explaining the deteriorating entry earnings of canada s immigrant cohorts 1966 2000 abstract using the 1981 1986 1991 1996 and 2001 canadian censuses we explore causes of the deterioration in entry earnings of successive cohorts of immigrant men and women roughly one third of the deterioration is explained by compositional shifts in language ability and region of birth we find no evidence of a decline in the returns to foreign education for either immigrant men or immigrant women but a definite deterioration in the returns to foreign labour market experience most strongly among men from non traditional source countries we can explain roughly two thirds of the male and one half of the female deterioration without any reference to entry labour market conditions when we also account for entry conditions our results suggest canada s immigrants of the late 1990s would otherwise have enjoyed entry earnings equal to or higher than their counterparts of the 1960s

political cycles in oecd economies this paper studies whether the dynamic behaviour of gnp growth unemployment and inflation is systematically affected by the timing of elections and of changes of governments the sample include the last three decades in 18 oecd economies we explicitly test the implication of several models of political cycles both of the opportunistic and of the partisan type also we confront the implication of recent rational models with more traditional approaches our results can be summarized as follows a the political business cycle hypothesis as formulated in nordhaus 1975 on output and unemployment is generally rejected by the data b inflation tends to increase immediately after elections perhaps as a result of pre electoral expansionary monetary and fiscal policies c we find evidence of temporary partisan differences in output and unemployment and of long run partisan differences in the inflation rate as implied by the rational partisan theory by alesina 1987 d we find virtually no evidence of permanent partisan differences in output growth and unemployment

fiscal policy outcomes and electoral accountability in american states clear fiscal policy effects appear in american state gubernatorial and legislative elections between 1968 and 1992 independent of the effects of incumbency coattails term limits and macroeconomic conditions the results show that accountability is generally stronger following a period of unified party control than under divided government voter reactions to taxes and spending relative to the state economy are conditional on expectations which differ for each party net of these expectations republican gubernatorial candidates lose votes if their party is responsible for unanticipated increases in the size of the state budget democrats do not and indeed may be rewarded for small increases independent of this the incumbent governor s party is punished in legislative elections for failing to maintain fiscal balance taken together these results show how electoral accountability for fiscal policy outcomes is strong but highly contingent on a complex configuration of party labels partisan control expectations and institutions

macroeconomic policy in a two party system as a repeated game this paper considers the interaction of two parties with different objectives concerning inflation and unemployment and rational and forward looking wage setters if discretionary policies are followed an economic cycle related to the political cycle results in equilibrium this cycle is significantly different from the traditional political business cycle reputational mechanisms due to the repeated interaction of the two parties and the public or commitments to a common policy rule can improve upon the discretionary outcome by reducing or eliminating the magnitude of the economic fluctuations

political and institutional determinants of fiscal policy in the european community in recent theoretical and empirical research the variation in political and institutional arrangements which may affect the process of national policy formation is examined in order to explain cross country differences with respect to fiscal policies pursued in this paper we build upon this literature and examine whether and how cross country differences in debt accumulation and public sector size of member countries of the european community during the 1980s can be explained we conclude that the growth of government debt is positively related to the frequency of government changes and negatively to sound budgetary procedures in countries with left wing governments the growth of the share of government spending in total output generally tends to be higher

state responses to fiscal crises the effects of budgetary institutions and politics this paper explores the dynamics of state taxes and spending during the late 1980s when regional economic downturns and increased expenditure demands led to substantial state budget deficits more restrictive state fiscal institutions such as no deficit carryover rules and tax and expenditure limitations are correlated with more rapid fiscal adjustment to unexpected deficits political factors are also important when a single party controls the state house and the governorship deficit adjustment is much faster than when party control is divided in gubernatorial election years tax increases and spending cuts are both significantly smaller than at other times

north south trade and industry specific pollutants abstract this paper investigates the production and pollution patterns arising from trade between high and low income countries when firms discharge industry specific pollutants we extend the common pollutant model of copeland and taylor north south trade and the environment quart j econ 109 1994 755 787 to incorporate industry specific pollutants and obtained a diversified equilibrium which differs markedly from the complete specialization equilibrium obtained in the original model with diversified production individual countries shares of production and emissions change in a flexible manner reflecting the competitiveness of their products in the world market this result makes it easier for empirical studies to test the theoretical relationships between industrial production emissions and the different attributes of countries including income and factor endowment despite the striking difference in the equilibrium patterns of production and emissions the prediction of the pollution haven hypothesis is retained and pollution intensive industries relocate to south finally a composite of pollutants weighted by disutilities increases in south and decreases in north

