union rents as a source of takeover gains among target shareholders this paper tests the hypothesis that the substantial gains enjoyed by shareholders in target firms during the corporate acquisition boom of the 1980s reflected in part shareholders recouping of the value of rents in the form of wage premiums higher fringe benefits and constraints on managerial authority held by unionized labor analyzing data on the merger and acquisition experience of nearly 300 large publicly traded target firms during the period 1982 86 the author finds consistent with that hypothesis that shareholders average returns from takeover activity were higher in unionized target firms 41 than in nonunion target firms 35 for unionized workers these effects are equivalent to an annualized employee loss approaching 8 of annual earnings or 50 of the wage premium conventionally associated with union coverage

long term attachments and long run firm rates of return long term attachments between workers and firms are common numerous studies have examined worker returns to tenure but little is known of firm returns to firm worker matches yet these attachments represent a human capital asset quasi held by the firm which is not captured by traditional accounting measures of firm assets firms with large quasi holdings of human capital will have higher measured return on assets other things equal analysis of data on 250 large manufacturing firms supports the view that firms profit from long term attachments with their workers consequently unmeasured human capital assets contribute to the explanation of persistence in measured long run excess profits across firms

the role of investment specific technological change in the business cycle this is a quantitative investigation of the importance of technological change speci c to new investment goods for postwar us aggregate uctuations a growth model that incorporates this form of technological change is calibrated to us data and simulated using the relative price of new equipment to identify the process driving investmentspeci c technology shocks the analysis suggests that this form of technological change is the source of about 30 of output uctuations 2000 elsevier science b v all rights reserved

a test of lazear s theory of delayed payment contracts according to lazear workers and firms enter into long term implicit contracts that discourage shirking and malfeasance by shifting compensation to the end of the contract such delayed payment contracts are less likely to occur in jobs in which it is comparatively simple to monitor worker effort this paper uses data from the national longitudinal survey and the dictionary of occupational titles to test that hypothesis in particular it tests whether jobs that involve repetitive tasks tend to be characterized by an absence of pensions mandatory retirement long job tenures and high wages for older workers

are those paid more really more productive the case of experience this study uses computerized personnel microdata on the white male managerial and professional employees at a major u s corporation to address the following question can the additional earnings which are associated with more labor market experience at a point in time really be explained by higher productivity at the same point in time our answer to this question based on both cross sectional and longitudinal information is that performance plays a substantially smaller role in explaining cross sectional experience earnings differentials and earnings growth than is claimed by those who have adopted the human capital explanation of the experience earnings profile this response depends critically on our assumption that the performance ratings which supervisors give to their white male managerial and professional subordinates adequately reflect the subordinates relative productivity in the year of assessment we present a great deal of evidence which strongly supports this assumption

high compensation creates a ratchet effect consider a firm which pays a credit constrained worker for his effort over two periods the more the firm pays in one period the wealthier is the worker in the following period and so the more he must then be paid for a given effort we describe the profit maximising contract under these conditions showing how this wealth ratchet effect can raise wages over time and cause the firm to fire older workers

job turnover and the returns to seniority in this article we match firm data to individual work history files to simultaneously estimate the wage and employment duration processes of a longitudinal sample of 2 million french workers employed in roughly 1 million firms and followed over 20 years the particular structure of the dataset allows us to distinguish between the impact of job search and labor demand indicators on wages and employment at the job level the model allows for correlated individual and job unobserved heterogeneity controlling for job matching we find that returns to seniority are close to zero

the returns to general experience job and occupational tenure a study using australian panel data this article uses australian panel data for the years 2001 2009 to estimate returns to general experience job and occupational tenure we pay particular attention to issues of unobserved heterogeneity bias in our estimations we find that both general experience and occupational tenure have statistically and numerically significant effects on wage outcomes even after controlling for unobserved heterogeneity job tenure on the other hand only seems to matter in ols regressions that do not control for heterogeneity biases once these biases are controlled for only a modest effect from job tenure remains the inclusion of occupational tenure in the estimating equation tends to negate even this modest job tenure effect the only exception to this is for workers in large organizations for these workers a small but statistically significant effect from job tenure remains even once we have controlled for heterogeneity and included occupational tenure in the estimating equation the results reported in this

