work hours wages and vacation leave using the panel study of income dynamics the authors provide a set of facts about vacation leave they show that on average vacation time taken rises one to one with paid vacation annual hours worked fall by about one full time week with every week of paid vacation the amount by which vacation time taken exceeds time paid is highest for women union members and government workers paid vacation weeks are positively associated with hourly wage rates and to a lesser extent with nonwage compensation and vacation time taken is weakly countercyclical vacation leave seems to be determined by broad employer policy rather than by negotiation between the worker and the firm in particular it is strongly related to seniority but depends very little on labor market experience and for job changers it is only weakly related to vacation on the previous job

compensating wage differentials in stable job matching equilibrium abstract this paper studies implicit pricing of non wage job characteristics in the labor market using a two sided matching model it departs from the previous literature by allowing worker heterogeneity in productivity which gives rise to a double transaction problem in a hedonic model deriving sufficient conditions under which assortative matching is the unique stable job worker matching we show that observed wage differentials between jobs reflect not only compensating wage differentials but also worker productivity gaps between the jobs we find that the job worker matching pattern determines the extent to which compensating wage differentials are confounded with the worker productivity gap effect

the millennium challenge corporation organizational constraints on us foreign aid 2004 11 summary the millennium challenge corporation mcc was established in 2004 to channel billions of us foreign assistance dollars to various infrastructure projects within a select group of low income countries that could presumably help themselves when ruling justly investing in people and encouraging economic freedom were considered primary contributors to self sustaining economic growth through multi method analysis this study reveals that with its choice of assessment categories and accompanying indicators the mcc undermines its governing principles in aid candidate qualification

on the dixit stiglitz model of monopolistic competition our purpose in this note is to revisit the popular monopolistic competition model of avinash k dixit and joseph e stiglitz 1977 and to stress the fact that the variant of this model used in the recent macroeconomic literature is significantly different from the original in particular by taking n as the number of active monopolists the recent discussion of dixit and stiglitz 1993 and xiaokai yang and ben j heijdra 1993 about the the advantages of neglecting terms of the order 1 n in the computed elasticities is significantly affected by the choice of the variant of the model the basic model presented in section i has been used from the start by dixit and stiglitz to study optimum product diversity it is a simple general equilibrium model with n monopolistic goods and a numeraire good which can be interpreted as labor or leisure time or as the aggregation of all the other goods in the economy the variant of the model analyzed in section ii was independently developed by several authors for different simple applications in macroeconomics 1 it is an enlarged model that includes an additional good interpreted as labor time but not taken as the numeraire more importantly the enlarged model does not lead to a general equilibrium analysis until the wage rate taken as given in a first step is adjusted competitively or strategically it is for the basic model that yang and heijdra 1993 yh give an alternative computation method taking into account the priceindex effect of individual pricing decisions this effect had been neglected in the original paper of dixit and stiglitz 1977 ds who were only concerned with the large n case ensured by low fixed costs and imperfect substitution between the monopolistic goods limiting their model to the special case of a unitary elasticity of substitution between the monopolistic goods and the numeraire good yh obtain an explicit solution but yh s solution is still an approximation because it neglects the indirect effects that feedback has on pricing decisions we will show that in the enlarged model taking into account this income feedback effect allows for an explicit solution and simplifies calculations but in the variant some meaningful cases are incompatible with free entry and thus prohibit the use of ds s approximation however as we conclude in section iii this is not to say that their approximation should never be used on the contrary the approximation hypothesis is a very useful part of dixit and stiglitz s contribution

clarifying the foreign aid puzzle a comparison of american japanese french and swedish aid flows this study explores the donor side of debates revolving around the proper role of foreign assistance as a foreign policy tool by empirically testing for the aid determinants of four industrial democracies france japan sweden and the united states a pooled cross sectional time series design is employed to assess the impacts of six sets of variables on aid flows to thirty six african states during the 1980s three sets of these variables humanitarian need strategic importance and economic potential are constructed using data traditionally employed in empirical foreign aid studies three additional sets of variables cultural similarity ideological stance and region are constructed from data that regional specialists consider to be important in the foreign aid equation although no two cases are alike one can nevertheless draw some tentative conclusions about the nature of the foreign aid regime of the final cold war decade of the 1980s on the basis of several cross national patterns in short the results 1 contradict rhetorical statements of northern policymakers who claim that foreign aid serves as an altruistic foreign policy tool designed to relieve humanitarian suffering 2 confirm the expected importance of strategic and ideological factors in a foreign aid regime heavily influenced by the cold war and 3 underscore the importance of economic particularly trade interests in northern aid calculations