voters as fiscal conservatives voters penalize federal and state spending growth this is the central result of my analysis of voting behavior in presidential senatorial and gubernatorial elections from 1950 1988 the composition of federal spending growth seems irrelevant the vote loss to the president s party from an extra dollar of defense or nondefense spending is the same however in gubernatorial elections expansion of state welfare spending exacts a disproportionate political price deficit financing of federal or state spending does not appear to matter politically i conclude by discussing the obvious question of why government budgets have grown in the face of this voter hostility

incomplete international cooperation to reduce co2 emissions alternative policies abstract as a first step toward a global treaty to control co2 emissions individual countries contemplate unilateral reductions in their fuel use such actions if significant would reduce world market fuel prices thereby stimulating fuel use elsewhere and causing problems for exporting countries possibly jeopardizing this policy initiative among the policy alternatives for mitigating the price effects of reduced demand reduced fuel consumption combined with buying or leasing fuel deposits to achieve a reduced supply is discussed in particular this policy which at first seems prohibitively costly is shown to dominate the original policy approach under a fairly wide set of circumstances

slowing down of globalization and global co2 emissions a causal or casual association abstract in recent years we have witnessed slowdowns of both globalization and global co2 emissions not only have organization for economic co operation and development oecd economies such as the us and the uk tried to bring manufacturing back to their home countries but non oecd economies such as china and india have also increased their shares of domestic products at both intermediate and final goods in this paper we employ the annual global multi regional input output tables compiled by the asian development bank to explore the linkage of the recent slowdown in globalization and global co2 emissions for the period 2012 2016 our results suggest that there are indeed some clues indicating a slowdown of globalization in several leading oecd and non oecd economies however the changes of consumption in non oecd economies are much larger than are those in oecd economies at the aggregate level the effects of globalization on emissions have been dominated by non oecd economies in particular china and india showing a negative linkage more specifically the changing pattern of globalization has contributed a net increase of 202 mt in global co2 emissions the recent slowdown of global co2 emissions cannot in general be attributed to the slowdown of globalization

political business cycles with endogenous election timing evidence from japan this paper empirically investigates the political business cycle hypothesis for japan taking into account the potential two way interaction that originates from the control within certain limitations by the government over election timing of japanese elections using a mixed qualitative and continuous variable simultaneous equation estimation procedure the authors cannot reject the traditional political business cycle manipulation hypothesis causation running from the timing of elections to real gnp growth they also find some limited support for the opportunistic hypothesis strong real gnp growth triggers elections copyright 1991 by mit press

budget institutions and fiscal policy in the u s states this paper summarizes state balanced budget requirements and the available empirical evidence on the effect of these rules on state fiscal policies existing state rules differ from many current proposals at the federal level they are typically restricted to part of the state budget they frequently permit short term borrowing and they lack formal enforcement mechanisms the paper also surveys previous research on how anti deficit provisions affect state fiscal policy the available evidence indicates that stringent anti deficit provisions lead to more rapid adjustment of state taxes and expenditures when fiscal deficits emerge this suggests that changing the federal budget process has the potential to affect federal fiscal policy this abstract was borrowed from another version of this item

government spending and budget deficits in the industrial economies fiscal policy nouriel roubini and jeffrey sachs this paper examines the evolution of the size of government and of budget deficits in oecd economies we highlight the rapid increase in government spending in the 1970s the sharp rise in budget deficits and public debt after 1973 and the reversal in these trends in the 1980s the increase in the size of government was associated in part with the slowdown in growth after 1973 but also reflected gradual adjustment of the ratio of spending to output towards a long run target which depends on political and institutional characteristics of the economy the political orientation of the government the degree of wage indexation and the degree of stability of the political system such factors also explain the size of budget deficits when faced with an adverse shock subsequent deficit reduction requires a measure of political consensus we note that such consensus is hard to achieve in multi party coalitions in consequence countries with such a political structure tended in consequence countries with such a political structure tended toin consequence countries with such a political structure tended to experience much more rapid increases in their debt gnp ratios

the effect of literacy on immigrant earnings we examine the impact of literacy on immigrant earnings and the sources of lower returns to education and experience among immigrants we find that the native born literacy distribution dominates that for immigrants however the two groups obtain similar returns to literacy skills contrary to discrimination based explanations for immigrant native born earnings differentials among the university educated literacy differences account for about two thirds of the earnings gap however low returns to foreign experience have a larger impact on this differential among the less educated literacy differences and differences in the returns to experience have similar effects on the earnings differential

