paper considers the increase in the euro intra area imbalances since the late 1990s and their role in the current european debt crisis by focusing on the case study of italy and germany we argue that both macroeconomic the functioning of the euro area and microeconomic internationalization of production factors contributed to the creation of such imbalances when sovereign risk and currency risk emerged in the periphery coupled with austerity as a response to these risks both factors made the euro crisis worse the present zero sum game approach is very risky for the stability of the euro area policy coordination of some kind is needed this requires agreeing on well identified economic policy priorities taking full account of the different positions of the members in terms of growth external imbalances and competitiveness new policy priorities are thus required in the euro zone that put more emphasis on cooperative positive sum games in convergence and competitiveness

the irony of state strength comparative responses to the oil shocks in the 1970s like two gigantic waves the oil shocks crested over the advanced industrial world during the 1970s the relatively stable postwar petroleum regime managed by the large oil firms and protected by american diplomatic and military strength collapsed in seven years crude oil prices adjusted for inflation increased more than 500 percent a multitude of national security economic and political challenges confronted the advanced industrial states but unlike war where the threat is observable and lines of conflict quickly become apparent the oil shocks cast up problems that were more insidious problems of energy security economic adjustment and industrial competitiveness these international dilemmas could be defined in various ways and a host of policy responses could be brought to bear upon them

a literature study for dea applied to energy and environment abstract this study systematically summarizes previous research efforts on data envelopment analysis dea applied to energy and environment in the past four decades including concepts and methodologies on dea environmental assessment industrial developments are very important for all nations in terms of their economic prosperities a problem is that the development produces various pollutions on air water and other types of contaminations all of which are usually associated with our health problems and climate changes thus it is necessary for us to consider how to make a balance between economic success and pollution mitigation to maintain a high level of social sustainability in the world it is widely considered that dea is one of the methodologies to examine the level of sustainability this study examines a recent research trend on dea applications from 1980s to 2010s nowadays many researchers have paid serious attention on how to combat various difficulties in the areas of energy and environment as a result the number of articles on dea applications on energy and environment has dramatically increased particularly after 2000s however it is true that dea has strengths and drawbacks in the applications therefore it is very important for us to carefully use dea for guiding large policy issues and business strategies such as the global warming and climate change an underlying premise of this study is that technology innovation in engineering and natural science may solve various problems by linking it with political and managerial efforts the use of dea provides a methodological linkage among them so enhancing the practicality in mitigating problems due to climate change and environmental pollutions this literature study along with a summary on conceptual and methodological developments provides us with guidelines for our future research works on dea on energy and environment issues

commercial policy in a fragmented world there is abundant evidence that the production process of firms is becoming increasingly fragmented internationally in the sense that a final manufactured good will consist of parts that have been manufactured in a variety of different countries studies of manufacturing industries suggest that the share of imported inputs in international trade rose significantly in the 1970 s and 1980 s and that the fragmentation of the production process has been particularly pronounced in industries such as transportation equipment and electrical machinery 1 what difference does it make if trade reflects a fragmentation of the production process rather than the traditional horizontal specialization in final goods in this paper i focus on the implications of fragmentation for the analysis of commercial policy and emphasize two features of vertical relationships 2 the first is the market linkages that are introduced in models of fragmentation due to the interaction between tariffs on final goods and tariffs on intermediate goods the incentives of countries regarding tariff reduction can vary significantly depending on the pattern of trade the second feature of vertical specialization is that producers of final goods often require inputs that are specialized to their particular needs so that vertical relationships may create contracting problems because of the possibility for opportunistic behavior commercial policy may play a role in altering the form of these vertical relationships

outsourcing and trade in a spatial world abstract this paper provides an analysis of outsourcing and trade in a spatial model a la hotelling in this setting we discuss the trade off between transport cost related disadvantages and outsourcing related production cost advantages of a large economy and we investigate how the existence of national transport costs influences both the structure of industrial production and the pattern of final goods trade in addition the model gives a rich picture of the possible welfare effects of trade liberalization in particular we show that a final goods exporting country definitely gains from economic integration while a final goods importing country may lose finally when lowering domestic outsourcing activities trade liberalization may reduce world welfare even if pro competitive effects lead to a decline in consumer prices

international outsourcing and factor prices with multistage production we develop a dual representation of the technology of international fragmentation for an industry using 2 factors in a continuum of stages we then derive a generalised factor price frontier which incorporates an endogenous adjustment of the margin of fragmentation using this frontier in a 2 2 general equilibrium model we investigate the role of outsourcing in the adjustment to a decline in the final output price of the multistage industry and the attendant factor price effects we also explore the implications of an improved technology of international fragmentation on the margin of fragmentation and on domestic factor prices