what aspects of formality do workers value evidence from a choice experiment in bangladesh this study uses a choice experiment among 2 000 workers in bangladesh to elicit willingness to pay wtp for job attributes a contract termination notice working hours paid leave and a pension fund using a stated preference method allows calculation of wtp for benefits in this setting despite the lack of data on worker transitions and the fact that many workers are self employed which makes it difficult to use revealed preference methods workers highly value job stability the average worker would be willing to forego a 27 percent increase in income to obtain a 1 year contract relative to no contract or to forego a 12 percent increase to obtain thirty days of termination notice there is substantial heterogeneity in wtp by type of employment and gender women value shorter working hours more than men while government workers place a higher value on contracts than do private sector employees

foreign aid an instrument for fighting communism abstract in this paper we test the argument that the sizeable reduction in aggregate aid levels in the 1990s was due to the end of the cold war we test two different models using a dynamic econometric specification on a panel of 17 donor countries spanning the years 1970 97 we find aid to be positively related to military expenditures in the former eastern bloc during the cold war but not in the 1990s suggesting that the reductions in aid disbursements are driven by the disappearance of an important motive for aid we also study the effect on aid allocation but here we do not find any robust effects of the end of the cold war

on monopolistic competition and involuntary unemployment in a simple temporary general equilibrium model it is shown that if the number of firms is small imperfect price competition in the markets for goods may be responsible for the existence of unemployment at any given positive wage in our examples involving two firms facing their true demand curves total monopolistic labor demand remains bounded as the wage rate goes to zero and unemployment prevails for a sufficiently large inelastic labor supply in the competitive case total labor demand would go to infinity and intersect labor supply at a positive wage

search theoretic models of the labor market a survey we survey the literature on search theoretic models of the labor market we show how this approach addresses many issues including the following why do workers sometimes choose to remain unemployed what determines the lengths of employment and unemployment spells how can there simultaneously exist unemployed workers and unfilled vacancies what determines aggregate unemployment and vacancies how can homogeneous workers earn different wages what are the tradeoffs firms face from different wages how do wages and turnover interact what determines efficient turnover we discuss various modeling choices concerning wage determination and the meeting process including recent models of directed search

strategic inattention delegation and endogenous market structure abstract we model an industry in which a discrete number of firms choose the output of their differentiated products deciding whether or not to consider the impact of their decisions on aggregate output the firm s choice of ignoring the impact of its production on aggregate output which is typical of monopolistic competition is derived as an equilibrium choice rather than assumed upfront such a choice is labelled as strategic inattention we show that our model of strategic inattention is isomorphic to a model of strategic delegation with managerial compensation based on relative profit performance thus monopolistic competition and cournot oligopoly are reconciled within a general model which can lead to either market form

migration and foreign aid when it comes to linkages between migration and the global allocation of foreign development assistance the size of the immigrant population from a recipient country residing in a donor country is an important determinant of dyadic aid commitments two complementary hypotheses probe this relationship first donors use foreign aid to achieve their broader immigration goals targeting migrant sending areas to increase development and decrease the demand for entry into the donor country second migrants already residing in the donor country mobilize to lobby for additional aid for their homeland empirical tests on a large sample of country pairs made up of twenty two donors and more than 150 recipients over the period 1993 to 2008 show robust support for these hypotheses

the trouble with compliance dependence and foreign policy in ecuador the compliance model of dependent foreign policy argues that dependent states will implement the foreign policy preferences of their dominant economic partners despite its failure to deliver strong empirical results compliance remains dominant within the study of dependent foreign policy this article examines compliance s problems and explains its endurance within the subfield of international relations six cases drawn from the hurtado and febres cordero administrations in ecuador during the 1980s are analyzed to evaluate compliance s three critical assumptions about the dependent foreign policy process the unitary actor core periphery bargaining and divergent preferences between core and periphery in only one of the cases do compliance s assumptions hold true and does compliance account for ecuador s foreign policy flaws in the bargaining assumption and the divergent preferences assumption account for the model s poor description of the process behind many dependent states foreign policies

choosing to target what types of countries get different types of world bank projects well governed countries are more likely to make use of foreign aid for the purposes of economic development and poverty alleviation therefore if aid agencies are providing funds for the sake of development these countries should receive more aid and categorically different types of aid as compared with poorly governed countries in poorly governed countries aid should be given in forms that allow for less discretion using an original data set of all world bank projects from 1996 to 2002 the author distinguishes programmatic projects from investment projects and national from subnational investment projects if the world bank allows more discretion in well governed countries then it will choose to provide programmatic and national aid for these recipients the author presents evidence that the world bank provides a larger proportion of national investment lending in better governed countries with regard to programmatic lending he finds mixed evidence among counties eligible for international development association ida aid good governance surprisingly is associated with a lower proportion of programmatic aid whereas for international bank for reconstruction and development ibrd borrowers good governance is associated with a higher proportion the author subjects these results to a number of robustness checks although he confirms the existing result in the literature that the world bank provides larger overall amounts of aid to better governed countries his examination of the disaggregated data leads to questioning whether both lending wings of the world bank are designing aid programs in the most prodevelopment way possible