demographic effects on the natural rate of unemployment or baby booms and unemployment abstract this paper establishes the importance of demographics on both the actual rate and the natural rate of unemployment the actual dynamics can be quite complex and the natural rate is shown to depend crucially on population shifts

intra firm bargaining under non binding contracts we present a new methodology for studying the problem of intra firm bargaining based on the notion that contracts cannot commit the firm and its agents to wages and employment we develop and analyse a general non cooperative multilateral bargaining framework between the firm and its employees and consider outcomes which are immune to renegotiations by any party equilibrium firm profits are characterizable as both a weighted average of a neo classical non bargaining firm s profits and a generalization of shapley value for a corresponding cooperative game furthermore the resulting payoffs induce economically significant distortions in the firm s input and organizational design decisions

do wages rise with job seniority a reassessment the authors provide new estimates of the return to job seniority using a dataset similar to that employed in joseph altonji and robert shakotko do wages rise with job seniority review of economic studies 1987 and robert topel specific capital mobility and wages journal of political economy 1991 they consider the strengths and weaknesses of these studies treatment of economy wide trends their dating conventions for tenure and wages their handling of wage observations that might span multiple jobs and their estimation approaches re estimation points to an effect often years of tenure on the log wage equal to 11 which is above the preferred estimate of altonji and shakotko but far below that of topel changes in earnings distributions and in the employment relationship motivate the examination of more recent data perhaps surprisingly the return to tenure has probably increased over time

interval bidding in a distribution elicitation format interval bidding allows people to report a range of values for a non market good herein we allow people to choose their distribution over this range endogenously we consider a multiplicative error model explaining the willingness to pay wtp which is estimated using a feasible generalized least squares estimator we apply our framework to a representative sample of the french population who were asked about the valuation of a bear conservation programme we find that most participants prefer stating their wtp as a range rather than a point but the shape of the distribution greatly varies across people our results support the use of the interval bidding with endogenous distribution approach in valuation studies

an equilibrium analysis of wage productivity gaps we develop a model in which each firm chooses a hiring standard as well as a wage schedule and an application fee we then characterize the set of nash equilibria and establish necessary and sufficient conditions for the existence of equilibrium if the distribution of productivities within each ability type is gaussian workers who pass the test will be paid more than the value of their marginal product while workers who fail the test will receive a wage net of the application fee below the value of their marginal product

partial adjustment without apology econometric partial adjustment models perform relatively well at the aggregate level however many kinds of microeconomic behavior involve discrete and occasional choices analyzing the classic employment adjustment problem we show how a generalized partial adjustment model tractably accommodates both observations by aggregating the actions of heterogeneous producers facing fixed adjustment costs aggregate disturbances cause changes in establishment level target employment and in the measure of establishments actively adjusting to their target whereas aggregate responses exhibit partial adjustment our framework also can be applied in general equilibrium settings with persistent idiosyncratic shocks without forfeiting the convenient use of linear solution methods

does salaried status affect human capital accumulation human capital studies do not usually consider whether an individual is paid an hourly wage or a salary the authors of this paper develop a conceptual framework that explains why some workers are p

factor adjustment spikes and interrelation an empirical investigation we take a descriptive look at interrelated factor demand starting from the observation that adjustment of capital and labor is lumpy we find that the adjustment dynamics of an input factor are affected by large adjustments in the other

labor market volatility in the search and matching model the role of investment specific technology shocks abstract shocks to investment specific technology have been identified as a main source of u s aggregate output volatility in this paper we present a model with frictions in the labor market and explore the contribution of these shocks to the volatility of labor market variables namely unemployment vacancies tightness and the job finding rate thus our paper contributes to a recent body of literature assessing the ability of the search and matching model to account for the large volatility observed in labor market variables to this aim we solve a neoclassical economy with search and matching where neutral and investment specific technologies are subject to shocks the three key features of our model economy are i firms are large in the sense that they employ many workers ii adjusting capital and labor is costly iii wages are the outcome of an intra firm nash bargaining problem between the firm and its workers in our calibrated economy we find that shocks to investment specific technology explain 40 of the observed volatility in u s labor productivity moreover these shocks generate relative volatilities in vacancies and the workers job finding rate which match those observed in u s data relative volatilities in unemployment and labor market tightness are 55 and 75 of their empirical values respectively

