wages and productivity growth in a dynamic monopoly abstract this paper studies the intertemporal problem of a monopolistic firm that engages in productivity enhancing innovations to reduce labor costs the optimal innovation policy is not monotone and the rate of productivity growth is the highest when the firm s size is in some intermediate range as long as its initial productivity is not too low the firm eventually reaches a steady state where the rate of productivity growth is identical to the rate of wage growth productivity dependent wage differentials do not affect productivity growth in the steady state they increase however the firm s long run equilibrium cost level

relative earnings and individual union membership in the united kingdom considerable attention has been focused in recent years on the empirical analysis of the effect of trade unions on the structure of earnings such empirical investigation usually entails measurement of the union non union differential in wages or earnings at the level of the individual this involves comparison of the earnings of union members with estimates of what their earnings would be were they not union members or equivalently examination of differences in earnings between individuals comparable with regard to all other relevant characteristics who differ in their union membership alone in the united kingdom all previous attempts at estimation of this differential have used aggregate data at either the industry or occupation level 1 the conventional methodology involves regression of the logarithm of the average wage on either the proportion of workers who are union members or the proportion covered by a collective agreement together with a vector of industry characteristics that are deemed to determine the non union wage however several problems are immediately apparent with this methodology first the model ignores the possibility of variation in the differential across industries which has potentially serious consequences second the vector of other characteristics customarily used is somewhat limited and raises doubts concerning the adequacy of the standardization for what might loosely be termed labour quality third only a sub sample of industries is ever used owing to lack of data those industries excluded are generally smaller in terms of employment that those included if the differential varies with the size of the industry a further bias will be induced all of these problems are either removed or lessened by the use of individual level data for an analysis of their impact at the industry level see geroski and stewart 1981 2 as a result it is now widely accepted that the appropriate way to measure such differentials is to use micro data sets at the level of the individual worker until recently suitable data have not been available for the united kingdom and hence such analysis was not possible this paper presents the first estimates for the united kingdom based on individual level data if the value of the union non union differential were the same for all workers in the unionized sector analysis at the industry level and the individual level would produce similar results however the marshallian laws of derived demand suggest that this will not be the case despite this clear prediction of variation in the differential there has been little systematic investigation of the variation this paper also presents such an analysis since variation in the differential across industries results in aggregation bias in industry level studies such an analysis is of considerable relevance to the evaluation of the evidence from such studies as well as being of interest in its own right the paper is laid out as follows section i presents a method of estimating the union non union differential at the individual level while section ii

spatial targeting of payments for environmental services a tool for boosting conservation benefits abstract payments for environmental services pes have become an increasingly popular market based instrument to translate external non market environmental services into financial incentives for landowners to preserve the ecosystems that provide the services however lack of spatial differentiation in the targeting mechanism may lead to efficiency losses addressing this challenge we construct an applied site selection tool which takes into account three variables that vary in space environmental services provided risks of losing those services and participation costs using data from costa rica s nicoya peninsula we empirically test the tool s potential to increase the financial efficiency of the forest focused pes program in place results show that given a fixed budget efficiency increases radically if per hectare payments are aligned to landowners heterogeneity in participation costs involving opportunity transaction and direct costs of protection respectively selecting sites based on environmental service potential also moderately increases efficiency overall additionality could in the best case be doubled but remains generally limited due to current low deforestation risks prevailing in costa rica to take advantage of the high efficiency potentials of flexible payments we propose inverse auction systems as a cost effective approach for the determination of micro level participation costs

unemployment in south africa the nature of the beast abstract unemployment in south africa is so widespread that it demands an explanation this paper examines a central question about south african unemployment why do the unemployed not enter the informal sector as is common in other developing countries the data do not support the idea that unemployment is largely voluntary the policy implications that government should diminish labor market segmentation and the obstacles to entering the productive informal sector may be relevant also to other developing countries with high unemployment

women and the union wage gap this paper uses the social change and economic life initiative 1986 data set to provide new estimates for the female union wage gap for britain the joint endogeneity of trade union and full time part time employment status is addressed within the econometric framework of a bivariate sample selection model the mean unconditional union mark up estimate for female full time workers is estimated at 14 6 percent with the comparable estimate for part time female workers estimated at 15 3 percent copyright 1992 by royal economic society

institutional prerequisites for economic growth europe after world war ii abstract european economic growth in the quarter of a century that ended in 1973 outstripped growth in any period of comparable length before or since the elements of europe s growth miracle wage moderation high investment and rapid export growth were delivered by a taylor made set of domestic and international arrangements on the domestic side the social market economy on the external side international agreements and institutions including the european payments union and the european coal and steel community that solved problems of commitment and cooperation that would have otherwise hindered the resumption of growth

bargaining and the timing of investment the joint determination of the timing of investment and wage bargaining is modelled two cases are considered a there is an alternating offer bargaining game over binding wage contracts and production is possible only when agreement is reached b there are no binding contracts so revenue is divided in period by period bargaining post investment investment can occur earlier in case b than in case a and the equilibrium in case b can pareto dominate the equilibrium with binding contracts these conclusions depend on players discount factors