wage inequality and varieties of capitalism this article draws on a new data set that enables the authors to compare the distribution of income from employment across oecd countries specifically the article conducts a pooled cross sectional time series analysis of the determinants of wage inequality in sixteen countries from 1973 to 1995 the analysis shows that varieties of capitalism matter the authors find that the qualities that distinguish social market economies from liberal market economies shape the way political and institutional variables influence wage inequality of particular interest to political scientists is the finding that the wage distributive effects of government partisanship are contingent on institutional context union density emerges in the analysis as the single most important factor influencing wage inequality in both institutional contexts

dependency theory and taiwan analysis of a deviant case the case of taiwan represents a challenge to two predictions from dependency theory that foreign economic penetration leads to slow economic growth and also to heightened inequality since the early 1950s taiwan has received massive foreign aid and investment but it has also had one of the highest sustained rates of growth in the world while income inequality on the island has decreased substantially an examinatin of this deviant case is pursued by consideration of the various mechanisms dependency theorists claim are responsible for the linkage of foreign economic penetration to stagnation and inequality in the taiwan case none of these mechanisms work out as predicated instead a variety of factors including the nature of the japanese colonial experience the emphasis on labor intensive enterprise and the absence of an entrenched burgeoisie created a situation in which both rapid growth and increasing equality could occur consideration of taiwan draws attention to flaws in the arguments of most

revenue reform and statebuilding in anglophone africa summary although increasingly justified in terms of statebuilding recent tax reforms in anglophone africa contributed only modestly to that goal they have produced impressive tax agencies but no detectable increases in revenue collections they have not addressed some major deficiencies in tax policy and administration the reforms have however helped improve the career prospects for senior african tax administrators and generated more movements of senior staff between tax agencies the private sector and international advisory work these personnel changes have ambiguous implications for the development of revenue capacity in the long term

is there a wage premium for volunteer oss engagement signalling learning and noise abstractvolunteer based open source production has become a significant new model for the organization of software development economics often pictures this phenomenon as a case of signalling individuals engage in the volunteer programming of open source software oss as a labour market signal resulting in a wage premium yet this explanation could so far not be empirically tested this article fills this gap by estimating an upper bound composite wage premium of voluntary oss contributions and by separating the potential signalling effect of oss engagement from other effects although some 70 of oss contributors believe that oss involvement benefits their careers we find no actual labour market premium for oss engagement the presence of other motives such as fun of play or altruism renders oss contributions too noisy to function as a signal

the labour market effects of offshoring of small and medium sized firms micro level evidence for germany small and medium sized enterprises smes are the economic powerhouse of many oecd countries perhaps most prominently so in germany yet the labour market dynamics caused by the internationaliza

offshoring tasks and the skill wage pattern the paper investigates the relationship between offshoring wages and the occupational task profile using rich individual level panel data our main results suggest that when only considering within industry changes in offshoring we identify a moderate wage reduction due to offshoring for low skilled workers though wage effects in relation to the task profile of occupations are not estimated with sufficient precision however when allowing for cross industry effects of offshoring i e allowing for labor mobility across industries negative wage effects of offshoring are quite substantial and depend strongly on the task profile of workers occupations a higher degree of interactivity and in particular non routine content effectively shields workers against the negative wage impact of offshoring

employer size wage effects evidence from matched employer employee survey data in the uk this paper employs a random sample of matched employer employee data from the uk to test seven possible explanations for the positive relationship between employer size and pay individual wage equations show a large employer size wage premium we then control for a range of establishment level variables based on seven hypotheses typically advanced to explain this premium each establishment level factor reduces the wage premium but a sizeable premium nonetheless remains in adjudicating on these hypotheses we find a strong association between the internal labour market and the employer size wage premium this finding supports the theory that the employer size wage effect may be due to the higher costs of turnover or monitoring in larger firms however we find contrasting effects for public versus private sector establishments

centralization of bargaining and wage inequality a correction of wallerstein wage inequality is a subject of intense political and substantive concern and di erencesin the extent of wage inequality between the anglo american economies and those of con tinental europe animate public and scholarly discussion the wide earnings di erentialsobserved in the united states and the united kingdom are commonly justi ed as the properand necessary incentives for a mature growth oriented economy the narrower income dif ferentials encountered in continental europe are rationalized as necessary for the protectionof the less well paid and the integrity of the social fabric the upward secular trend in wageinequality in the us since the 1970s which is a stark reversal of the pattern observed duringthe preceding 40 years is also a topic attracting wide public and scholarly attention despite the importance of the subject and the amount of attention that it has received the extensive literature on the economic impact of wage bargaining institutions in advanceddemocratic societies contains only a few widely accepted ndings one of these is that morecentralized bargaining institutions strongly encourage wage equality no less an authoritativeorgan than the oecd notes for instance that there is a fairly robust relation betweencross country di erences in earnings inequality and bargaining structures oecd 1997 p 64 several well designed country speci c studies support the claim that the system ofcollective bargaining is a major determinant of variations in the extent of wage inequality hibbs and locking 1996 2000 erickson and ichino 1995 yet even the most careful andwell executed country level results may be a ected by idiosyncratic country speci c factors evidence at the cross national level is required the most careful and convincing cross national empirical documentation of the link between centralized bargaining institutionsand wage inequality appears in wallerstein 1999 published in this journal