a theory of wage dynamics a dynamic equilibrium model of long term implicit labour contracts under incomplete but symmetric information is developed workers are assumed to be risk averse and of unknown ability or productivity risk neutral firms learn as do workers about each worker s productivity by observing the worker s output over time it is shown that equilibrium contracts provide for wages which never decline with age and increase only when the worker s market value increases above his current wage in addition to characterizing the equilibrium wage contract we also derive some of its implications for the behaviour of aggregate wages across various groups of workers these implications explain some findings in the recent empirical literature on ageearnings profiles in particular our model can explain why earnings may be positively related to experience even after controlling for productivity as some empirical studies have indicated

a two sector model of endogenous growth with leisure in this paper we analyze a class of endogenous growth models with physical and human capital and with three altematives uses of time unqualified leisure work and education in contrast to some other related models we find that even in the absence of technological extemalities there could be multiple balanced paths we provide a characterization of the qualitative behavior of consumption leisure work and education over those balanced paths and study their transitional dynamics

learning and incentive a study on analyst response to pension underfunding abstract there is a long standing debate on whether sell side analysts learn from their experience to improve earnings forecast skills this study shows that incentive is an important factor for understanding the learning by doing effect by analysts we examine analysts response to a complex type of information corporate pension underfunding pension underfunding negatively impacts future earnings and analysts on average underreact to such information in their earnings forecasts more importantly when there is a strong incentive for analysts to deliver accurate forecasts analyst learning effectively reduces their underreaction to pension underfunding information on the other hand when such an incentive is absent the analyst learning effect is not discernible in the data further evidence suggests that analyst learning and incentive jointly reduce stock market mispricing associated with corporate pension underfunding

employer size and on the job training decisions the effect of employer size on labor market outcomes have been the subject of extensive although relatively recent research by economists it has been widely demonstrated that large and small firms exhibit a number of differential characteristics with regard to their employment relationships 29 42 employees at large firms have higher wages and fringe benefits 16 10 15 22 32 35 higher levels of job mobility within the firm 19 greater job stability 44 a greater tendency to have mandatory overtime rules 23 higher education levels 8 a more structured work environment 20 26 46 and higher levels of investments by the firm both in the form of search costs 4 5 and direct on the job training 6 10 while numerous theories exist that account for many of these relationships such as monitoring and on the job training models no single explanation has been able to account definitively for the observed empirical patterns clearly size of employer is a significant factor in the dynamics of labor markets that still requires much investigation the focus of this paper is on one particular aspect of employer size effects the observed higher training investments in large firms we propose and test a model in the human capital tradition of viewing on the job training ojt as an investment 9 36 38 39 42 which not only explains the greater investment in on the job training by larger firms but additionally generates predictions with regard to the allocation of the firm s resources across investment in people with different demographic characteristics these latter implications of the model facilitate empirical comparisons to alternative explanations our central hypothesis is that large employers exhibit different behavior from small employers with regard to the risk component of the investments in their employees other training decision models that have addressed firm behavior under uncertainty have done so in the context of monitoring difficulties introduced by either the higher opportunity cost of managers time 43 or diseconomies of scale in monitoring 16 in larger firms although both of these approaches

job duration seniority and earnings an important stylized fact about labor markets is that workers with longer seniority with their current employer have higher earnings than other workers with the same total labor market experience this study shows that workers in longer jobs earn more throughout than workers in a series of shorter jobs and that the measured positive cross sectional return seniority is largely a statistical artifact due to the correlation of seniority with an omitted variable representing the quality of the worker the job or the worker employer match the implication is tha t earnings do not in fact rise very much with seniority copyright 1987 by american economic association