unionisation structures and innovation incentives this paper examines how dierent unionisation structures aect rms innovation incen tives and industry employment we distinguish three modes of unionisation with increasing degree of centralisation 1 decentralisation where wages are determined independently at the rm level 2 coordination where one industry union sets individual wages for all rms and 3 centralisation where an industry union sets a uniform wage rate for all rms while rms investment incentives are largest under centralisation investment in centives are non monotone in the degree of centralisation decentralisation carries higher investment incentives than coordination labour market policy can spur innovation by decentralising unionisation structures or through non discrimination rules

why do governments subsidise investment and not employment abstract the governments of nearly all industrialised countries use subsidies to support the economic development of specific sectors or regions with high rates of unemployment conventional economic wisdom would suggest that the most efficient way to support these regions or sectors is to pay employment subsidies we present evidence showing that capital subsidies are empirically much more important than employment subsidies we then develop a simple model with unemployment to explain this phenomenon in our model unemployment arises due to bargaining between unions and heterogenous firms that differ with respect to their productivity union bargaining power raises wage costs and leads to a socially inefficient collapse of low productivity firms and a corresponding job loss union firm bargaining also gives rise to underinvestment it turns out that an investment subsidy dominates an employment subsidy in terms of welfare if there is bargaining over wages and employment on the firm level if bargaining is over wages only results are ambiguous but capital subsidies may still be preferable

wage aspirations and unemployment persistence abstract we use panel data to examine the empirical determinants of the reservation wage in particular the influence of previous wages and consider what this implies for the evolution of the natural rate of unemployment we find that previous wages have a significant but relatively small effect on reservation wages an elasticity between 0 15 and 0 47 we also find considerable differences across genders with previous wages being more important for men and market wages being more important for women overall our results suggest that the reservation wage will adjust quite quickly to shocks

the tradeoff between wages and employment in trade union objectives this paper demonstrates that contrary to a widely held opinion the determination of the goals of unions is fully amenable to empirical analysis a characterization of the wage and employment setting process in unionized markets is adopted and its qualitative implications examined the first order condition for this model is fitted to time series data on the newspaper industry from ten cities the international typographical union s objective function reveals very restricted opportunities for substituting wages for employment in response to a change in the slope of the employer s labor demand function larger union locals place greater emphasis on wages versus employment than smaller union locals

reservation wages and the cost of unemployment this paper studies direct evidence on reservation wages reported in great britain in 1982 to assess 1 whether such asking prices are high and 2 whether variations in these reservation wages are related to differences in measures of the subjective and objective costs of unemployment a majority overall and for various subgroups reports reservation wages no higher than own past wages adjusted for earnings growth but there is nonetheless considerable dispersion in the ratio of reservation to past wages reservation wages are somewhat related to measures of the differential cost of unemployment most clearly for men although the independent role of benefits is often imprecisely measured however exactly which of these costs matter differs significantly according to whether the separation from last employment was voluntary or involuntary copyright 1989 by the london school of economics and political science

work experience earnings and participation evidence from the women and employment survey this paper presents a probit model of labour force participation and a set of earnings equations estimated using data from the 1980 women and employment survey the results of the participation model compare with previous findings and the earnings models give typical results of human capital and job characteristics variables exclusion of the sample selection effect appears to be of importance and a linear piecewise experience variable outperforms the quadratic specification

trade unions and regional development abstract we focus on the role that labour unions play in the context of a two region dual economy we show that unskilled unions will increase the wage of unskilled workers and depress growth in both the backward and the advanced regions the growth effects will be felt more strongly in the relatively poor region if skilled workers are allowed to migrate and unions recognize that a more aggressive wage setting policy may foster migration unions will moderate their wage requests however regional unions would then have a strong incentive to coordinate their wage demands across regions this would further raise the unskilled wage and more so in the backward region we conclude that labour market policies designed to foster regional convergence should seek both to discourage centralized wage setting and favour skilled labour mobility

cyclical quality adjustment in the labor market 1 introductionthe u s unemployment rate fell to very low levels during the 1990s even more impressively the unemployment rate for minorities and less educated individuals fell disproportionately convergence of relative unemployment rates in expansions and divergence in recessions has been a feature of the u s economy over the last 30 years there are many possible reasons for this feature for example if the costs of hiring and firing less skilled labor are low one would expect these individuals to have very procyclical employment in this paper i explore an alternative model when there is an excess supply of labor high skilled people take jobs that would normally be occupied by less skilled people in expansions the process reverses with less skilled workers getting access to jobs that they would normally not attain i refer to this process as cyclical quality adjustment reder 1955 p 834 was one of the first to discuss how hiring standards adjust to business cycle conditions quality variations in labor markets arise through upgrading and downgrading of members of the labor force relative to the jobs they are to fill when applicants become scarce employers tend to lower the minimum standards upon which they insist as a condition for hiring a worker to fill a particular job and vice versa when applicants become plentiful since then many papers have developed this idea theoretically and many economic commentators appear to share this view of the labor market for example the economic report of the president states that a strong labor market is particularly important to less advantaged groups in the labor market such as workers with less education younger workers racial and ethnic minorities and immigrants when employers find it hard to fill vacancies they are more willing to hire and train workers whom they might pass over when they have fewer openings and an abundance of applicants council of economic advisors 1999 p 103 likewise the expansion during the 1990s spawned many newspaper articles about the improvement in the types of jobs available to less skilled applicants however there is little systematic empirical work about changes in job assignment in the united states over the business cycle the empirical work in this paper seeks to redress this situation cyclical assignment changes are important for many reasons as mentioned earlier job upgrading is a potential explanation for the greater cyclical variation of employment experienced by less skilled workers it is well known that the unemployment rates of less skilled individuals and minorities are more countercyclical relative to more skilled individuals clark and summers 1981 kydland 1984 keane and prasad 1993 hoynes 1999 the standard explanation for this effect is that low ability workers are more likely to be laid off in downturns because training and hiring costs are lower for these workers no commensurate attention has been paid to the issue of how the decision of who to hire changes over the business cycle however assignment models present a natural explanation for the greater procyclicality of employment of the less skilled both the adjustment cost hypothesis and the upgrading hypothesis imply that less skilled workers will have more procyclical employment empirically they are distinguishable because the upgrading explanation implies that jobs obtained by comparable workers should vary systematically over the cycle the adjustment cost hypothesis relates to the composition of those whose jobs are terminated second these mechanisms suggest a reason why wages are particularly procyclical for job changers recent studies using panel data have indicated that the wages of job starters are much more procyclical than the wages of workers who do not change jobs researchers have suggested various explanations for this result beaudry and dinardo 1991 and macleod and malcomson 1993 present contracting models in which the wages of job starters depend on the state of the labor market when they join the firm