fiscal policy cycles and public expenditure in developing countries the paper studies empirically the fiscal policy instruments by which governments try to influence election outcomes in 24 developing countries for the 1973 1992 period the study finds that the main vehicle for expansionary fiscal policies around elections is increasing public expenditure rather than lowering taxes and public investment cycles seem particularly prominent institutional mechanisms which constrain discretionary expenditure policies and which strengthen fiscal control are therefore worthwhile considering to prevent opportunistic policy making around elections

why are the relative wages of immigrants declining a distributional approach the authors show that the decline in the relative wages of immigrants in canada is far from homogeneous across the wage distribution the well documented decline in the mean wage gap between immigrants and canadian born workers hides a much larger decline at the low end of the wage distribution while the gap hardly changed at the top end of the distribution using standard ols regressions and unconditional quantile regressions the authors show that both the changes in the mean wage gap and in the gap at different quantiles are well explained by standard factors such as experience education and country of origin of immigrants interestingly an important source of change in the wages of immigrants relative to the canadian born is the aging of the baby boom generation which has resulted in a relative increase in the labor market experience and thus in the wages of canadian born workers relative to immigrants

does electoral accountability affect economic policy choices evidence from gubernatorial term limits this paper analyzes the behavior of u s governors from 1950 to 1986 to investigate a reputation building model of political behavior we argue that differences in the behavior of governors who face a binding term limit and those who are able to run again provides a source of variation in discount rates that can be used to test a political agency model we find evidence that taxes spending and other policy instruments respond to a binding term limit if a democrat is in office the result is a fiscal cycle in term limit states which lowers state income when the term limit binds

earning trajectories of highly educated immigrants does place of education matter the author compares the earnings and earning trajectories of u s college educated immigrants with those of similar immigrants who completed their education abroad using cross sectional and longitudinal data from the 1993 and 2003 national surveys of college graduates adjusting for demographics results based on cross sectional data suggest that the annual earnings of college educated foreign born men were 9 less than those of similar u s born men whereas the annual earnings of college educated foreign born women were 3 less than those of similar u s born women after further adjusting for place of education however the gap narrowed by 42 for men and vanished for women an analysis of longitudinal data reveals that in the first 15 years after arrival u s educated foreign born science and engineering s e professionals had higher earnings growth relative to native born s e professionals than their foreign educated counterparts evidence also indicates that attrition was associated with labor

divided government fiscal institutions and budget deficits evidence from the states does partisan control of american state government have systematic effects on state spending and taxing levels does divided control affect the government s ability to make hard decisions do institutional rules like legal deficit carryover restrictions matter using a formal model of fiscal policy to guide empirical analysis of data covering the american states from 1968 to 1987 we conclude that 1 aggregate state budget totals are driven by different factors under democrats and republicans the net result being that democrats target spending and taxes to higher shares of state level personal income 2 divided government is less able to react to revenue shocks that lead to budget deficits particularly where different parties control each chamber of the legislature and 3 unified party governments with restricted ability to carry deficits into the next fiscal year outside the south have sharper reactions to negative revenue shocks than those without restrictions

fragmented government effects on fiscal policy new evidence most industrialized countries entered the 1980s with their public finances in disarray at the time persistent deficits pushed up public debt to gdpratios despite such similarities deficit spending varies substantially between countries and within countries over time recent theoretical and empirical research has considered how differences in political arrangements affecting national policy formation might explain variation in fiscal policies pursued using a panel of 22 oecd countries over the 1971 1996 period this paper extends previous literature on the effects of fragmented government on fiscal policy outcomes in various directions first we focus on data relating to central government instead of general government as all theories refer to central government second not only do we analyze the effect of size fragmentation of government we also examine government s position vis a vis parliament and government s political fragmentation we find evidence that more fragmented government defined in terms of the number of political parties in a coalition or the number of spending ministers have higher deficits there is also some evidence that governments that dispose of excess seats in parliament have lower deficits right wing governments appear to have been fiscally more responsible in the seventies political fragmentation does not affect government s budget deficit

an introduction to the economics of immigration in oecd countries the share of the foreign born in oecd countries is increasing and this article summarizes economics research on the effects of immigration in those nations four broad topics are addressed labor market issues fiscal questions the political economy of immigration and productivity international trade extreme concerns about deleterious labour market and fiscal impacts following from new immigrants are not found to be warranted however it is also clear that government policies and practices regarding the selection and integration of new migrants affect labour market fiscal and social cultural outcomes policies that are well informed well crafted and well executed beneficially improve population welfare