hedonic wages and labor market search this article investigates the consequences of labor market search for the theory of hedonic wages we find that the introduction of search has surprising consequences for the theory of hedonic wages in particular we demonstrate that the equilibrium distribution of wage and nonwage amenity bundles generally bears little resemblance to workers underlying preferences a consequence of this analysis is that estimates of workers marginal willingness to pay derived from the conventional hedonic wage methodology are biased in addition we demonstrate that search generates differences between firm level and employee level data that can cause substantial deviations in the estimates of hedonic wage equations

the workers value of the remaining employment contract duration this paper introduces and applies a method for estimating workers marginal willingness to pay for job attributes employing data on job search activity worker s willingness to pay for the remaining duration of the employment contract is derived we provide evidence that workers attach substantial value to the remaining contract duration a temporary worker with a remaining contract of 6 months is willing to pay about 10 of the wage to increase the contract by one month

workers marginal costs of commuting abstract this paper applies a dynamic search model to estimate workers marginal costs of commuting including monetary and time costs using data on workers job search activity as well as moving behaviour for the netherlands we provide evidence that on average workers marginal costs of one hour of commuting are about 17 euro

offer heterogeneity in a two state model of sequential search the econometric method in the c flinn and j heckman 1982 study for estimating a markovian model of search unem ployment and job tenure is further augmented by introducing a possibi lity that jobs may differ by separation rates or nonwage attributes a set of reservation wages is obtained as a solution to the value fun ctions differences in reservation wages estimate the compensating no nwage utility differentials among jobs the unemployment spell distri bution is characterized as one of competing risk based on which type of job is finally accepted the model is implemented using data from the employment opportunities pilot project copyright 1988 by mit press

consensus or compliance foreign policy change and external dependence the foreign policy behavior of weak states conventional wisdom holds is largely determined by a process of bargaining with a dominant state compliance with the dominant state s preferences is viewed as necessary to the maintenance of economic exchange relations that benefit the weak state evidence for such a theory has been found in cross sectional correlations of aid and trade with un voting however such empirical studies have ignored alternative explanations overlooked elements of the statistical record and failed to examine the logic of the bargaining model the assumptions of the bargaining model are vulnerable to criticism an alternative model emphasizes multiple constraints on the behavior of both the strong and the weak nation in an asymmetrical dyad reanalysis of the data uncovers strong evidence of an explanation for foreign policy continuity rooted in dependency dependency permeates and transforms the political system of dependent nations thus bringing about constrained consensus rather than compliance furthermore the data provide strong evidence for an explanation of foreign policy change in both nations that centers on regime change not on bargaining with an external actor

valuing alternative work arrangements abstract we employ a discrete choice experiment in the employment process for a national call center to estimate the willingness to pay distribution for alternative work arrangements relative to tr

the compliant foreign policy of the dependent state revisited empirical linkages and lessons from the case of somalia studies of the linkage between economic dependence and foreign policy compliance have been confounded by the difficulties of measuring dependence single indicators of dependence may be inadequate reflections of what appears to be a multidimensional phenomenon but the relative potency of these factors has not yet been weighed the ability to determine the relative salience of dependence factors has been limited by the dominant state centric model employed in prior research which examines a single dominant state and the foreign policies of its many dependencies this model fails to capture what in reality is the norm that most peripheral states find themselves involved in dependent relations with two or more regional and global powers a dependent state centric model one that examines a single dependent state s foreign policies vis a vis its several dominant states thus is theoretically warranted and its application provides an opportunity to compare the relative salience of different types of de

the determinants of black white differences in early employment careers search layoffs quits and endogenous wage growth this paper studies the transition from school to full time employment and subsequent labor mobility during the first five postschooling years for several recent cohorts of black and white male terminal high school graduates using unique data from the 1979 youth cohort of the national longitudinal surveys of labor market experience a constrained optimization model of labor force dynamics is implemented empirically integrating features of models previously described in the literature the estimates of the model provide quantitative evidence on underlying structural differences in labor market constraints faced by blacks and whites for example while blacks have overall a substantially smaller wage return to work experience and face a less disperse wage offer distribution blacks face a higher probability of receiving job offers