are wages habit forming evidence from micro data although utility functions play a central role in economics the axiom that utility depends only on the absolute levels of its arguments is rarely tested this paper uses panel data on 2000 british employees who remain with the same employer and who are not promoted from one wave to the next it is shown that one important measure of well being overall job satisfaction is strongly positively correlated with the change in the worker s pay between waves but is unrelated to the current level of pay empirical tests suggest that a reference dependent satisfaction function where individual well being depends on current pay relative to past pay is more consistent with these regression results than are productivity or agency explanations of increasing wage profiles some evidence is presented of greater job satisfaction effects of pay rises for lower paid less well educated and younger workers these results provide some micro evidence consistent with the theory widespread in social science of habituation individuals may become used to any given level of consumption or income as such they tie in with the finding that a country s well being as measured by the average happiness of its citizens is only weakly correlated with its per capita gnp

the role of pensions in the labor market a survey of the literature because employer sponsored group pension plans entail agreements between workers and their employers explicitly linking future payment and employment they offer an unusual window into long term employment relationships this review of recent research on pensions explores how pensions influence employee compensation retirement turnover and other matters central to the determination of labor s price and quantity over time the authors also outline some unanswered questions and difficult to reconcile findings because the pension promise involves an explicit and relatively well documented set of statements regarding future contingent payment and employment an examination of the design and operation of employersponsored group pension plans can yield important insights into the long term employment relationship specifically pension research illuminates some important labor market questions in two ways it offers insight into an important element of compensation in its own right and it furthers our understanding of labor markets in which long term

work incentives hierarchy and internal labor markets this paper argues that contracts with payment based on a ranking of employee performance can provide performance incentives even under asymmetric information that prevents payment based on individual performance only being enforceable such contracts also fit with five features of labor markets that have aroused considerable interest 1 hierarchical wage structures 2 internal promotion 3 wage rates that rise with seniority and experience more than productivity 4 the variance of earnings increasing with experience and 5 wage rates attached to jobs rather than individuals with differentials set by administrative procedures rather than by reference to external market wages

relational contracts and the value of relationships this article studies optimal relational contracts when the value of the relationship between contracting parties is not commonly known i consider a principal agent setting where the principal has persistent private information about her outside option i show that if the principal has the bargaining power she wants to understate her outside option to provide strong incentives and then renege on promised payments while if the uninformed agent has the bargaining power the principal wants to overstate her outside option to capture more surplus i characterize how information is revealed how the relationship evolves and how this depends on bargaining power jel c78 d82 d83 d86

job mobility and earnings over the life cycle previous studies have shown that in the short run quits generally lead to wage increases on the next job and layoffs to no increase or to a wage cut the author of this study argues however that the prospect of a job change for any reason creates a disincentive for a worker to invest in training that is specific to the current job and therefore those who change jobs frequently may earn less over their life cycle than those who other things equal seldom change jobs an analysis of data from the national longitudinal survey of mature men supports that expectation showing that for white males job separations usually lead to wage gains in the short run but nonmobile workers tend to achieve significantly higher wages over the long run

economic determinants of workers retirement decisions the landscape for older workers has changed dramatically in recent decades governments have made cuts to public pension programs private pensions have shifted from defined benefit to defined contribution plans equity and housing markets have been unusually volatile and workers have experienced declining morbidity and mortality at the same time the labor force participation rate for older men and women has been rising over the past two decades implying later retirement are these phenomena related this paper reviews the large and growing body of literature exploring the economic determinants of workers retirement decisions including public and private pensions wealth and savings health and health insurance and labor demand

embodied technical change and the fluctuations of unemployment and wages a matching model where technological change is partially embodied in the job match is shown to be successful in explaining the variability of unemployment and vacancies if we incorporate long term wage contracts into the model it also explains a number of stylized facts on the dynamics of real wages which have been found in the empirical labor literature