the impact of local unemployment rates on reservation wages and the duration of search for a job evidence about the relationship of local unemployment rates and individuals reservation wages and duration of search for a job if unemployed is sparse and mixed this study uses us data from the panel study of income dynamics psid to test whether relatively high local unemployment rates reduce the reservation wages of area residents or increase the duration of search labour search theory provides the grounding for the sample selection corrected simultaneous equations econometric model in neither ols nor 2sls results is evidence found that local unemployment rates affect either reservation wages or the duration of search these results suggest that policies targeted at alleviating unemployment should focus on increasing the demand for labour rather than hope that such policies will be beneficial if pursued in high unemployment areas because of their effects on labour force characteristics

do unions reduce investment evidence from canada the authors test for a link between unionization and net investment rates in canadian manufacturing analysis of data on 18 industries for the years 1967 87 reveals a negative non linear relationship the presence of unions appears to have reduced investment when the percentage of firms in the industry that were unionized was between 0 and approximately 50 with a plateau or slight positive marginal effect above this level in an industry moving from no unions to the mean level of unionization net investment and gross investment are predicted to fall by 66 74 and 18 25 respectively

estimating the probability of trade union membership a study of men and women in britain the paper examines the determinants of the individual decision to unionize for british employees and uses micro data from the 1975 national training survey the unionization probability is estimated separately for manual and non manual men and full time and part time women an interesting finding is that personal characteristics of both men and women generally do not affect the unionization probability this result run counter to the common perception that family responsibilities explain low female trade union density

estimating reservation wages of employed workers using a stochastic frontier according to search theory workers form reservation wages such that employment offers paying wages less than the reservation wage are rejected the first job offer paying a wage higher than the reservation wage is accepted and search is terminated though the reservation wage is clearly a matter of individual taste and unobservable a number of empirical articles have nevertheless appeared on the subject the present paper adds to this literature its novel aspects are that it uses data on employed workers rather than unemployed workers as is usually the case and that it applies a comparatively new econometric technique stochastic frontier estimation to the problem of estimating reservation wages our interests in this paper are twofold first the paper provides estimates of worker reservation wages utilizing the stochastic frontier regression technique second we use these estimates to test various hypotheses regarding the response of reservation wages to factors that search theory suggests are important in the determination of reservation wages the remainder of the paper is organized as follows section ii discusses the previous empirical literature on the reservation wage section iii sketches the theory and estimation techniques we use section iv lays out a framework for assessing the validity of the approach used here finally section v presents the empirical results

unionization structure licensing and innovation we show the effects of the unionization structure viz decentralized and centralized unions on a firm s incentive for technology licensing and innovation the incentive for technology licensing is stronger under decentralized unions we identify circumstances under which the benefit from licensing creates a stronger incentive for innovation under decentralized unions if the union s preference for employment is high the benefit from licensing may create higher incentive for innovation under decentralized unions however if the union s preference for wage is high enough the incentive for innovation is higher under a centralized union irrespective of licensing ex post innovation if the centralized union decides whether or not to supply workers to all firms the possibility of higher innovation under decentralized unions increases we further show that perfectly substitutable workers can be better off under decentralized unions if the labor productivity depends on the unionization structure which occurs in our analysis when e g licensing after innovation occurs only under decentralized unions or innovation with no licensing occurs only under a centralized union

rational expectations and policy credibility following a change in regime we examine the dynamic path of an economy after a change in regime when neither the policy to be followed nor the reactions of the public are known the model is an application of kreps and wilson s reputation model to barro and gordon s macroeconomic policy game equilibrium is defined to be the dynamically consistent solution to a game between the government and the private sector it involves mixed strategies and bayesian learning by both sides until the uncertainty about government and public behaviour is resolved the absence of complete credibility of government policy and intransigence of private sector wage demands increase the output loss of disinflation the analysis also sheds light on the strategic nature of economic policymaking and the role of information in macroeconomics