the economics of quality in the specialty coffee industry insights from the cup of excellence auction programs this study estimates price determinants for specialty green coffee auctions using records from the 2004 2010 cup of excellence programs hosted by the alliance for coffee excellence while some literature on coffee has focused on certifications and sustainability labels the discussion of price determinants has been limited this article replicates one of the first publications on price determinants and formulates a new model to more accurately describe the market we include the necessary additional variables and estimate the model using a truncated maximum likelihood estimation technique while sensory quality has a strong effect on price the highest premiums stem from obtaining a top rank compared to other coffees from the same country and north american buyers are more responsive to sensory quality than buyers in asian and european markets jel classifications c24 d44 q13

competition for market share or for market size oligopolistic equilibria with varying competitive toughness for an industry producing a composite commodity we propose a comprehensive concept of oligopolistic equilibrium allowing for a parameterized continuum of regimes varying in competitive toughness each firm sets simultaneously its price and its quantity under two constraints relative to its market share and to market size the price and the quantity equilibrium outcomes always belong to the set of oligopolistic equilibria when firms are identical and we let their number increase any sequence of symmetric oligopolistic equilibria converges to the monopolistic competition outcome further results are derived in the symmetric ces case concerning in particular the collusive solution enforceability

a dynamic analysis of educational attainment occupational choices and job search this article examines career choices using a dynamic structural model that nests a job search model within a human capital model of occupational and educational choices wage growth occurs in the model because workers move between firms and occupations as they search for suitable job matches and because workers endogenously accumulate firm and occupation specific human capital simulations performed using the estimated model reveal that both self selection in occupational choices and mobility between firms account for a much larger share of total earnings and utility than the combined effects of firm and occupation specific human capital

search and nonwage job characteristics this paper quantifies the importance of nonwage job characteristics to workers by estimating a structural on the job search model the model generalizes the standard search framework by allowing workers to search for jobs based on both wages and job specific nonwage utility flows within the structure of the search model data on accepted wages and wage changes at job transitions identify the importance of nonwage utility through revealed preference the estimates reveal that utility from nonwage job characteristics plays an important role in determining job mobility the value of jobs to workers and the gains from job search

money talks supplementary financiers and international monetary fund conditionality what explains the changes in international monetary fund imf conditionality i argue that imf conditionality agreements are influenced by supplementary financiers the imf regularly relies on external financing to supplement its loans to countries facing payments imbalances as a result these supplementary financiers are able to exercise leverage over the imf and the design of its conditionality programs i consider the influence of one type of supplementary financier private financial institutions on imf conditionality conclusions are supported by a data set of 249 conditionality arrangements coded according to their terms and two case studies

anti u s foreign policy of dependent states mexican and costa rican participation in central american peace plans literature on the foreign policy behavior of economically dependent states holds that they will comply with the foreign policy preferences of the united states particularly on cold war issues regional foreign policies of mexico and costa rica defy this view despite significant economic dependence on u s aid and trade both miguel de la madrid and oscar arias developed peace plans for central america that directly countered the objectives of the reagan policy for the area pressures resulting from a regional security threats b the flow of refugees into costa rica and mexico c the foreign policy traditions of each country and d the need to counteract the effects of dependence guided these presidents to accept the risks of a defiant foreign policy in order to satisfy local demands even though heavily dependent and under pressure from the u s government to comply with its regional foreign policy mexico and costa rica implemented policies that served their own national interests and defied wa

can the world cut poverty in half how policy reform and effective aid can meet international development goals abstract poverty in the developing world will decline by about one half by 2015 if the trends of the 1990s persist most of this poverty reduction will occur in asia however while poverty will decline only slightly in africa effective aid could make a contribution to greater poverty reduction in lagging regions even more potent would be significant policy reform in these countries we develop a model of efficient aid in which flows respond to policy improvements that create a better environment for poverty reduction and effective aid we investigate scenarios of policy reform and efficient aid that point the way to how the world can cut poverty in half in every major region

dealing with monopsony power employment subsidies vs minimum wages abstract we show in a monopsony model that accounting for changes in hours a minimum wage has ambiguous effects on employment and welfare when all workers have the same preference ordering over leisure and consumption employment subsidies unambiguously improve welfare many countries have minimum wages and also tax minimum wage workers

on monopolistic competition and optimal product diversity workers rents also matter in the dixit stiglitz model of monopolistic competition entry of firms is socially too small other authors have shown that excess entry is also a possibility with other preferences for diversity we sow that workers rents also contribute to explain excess entry through a general equilibrium mechanism larger wages indeed raises the aggregate earnings and firms sales and profits which entices too many firms to enter we discuss the possibility of over provision of varieties by comparing the equilibrium to unconstrained and constrained social optima and to other regulatory frameworks where wages are not controlled