piece rates principal agent models and productivity profiles parametric and semi parametric evidence from payroll records this paper uses data on the wages received by piece rate workers to estimate worker productivity profiles the data were collected from the payroll records of a british columbia copper mine the advantage of these data is the close link between observed wages and worker productivity an explicit model is used to control for worker effort as a function of observable worker characteristics and the parameters of the compensation system the model implies a censored wage distribution the parameters of which can be estimated using well known econometric techniques semi parametric estimation allows for the relaxation of the distributional assumptions of the model results suggest that while productivity profiles were increasing concave functions of tenure they were also very flat i relate these results to historical arguments on the skill saving nature of technological change in the mining industry at the end of the nineteenth century

labor market dynamics under long term wage contracting abstract recent research seeking to explain the strong cyclicality of us unemployment emphasizes the role of wage rigidity this paper proposes a micro founded model of wage rigidity an equilibrium business cycle model of job search where risk neutral firms post optimal long term contracts to attract risk averse workers equilibrium contracts feature wage smoothing limited by the inability of parties to commit to contracts the model is consistent with aggregate wage data if neither worker nor firm can commit producing too rigid wages otherwise wage rigidity does not lead to a substantial increase in the cyclical volatility of unemployment

seniority wages and productivity a turbulent decade why does a worker s wage tend to grow with seniority in the firm and what does this have to do with productivity two decades ago neoclassical labor economists thought that the theory of human capital provided a good answer to this question the last decade has however been one of puzzles and doubt at this point few would give an unambiguous answer and much hinges on the answer an attractive feature of human capital theory is that it yields a consistent and coherent explanation for several aspects of the employer employee relationship for example seniority systems layoff policies that vary with skill and the relationship between tenure and turnover can be explained in terms of human capital the fact that these explanations are connected leads however to something like a domino effect doubts about one cast doubt on the others if the human capital explanation for the wage seniority relationship is flawed then human capital explanations for other phenomena may require reevaluation in addition an important body of empirical research is built around the assumption that at any point in time a person s wage indicates the person s productivity included here is the extensive literature on the human capital earnings function as well as work on labor demand market discrimination and compensating differentials that assumption has become controversial in recent years in part because implicit contract theories predict that compensation will be redistributed over the period of the contract if a person s spot wage has little to do with spot productivity but rather is an instrument of a complex insurance or deferred compensation scheme then a reassessment of the empirical research may be necessary

employee wage growth within the firm a deferred payment or human capital investment an analysis of the relationship between seniority and wages within a large us manufacturing firm is presented firm specific information is used to infer the ability level of employees knowledge of employee ability is essential in devising tests of the deferred payment scheme and human capital models of wage growth hypotheses regarding the ways in which the returns to seniority are expected to vary across the firm hierarchy were constructed and empirically tested the results appear to lend some support to the deferred payment scheme model and to be inconsistent with the predictions of the simple human captial model

do wages rise with job seniority many previous studies have found a strong positive effect of job seniority tenure on wages this paper re examines the evidence using a simple instrumental variables scheme to deal with the fact that tenure is likely to be related to unobserved individual and job characteristics that affect the wage we use the variation of tenure over a given job match as the principal instrumental variable for tenure the variation in tenure over the job is uncorrelated by construction with the fixed individual and job match specific components of the error term of the wage equation our main finding is that the partial effect of tenure on wages is small and that general labour market experience and job shopping account for most wage growth over a career the strong cross section relationship between tenure and wages is due primarily to heterogeneity bias prior researchers see mincer and jovanovic 1981 bartel and borjas 1981 borjas 1981 cline 1979 and mellow 1981 and many others have established that job seniority has a strong positive relationship with wage rates in a cross section or a cross section time series of individuals in this paper we re evaluate the evidence concerning the partial effects on wages of job seniority tenure and total labour market experience the extent to which wages rise with tenure is important for several reasons first and foremost the wage tenure profile is a fundamental question about the structure of earnings over careers second the wage tenure profile is a key determinant of the extent to which the earnings power of individuals is tied to specific jobs and it is important for assessment of the losses suffered by displaced workers hamermesh 1984 third evidence that wages rise with job tenure has been used to explain the decline in quits with tenure since the wage growth on the current job lowers the probability that the worker will locate a superior alternative a growing theoretical literature surveyed in parsons 1984 has taken the evidence of a strong wage tenure profile at face value and sought to provide an explanation for the relationship the most prominent explanation is the theory of specific human capital oi 1962 becker 1962 mincer 1974 parsons 1972 kuratani 1973 and hashimoto 1980 in which the growth of wages with tenure holding experience constant is attributed to the worker s share of investments in firm specific skills more recently lazear 1981 has presented a supervision model of wage growth in which firms defer compensation as a means of inducing workers not to shirk freeman 1977 and harris and holmstrom 1982 provide an explanation for wage growth based on an insurance motive salop and salop 1976 nickell 1976 and guasch and weiss 1982 present adverse selection models of wage growth in which firms use a wage tenure profile as a