rent sharing and collective wage contracts evidence from german establishment level data using german establishment level data this article analyses whether wages respond to firm specific profitability conditions particular emphasis is given to the question of whether the extent of rent sharing varies with collective bargaining coverage in this context two conflicting hypotheses are tested the first one asserts that unions exploit their bargaining power at the firm level and appropriate a larger share of rents than the bargaining parties in uncovered firms the second one states that unions favour a compressed intra industry wage structure and suppress the responsiveness of wages to firm specific profitability conditions the empirical analysis provides strong support for the second hypothesis while pooled ordinary least squares pols estimates yield positive estimates of the rent sharing coefficient in covered establishments dynamic panel data estimates accounting for unobserved heterogeneity and the endogeneity of rents point to a rent sharing coefficient of zero

comparison of energy consumption and ghg emissions of open field and greenhouse strawberry production abstract the greenhouse areas in iran have expanded rapidly and the greenhouse holders have shown a great tendency to cultivation of those crops that used to be cultivated in open fields although greenhouses are intensive in terms of yield and whole year production they are considered being one of the major contributors to greenhouse gases ghg emissions in the agricultural sector in the present study strawberry cultivation in greenhouses gh and open fields of was selected as a representative of those crops which can be grown in both systems initial data were randomly collected from 70 ofs and 33 ghs in province of gilan iran energy consumption and ghg emission of two different strawberry production systems were compared moreover energy use efficiency of gh producers due to more energy consumption was studied then degrees of technical efficiency te pure technical efficiency pte and scale efficiency se were determined using data envelopment analysis dea additionally the amount of energy inputs wasted in inefficient greenhouses was assessed and energy saving was computed furthermore the effect of energy optimization on ghg emission was investigated and the total amount of ghg emission was calculated the total average of energy input and output was estimated at 35 092 4 mj ha 1 and 10 405 9 mj ha 1 for of production and similarly 1 356 932 8 mj ha 1 and 137 772 4 mj ha 1 for gh strawberry production total ghg emission was calculated as 803 4 kg co2eq ha 1 and 35083 5 kg co2eq ha 1 for of and gh production respectively based on the evaluations 20 2 273 902 8 mj ha 1 of overall energy sources can be saved if the performance of inefficient farmers is enhanced optimizing energy in the greenhouse production can result in a significant reduction in total ghg emission and the present emission of ghg can be reduced to the value of 29309 1 kg co2eq ha 1

human capital and information this paper examines the issue of the establishment size wage effect it analyzes a cross section for the year 1979 with information on 607 individuals and the 60 private sector establishments where they work it discusses four theories of the establishment size wage effect and uses empirical proxies to test them it shows that when a dummy variable on computer access in the establishment is introduced as a regressor the establishment size variable is an insignificant regressor this result and other evidence supports the contention that the establishment size coefficient captures the effect of unobserved human capital accumulation

services outsourcing and innovation an empirical investigation we provide a comprehensive empirical analysis of the links between international services outsourcing domestic outsourcing profits and innovation using plant level data we find a positive effect of international outsourcing of services on innovative activity at the plant level such a positive effect can also be observed for domestic outsourcing of services but the magnitude is smaller this makes intuitive sense as international outsourcing allows more scope for exploiting international factor price differentials therefore giving the establishment higher profits and more scope to restructure production activities towards innovation we also find that international outsourcing has a positive effect on profitability as predicted by theory while this is not true for domestic sourcing the results are robust to various specifications and an instrumental variables analysis

will most of us be working for giant enterprises by 2028 abstract various economic theories yield quite opposite predictions about the changing size of enterprises and establishments and the purpose of this essay is to present some stylized facts to begin to resolve some of these theoretical confusions the estimates for this purpose cover a period of almost four decades they show that average establishment size has decreased since the late 1960s that the number of establishments per enterprise has leveled off since the early 1980s and that the average size of enterprises reveals an undulating pattern with a sharp upturn at the end of the century due to the impact of the merger wave considerable attention is paid to the causal factors underlying these changes particular in reference to the conflicting theoretical evidence

trade and protection with multistage production this paper analyses trade in manuf acutured goods that are produced via a vertical production structure with many stages where some value is added at each to an intermediate product to yield a good in process ready for the next stage we consider the stage at which a good is traded to be an economically endogenous variable with comparative advantage determining the pattern of production specialization by stages across countries we study how endowment changes and policy shifts move the margin of comparative advantage which thus provides a channel for resource allocation adjustment that is additional to the usual ones of factor substitution and changes in the quantity of output