journalists and the stock market we use exogenous scheduling of wall street journal columnists to identify a causal relation between financial reporting and stock market performance to measure the media s unconditional effect we add columnist fixed effects to a daily regression of excess dow jones industrial average returns relative to standard control variables these fixed effects increase the r super 2 by about 35 indicating each columnist s average persistent bullishness or bearishness to measure the media s conditional effect we interact columnist fixed effects with lagged returns this increases explanatory power by yet another one third and identifies amplification or attenuation of prevailing sentiment as a tool used by financial journalists the author 2012 published by oxford university press on behalf of the society for financial studies all rights reserved for permissions please e mail journals permissions oup com oxford university press

reputation and imperfect information abstract a common observation in the informal literature of economics and elsewhere is that is multistage games players may seek early in the game to acquire a reputation for being tough or benevolent or something else but this phenomenon is not observed in some formal game theoretic analyses of finite games such as selten s finitely repeated chain store game or in the finitely repeated prisoners dilemma we reexamine selten s model adding to it a small amount of imperfect or incomplete information about players payoffs and we find that this addition is sufficient to give rise to the reputation effect that one intuitively expects

government policy real wage resistance and the resolution of conflict a theory of bargaining with k players is proposed to reconcile the multitude of conflicting interests in an econometric model this nash strategy corresponds to a non zero sum differential dynamic game and is established either by rational anticipation of finite conflict or pre play round table discussion the theory is illustrated with an analysis of conflict between government trade unions and entrepreneurs all results are calculated from a large scale multisectoral dynamic model of the u k economy developed by the cambridge growth project

unions wages and productivity some evidence from uk engineering firms estimates of union wage and productivity effects are derived using primary micro level panel data for a sample of firms in the uk engineering industry union wage differentials of the order of 10 are suggested from the results whereas union productivity impacts appear to be non linear with respect to union density

the codetermined firm in oligopoly abstract a simple duopoly model is considered where firm owners bargain with employees representatives about employment but not about wages as is the case for codetermined firms in germany it turns out that for some range of the bargaining power a prisoner s dilemma exists bargaining is the dominant strategy although joint profits would be maximized with unrestricted profit maximization

an econometric analysis of reservation wages this paper describes an analysis of survey data on unemployed people who reported their asking wage and the wage they expected to earn we show that if agents behavior is described by the standard optimal job search model one can use these data to deduce structural parameters rather than estimate them and we report our deductions from two surveys 1 of british unemployed people

market structure and the demand for unionized labor frequently the separate branches of economics grow up with far too little cross fertilization as a consequence research and results taken for granted in one field are all too frequently ignored in another such is the case with the three decades of work done on pricing behavior within a vertical stream of production the general conclusion of this work is that input monopolies will not alter their price in response to alterations in downstream market structure it is surprising that this work carried out in industrial organization has not received more attention from those studying union wage behavior this is especially so given that several of the more popular models of union behavior are similar to those we impute to the neoclassical monopoly the failure to draw on this work has resulted in several confusions in the contemporary study of unions this paper builds from the work on input pricing to demonstrate that in a very wide variety of cases the elasticity of derived demand for labor is completely invariant to product market structure in addition the specific conditions sufficient for this invariance to hold true are identified such a demonstration is important for discriminating between models of union behavior which assume bargaining along the labor demand curve and models which assume bargaining off the demand curve indeed the demonstration reveals the likely inadequacy of the labor demand curve model the logic for this conclusion is three tiered first demand curve models predict that wages will depend crucially on the elasticity of labor demand second measures of industrial concentration are usually significant in wage equations a result thought in harmony with the elasticity emphasis of demand curve models but third as will be shown market structure will typically not affect the labor demand elasticity this suggests that the conventional interpretation of the second point is wrong and casts doubt on the explanatory power of demand curve models in general while a variety of specific models of union behavior share the characteristic of bargaining along the demand curve these models are tied together by the assumption that unions choose the wage and firms respond with the employment level thus whether one assumes that unions maximize the wage bill collective rents or some explicit objective function of wage and employment

an empirical analysis of employed and unemployed job search behavior this paper analyzes the job search activities of employed and unemployed job seekers using self reported data from a 1980 survey one novel finding from reduced form equations is that many searchers both employed and unemployed rejected at least one offer before accepting a job the reduced form results are used to estimate reservation wages based on a fairly standard model of job search most of the job searchers accepted a job offer with a wage below the estimated reservation wage suggesting that the model does not fit the data well

trade unions investment and employment the implications of long term wage contracts and investment in capital on non cooperative wage bargaining between a firm and a union are analysed the union maximises a utilitarian utility function and the firm faces a neoclassical investment problem with internal adjustment costs the monopoly union outcomes with binding contracts is time inconsistent because the union has an incentive to renege on announced low wage strategies once the capital stock has been accumulated the monopoly union outcome without binding contracts leads to credible strategies which correspond to higher wages and lower levels of employment investment and the capital stock efficient contracts give rise to higher employment than monopoly union outcomes whether with or without long term wage contracts the results are illustrated with a numerical example finally when the game between the union and firm is repeated reputational equilibira provide a solution to the problem of time inconsistency

union wage differentials in the face of changes in the economic and legal environment this paper examines changes in union wage differentials in britain between 1980 and 1984 on the basis of two comparable establishment level data sets this period saw considerable economic and legislative change with potential effects on the outcomes of collective bargaining despite these changes the mean differential has little change between these two years and what there is is attributable to compositional changes such as the shift away from the manufacturing sector and the downward shift in the establishment size distribution the impact of the changes in unemployment and union coverage that took place is found to be minimal copyright 1991 by the london school of economics and political science