from domestic to international justice the welfare state and foreign aid foreign aid often is interpreted as an international projection of domestic income redistribution mechanisms and many authors suggest that differences between welfare states account for variations in donor behavior a new understanding of the welfare state can improve traditional explanations of this linkage existing studies of the welfare aid relationship use two welfare state indicators domestic spending and partisan politics we propose a third type of indicator the institutional attributes of the welfare state and demonstrate its relevance the level of foreign aid provided by a country varies with social spending but even more so with the degree to which its welfare state embodies socialist attributes this finding helps explain how domestic political institutions influence the evolution of international cooperation and specifically how welfare principles institutionalized at the domestic level shape the participation of developed countries in the international aid regime

preference for the workplace investment in human capital and gender we use a hypothetical choice methodology to estimate preferences for workplace attributes from a sample of high ability undergraduates attending a highly selective university we estimate that women on average have a higher willingness to pay wtp for jobs with greater work flexibility and job stability and men have a higher wtp for jobs with higher earnings growth these job preferences relate to college major choices and to actual job choices reported in a follow up survey four years after graduation the gender differences in preferences explain at least a quarter of the early career gender wage gap

constrained by hours and restricted in wages the quality of matches in the labor market this paper examines the explicit loss born by workers who face constraints in their working hours by analyzing differences in actual and desired hours and wages men tend to be underemployed while women are evenly split between over and underemployment losses in surplus are generally small but 10 of underemployed men and women experience losses of more than 34 or 50 of surplus respectively the loss measure is also an important determinant in predicting labor market transitions meaning increases in surplus losses generate a higher probability of changing from workers present jobs or changing the number of hours jel j22 j41

estimating compensating wage differentials using voluntary job changes evidence from germany the author develops a model predicting that in a labor market that attaches a wage premium to jobs with a disamenity a compensating wage differential the premium s upper bound will be defined by the average wage change of voluntary job movers whose consumption of the disamenity rises as a result of their move its lower bound by the wage change of those whose consumption of the disamenity falls these predictions will not hold if as predicted by a segmented labor market model the labor market attaches a wage penalty to workplace disamenities using longitudinal data on job characteristics and wages in germany in 1984 2001 the author estimates the market returns to four workplace disamenities heavy workload job insecurity poor hours regulation and a mismatch between skills possessed and skills required the results broadly support the existence of compensating differentials in the german labor market

job search by employed and unemployed youth analysis of data from the new youth cohort of the national longitudinal survey yields evidence that young unemployed job seekers chose higher levels of search effort as measured by number of methods used and time spent per method and lower reservation wages relative to offered wages than did comparable employed job seekers in 1981 these differences in search choices at least partly explain differences in search outcomes between the two groups unemployed searchers apparently were more likely than employed searchers to gain new employment and the wages they obtained were slightly lower the author argues that the greater search effort by unemployed job seekers is due to the higher costs of search they bear because of foregone earnings

monopolistic competition and the effects of aggregate demand how important is monopolistic competition to an understanding of the effects of aggregate demand on output we ask the question at three levels can monopolistic competition by itself explain why aggregate demand movements affect output can it together with other imperfections generate effects of aggregate demand in a way that perfect competition cannot if so can it give an accurate account of the response of the economy to aggregate demand movements the answers are no yes and yes

endogenous markups intensity of competition and persistence of business cycles in order to study the propagation mechanism of business cycles in particular to investigate how the intensity of competition affects market structure and output persistence over business cycles this paper presents a real business cycle model with imperfect competition and increasing returns to scale this analysis considers the markups of price over cost to be endogenous with endogenous markups two standard forms of oligopolistic competition bertrand and cournot are considered results show that 1 the propagation mechanism in the sense of output persistence is greater under cournot 2 the propagation mechanism is unequivocally greater with imperfect competition regardless of whether markups are endogenous or not and 3 under imperfect competition the propagation mechanism is greater with endogenous markups than with exogenous markups overall these results suggest that more intense competition produces lower persistence in output growth and thus a weaker propagation mechanism in a calibration exercise these differences were also found to be quantitatively important

targeting aid to the needy and deserving nothing but promises by reallocating aid to where it is needed most and where a productive use is most likely donors could help alleviate poverty in developing countries the rhetoric of donors suggests that this insight has increasingly shaped the allocation of aid we assess the poverty and policy orientation of bilateral and multilateral aid in different ways in addition to presenting stylised facts based on bivariate correlations we apply a tobit model that captures both altruistic and selfish donor motives we find little evidence supporting the view that the targeting of aid has improved significantly most donors provide higher aid to relatively poor countries but so far the fight against poverty has not resulted in a stronger focus on needy recipients with favourable local conditions the estimation results reveal that the policy orientation of aid critically depends on how local conditions are measured in general however donors appear to be less policy oriented than poverty oriented the response of donors to changing institutional and policy conditions in recipient countries turns out to be fairly weak we reject the proposition that multilateral aid is clearly superior to bilateral aid in terms of rewarding poor countries with better policies and institutions