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

the impact of information and communication technology adoption on multinational firm boundary decisions this article evaluates the effect of adopting internet enabled information and communication technology ict adoption on the decision to reorganize production across national borders foreign boundary decision by multinational enterprises mnes using a transaction cost framework we argue that ict adoption influences foreign boundary decisions by lowering coordination costs both internally and externally for the firm we propose that the heterogeneity in the technology s characteristics namely complexity and the production processes degree of codifiability moderate this influence using a difference in differences methodology and exploiting the richness of confidential us census bureau microdata we find that overall ict adoption is positively associated with greater likelihood of in house production as measured by increases in intra firm trade shares furthermore we find that more complex forms of ict are associated with larger increases in intra firm trade shares finally our results indicate that mnes in industries in which production specifications are more easily codified in an electronic format are less likely to engage in intra firm relative to arm s length trade following ict adoption

the production life cycle tasks in production have different dynamics in comparison with individual products we build a general equilibrium model where three forces offshoring learning and wage interact to determine how production fragmentation evolves over time we show that the production process follows a life cycle its fragmentation emerges deepens and converges our model is stylized and versatile which can be used to tractably characterize the loci of global output productivity welfare and value added distribution as production fragmentation progresses this article is protected by copyright all rights reserved

service offshoring and firm employment abstract major technological advances have recently spurred a new wave of offshoring in services which used to be non tradable should service workers in developed countries worry about their jobs trade theory has given a nuanced answer to this question suggesting that efficiency gains from offshoring may counteract direct job losses which leaves the predicted net effect ambiguous this paper investigates the employment effects of service offshoring in a newly combined and exceptionally detailed panel dataset covering almost the entire universe of german firms service imports over the years 2001 2013 it exploits firm specific export supply shocks by partner countries and service types as an instrumental variable to find that service offshoring has increased firm employment in line with the canonical trade in tasks model the employment gains are greater in firms with higher initial levels of service offshoring

internalizing global value chains a firm level analysis a key decision facing firms is the extent of control to exert over the different stages in their production processes we develop and test a property rights model of firm boundary choices along the

income distribution factor endowments and trade openness abstract this paper studies the empirical links among factor endowments trade and personal income distribution by using panel data we show that land and capital intensive countries have a less equal income distribution while skill intensive countries have a more equal income distribution we also show that the effects of trade openness on inequality depend on factor endowments in a way consistent with several recent case studies but not with the simple hecksher ohlin framework our results are robust to the division of the sample according to level of income the inclusion of different regressors the use of different measures of trade openness and of relative factor abundance and tests for possible problems of endogeneity

supply and demand allocation and wage inequality an international comparison an allocation model of workers differentiated by their field of study is developed to test whether international differences in the wage structure can be explained by differences in labour demand and supply in each country the model explicitly takes into account the effects of supply and demand shifts on the allocation structure to disentangle country specific differences in the recruitment for one occupation from real supply demand effects empirical results based on data for nine countries show that cross country differences in wage inequality explain at least two third of the differences in labour demand and supply

employment job turnover and trade in producer services uk firm level evidence abstract we provide the first firm level evidence of the impact of the trade in producer services offshoring on the labour market using a new data set from the uk that measures trade in services at the firm level we find no evidence that importing intermediate services is associated with job losses or greater worker turnover using regression to control for observable differences between firms that import service inputs and those that do not we show that firms that start importing intermediate services experience faster employment growth than equivalent firms that do not this seems likely to be the result of positive demand shocks which cause a simultaneous increase in employment output and use of imported service inputs

offshoring along the production chain recent contributions on offshoring often assume that firms can freely split their production process into separate steps which can be ranked according to the cost savings from producing abroad we replace this assumption by the notion of a technologically determined sequence of production steps in our model cost savings from offshoring fluctuate along the production chain and moving unfinished goods across borders causes transport costs we show that in such a setting firms may refrain from offshoring even if relocating individual steps would be advantageous conversely small variations in model parameters may lead to a large increase in offshoring activities

oil abundance and violent political conflict a critical assessment abstract this paper addresses one of the empirical claims of the resource curse argument namely that oil abundance raises the probability of political violence i argue that the two main theoretical premises of the oil civil war link rent seeking and the rentier state model fail to provide a convincing argument as to why oil economies are more vulnerable to the onset of civil war i find that three often mentioned mechanisms as to why oil economies succumb to political violence not convincing that oil economies are poor economic performers that oil economies generate high corruption and that oil economies tend to produce authoritarian regimes i also examine the empirical evidence on the oil civil war link and conclude that the results are not robust i conclude with some policy implications

trade and communication costs two models in which communication costs are a cost to trade are investigated one model looks at the role of communication in determining the firms geographic extent in the use of local factor services communication costs are modelled as a quasi public good network in which communication services are provided by an average cost pricing monopolist the network technology is subject to increasing returns congestion effects and network externalities the second model focuses on communication for the purposes of international trade in goods with similar assumptions on the technology of communication as in the first model in this model an important distinction is made between international equilibrium and global equilibrium in both models the impact of reductions in communication costs on the market extent of firms trade volumes and productivity are examined the models have generic multiple equilibria with quite different welfare and comparative static properties

