Government mandates are often used to promote equality in the workplace, often imposing additional costs upon employers. Economic theory suggest that these additional costs will be shifted onto the employees through a reduction in wages. However, when wage shifting is not an option due to anti-discrimination laws, how will employers respond to the additional costs imposed? Gruber (1994) found that wage shifting occurs when the groups benefiting from a government mandate are easily identifiable to the employer, despite the existence of anti-discrimination laws. This study seeks to further the work of Gruber (1994) and examine wage shifting at an industry level. We look at industries that have a large percentage of workers who are benefited by a government mandate to see if the wage shifting in these industries was more significant. This study finds that, as the percentage of workforce receiving benefits increases, the amount of wage shifting grows.

京都大学 / 0048 / 新制・課程博士 / 博士(経済学) / 甲第20147号 / 経博第545号 / 新制||経||280(附属図書館) / 京都大学大学院経済学研究科経済学専攻 / (主査)准教授 遊喜 一洋, 教授 劉 徳強, 教授 神事 直人 / 学位規則第4条第1項該当 / Doctor of Economics / Kyoto University / DFAM

The U.S. apparel manufacturing industry includes many reputable firms, but is also believed to include many sweatshop operations. Sweatshop workers often work under sub-minimum wages, excessively long hours, and abusive management. Sweatshop establishments in the United States typically violate several U.S. labor laws. Two they commonly violate are the minimum wage under the Fair Labor Standards Act of 1938 and the ban on hiring illegal immigrants under the Immigration Reform and Control Act of 1986. The purpose of the present research was to estimate minimum penalties that would provide no monetary incentive for the average U.S. apparel manufacturing firm to violate the minimum wage and the ban on hiring illegal immigrants. The minimum per-violation penalties that were estimated to deter violation of the minimum wage are 8 to 28 times the current maximum penalty of $1,000 per violation, and those estimated to deter the hiring of illegal immigrants are 3 to 10 times the current maximum penalty of $10,000 per violation. The estimated penalties are associated with annual probabilities of prosecution ranging from 5% to 15%. The estimated penalties primarily depend on the difference between legal and illegal wage rates. A sensitivity analysis indicated that the estimated penalties are insensitive to the value of the own-price elasticity of production labor demand, which is one of the variables used to calculate the penalties. The results suggest that current federal penalties for violating the minimum wage or the ban on hiring illegal immigrants do not deter infraction of these laws by U.S. apparel manufacturers. / Master of Science

This dissertation is an empirical investigation into the distributive effects of overand under-education, defined as market outcomes such that some workers possess skills over or below those required at their jobs respectively. This type of market failure can arise in assignment and search equilibrium settings, as well as in the presence of asymmetric information regarding workers' performance on the job. The existence of permanent and sizable mismatch rates means that returns to education are depressed for over-educated workers and in ated for under-qualified workers. Thus, irreversible decisions to invest in human capital are made in a context of uncertainty regarding the exact outcomes that might arise. As in the Todaro model, where individuals decide whether to migrate to cities based on the expected values of the available alternatives, workers might decide it is worthwhile to keep investing in education even if the probability of finding appropriate employment is falling. The three chapters of the dissertation are entitled: Skill Mismatch and Earnings: A Panel analysis of the U.S. Labor Market," Earnings Inequality and Skill Mismatch in the U.S: 1973-2003," and Employment and Distribution Effects of Changes in the Minimum Wage." Skill Mismatch and Earnings: A Panel analysis of the U.S. Labor Market This chapter examines the effect on earnings induced by a mismatch between workers' skills and the skills actually required on the job. It uses the Current Population Survey (CPS) for the period 1983-2002. The special re-interview methodology of the CPS is used to create a large panel, so that individual heterogeneity can be controlled for. Skill requirements are estimated by the median education level for each 3-digit occupation in the 1980 census occupational classification. The analysis, including the determination of skill requirements, is conducted for males and females separately. Cross-sectional analysis confirms the findings in the recent literature. Returns to required schooling are higher than the returns to attained education in standard earnings regressions. Also, for workers with similar educational attainment, over-education reduces earnings and under-education increases them. Contrary to what other studies have found, we conclude that these results are confirmed after controlling for individual fixed effects. The chapter also investigates which groups are more exposed to mismatch. I use standard probit analysis with over-education and under-education as the respective dependent variables. Women, service sector, and non-unionized workers appear to have higher probabilities of mismatch. Earnings Inequality and Skill Mismatch This chapter shows that skill mismatch is a significant source of inequality in real earnings in the U.S. and that a substantial fraction of the increase in wage dispersion during the period 1973-2002 was due to the increase in mismatch rates and mismatch premia. Standard human capital earnings regressions that do not decompose the education variable into required, surplus, and deficit years provide biased estimates of the relative importance of education in explaining earnings inequality. In 2000-2002 surplus and deficit qualifications taken together accounted for 4:3 and 4:6 percent of the variance in earnings, or around 15 percent of the total explained variance. The dramatic increase in over-education rates and premia accounts for around 11 and 32 percent of the increase in the coeffcient of variation of log earnings during the 30 years under analysis for males and females respectively. Residual inequality is slightly diminished when the estimating equation allows the prices of surplus, required and deficit qualifications to differ but the well-studied increasing trend of within-group inequality remains otherwise unchanged. Changes in the composition of the labor force are found to be important predictors of increasing residual inequality even when skill mismatch is taken into account. The Distributive Effects of the Minimum Wage: an Effciency Wage Model with Skill Mismatch (co-authored with Peter Skott) This chapter analyzes the effect of changes in the real value of the minimum wage on the wage distribution. Changes in the minimum wage and other labor market institutions affect workers in all groups and empirically appear to be good complement to standard supply and demand arguments in explaining overall inequality. We use an effciency wage model but allow for mismatch between jobs and workers. This framework yields predictions not only on the skill premium but also on the extent of inequality within groups. To keep matters as simple as possible, we assume that high-skill workers can get two types of jobs (good and bad), whereas low-skill workers have only one type of employment opportunity (bad). As long as some matches of high-skill workers and bad jobs are sustained in equilibrium, changes in the exogenous variables will affect not only wages and employment rates but also the degree of mismatch. Thus, this paper shows that `over-education' can be generated endogenously in effciency wage models and that a fall in the real value of the minimum wage can (i) reduce total employment, (ii) lead to a simultaneous decline in both the relative employment and the relative wage of low-skill workers, and (iii) produce a rise in within-group as well as between-group inequality. Evidence from the US suggests that these theoretical results are empirically relevant.