aid delivery through non governmental organisations does the aid channel matter for the targeting of swedish aid this paper analyses whether aid channelled through non governmental organisations ngos is less affected by selfish donor motivations and better targeted to needy recipient countries than aid distributed by state agencies we employ tobit and probit models and make use of an exceptionally detailed database that allows an assessment of the allocation of swedish aid channelled through ngos in comparison to the allocation of swedish official aid our analysis provides mixed results on the one hand ngos appear to be altruistic as far as available indicators on political and commercial motivations of aid can tell on the other hand needs based targeting of aid by ngos turns out to be surprisingly weak gdp per capita of recipient countries shapes the allocation of official aid but not that of aid channelled through ngos the headcount of absolute poverty has a significantly positive effect on aid allocation but its impact is not particularly strong when ngos are involved overall the swedish case supports the sceptical view that ngos are not necessarily superior donors compared to state aid agencies

school characteristics and teacher turnover assessing the role of preferences and opportunities job characteristics can affect worker turnover through their effect on utility and through their effect on outside job opportunities the aim of this study is to identify and estimate the roles of these two channels separately our method exploits information on job changes and relies on an augmented sample selection correction to illustrate our approach we use an exhaustive register of dutch primary school teachers and show a detailed picture of preferences for school characteristics we also find that the dependence between current and outside job attributes can affect turnover and thus the allocation of teachers across schools

the pricing of job characteristics when markets do not clear theory and policy implications this article examines nonsequential search when jobs vary with respect to nonpecuniary characteristics in the presence of frictions in the labor market the equilibrium job distribution need not show evidence of compensating wage differentials the model also generates several pervasive features of labor markets unemployment and vacancies apparent discrimination and market segmentation when workers are homogeneous restrictions on the range of job offers decrease welfare and cannot reduce unemployment however when workers have heterogeneous preferences such restrictions may lower unemployment and can even lead to a pareto improvement in welfare we consider the impact of policies banning discrimination and regulating working conditions

a paradox of redistribution in international aid the determinants of poverty oriented development assistance summary donors differ in the amount of official development assistance dedicated to poverty reduction we investigate the causes of variation over time and donors by employing both a regression approach with aggregate data on bilateral aid and two short country studies on germany and the united kingdom we find that there is a trade off between the total amount of money given and the amount of money given to poor countries the trade off is similar to the paradox of redistribution of targeting vs redistribution in rich welfare states case study evidence illustrates how countries have managed this tradeoff

estimating workers marginal willingness to pay for job attributes using duration data this paper develops and applies a method for estimating workers marginal willingess to pay for job attributes when workers job choices are characterized by imperfect information and labor market search as an application this paper analyzes the job durations of white males using data from the national longitudinal survey youth cohort and the dictionary of occupational titles estimates of workers willingness to pay derived from the job duration model are compared with those derived from an hedonic wage model

the simple macroeconomics of profit sharing this paper is in the spirit of the temporary equilibrium approach to macroeconomics it basically extends that framework to cover a profit sharing system and then compares the macroeconomic characteristics with those of the more familiar wage system a first preliminary step is to demonstrate how a microeconomic model of monopolistic competition can be built up into a junior member of the keynesian macro family the methodology is to create from first principles including a careful formulation of a monopolistically competitive product market structurea natural underpinning for the standard aggregate demand specification the primary goal of the paper is to apply the integrated monopolistic competitionkeynesian type apparatus described above to investigate the macroeconomic properties of a profit sharing economy the existence of a consistent general framework covering both cases invites meaningful comparisons that indicate clearly why an economy based on profit sharing principles possesses natural immunity to stagflation by contrast the wage economya system we have largely accepted without critically examining its macroeconomic consequences is more prone to suffer from unemployment and inflation the policy implications for aggregate demand management in wage and share systems are analyzed and contrasted in writing this paper my philosophy has been to not shirk from using those reasonable parameterizations and functional forms which yield nice crisp results and permit me to focus sharply on the essential logic of basic issues it is certainly possible to present the main results in a somewhat more general formulation as the astute reader will appreciate but i fear only at some cost of distracting attention from those central features i wish to highlight