outsourcing and the us labour market there is worldwide concern about the vulnerability of the current labour force to displacement by future imported services in the usa some have suggested that as much as one third of the workforce might be vulnerable to such outsourcing however the labour market impacts of this displacement are difficult to assess using purely analytical or statistical approaches in this paper simulation methods are used to understand how sensitive the us economy and labour market are to increases in services imports specifically the scenario examined assumes that the share of imported services in total employment increases from 0 8 per cent to 7 25 per cent over a time horizon in which workers are unable to change occupations in response it is found that all industries increase their use of imported services and their use of the composite input that is comprised of imported services and tradable labour with the exception of legal workers all workers in tradable occupations experience declines in their real wages demand for non tradable occupations labour rises in the industries that expand the most while demand falls in shrinking industries the non tradable occupations that are used intensively in the shrinking industries experience declines in real wages while the real wages rise for workers in non tradable occupations used intensively in the expanding industries

earnings and caste an evaluation of caste wage differentials in the nepalese labour market abstractthis paper examines the sources of wage differentials among castes in nepal a country which had until 1963 an age old caste based social division of labour we use an extended oaxaca decomposition model with occupation and firm size augmenting the conventionally used measures of human capital endowments our results indicate that caste wage differentials in nepal are large and that human capital endowments and lack of access to better paying occupations and larger firms have a significant impact furthermore we find mixed evidence that the government policy of affirmative action has narrowed down the caste wage differential

a comprehensive review of data envelopment analysis dea approach in energy efficiency the main aim of this review article is to review of dea models in regarding to energy efficiency this paper reviewed and summarized the different models of dea that have been applied around the world to development of energy efficiency problems consequently a review of 144 published scholarly papers appearing in 45 high ranking journals between 2006 and 2015 have been obtained to achieve a comprehensive review of dea application in energy efficiency accordingly the selected articles have been categorized based on year of publication author s nationalities scope of study time duration application area study purpose results and outcomes results of this review paper indicated that dea showed great promise to be a good evaluative tool for future analysis on energy efficiency issues where the production function between the inputs and outputs was virtually absent or extremely difficult to acquire

exploring the impact of trade and investment on income inequality a cross national sectoral analysis of the developed countries this article explores the relationship between international integration and domestic inequality in the developed countries in the mid 1980s and early 1990s the analysis examines two major modes of integration trade and direct investment disaggregating each by economic sector and distinguishing between imports and exports and inbound and outbound flows and stocks in measuring income inequality extensive use is made of micro data sets that have recently become available through the luxembourg income study lis which provides much more detailed and comparable data on income inequality than has heretofore been the case in particular lis data can be aggregated at the level of economic sector and permit the comparison of pre and post government income the study finds few significant relationships between either trade or investment and sectoral income distribution the overall conclusion is that economic globalization is not a critically important factor in explaining recent trends in income inequa

disaggregated wage curves in the united states evidence from panel data of young workers the paper presents wage curve results disaggregated over time by individual characteristics occupations industries and regions in the united states using a panel data set of young workers the results suggest that instead of a strong aggregate wage curve there are a number of different wage curves over time and for different worker groups the slope of the aggregate wage curve varies over time with the strongest wage curves in the late 1980s wage curves exist for most labour market groups the wages of the least educated hispanics those in relatively low skill occupations or service industries are most sensitive to changes in unemployment wages of government workers and those in the mining industry increase with unemployment finally wage curves are steepest in the western states

post unification wage growth in east germany following monetary union with west germany in 1990 the real wage of east german workers rose 83 i use the german socio economic panel data to investigate the determinants of wage growth and assess whether they are consistent with efficient restructuring although job changing rates were initially high the share of wage growth that accrued to movers was little higher than in the west suggesting that the incentives to move were too low for 1990 to 1991 the biggest gainers were low wage workers generally and women and the less educated specifically for 1991 to 1996 the biggest gainers were women and the better educated

outsourcing and optimal nonlinear taxation a note this paper concerns optimal taxation and outsourcing if the government has a direct instrument for taxing outsourcing the policy rules for marginal income taxation remain as in the standard model

trade in goods and trade in tasks an integrating framework abstract we introduce a simple but flexible analytical framework in which both trade in goods and trade in tasks arise we use this framework to provide versions of the gains from trade and the famous four ho theorems heckscher ohlin factor price equalisation stolper samuelson and rybczynski that apply to this environment we extend our framework to accommodate monopolistic competition and two way offshoring and to integrate theoretical results of the early offshoring literature

globalization and the skilled city abstract the location of economic activity both across and within countries has undergone dramatic shifts over the last five decades three key trends stand out first cross country inequality has declined as many developing countries have grown rapidly second economic geography within countries has instead grown more unequal in both the developed and the developing world third within country spatial disparities have grown mainly because of the disproportionate success of skilled cities in this paper i develop a model that jointly explains these patterns as a consequence of deepening international economic integration my model explains the faster population and output growth of skilled cities as well as their tendency to increase their initial skill advantage consistent with the evidence my theory predicts a non monotonic path of urban growth in developed countries the model predicts a future shift in worldwide urban hierarchies as some developing world cities overtake unskilled cities in industrialized countries along global supply chains