the changing labor market position of canadian immigrants this paper uses pooled 1971 1981 and 1986 canadian census data to evaluate the extent to which 1 the earnings of canadian immigrants at the time of immigration fall short of the earnings of comparable canadian born individuals and 2 immigrants earnings grow more rapidly over time than those of the canadian born variations in the labour market assimilation of immigrants according to their gender and country of origin are also analysed the results suggest that recent immigrant cohorts have had more difficulty being assimilated into the canadian labour market than earlier ones an apparent consequence of recent changes in canadian immigration policy labour market discrimination against visible minorities and the prolonged recession of the early 1980s summary in fre excerpt

why are stabilizations delayed when a stabilization has significant distributional implications e g tax increases to eliminate a large budget deficit socioeconomic groups may attempt to shift the burden of stabilization onto other groups the process leading to stabilization becomes a war of attrition each group attempting to wait the others out and stabilization occurring only when one group concedes and bears a disproportionate share of the burden the authors solve for the expected time of stabilization in a model of rational delay and relate it to several political and economic variables they motivate this approach and its results by comparison to historical and current episodes copyright 1991 by american economic association

canadian economics research on immigration through the lens of theories of justice we assess the current state of knowledge in the economics of immigration and consider how economic theories of knowledge can be used to further the goal of developing a just immigration policy in the process we highlight the contributions of economists working in canada and canadian economists internationally in furthering our understanding of this important research area we identify research gaps such as the need for more research on the underlying causes of the poor returns to foreign work experience for immigrants from non traditional source countries and the effect of immigrants on stimulating innovation more research is also needed on the implications of temporary foreign worker tfw programs and the growing importance of employers in immigrant selection systems la recherche canadienne en economie de l immigration a travers la lentille des theories de la justice on jauge l etat present des connaissances en economie de l immigration et on examine comment les theories economiques de la connaissance peuvent etre utiles dans la poursuite d un objectif qui serait de mettre en place une politique d immigration juste dans ce processus on souligne les contributions des economistes travaillant au canada a notre comprehension de ce chantier de recherche on identifie certaines zones d ombre comme la recherche pour comprendre les causes sous jacentes aux pauvres rendements de l experience de travail des immigrants en provenance des pays qui ne sont pas des sources d immigration traditionnelles et celle pour comprendre les effets des immigrants sur la stimulation de l innovation il faudra aussi davantage de recherches sur les implications des programmes pour attirer et accueillir les travailleurs etrangers temporairement et sur l importance croissante des employeurs dans les systemes de selection d immigrants

immigrant earnings age at immigration matters a correlation between age at immigration and earnings is observed in canadian census data the evidence supports three underlying sources of the effect first work expe rience in the source country yields virtually no return in the host country second the return to education varies with age at immigration and finally an acculturation effect is observed for immigrants who are visible minorities or whose mother tongue is not english further it is found that educational attainment and relatedly earnings vary systematically across age at immigration with those arriving around age 15 to 18 obtaining fewer years of education

footloose and pollution free in numerous studies economists have found little empirical evidence that environmental regulations affect trade flows in this paper we propose and test several common explanations for why the effect of environmental regulations on trade may be difficult to detect we demonstrate that whereas most trade occurs among industrialized economies environmental regulations have stronger effects on trade between industrialized and developing economies we find that for most industries pollution abatement costs are a small component of total costs and are unrelated to trade flows in addition we show that those industries with the largest pollution abatement costs also happen to be the least geographically mobile or footloose after accounting for these distinctions we measure a significant effect of pollution abatement costs on imports from developing countries and in pollution intensive footloose industries

equilibrium political budget cycles political business cycle theories generally rely on nominal rigidities and voter myopia this paper offers an equilibrium theory that preserves some basic insights from earlier models though with significant refinements the political budget cycle emphasized here is in fiscal policy rather than output and inflation it arises via a multidimensional signal process one can consider the welfare implications of proposals to mitigate the cycle and the effects of altering the electoral structure copyright 1990 by american economic association

emissions trading of global and local pollutants pollution havens and free riding abstract in the presence of local sulfur and global carbon pollutants we examine the pollution haven hypothesis and free riding behavior under domestic emissions trading poorer southern countries become pollution havens when free trade opens up whenever sulfur damage functions are linear or when sulfur levels in equilibrium are not higher in the south with global trading of carbon permits the pollution haven effect emerges in equilibrium whenever the convex sulfur damage functions are nonlinear countries that do not participate in a global protocol designed to reduce carbon emissions enjoy double benefits stemming from free riding and cleaner local environments

political parties electoral competition government expenditures and economic reform in india political analysis of economic policy making in india has tended to downplay the role of political parties while stressing the influence of classes and the state this article reports the results of an attempt to understand policy making in india in terms of political parties and their electoral concerns the analysis will illustrate the extent to which changing patterns of government expenditures can be understood as a result of the emergence of electoral competition to the congress party this focus on political parties will also offer an additional perspective on the ability of the ruling party in india to undertake the economic reform necessary for sustained economic growth