a monopoly union model of wage determination with capital and taxes an empirical application to the finnish manufacturing abstract the paper formulates a model of wage determination in which the firm decides on employment after a monopoly union has determined wages the novelty is to incorporate into the model investment and capital decisions by firms the subgame perfect nash equilibrium and its comparative statics for wages capital stock and employment are characterized in a two stage game the model is then estimated by using annual data from the finnish manufacturing sector over the period 1960 1987 the dynamic system of equations describing the determination of capital stock wages and hours of work performs reasonably well there are no obvious signs of misspecifications coefficient estimates are relatively precise and other properties of the models predominantly lie in conformity with our theoretical reasoning the nash equilibrium with dynamics for nominal wages and capital stock encompasses more conventional specifications which can be derived from the neoclassical theory of investment and demand supply theory of labour markets finally diagnostics and various non nested test procedures indicate that the conditional hours of work specification where hours of work are determined recursively after the wage capital stock game outperforms alternative specifications implied by the conventional theory of the demand for factors of production

to be unionized or not to be a case for cost raising strategies under cournot oligopoly abstract this paper analyses the decision by firms under cournot oligopoly as to recognize unions in order to gain market power despite higher costs considering classical models of union firm bargaining namely right to manage rtm and efficient bargaining eb we show that for a sufficiently low level of union power eb firms might adopt cost raising strategies this theoretical prediction is compatible with some empirical evidence in favour of eb and adds to the theoretical finding that eb might dominate rtm under unionized cournot nash oligopoly it also suggests closer antitrust scrutiny as whether unions can provide cartel like services to oligopoly firms allowing them to distort product market competition at the expense of consumers

unemployment in britain male unemployment in britain has risen from around 2 per cent in the 1950s to around 17 per cent in 1985 see figure 1 the figures are for male unemployment because there is no consistent series for women 1 even more remarkably unemployment has fallen in only three years out of the last twenty 1973 1978 and 1979 to account for this we need a model that explains both changes in the natural or non accelerating inflation rate of unemployment nairu and deviations from it we use a three equation supply side model centred on the labour market this has two main features the first concerns the determination of employment in the short run the labour demand function that we use cuts through the fruitless debate now raging especially in europe as to whether current unemployment is classical or keynesian according to the classical view employment is too high because real wages are too high according to the keynesian view real wages are not binding and unemployment is high because the product market does not clear with prices too high relative to nominal demand the whole debate is set in the framework of perfect competition yet in perfect competition prices are set by impersonal forces and it is not clear what could possibly stop prices clearing the market it is much more reasonable to think of prices as being set by imperfectly competitive firms existing prices being the best they can think of given the demand they face in this context firms demand for labour will depend on both the real product wage and the level of real aggregate demand this is the demand function we estimate and it conforms both to common sense and to the data however this does not imply that employment can be made to grow without limit by pumping up real demand for in the medium term when price surprises are eliminated our model determines three variables employment real wages and real demand on the basis of three equations an employment equation a price equation and a wage equation thus in the medium term there is a natural level of employment and corresponding to this a natural level of real aggregate demand the second key feature of our model concerns the medium term determination of unemployment in the medium term the planned mark up of wages over prices in wage settlements must be consistent with the mark up of prices over wage costs in employers pricing behaviour for if wage setters try to set real product wages higher than is consistent with employers pricing behaviour this generates ever increasing inflation thus the key to understanding unemployment in the medium term is the behaviour of wage setters if events occur that push them towards too high real wages then unemployment has to rise to offset these influences we shall call these influences wage pressure variables or push factors and they are clearly crucial in understanding unemployment the variables here include the social security system employment protection

wage determination in britain is there a local dimension church a and hutchinson g 1989 wage determination in britain is there a local dimension reg studies 23 289 300 this study presents an empirical regression analysis of wage determination in the five labour markets of motherwell preston reading torquay and the london borough of newham the data source is a newly available questionnaire survey of approximately 1 000 establishments undertaken in 1984 5 the explanatory variables include the plant s size ownership industrial type three proxies for labour quality the proportion of youths the proportion of females and the proportion of part time workers and a union recognition dummy variable the results discuss the relative importance of both national and local influences on pay levels church a et hutchinson g 1989 la determination des salaires en grande bretagne est ce qu il y a un optique local reg studies 23 289 300 cet article presente une analyse empirique de regression de la determination des salaires dans cinq bassins d empl

press freedom externally generated transparency and stock price informativeness international evidence abstract this paper examines the impact of press freedom on stock price informativeness in a sample of firms from 50 countries we find a significant relation between more press freedom and lower stock price synchronicity our results suggest that the freedom of the press can enhance the information environment of stock markets

the employer size wage gap evidence for britain university of edinburgh and university of sussexfinal version received 5 may 1992 this paper presents estimates for the employer plant size wage gap for britain using anordered probit model selectivity corrected wage equations are estimated for three plant sizecategories in a comparison between plants with more than 500 workers and those with lessthan 100 a wage gap estimate of over 17 per cent is detected the wage effects of unionizationin plants with more than 500 workers is reported as insignificant in contrast to evidenceprovided by idson and feaster 1990 for the united states no evidence of non randomsorting of workers across plant size is detected