redistributive income taxation under outsourcing and foreign direct investment this paper deals with optimal income taxation under international outsourcing and fdi we show how the joint effect of outsourcing and fdi on the optimal marginal income tax rates depends on whethe

whose job goes abroad international outsourcing and individual job separations this paper focuses on the adjustment costs of globalisation by studying the effects of international outsourcing on individual transitions out of jobs in the danish manufacturing sector for the period 1990 2003 a competing risks duration model that distinguishes between jobto job and job to unemployment transitions is estimated outsourcing is found to increase the unemployment risk of low skilled workers but the quantitative impact is modest outsourcing is also found to reduce the job change hazard rate for all education groups thus the paper provides evidence for small adjustment costs of globalisation

differences and changes in wage structures preface introduction and summary richard b freeman lawrence f katz 1 a comparison of changes in the structure of wages in four oecd countries lawrence f katz gary w loveman david g blanchflower 2 international differences in executive and managerial compensation john m abowd michael l bognanno 3 the gender earnings gap some international evidence francine d blau lawrence m kahn 4 international wage curves david g blanchflower andrew j oswald 5 the changing structure of male earnings in britain 1974 1988 john schmitt 6 real wages employment and wage dispersion in u s and australian labor markets robert g gregory francis vella 7 labor markets and economic growth lessons from korea s industrialization 1970 1990 dae il kim robert h topel 8 wage differentials in italy market forces institutions and inflation christopher l erickson andrea c ichino 9 the swedish wage structure the rise and fall of solidarity wage policy per anders edin bertil holmlund 10 getting together and breaking apart the decline of centralized collective bargaining richard b freeman robert s gibbons 11 earnings inequality in germany katharine g abraham susan n houseman 12 a comparative analysis of east and west german labor markets before and after unification alan b krueger jorn steffen pischke contributors author index subject index

work characteristics firm size and wages a positive wage firm size relationship is well documented in the empirical literature in industrial organization and labor economics firm size seems to proxy various unobserved determinants such as job satisfaction monitoring costs more complex technologies and worker participation in monopoly profits it is generally argued that the greater the possibility of controlling for these latent factors the less likely that a significant size effect will appear this paper attempts to distinguish firm size from other wage determinants for a rich data source for west germany and demonstrates the persistence of the size premium

an analysis of energy use and relation between energy inputs and yield in tangerine production abstract the objective of this study is to determine energy balance between inputs and output for tangerine production in mazandaran province one of the most important citrus production centers in iran data is collected by administering a questionnaire in face to face interviews the results show that the highest share of energy was utilized by application of chemical fertilizers and chemicals average yield and energy consumption are calculated as 26862 5 kg ha 1 and 62260 9 mj ha 1 respectively the energy productivity and net energy value are estimated as 0 43 kg mj 1 and 8201 4 mj ha 1 respectively the ratio of energy outputs to energy inputs is approximately 0 87 in addition the cobb douglas production function is applied to estimate the econometric relationship among different forms of energy consumption the findings suggest that tangerine producers must optimize their use of indirect and non renewable energy resources they apply an excess use of some energy inputs resulting in an inverse effect on yield as well as imposing risks to natural resources and human health

ability biased technological transition wage inequality and economic growth thispaper develops a growthmodel characterizedbyability biasedtechnological transition in which the evolution of technology education attainment and wage inequality is consistent with the observed pattern in the united states and other advanced countries over the past several decades it argues that an increase in the rate of technological progress raises the return to ability and simultaneously generates an increase in wage inequality between and within groups of skilled and unskilled workers an increase in average wages of skilled workers a temporary decline in average wages of unskilled workers an increase in education and a productivity transitory slowdown

globalization outsourcing and wage inequality there is considerable debate over whether international trade has contributed to the declining economic fortunes of less skilled workers one issue that has become lost in the current discussion is how firms respond to import competition and how these responses in turn are transmitted to the labor market in previous work we have argued that outsourcing by which we mean the import of intermediate inputs by domestic firms has contributed to an increase in the relative demand for skilled labor in the united states if firms respond to import competition from low wage countries by moving non skill intensive activities abroad then trade will shift employment towards skilled workers within industries in this paper we extend our previous work by combining new import data from the revised nber trade database with disaggregated data on input purchases from the census of manufactures we construct industry by industry estimates of outsourcing for the period 1972 1990 and reexamine whether outsourcing has contributed to an increase in relative demand for skilled labor our main finding is that outsourcing can account for 31 51 of the increase in the relative demand for skilled labor that occurred in u s manufacturing industries during the 1980s compared to our previous estimate of 15 33 this abstract was borrowed from another version of this item