immigrants economic assimilation evidence from longitudinal earnings records we examine immigrants earnings trajectories and measure the extent and speed with which they are able to reduce the earnings gap with natives using a dataset that links respondents of the survey

education credentials and immigrant earnings using 1981 to 2001 census data we study how the human capital of immigrants is rewarded in canada we distinguish between years of schooling and degrees obtained in order to estimate sheepskin effects the gain in earnings associated with receipt of a degree controlling for years of schooling we find that immigrant years of schooling and immigrant work experience accumulated before arrival is valued much less than canadian experience of comparable natives however for immigrants the increase in earnings associated with completing educational programs is generally higher than that of comparable natives we provide both signalling and human capital interpretations of this finding a l aide des donnees de recensement entre 1981 et 2001 on examine la facon dont le capital humain des immigrants est reconnu et remunere au canada on fait la distinction entre les annees de scolarite et les grades obtenus afin de calibrer les effets du diplome les gains associes a l obtention du grade apres avoir pris en compte les annees de scolarite on decouvre que les annees de scolarite et d experience accumulees par les immigrants avant leur arrivee recoivent une ponderation moins grande que l experience comparable des canadiens cependant pour les immigrants le fait de completer leur programme a un effet sur l accroissement des revenus qui est plus important que pour les canadiens de souche on suggere des interpretations de ces resultats a partir de theorisations fondees sur le capital humain et la theorie des signaux

the labour market performance of recent migrants migrant workers constitute a vital component of many western labour markets although migrants can benefit greatly by moving to higher wage economies it is important to compare their labour market outcomes with those of native born workers in this paper we discuss factors that have been found to influence labour market success in the receiving country and examine the actual performance of recent migrants to the uk the uk provides a good case study for conducting such an exercise because of the very large increases in immigration that have been seen over the past decade we find that labour market performance varies greatly between migrant groups and that outcomes have changed noticeably following the uk government s decision to allow migrants from poland and other central and eastern european countries more or less free access to the labour market after eu enlargement in 2004

a positive theory of fiscal deficits and government debt this paper considers an economy in which policymakers with different preferences alternate in office as a result of elections government debt is used strategically by each policymaker to influence the choices of his successors if different policymakers disagree about the desired composition of government spending between two public goods the economy exhibits a deficits bias that is debt accumulation is higher than it would be with a social planner the equilibrium level of debt is larger the larger is the degree of polarization between alternating governments and the less likely it is that the current government will be re elected

the political economy of government responsiveness theory and evidence from india the determinants of government responsiveness to its citizens is a key issue in political economy here we develop a model based on the solution of political agency problems having a more informed an politically active electorate strengthens incentives for governments to be responsive this suggests that there is a role both for democratic institutions and the mass media in ensuring that the preferences of citizens are reflected in policy the ideas behind the model are tested on panel data from india we show that public food distribution and calamity relief expenditure are greater controlling for shocks where governments face greater electoral accountability and where newspaper circulation is highest

the weak government thesis some new evidence this paper presents new evidence on the hypothesis that coalition governments will find it more difficult to keep their budgets in line after an adverse economic shock than do one party majoritarian governments the estimates are based on a broad sample of oecd countries for the period 1979 1995 using various specifications as suggested in the literature we do not find evidence that the type of government affects cross country variation in fiscal policy however the number of political parties in government affects central government debt growth

political business cycles and endogenous elections empirical research of political business cycles pbcs may suffer from endogeneity bias when incumbent governments have discretion to call for an early election using an instrumental variable iv routine on data from japan and the u k we find strong evidence to support the notion that election timing is a function of the economy rather than the macroeconomy being driven by elections as assumed in pbc in single equation regressions no evidence of political cycles are found but hausman tests suggest elections are endogenous in our regressions a monetary cycle in japan and an inflation cycle in the u k are uncovered through iv estimation

the political determinants of fiscal policies in the states of india an empirical investigation abstract using data from the 14 major states of india we investigate whether state governments fiscal policy choices are tempered by political considerations our principal findings are twofold first we show that certain fiscal policies experience electoral cycles state governments raise less commodity tax revenue spend less on the current account and incur larger capital account developmental expenditures in election years than in all other years second we show that coalition state governments raise less own non tax revenues and spend less on the current account than state governments that are more cohesive in composition in sum the dispersion of political power affects government size