unions taxes and the structure of multinational enterprises abstract this note analyzes how a firm s relationship with unions or tax authorities influences its basic structure in particular it is shown that the prospect of capture by unions or tax authorities of part of the rents associated with the firm s investments leads it to open more plants than is technologically efficient thus unions and taxes are an independent reason for a firm s expansion nationally and for foreign direct investment

herding in analysts recommendations the role of media abstract this study investigates the impact of media on analysts herding behavior when making stock recommendations we find three main results first we find that analysts herd less when stocks are covered more in the media second when the firm has negative media sentiment analysts tend to herd more third higher disagreement in the media is associated with a higher tendency to herd among analysts these findings are robust to the confounding effect of news flows on returns as well as to alternative explanations in addition we find that the effect of media on the herding behavior is conditional on analyst characteristics

the trade union wage gap in britain some new estimates abstract new estimates of the union non union wage gap in britain derived from household data are reported the results about 12 for manual and about 4 for non manual workers expand upon the tentative conclusions of the few earlier similar british studies

the determinants of wage pressure some implications of a dynamic model most models of wage determination are static this paper analyzes a simple dynamic model of collective bargaining and argues that this provides insights into the determinants of wage pressure that a static model cannot provide in particular it is shown how the length of labor contracts and the dynamics of the labor market affect the level of aggregate wage pressure the policy implications of the model are very different from those traditionally put forward to moderate wage pressure copyright 1991 by the london school of economics and political science

corporate social responsibility and media coverage abstract in this study we examine whether firms that act more socially responsible receive more favorable media coverage and we consider whether firms use csr to actively manage their media image we focus on all news stories about a firm not just those that report on specific csr initiatives and find that more socially responsible firms receive more favorable news reportage overall i e they have a more positive media image these findings are robust after controlling for potential endogeneity further consistent with firms actively managing their media image we find a stronger relation between csr and media favorability when incentives to improve a firm s media image are high e g among firms in sin industries during periods of low investor sentiment and prior to seasoned equity offerings finally we find that for firms that demonstrate superior social responsibility and receive more favorable news reporting there is a significant interaction between social responsibility and media favorability that increases decreases a firm s equity valuation cost of capital our results are consistent with the media slanting their reporting in favor of good performing csr firms overall we contribute to the literature by showing that firms can influence their media coverage through a relatively subtle channel csr performance

how important is the financial media in global markets this article studies differences in the information content of 870 000 news announcements in 56 markets around the world in most developed markets a firm s stock price moves much more on days with public news about the firm in contrast in many emerging markets volatility is similar on news and non news days we examine several hypotheses for our findings cross country differences in stock price reactions are best explained by insider trading followed by differences in the quality of the news dissemination mechanism our findings are useful for quantifying the extent of insider trading and how the financial media affects international markets jel g14 g15 public news announcements are a major mechanism for disseminating information to investors each day the financial media releases thousands of articles covering companies in markets worldwide investors use this news to estimate assets fundamental values despite the perceived importance of the

mrs thatcher s economic policies 1979 1987 mrs thatcher s economic policies 1979 87 kent matthews and patrick minford mrs thatcher inherited a weak economy whose poor performance she attributed to policies of cosy consensus lax discipline high inflation and pervasive inefficiency these she sought to banish forever the authors stress the astuteness with which this radical programme was pursued rather than launching an immediate and grand assault on all fronts mrs thatcher picked off enemies one by one each victory consolidating her position for the next attack only when inflation was clearly under control could more radical supply side measures be introduced matthews and minford argue that the recession of 1980 81 was caused not by tight domestic demand but by external and supply side shocks subsequently tight monetary and fiscal policy did have powerful effects both in achieving rapid inflation reduction and in holding unemployment above its equilibrium level once serious supply side policies were introduced they had a significant effect on productivity growth and on the equilibrium rate of unemployment matthews and minford conclude that the latter was halved between 1981 and 1986 by which date it stood at 1 6 million or roughly half of actual unemployment whilst unemployment may slowly fall towards its equilibrium level the authors do not recommend fiscal or monetary expansion to accelerate this adjustment rather they advocate further supply side measures and deregulation to help markets achieve this transition

fiscal policy profits and investment this paper evaluates the effects of fiscal policy on investment using a panel of oecd countries we find a sizeable negative effect of public spending and in particular of its wage component on profits and on business investment this result is consistent with different theoretical models in which government employment creates wage pressure for the private sector various types of taxes also have negative effects on profits but interestingly the effects of government spending on investment are larger than those of taxes our results can explain the so called non keynesian i e expansionary effects of fiscal adjustments jel e22 e62

specification induced uncertainty in the estimation of trade union wage differentials from industry level data at a more specific level the paper is concerned with the estimation of union non union wage differentials from industry level data for the uk manufacturing sector metcalf 1977 reviewing the evidence from such industry level studies concludes that they suggest that a figure of 20 per cent may not be dreadfully in error for the average earnings differential received by manual workers who are covered by a collective agreement a more recent study at the individual level for union membership stewart 1983 suggests that a figure of below 10 per cent may be more appropriate however metcalf s summary figure remains representative of the industrylevel evidence this paper concentrates on two particular problems inherent in these industry level studies and in studies in other areas using such cross section data the first of these concerns the potential industry specificity of parameter values in the case of union wage differentials the marshallian laws of derived demand provide theoretical grounds for expecting the differential to vary across industries failure to take proper account of this will in general result in biased estimation even of the average differential in addition interpreting the estimated average differential as if it were that to be found in a typical industry may be a highly misleading representation of the impact of collective bargaining on the wage structure section i of this paper is concerned with this inter industry variation in the differetial and in particular with modelling how the differential varies with the extent of coverage in the industry our finding is that there is a large inter industry variation in the differential with the average being made up of a large differential in a small group of industries and a much smaller and insignificant differential in the majority of industries in such circumstances the estimated average differential is not representative of that prevailing in either group