structural reforms and labor market outcomes international panel data evidence this paper explores the impact of structural reforms on a comprehensive set of macro level labor market outcomes including the unemployment rate the average wage index and overall and female employment levels and labor force participation rates together these outcome variables capture the overall health of the labor market and the aggregate welfare of workers yet there seems to be no other comprehensive empirical investigation in the existing literature of the impact of structural reforms at the cross country macro level on labor market outcomes other than the unemployment rate data were collected from a variety of sources including the world bank world development indicators the international monetary fund international financial statistics and the international labor organization key indicators of the labor market the resulting dataset covers up to 88 countries the majority being developing for 10 years on either side of structural reforms that took place between 1960 and 2001 after documenting the average trends across countries in the labor market outcomes up to 10 years on either side of each country s structural reform year the authors run fixed effects ordinary least squares as well as instrumental variables regressions to account for the likely endogeneity of structural reforms to labor market outcomes overall the results suggest that structural reforms lead to positive outcomes for labor unlike related literature the paper does not find conclusive evidence on unemployment redistributive effects in favor of workers along the lines of the stolper samuelson effect may be at work

what determines the elasticity of substitution between capital and labor a literature review this paper provides the first comprehensive review of the empirical and theoretical literature on the determinants of the elasticity of substitution between capital and labor our focus is on the two input constant elasticity of substitution ces production function we start by presenting four concise observations that summarize the empirical literature on the estimation of motivated by these observations the main part of this survey then focuses on potential determinants of capital labor substitution we first review several approaches to the microfoundation of production functions where the elasticity of substitution eos is treated as a purely technological parameter second we outline the construction of an aggregate elasticity of substitution aes in a multi sectoral framework and investigate its dependence on underlying intra and inter sectoral substitution third we discuss the influence of the institutional framework on the extent of factor substitution overall this survey highlights that the effective elasticity of substitution ees which is typically estimated in empirical studies is generally not an immutable deep parameter but depends on a multitude of technological non technological and institutional determinants based on these insights the final section identifies a number of potential empirical and theoretical avenues for future research

winners and losers a micro level analysis of international outsourcing and wages our paper investigates the link between international outsourcing and wages utilizing a large household panel and combining it with industry level information on industries outsourcing activities from input output tables this approach avoids prob lems such as aggregation bias potential endogeneity bias and poor skill definitions that commonly hamper industry level studies we find that outsourcing has had a marked impact on wages applying two alternative skill classifications we find evidence that a 1 percentage point increase in outsourcing reduced the wage for workers in the lowest skill categories by up to 1 5 while it increased wages for high skilled workers by up to 2 6 this result is robust to a number of different specifications jel classification f16 j31 gagnants et perdants une analyse micro economique de la sous traitance internationale et des salaires ce memoire etudie le lien entre la sous traitance internationale et les salaires a l aide de donnees d un grand panel de menages qu on combine avec des donnees au niveau des industries sur les activites de sous traitance de celles qui en font obtenues des tableaux interindustriels cette approche evite les problemes qui habituellement polluent les etudes au niveau de l industrie biais d agregation biais d endogeneite potentielle mauvaises definitions des habiletes on decouvre que la sous traitance a un effet sur les salaires a l aide de differentes formes de classification des habiletes il appert qu un point de pourcentage d augmentation dans la sous traitance reduit les salaires des travailleurs dans les categories d habilete les plus basses de 1 5 alors qu il accroit les salaires de travailleurs specialises de 2 6 ce resultat est robuste et avere meme quand on utilise diverses specifications

a dea approach for estimating the agricultural energy and environmental efficiency of eu countries this study attempts to evaluate the energy and environmental efficiency of the primary sectors of the eu member state countries the evaluation is based on a non radial data envelopment analysis dea model which allows for non proportional adjustments to energy inputs and undesirable outputs and thus it provides different estimations for energy and environmental efficiency scores the 2001 2008 time period was selected for this research one of the most important findings is that countries like germany sweden or austria with strong environmental protection standards appear to be less energy and environmentally efficient compared with countries like denmark belgium spain france or ireland in addition a series of eastern european countries achieve low efficiency scores which can be characterized as expectable due to low technology level being implemented in the primary production process there are also two sub periods for this research the first one 2001 2006 covers the fully coupled with specific cultivations period for subsidy administation and the second 2007 2008 where the new decoupled subsidy scheme was implemented there are significant hints for considerable changes of energy and environmental efficiency after the implementation of the the new cap with the new member states siginificantly differ of both energy and environmental efficiency copmared with the older ones

outsourcing and the skilled unskilled wage gap abstract within the context of a product variety model this paper examines the impact of outsourcing of skill intensive tasks on the skilled unskilled wage gap outsourcing affects the wage gap through direct as well as indirect channels while outsourcing decreases the effective wage of skilled workers in the services sector owing to inter sectoral labour mobility its overall impact on the equilibrium skilled wage is positive through an increase in the size of external economies in the industrial sector outsourcing can reduce the unskilled wage in overall terms outsourcing of skill intensive tasks increases the skilled unskilled wage gap