the political economy of benefits and costs a neoclassical approach to distributive politics this essay offers a rational political explanation for the notorious inefficiency of pork barrel projects with an optimization model of legislative behavior and legislative institutions the model emphasizes the economically arbitrary from a welfare point of view importance of the geographic incidence of benefits and costs owing to the geographic basis for political representation we explore the implications of a legislator s objective function and derive conditions under which a representative legislature will select an omnibus of projects each of which exceeds the efficient scale

political business cycles democratization and economic reform the case of africa abstract this paper presents cross country evidence that political business cycles are alive and well in the nascent democracies of the developing world africa provides fertile ground for the study of political business cycles this paper uncovers systematic electorally timed interventions in five monetary and four fiscal policy variables in a panel of african countries these findings are consistent with the predictions of rational opportunistic political business cycle theory if africa s increasingly frequent elections are associated with reversals of fiscal and monetary policy reform there is a potential conflict between political and economic reform

empirical age earnings profiles the human capital earnings function in which earnings are expressed as a quadratic in potential experience is probably the most widely accepted empirical specification in economics in spite of its widespread acceptance the human capital earnings function provides a very poor approximation of the true empirical relationship between earnings and experience the standard formulation understates early career earnings growth by about 30 50 and overstates midcareer growth by 20 50 however simple alternative specifications that fit the data are available

assimilation changes in cohort quality and the earnings of immigrants this paper reexamines the empirical basis for two facts that seem to be found in most cross section studies of immigrant earnings 1 the earnings of immigrants grow rapidly as they assimilate into the united states and 2 this rapid growth leads to many immigrants overtaking the earnings of the natives within 10 15 years after immigration using the 1970 and 1980 u s censuses this paper studies the earnings growth experienced by specific immigrant cohorts during the period 1970 80 it is found that within cohort growth is significantly smaller than the growth predicted by cross section regressions for most immigrant groups this differential is consistent with the hypothesis that there has been a secular decline in the quality of immigrants admitted to the united states

fragmented fiscal policy abstract this paper explores on a panel of 19 oecd countries the role of fragmentation in determining fiscal outcomes over the 1970 95 period we first define the notion of fragmentation of fiscal policy making as the degree to which the costs of a dollar of aggregate expenditure are internalized by individual decision makers empirically this notion has two key logical components the number of decision makers and the rules of the game or the budget process in turn the number of decision makers can refer to the number of parties in a coalition or the number of ministers in the cabinet we test all these determinants against each other and against perhaps the oldest explanation of all ideology we show that cabinet size and to a lesser degree coalition size and ideology are significant and robust determinants of fiscal outcomes in particular transfers are the budget items most affected by these factors

political parties and the business cycle in the united states 1948 1984 this paper tests the existence and the extent of a politically induced business cycle in the u s in the post world war ii period the cycle described in this paper is different from the traditional political business cycle of nordhaus it is based on a systematic difference between the monetary policies of the two parties in a model with labor contracts from an explicit optimization problem we derive a system of equations for output and money growth then we successfully test the non linear restriction imposed by the theory on the parameters of the system of equations we cannot reject the hypothesis that money growth has been systematically different under the two types of administration and that this difference contributes to explain output fluctuations

labor market assimilation of immigrant women using 1970 1980 and 1990 u s census data the author examines the life cycle patterns of immigrant women s labor force participation he finds that the cross sectional approach that has been used in all previous studies leads to a substantial over estimate of the degree to which immigrant women s assimilation increases their labor force participation the effect of assimilation found by using the cohort approach however which acknowledges the possibility that patterns of labor force participation partly reflect the year of immigration is still sizable the effect is concentrated within the first 10 years after arrival there are substantial differences in participation and assimilation by country of birth immigrants from japan korea and china are found to have experienced the greatest degree of assimilation with an effect that raises the probability of working by 20 percentage points during the first 10 years after arriving in the united states

endogenous elections electoral budget cycles and canadian provincial governments the existence of manipulative electoral budget cycles and opportunistic election setting is examined in the framework of a parliamentary democracy empirical tests are conducted using a pooled time series cross section data set derived from canadian provincial governments over the 1962 1992 period evidence in support of the electoral budget cycle hypothesis but not the opportunistic election timing hypothesis is obtained

the labor market skills of recent male immigrants evidence from the current population survey using data from special supplements to the current population survey cps the authors track the education and hourly earnings of recent male immigrants to the united states in terms of these measures of labor market skills the cps data suggest that immigrants who came in the late 1980s were more skilled than those who arrived earlier in the decade this pattern represents a break from the steady decline in immigrant skill levels observed in 1940 80 census data despite the encouraging trend over the 1980s however the average skills of recent immigrants remain low by historical standards