effects of asymmetric information and reference emission levels on the emissions from deforestation and degradation abstract reducing emissions from deforestation and degradation plus as an important measure to mitigate climate change can effectively reduce the emissions caused by deforestation and degradation in tropical countries it is particularly important in the projects of reducing emissions from deforestation and degradation plus that carbon emission monitoring and reference emission levels are tied to the revenues of a country however how do the reference emission levels and information of emissions influence project performance is still uncertain within a theoretical analysis framework this paper considers the confliction among landholder behaviors goals of policymakers as well as the distortion caused by the existence of asymmetric information the theoretical framework reveals two hypotheses through comparing optimal decisions under different scenarios i an increase in reference emission levels can lead to a decrease in landholders efforts and an increase in actual emissions ii information asymmetry caused by the increase of landholder s forest area results in an increase in emissions the empirical study uses panel data for 75 developing countries to test these hypotheses the results show that a monitoring reporting and verification system can help achieve the social optimum level for emissions and the efforts by landholders an increase in the forest areas owned by landholders and in rel will lead to an increase in emissions the empirical results also confirm this point at a global scale as well as regionally in africa latin america the caribbean and asia oceania as solutions for these problems an effective monitoring reporting and verification system is crucial in successful implementation of reducing emissions from deforestation and degradation plus

reservation wage analysis of unemployed youths in australia this paper focuses on the analysis and structural estimation of the reservation wage function from a job search model using modified 2sls and maximum likelihood procedures with selectivity bias adj

macroeconomic stabilization policy and trade union behaviour as a repeated game lt is unquestionably true that the presence of trade unions in an economy affects its macroeconomic behaviour by attempting to maintain traditional patterns of relative wages among occupations and industries and by resisting cuts in real wages unions slow macroeconomic adjustment and structural change in response to macroeconomic shocks it is often argued that by insulating groups of workers from competitive pressures wage determination is less associated with market clearing than it otherwise would be overlapping contracts and resistance to relative wage changes thus give aggregate wage inflation mo mentum it would not otherwise have taylor 1980 jackman 1983 trade union bargaining may affect the position of the phillips curve jackman and layard 1982 nickell 1982 a popular argument for the increases in the nairu non acceleratinginflation rate of unemployment which have taken place between 1960 and 1980 in many industrialized countries where unions are strong is that trade unions have grown more militant and their bargaining behaviour has changed in some way this argument goes back at least as far as hines 1964

investment profit sharing and the degree of centralization abstract this paper examines monopoly unions which are strong enough to use two part tariffs i e basic wages plus profit shares it is shown that decentralization in bargaining increases the total pay per worker and lowers the levels of capital stock and income

the market for news we investigate the market for news under two assumptions that readers hold beliefs which they like to see confirmed and that newspapers can slant stories toward these beliefs we show that on the topics where readers share common beliefs one should not expect accuracy even from competitive media competition results in lower prices but common slanting toward reader biases on topics where reader beliefs diverge such as politically divisive issues however newspapers segment the market and slant toward extreme positions yet in the aggregate a reader with access to all news sources could get an unbiased perspective generally speaking reader heterogeneity is more important for accuracy in media than competition per se

the relationship between unemployment spells and reservation wages as a test of search theory the theory of stationary job search predicts that controlling for other factors that affect the probability of leaving unemployment duration and reservation wages are likely to be positively associated the paper tests this prediction for british cross sectional data from 1982 using an estimating equation implied by search theory simultaneity is crucial in the evaluation of this prediction with single equation and instrumental variable estimates differing markedly perhaps surprisingly given the extreme paucity of both job interviews and offers in the sample the main finding is that reservation wages play a significant role in the determination of duration

trade unions non binding wage agreements and capital accumulation abstract this paper provides a counterexample to some recent results of grout and others which state that in a bargaining situation without binding wage agreements the capital stock will be biased downwards in a general equilibrium setting this result may be reversed the model is a simple diamond type overlapping generations economy where the young supply labour and the old own both capital and shares in firms in this environment a move from binding to non binding wage contracts may increase the capital stock as will a rise in trade union power finally it is shown that the move to non binding contracts may increase or decrease steady state utility but that the non binding contracts equilibrium is always pareto inefficient

bankruptcies firm size and unemployment a big bang theory of economic cycles this paper analyses the impact of bankruptcies on unemployment in an economy characterised by no substitutability of labour a computer simulation model is used to analyse its properties spectral analysis reveals the existence of cycles in unemployment it is found that average unemployment tends to be lower the more flexible are wages and interest rates provided both move anticyclically and the more rapid is the speed with which existing firms expand an economy characterised by small firms is found to be more stable with a tendency to a longer cycle than one characterised by large firms however given the assumptions we have made it is also likely to be characterised by higher average unemployment