welfare state retrenchment revisited entitlement cuts public sector restructuring and inegalitarian trends in advanced capitalist societies in recent years it has become commonplace for comparativists to emphasize the resilience of welfare states in advanced capitalist societies and the failure of neoliberal efforts to dismantle the welfare state challenging some tenets of the resilience thesis this article seeks to broaden the discussion of welfare state retrenchment the authors argue that a sharp deceleration of social spending has occurred in most oecd countries since 1980 that welfare states have failed to offset the rise of market generated inequality and insecurity and that welfare programs have become less universalistic they stress the distributive and political consequences of market oriented reforms of the public sector

innovation and wage effects of international outsourcing abstract we investigate the effects of increased outsourcing of production to a low wage country such international outsourcing lowers the marginal cost of production and thus increases profits creating greater incentives for innovation a reduction in the resource requirement in adapting technology relative to improving products or an expansion in the portion of production that can be outsourced generates a greater extent of international outsourcing a lower relative wage and a faster rate of innovation an increase in production taxes in the north production subsidies in the south or a subsidy to adapting technologies has similar effects

do smaller firms pay less in the caribbean the case of trinidad and tobago this article constitutes the first study of the employer size wage effect for a caribbean country namely the republic of trinidad and tobago using a rich micro level data set we estimate the firm size wage premium in an empirical model of wage determination despite exploring a variety of theories samples estimation techniques and tests we find that consistent with the empirical literature larger firms in trinidad and tobago pay higher wages than smaller firms for equally productive workers

the rise and fall of centralized wage bargaining during the three decades spanning the early 1950s to the early 1980s the wage setting process in most northern european countries was dominated by centralized bargaining i e peak level labor and employer associations set wages nationwide in the early 1980s centralized wage bargaining began to collapse in this paper we assess a novel explanation for both the initial establishment of a centralized wage setting process and its subsequent collapse according to our theory centralized wage bargaining was set up as a response to the spillovers created by the unemployment benefit program its collapse was the result of the increase in the productivity gap across workers brought about by equipment specific technological progress and equipment skill complementarity

left government policy and corporatism explaining the influence of partisanship on inequality the author argues that to understand the relationship between partisan government and equality two fundamental things need to be done separate the effects of partisanship on policy and of policy on the economy and assess the influence of government partisanship once the mediating role of corporatism is accounted for the main goal of this article is to explore the relationship between government partisanship policy and inequality at the lower half of the wage distribution the analysis is motivated by a puzzling finding in previous work the absence of government partisanship effects on earnings inequality the author focuses on the role of three different policies government employment the generosity of the welfare state and minimum wages the results show that government employment is a most significant determinant of inequality although it is affected by left government only when corporatism is low they also demonstrate that welfare state generosity does not affect inequality and in turn is not associated with left government finally they reveal that the effect of government partisanship on minimum wages and of minimum wages on inequality is completely conditional on the levels of corporatism these effects are only present when corporatism is low the author explains why specific policies do or do not affect earnings inequality and also why corporatism mitigates or magnifies the influence of government partisanship by explicitly exploring the determinants of policy and earnings inequality the article represents an important contribution to our understanding of how governments can promote redistribution

international fragmentation boon or bane for domestic employment abstract in this paper we introduce the fairness approach to efficiency wages into a standard model of international fragmentation this gives us a theoretical framework in which wage inequality and unemployment rates are co determined and therefore the public concern can be addressed that international fragmentation and outsourcing to low wage countries lead to domestic job losses we develop a novel diagrammatic tool to illustrate the main labour market effects of international fragmentation we also explore how preferences for fair wages and the size of unemployment benefits govern the employment effects of outsourcing and critically assess the role of political intervention that aims to reduce unemployment benefits under internationally fragmented production

offshoring the nature of tasks and occupational stability empirical evidence for germany using a large administrative data set of individual employment histories for germany this paper studies the relationship between offshoring and the individual risk of leaving the occupation moreover a rich data set on tasks performed in occupations is used to better characterise the sources of worker vulnerability both material and service offshoring are on average not associated with an increase in occupational outflow rates however this association depends on the nature of tasks performed in the occupation higher intensities of interactive and in particular non routine tasks are associated with a larger decrease or a smaller increase in the occupational hazard rate

monetary union and wage bargaining institutions in the eu extrapolating from some member state experiences this article considers the question of how monetary union in the eu is likely to impact the preferences of governments employers and unions regarding the organization of wage bargaining european monetary union involves a decentralization of wage bargaining centered at the national level in relation to monetary policy centralized at the european level drawing on recent literature and on the experience of two member states italy and spain which prior to emu underwent periods of intense bargaining fragmentation the author argues that the imposition of restrictive monetary policy in a fragmented wage bargaining context in which workers nonetheless have substantial bargaining rights tends to have perverse effects these effects ultimately led governments and bargaining actors in italy and spain to seek a reorganization of bargaining that gave national actors greater control over wage setting the article considers to what extent a similar dynamic might play out in the euro zone