self selection and the earnings of immigrants this paper analyzes the way in which the earnings of the immigrant population may be expected to differ from the earnings of the native population because of the endogeneity of the decision to migrate the empirical study shows that differences in the u s earnings of immigrants with the same measured skills but from different home countries are attributable to variations in political and economic conditions in the countries of origin at the time of migration excerpt

you can t take it with you immigrant assimilation and the portability of human capital the national origin of an individual s human capital is a crucial determinant of its value education and labor market experience acquired abroad are significantly less valued than human capital obtained domestically this difference can fully explain the earnings disadvantage of immigrants relative to comparable natives in israel variation in the return to foreign schooling across origin countries may reflect differences in its quality and compatibility with the host labor market the return to foreign experience is generally insignificant acquiring additional education following immigration appears to confer a compound benefit by raising the return to education acquired abroad

the visible minority earnings gap across generations of canadians abstract to what extent the earnings gaps facing canada s visible minorities reflect discrimination is a question of tremendous policy interest this paper argues that failing to account for the limited canadian ancestry of visible minorities overestimates discrimination if immigrant assimilation is an intergenerational process using the 2001 and 2006 canadian censuses weekly earnings conditional on a rich set of worker and job characteristics are compared with child immigrant second and third and higher generation canadian men the results reveal a tendency for earnings to increase across subsequent generations of visible minority but not white men though the pattern is strongest between the first and second generation for black men it is also evident between the canadian born with and without a canadian born parent despite this progress for most visible minority groups earnings gaps are identified even among third and higher generation canadians

international migration and educated unemployment this paper provides a novel explanation of educated unemployment which is a salient feature of the labor markets in a number of developing countries in a simple job search framework we show that educated unemployment is caused by the prospect of international migration that is by the possibility of a brain drain in addition the analysis shows that a developing country may end up with more educated workers despite the brain drain and educated unemployment

incumbent behavior vote seeking tax setting and yardstick competition this paper develops a model of the political economy of tax setting in a multijurisdictional world where voters choices and incumbent behavior are determined simultaneously voters are assumed to make comparisons between jurisdictions to overcome political agency problems this forces incumbents into a yardstick competition in which they care about what other incumbents are doing we provide a theoretical framework and empirical evidence using u s state data from 1960 to 1988 the results are encouraging to the view that vote seeking and tax setting are tied together through the nexus of yardstick competition

the economics of immigration this literature review concerns the impact of immigration on the economy of the host country focusing on the experience of the united states the emphasis is on the period from the 1970s to the 1990s the author shows that research earlier in this period generally concluded that the economic effects of immigration were positive but that more recent research on later migrations have generally concluded that immigration may be having an adverse effect on the earnings of native unskilled workers and be placing an increased burden on welfare programs the importance of such economic analysis for the formulation of appropriate migration policies is stressed

immigrant worker assimilation is it a labor market phenomenon the work in this paper contributes to the debate on the economic assimilation of immigrant workers in the u s labor market a model of simultaneous occupational choice and earnings is estimated for foreign born hispanic men foreign born east asian men and for native white men to test the general hypotheses of assimilation an important distinction is made between those who migrated as adults and those who migrated as children the results suggest that the appearance of assimilation may be the outcome of pre labor market experiences of individuals who migrate as children along with changes in u s immigration law that have relaxed skill criteria for entering immigrants

the earnings of immigrant men in canada job tenure cohort and macroeconomic conditions using eleven cross sectional surveys spanning 1981 92 the authors compare the earnings of immigrant and native born men in canada apparently recent immigrant cohorts have suffered no decline in earnings job tenure is found to be a strongly significant determinant of earnings previous estimates of immigrant earnings differentials which have not incorporated job tenure information may partly reflect differences in tenure between immigrants and the native born when the sample is restricted to pairs of surveys that are close to the census survey years the estimates of cohort effects are sensitive to the choice of survey years one possible explanation for that sensitivity is suggested by the finding that macroeconomic conditions are a statistically significant determinant of the rate of assimilation of recent immigrants

political cycles in a developing economy effect of elections in indian states the author studies the effect of state legislative assembly elections on the policies of state governments in 14 major states of india from 1960 to 1996 she identifies the effect of the timing of elections using an instrument for the electoral cycle that distinguishes between constitutionally scheduled elections and midterm polls she contrasts two levers of policy manipulation fiscal policy and public service delivery to distinguish between alternative models of political cycles the predictions of three models are tested 1 populist cycles to woo uninformed and myopic voters 2 signaling models with asymmetric information 3 a moral hazard model with high discounting by political agents the empirical results for fiscal policy show that election years have a negative effect on some commodity taxes a positive effect on investment spending but no effect on deficits primarily because consumption spending is reduced with regard to public service delivery elections have a positive and large effect on road construction by state public works departments strikingly the fiscal effects are much smaller than the effect on roads the author argues that the pattern of evidence is inconsistent with the predictions of models of voter myopia and asymmetric information she explores an alternative moral hazard model in which the cycle is generated by high political discounting and career concerns persuade politicians to exert greater effort in election years on the management of public works