to invest or insure how authoritarian time horizons impact foreign aid effectiveness in this article the author argues that the time horizon a dictator faces affects his incentives over the use of aid in three ways first dictators have a greater incentive to invest in public goods when they have a long time horizon second dictators with short time horizons often face the threat of challengers to the regime this leads them to forgo investment and instead consume state resources in two forms that harm growth repression and private pay offs to political opponents third dictators with short time horizons have a strong incentive to secure personal wealth as a form of insurance in case the regime falls using panel data on dictatorships in 71 developing countries from 1961 to 2001 the author finds that time horizons have a positive impact on aid effectiveness foreign aid is associated with positive growth when dictators face long time horizons and negative growth when time horizons are short

who supports global economic engagement the sources of preferences in american foreign economic policy in this article we bring together opposing international relations theories to better understand u s foreign policy in particular foreign trade and aid using votes in the u s house of representatives from 1979 2004 we explore different theoretical predictions about preferences for foreign economic policy we assess the impact of domestic factors namely political economy and ideological preferences versus foreign policy pressures our three main results highlight the differential effect of these factors in the two issue areas first aid preferences are as affected by domestic political economy factors as are trade preferences second trade preferences but not economic aid ones are shaped by the president s foreign policy concerns for economic aid domestic political economy factors matter more than foreign policy ones third aid preferences are shaped more by ideological factors than are trade ones but ideology plays a different substantive role in each different constituencies support aid and trade this finding has implications for foreign policy substitutability the internationalist coalition in u s foreign policy statist theories of foreign policy and the connection between public opinion and legislative voting

search for nonwage job characteristics a test of the reservation wage hypothesis previous structural models of job search behavior have been based upon the reservation wage property this article provides estimates of a more general search model that nests models with the reservation wage property the estimates lead to rejection of the reservation wage property the model includes hours of work in the utility function but other nonwage job characteristics can be included as well an experiment based on the estimated parameters indicates that a significant proportion of job offers would be mistakenly predicted to be accepted or rejected under the restrictions implied by the reservation wage property

ranking firms using revealed preference this article estimates workers preferences for firms by studying the structure of employer to employer transitions in u s administrative data the article uses a tool from numerical linear algebra to measure the central tendency of worker flows which is closely related to the ranking of firms revealed by workers choices there is evidence for compensating differentials when workers systematically move to lower paying firms in a way that cannot be accounted for by layoffs or differences in recruiting intensity the estimates suggest that compensating differentials account for over half of the firm component of the variance of earnings

aid fragmentation or aid pluralism the effect of multiple donors on child survival in developing countries 1990 2010 while most policy makers and researchers stress the negative impact of aid fragmentation on development outcomes in recipient countries we argue that the greater diversity of perspectives entailed by higher multiplicity of donors can help select better policies we hypothesize a u shaped relationship countries with a moderate number of donors fare better than countries with either few or many donors the hypothesis is supported by a generalized method of moments gmm analysis of the relationship between health aid donors and child survival in 110 low and middle income countries during 1990 2010

measuring labor market frictions a cross country comparison in this paper we define and estimate measures of labor market frictions using data on job durations we compare different estimation methods and different types of data we propose and apply an unconditional inference method that can be applied to aggregate duration data it does not require wage data it is invariant to the way in which wages are determined and it allows workers to care about other job characteristics the empirical analysis focuses on france but we perform separate analyses for the united states of america the united kingdom germany and the netherlands we quantify the monopsony power due to search frictions and we examine the policy effects of the minimum wage unemployment benefits and search frictions jel j63 j64

the empirical content of the job search model labor mobility and wage distributions in europe and the us abstract job search models of the labor market hypothesize a very tight correspondence between the determinants of labor turnover and individual wage dynamics on one hand and the determinants of wage dispersion on the other this paper offers a systematic examination of whether this correspondence is present in the data by estimating a rudimentary partial equilibrium job search model on a three year panel of individual worker data covering 10 european countries and the u s we find that our basic job search model fits the data surprisingly well this also allows us to point at a number of interesting empirical regularities about wage distributions our results suggest that cross sectional data on individual wages contain the basic information needed to obtain a reliable measure of the magnitude of labor market frictions as measured by a parameter of the canonical job search model finally we use our results in a cross country comparison of the intensity and nature of job to job turnover we arrange countries into two different groups according to their turnover intensity we further show that the nature of job to job turnover is very different between those two groups turnover is predominantly voluntary in low turnover countries whereas it is to a large extent involuntary in high turnover countries