economic determinants of workers retirement decisions economic determinants of workers retirement decisions the landscape for older workers has changed dramatically in recent decades governments have made cuts to public pension programs private pensions have shifted from defined benefit to defined contribution plans equity and housing markets have been unusually volatile and workers have experienced declining morbidity and mortality at the same time the labor force participation rate for older men and women has been rising over the past two decades implying later retirement are these phenomena related this paper reviews the large and growing body of literature exploring the economic determinants of workers retirement decisions including public and private pensions wealth and savings health and health insurance and labor demand

monopsony power and relative wages in the labor market for nurses this paper examines the thesis that monopsony power is an important determinant of wages in nursing labor markets using data from the 1985 93 current population surveys measures of relative nurse non nurse wage rates for 252 labor markets are constructed contrary to predictions from the monopsony model no positive relationship exists between relative nursing wages and hospital density or market size nor is support found for the presence of monopsony power based on evidence on union wage premiums slopes of experience profiles or the mix of rn to total hospital employment

employment tenure and earnings profiles in japan and the united states comments the relationship between job tenure and annual earnings in japan has received considerable attention from social scientists examining employment contracts and the japanese compensation system in their widely cited article masanori hashimoto and john raisian 1985 using data for 1980 showed that japanese men have greater job tenure than comparable workers in the united states and that the earnings of japanese men rise more rapidly with increased tenure they found that an additional year of tenure increases earnings in both small and large firms in japan more than does an additional year of general market experience their results for the united states indicate that general market experience increases earnings more than an additional year of job tenure the 1970 s and 1980 s were a period of substantial change in japanese labor markets due to the rapid aging of the population and the restructuring of the economy following the oil crisis the present analysis extends the work of hashimoto and raisian by estimating earnings equations for japanese men for the years 1971 1976 1981 and 1986 specifically we wish to investigate whether hashimoto and raisian s findings have been stable over time or whether changes in the labor market have altered the importance of tenure relative to total labor market experience in the japanese labor market i changes in the labor market

excessive wages and the return on capital received wisdom suggests that excessive wages defined as the part of real wages that do not follow labour productivity developments are adversely associated with the return on capital this paper argues that excessive wages and profits are better thought of as responses to changes in the economic political and institutional environment and there is no a priori reason for a negative relationship between them we thus investigate whether there is a causal effect of excessive wages on capital return using aggregate panel data for 19 oecd countries for the period 1970 2000 we account for the endogeneity of excessive wages by exploiting variations in institutional and labour market characteristics our main finding is that excessive wages do not affect the return on capital this result remains robust to alternative empirical specifications and to alternative definitions of profitability and excessive wages and questions the standard advice by international economic organizations on wage moderation copyright the author 2011 published by oxford university press on behalf of the cambridge political economy society all rights reserved oxford university press

consequences of seniority wages on the employment structure the author examines seniority wage profiles in german establishments to discern hiring patterns with respect to age and sex using the country s linked employer employee dataset liab over the per

the unemployment volatility puzzle is wage stickiness the answer i discuss the failure of the canonical search and matching model to match the cyclical volatility in the job finding rate i show that job creation in the model is influenced by wages in new matches i summarize microeconometric evidence and find that wages in new matches are volatile and consistent with the model s key predictions therefore explanations of the unemployment volatility puzzle have to preserve the cyclical volatility of wages i discuss a modification of the model based on fixed matching costs that can increase cyclical unemployment volatility and is consistent with wage flexibility in new matches