unionism and employment behaviour although there exists a large literature on the effects of trade unions upon wages there is no published work that uses microeconomic data on establishments to examine the employment consequences of unionism this paper addresses this issue with a recent british data set and shows that even after the addition of a substantial set of control variables there is a strong association between poor employment performance and the presence of trade unions the union employment growth differential is estimated at approximately 3 percent per annum copyright 1991 by royal economic society

taking stock a comparative analysis of payments for environmental services programs in developed and developing countries abstract payments for environmental services pes are an innovative approach to conservation that has been applied increasingly often in both developed and developing countries to date however few efforts have been made to systematically compare pes experiences drawing on the wealth of case studies in this special issue we synthesize the information presented according to case characteristics with respect to design costs environmental effectiveness and other outcomes pes programs often differ substantially one from the other some of the differences reflect adaptation of the basic concept to very different ecological socioeconomic or institutional conditions others reflect poor design due either to mistakes or to the need to accommodate political pressures we find significant differences between user financed pes programs in which funding comes from the users of the es being provided and government financed programs in which funding comes from a third party the user financed programs in our sample were better targeted more closely tailored to local conditions and needs had better monitoring and a greater willingness to enforce conditionality and had far fewer confounding side objectives than government financed programs we finish by outlining some perspectives on how both user and government financed pes programs could be made more effective and cost efficient

union membership collective bargaining coverage and the trade union mark up for britain abstract this paper estimates the union mark up using british general household survey data the wage gap is decomposed both for the mean and the variance of the earnings distribution the results indicate that the union mark up is larger than previously estimated and that structural effects account for a major part of the differences that are found in the earnings distributions of covered union members covered non unionists and uncovered non unionists

the union wage effect in late nineteenth century britain this paper gives a historical dimension to the impact of trade unions on earnings by estimating the union wage effect in britain between 1889 90 using data from the us commissioner of labour survey conducted at that time the determinants of union status are also investigated in terms of profit estimation using individual characteristics which may be correlated with union membership the results of this first stage are used in the computation of selectivity corrected estimates of the union wage effect it is found that the effect of union membership on earnings at this time was in the order of 15 20 for a range of different skill levels

codetermination as a strategic advantage abstract a theoretical model of codetermination is considered where consistent with german institutions firm owners bargain with employees representatives about employment but not about wages a duopoly and a more general oligopolistic situation are analyzed for some range of bargaining power a prisoner s dilemma exists codetermination leads to increased profits if the other firm is a traditional profit maximizer bargaining is the dominant strategy although joint profits would be maximized with unrestricted profit maximization the theory is tested with data from 22 german firms who operate in the same markets over 23 years codetermined firms actually show a different behavior than other companies

labor policy and investment evidence from canada some critics of proposed legislative labor policy changes contend that laws favoring labor would adversely affect business investment research on labor policy however often assumes that investme

targeting redd an empirical analysis of carbon sequestration in indonesia summary the implementation of redd requires knowledge of the willingness to accept land use change contracts and its application over large areas this paper uses primary data from indonesia to contrast two approaches to the elicitation of the supply curve for carbon an auction and an analysis of opportunity costs the analysis shows that there are important differences between the two approaches for a wide range of prices an analysis of bidding behavior shows that location and individual preferences time and risk preferences but not opportunity costs play a significant role in this decision the implications for targeting are discussed

the reservation wage curve evidence from the uk we investigate the relationship between an individuals reservation wage and unemployment in the local area district largely unexplored in the literature this adds to the work which has examined the association between employee wages and unemployment the wage curve

seniority earnings and unions this paper uses a new data source to investigate whether wages rise more with seniority in unionized or non unionized workplaces the data distinguish workers who are covered by incremental wage scales with automatic progression by seniority for union workers with seniority scales the union wage differential increases with seniority this is not the case for union workers without seniority scales taking account of this heterogeneity we are able to reconcile previous paradoxical empirical findings the results provide support for discriminating monopoly models of the trade union and have important efficiency and distributional implications

an investigation into the power of insiders in wage determination abstract this paper is concerned with the role of insider forces in wage determination various union and non union models of wage behaviour are considered and they imply that wages are a convex combination of internal and external factors certain union models also imply a degree of hysteresis data on fourteen british production industries reveal that i insider forces are important ii their importance is directly related to both union power and the degree of monopoly in the product market iii the state of the aggregate labour market is also important and iv hysteresis effects arising from insider power are only significant in a small minority of sectors

open shop unions and product market competition in this paper we analyse the impact of changes in product market competition on wage outcomes in the presence of an open shop union with less than full union membership product market competition is shown to aect not only a unionised rm s pro ts but also its payoin the event of a dispute in contrast to the pre diction of the standard model increases in product market competition may now increase wage levels the model is therefore able to accommodate the mixed empir ical ndings regarding the impact of product market competition on union wages

unemployment benefit duration and incentives in britain how robust is the evidence abstract recent years have seen considerable advances in the econometric treatment of micro data in models of unemployment duration this paper examines the evidence from such models concerning the effects of unemployment benefits on incentives to work in britain widely accepted results of a small but significant benefit effect are reproduced using a sample of 1 231 unemployed men however these results are only found when benefit receipt is assumed to follow a hypothetical pattern which is shown to be unrealistic and over generous when more realistic calculations of benefits are used no benefit effect is found the paper also argues that search theory is of little help in determining the choice between competing functional forms and explanatory variables results concerning benefits are shown to be sensitive to the latter