what determines aggregate returns to scale abstract this paper develops a unified framework that incorporates four features important in existing models with increasing returns fixed costs decreasing marginal costs product variety and market power when fixed costs are not allowed to vary and profits are imposed to be zero in every period only the degree of returns to variety determines the degree of aggregate increasing returns to scale when fixed costs respond to changes in aggregate activity or the zero profit condition does not hold in the short run aggregate returns depend not only on product variety but also on diminishing marginal costs or market power the degree of market power however does not affect input prices which are critical to determine the uniqueness of equilibrium

equilibrium search and tax credit reform an empirical equilibrium job search model with wage posting is developed to analyze the labor market impact of uk tax reforms the model allows for a rich characterization of the labor market with hours responses accurate representations of the tax and transfer system and both worker and firm heterogeneity the model is estimated with pre reform longitudinal survey data using a semi parametric estimation technique and the impact of actual tax reform policies is simulated the model predicts that the british working families tax credit and contemporaneous reforms increased employment with equilibrium effects found to play a relatively minor role

on the job search with match specific amenities we construct an equilibrium on the job search model in which workers value wages and amenities we show by example that in a standard burdett mortensen model with a distribution of worker tastes over amenities worker mobility need not imply equilibrium wage dispersion

designing global collective action in population and hiv aids programs 1983 2002 has anything changed the 1994 international conference of population and development icpd in cairo established goals for the expansion of assistance in matters of reproductive health and hiv aids this global effort marked a structural break in principle from the past but did it also change funding behavior panel data on expenditures of oecd donors for three types of aid agencies multilateral non governmental agencies and bilateral aid for the years 1983 2002 do not reveal an unambiguous improvement in donor behavior funding choices for multilateral organizations and ngos have become more interdependent but burden sharing remained stable and generosity dropped substantially after 1994

employment vulnerability and earnings in urban west africa this article develops indicators of vulnerability in employment in seven economic capitals of west africa and studies their links with individual incomes quantitative distributional and qualitative analyses show that vulnerability compensating mechanism is mainly seen in the informal sector in the upper tail of the earnings distribution and particularly in the circumstance of visible underemployment employment vulnerability is not compensated for the poorest workers in the private sector long job queues and weak institutional protection of workers may have reduced bargaining power in the formal sector

unemployment risk and wage differentials workers in less secure jobs are often paid less than identical looking workers in more secure jobs we show that this lack of compensating differentials for unemployment risk can arise in equilibrium when all workers are identical and firms differ only in job security i e the probability that the worker is not sent into unemployment in a setting where workers search for new positions both on and off the job the worker s marginal willingness to pay for job security is endogenous increasing with the rent received by a worker in his job and depending on the behavior of all firms in the labor market we solve for the labor market equilibrium and find that wages increase with job security for at least all firms in the risky tail of the distribution of firm level unemployment risk unemployment becomes persistent for low wage and unemployed workers a seeming pattern of unemployment scarring created entirely by firm heterogeneity higher in the wage distribution workers can take wage cuts to move to more stable employment

the pervasive absence of compensating differentials we study the relation between individual preferences for job amenities e g type of work job security and compensating wage differentials in cross section to this end we estimate a partial equilibrium job search model on panel data from eight european countries there are five non wage job characteristics and two sources of job to job mobility on the job search and reallocation shocks we also allow for two types of unobserved heterogeneity we find strong preferences for amenities especially job security yet these preferences do not translate into significant wage differentials in cross section counterfactual experiments show that one would need extremely low levels of search frictions for compensating differentials to arise lastly a similar exercise on the distribution of job change outcomes reveals the role of constrained job to job mobility in the absence of compensating wage differentials copyright 2009 john wiley sons ltd

trade configurations in asia assessing de facto and de jure regionalism given the backdrop of significant uncertainties largely propelled by the ongoing trade spat between the united states and china to what degree can the asian region move forward in terms of de facto trade integration drawing on the new economic geography literature this paper offers new insights into the literature on trade regionalism in asia by empirically illustrating how asian economies can tap into the regional market potential specifically the paper examines the scope for further de facto integration among the asian countries engaged in the negotiation for the regional comprehensive economic partnership rcep agreement by estimating foreign market potential fmp indices to preview the main findings the empirical analysis demonstrates that the share of intra regional trade in total rcep trade flows and consequently the ratio between within and outside rcep trades are significantly lower than what they could potentially be the paper makes a case that the enhancement of de jure integration among these economies through the rcep must be accompanied by efforts to improve de facto integration

globalization and specialization abstract the popular dixit stiglitz ethier framework proposes that globalization increases the menu of intermediate goods available to downstream firms and that gains from specialization raise welfare unambiguously this study shows that both results depend critically on the assumption that demand elasticities are invariable the more general framework presented here provides two main insights first whether specialization rises or falls depends ultimately on the shape of the cost function and second globalization can actually reduce welfare in the case when specialization falls