delayed payment contracts and a firm s propensity to hire older workers there are jobs for which firms employ older workers but tend not to hire new older workers this may be attributable in part to implicit contracts that discourage worker shirking and malfeasance by shifting compensation to the end of the contract such delayed payment contracts can introduce a form of fixed costs into the employment relationship much as with hiring and training costs these fixed costs lead firms to hire primarily young long term workers while firms employ older workers workers who are serving out the last years of their contract they tend not to hire them this paper presents empirical evidence that is consistent with this argument

the effect of job tenure on wage offers a wage offer can be either acceptable or unacceptable to a worker but in cross sectional and panel data only acceptable wage offers are observed an ols wage equation will not reveal how job tenure affects wage offers but rather will reveal how tenure affects acceptable wage offers by jointly modeling the firm s determination of the wage offer and the worker s decision to accept or reject the offer we are able to estimate the effect of job tenure on wage offers consistently in contrast to the usual ols results we find that job tenure has no statistically significant effect on wage offers

business cycles and labor market search the quantitative implications of labor market search for economic fluctuations are evaluated in the context of a real business cycle model incorporating labor market search into the model is found to improve its empirical performance along several dimensions in particular hours now fluctuate substantially more than wages and the contemporaneous correlation between hours and productivity falls in addition the model replicates the observation that output growth displays positive autocorrelation at short horizons overall the empirical results suggest that the labor market search environment embodies a quantitatively important propagation mechanism copyright 1996 by american economic association

employment tenure job expectancy and earnings profile in japan the purpose of this study is to examine the relationships between employment tenure and earnings profile in japan since the japanese labour market has recently experienced substantial changes it is natural for the japanese employment and compensation system to be influenced by such changes in this study the changes that have happened to the japanese employment and compensation system in recent years have been considered empirically by focusing on the relationships between employment tenure and earnings profiles to do this a forward looking variable called expected job tenure or job expectancy is introduced and the effects of it on earnings profile

long run implications of investment specific technological change an attempt is made to disentangle its effects from the more traditional hicksneutral form of technological progress the balanced growth path for the model is characterized and calibrated to u s national income and product account nipa data the quantitative analysis suggests that investment specific technological change accounts for the major part of growth jel e13 030 041 047

the effect of mandatory retirement on earnings profiles in japan using data from the japanese basic survey on wage structure for 1981 and 1986 the authors estimate the effect of the age of mandatory retirement on the rate of growth of earnings with job tenure i

do academic salaries decline with seniority this article reexamines the negative seniority earnings relationship for academic economists the empirical results show that the anomalous negative seniority effect found in earlier academic market studies holds in the absence of direct measures of research productivity the negative effect however eventually disappears as more comprehensive measures of publishing citations and other productivity measures are included in the wage equation to control for the quantity and quality of faculty productivity faculty with greater seniority appear to be rewarded relatively less simply because many have been relatively less productive than their colleagues with less seniority at similar stages in their careers

firm specific seniority and wages this article studies the relationship between seniority and wages micro data with more than one observation from each firm are utilized to single out the seniority effect on wages arising within firms from the total seniority wage effect the results show that the seniority effect arises within firms but do not support the human capital explanation of the seniority wage profile employees with high levels of firm specific on the job training requirements have less steep wage profiles the results give some support to the theory of delayed compensation as piece rate workers have negligible returns to seniority

labor turnover wage structures and moral hazard the inefficiency of competitive markets a multiperiod general equilibrium model of the labor market is developed in which risk averse workers are faced with job related uncertainty and labor turnover is costly if a worker is unlucky and suffers a bad job match he quits and joins another firm hoping that he will like its work environment more because the quality of a job match is unobservable workers cannot insure against the risk of a bad match the firm provides implicit insurance against job dissatisfaction typically by paying workers more than their net marginal products in their early years with the firm and less subsequently since the probabilities of the insured against events the quit rates over time are affected by the amount of such insurance provided this implicit insurance is characterized by moral hazard individuals quit when in the absence of insurance they would not the equilibrium contract balances out efficiency in risk bearing with efficiency in turnover incentives we show that the equilibrium contract is not con