evidence of new immigrant assimilation in canada previous studies of the labour market experience of male immigrants to canada have uncovered two disturbing trends declining entry earnings for successive new immigrant cohorts and low assimilation rates these findings suggest that many of these cohorts may never assimilate the 1991 census provides a first look at the immigrant cohorts arriving in the 1980s these immigrants appear to avoid the plight of their predecessors entry earnings have stopped falling and those immigrants arriving between 1981 and 1985 experienced a 17 per cent assimilation rate i am unable to explain this turnaround based on the observable characteristics recorded in the census data

ethnic enclaves and immigrant earnings growth the impact of living in an ethnic enclave on earnings growth of immigrants in canada is examined using the 1981 2001 censuses consistent with u s findings enclaves are found to have a negative impact on the earnings growth of male immigrants a negative impact is also found for female immigrants living in an enclave was found to be particularly harmful for individuals immigrating as adults especially for females but did not affect immigrants who arrived at a young age enclaves had a more negative impact on high skilled male immigrants especially if they had received the bulk of their education outside canada enclaves were also found to hinder language skills l impact du fait de vivre dans une enclave ethnique sur la croissance des gains des immigrants au canada est analysea l aide des donnees de recensements de 1981 a 2001 en concordance avec les resultats des etudes americaines on decouvre que les enclaves ont un effet negatif sur la croissance des gains des hommes immigrants il y a aussi un impact negatif sur la croissance des gains des femmes immigrantes vivre dans une enclave est particulierement dommageable pour les personnes qui immigrent au stade adulte et ce particulierement pour les femmes les effets negatifs ne se font pas sentir sur les immigrants qui arrivent en bas ge les enclaves ont un effet davantage negatif pour les hommes immigrants hautement qualifies en particulier s ils ont recu le gros de leur education hors du canada on montre que de vivre en enclaves retarde le developpement d habiletes langagieres

free trade and global warming a trade theory view of the kyoto protocol this paper demonstrates how three important results in environmental economics true under mild conditions in closed economies are false or need serious amendment in a world with international trade in goods since the three results we highlight have framed much of the ongoing discussion and research on the kyoto protocol our viewpoint from trade theory suggests a re examination may be in order specifically we demonstrate that in an open trading world but not in a closed economy setting 1 unilateral emission reductions by the rich north can create self interested emission reductions by the unconstrained poor south 2 simple rules for allocating emission reductions across countries such as uniform reductions may well be efficient even if international trade in emission permits is not allowed and 3 when international emission permit trade does occur it may make both participants in the trade worse off and increase global emissions

canadian immigration policy the effectiveness of the point system and other instruments this paper examines the effects of changes in canadian immigration policy on the occupational composition of immigration we focus on 1967 changes that created a regulatory system including the point system that still forms the framework of canadian immigration policy we find that the point system provides some control over occupational composition but that its effectiveness in fine tuning is limited by the large number of other characteristics it seeks to control we also find that entry class and source country composition of inflow have impacts that have swamped the effects of the point system in the last two decades summary in fre

an efficient mechanism to control correlated externalities redistributive transfers and the coexistence of regional and global pollution permit markets abstract we examine joint tradable permit markets as a self enforcing mechanism to control correlated externality problems by correlated we mean multiple pollutants that are jointly produced by a single source but which simultaneously cause differentiated regional and global externalities e g smog and global warming by self enforcing we mean a mechanism that accounts for the endogeneity that exists between competing jurisdictions in the setting of environmental policy within a federation of regions we find that joint domestic and international permit markets are pareto efficient for a wide class of preferences

on the efficiency of a global market for carbon dioxide emission permits type of externality and timing of policymaking we demonstrate that global permit markets are pareto efficient despite the externality type production or consumption when income redistribution occurs after regional environmental policymaking ex ante income redistribution is neutral if emissions affect production only but non neutral if emissions affect consumption 2008 elsevier b v all rights reserved

electoral and partisan cycle regularities in canada in this paper following recent politico institutional approaches to the theory of economic policy the authors present a methodology for identifying political cycle regularities and test for electoral and partisan cycles in canadian target variables and monetary and fiscal policy instruments using annual data from 1926 to 1994 the empirical evidence suggests the absence of political cycles in canada