<P> The three essays in this thesis conduct empirical research on the economics of immigration using data from the Canadian Censuses. In the first paper, I analyze the impact of immigration on native-born Canadians' wage growth by combining an area approach and a skill approach. The estimated effects of immigration from both a first difference regression and a two-stage regression are either statistically insignificant or significantly positive. The results indicate that there is no evidence for a negative impact of the large immigrant influx during the 1990s on the wage growth of natives. The second essay examines the impact of residence in an ethnic enclave on male immigrants' labour force activities. For recent immigrants who arrived in Canada within ten years, the intensity of enclave residence is found to be negatively associated with their labour force participation rate, but positively correlated with their employment probability. However, living in an enclave has no significant effect on the labour force activity of old immigrants whose years-since-migration is more than twenty. These findings are robust to probit and instrumental variable estimations. In the third essay, I examine the returns to education for first, second and third generation immigrant men. Multivariate regression results indicate that the third generation with at least postsecondary education earn more than the equally educated first and second generations. However, the third generation do not have a wage premium over the second generation when they have high school education and lower. I explain the well-educated second generation's difficulty in translating their intellectual ability into productivity by their ethnic and linguistic distance from the Canadian mainstream, and by negative city-specific effects. I then suggest that immigrant assimilation policies that target the well-educated first and second generations should be designed to promote the acceptance of their human capital by the Canadian labour market. </p> / Thesis / Doctor of Philosophy (PhD)

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<p>This thesis comprises three essays. The first two essays examine what inferences can be drawn about the structure of wages from the experiences of displaced workers using the Ontario Ministry of Labour Plant Closure Survey. The third essay examines the effect of unemployment benefits on household consumption during spells of unemployment, with a particular emphasis on durables purchases. It employs data from a second and new data source, the Canadian Out of Employment Panel.</p> <p>The first essay revisits the issue of what can be learned about wage tenure profiles from displaced worker data. The positive relationship between wages and tenure in cross section data is consistent with the accumulation of firm specific capital. Alternatively, it may be explained by unobserved heterogeniety across workers, or by endogenous mobility. Displaced worker data is quite helpful in correcting for the first possible bias, and less so for the second. The relationship between various estimation strategies in the literature is illustrated. Estimates that control for individual heterogeniety and endogenous mobility driven by systematic differences in the pay policies of firms are presented. In this data, 10 years of tenure appears to raise wages by about 7%.</p> <p>The second essay examines intra-industry wage differentials. Even after conditioning on a rich set of worker and job characteristics, firm of employment is a significant determinant of wages. Estimates that employ the longitudinal nature of data demonstrate that sorting of workers across firms by unobserved ability can explain about half of the observed differentials. Firm wage differentials are observed within narrow industries, consistent across broad occupational groups, and robust to conditioning on differences in the mix of skills or job characteristics. Further "high wage" firms exhibit high average tenures suggesting that positive wage premia are associated with reduced mobility. These observations imply that compensating wage differentials are also a poor candidate explanation for the observed differentials. The results are more consistent with models based on rents or some firm monopsony power. The results also raise questions about the interpretation of wage regressions which ignore firm heterogeneity, and about the sources of wages losses among displaced workers.</p> <p> The final essay examines how households smooth consumption over the income losses due to an unemployment spell. A model of "internal capital markets" is proposed, which suggests that households adjust the timing of the replacement of small durables to income flows. The plausibility of this model is investigated empirically, using a series of program changes in the Canadian unemployment insurance scheme for exogenous variation in transitory income. The data are consistent with the predictions of the "internal capital markets model" while rejecting both a standard life cycle model and a "rule of thumb" model of household expenditure patterns.</p> / Thesis / Doctor of Philosophy (PhD)

This dissertation examines aspects of both the consumer (the "give") and the server (the "take") sides of restaurant tipping. On the consumer side, I address both why, and how much, people tip in restaurants. I also examine a policy issue related to the recent Supreme Court decision in United States v. Fior d'Italia. These issues are addressed via a combination of theoretical, empirical, and experimental analysis. On the server side, I use survey data collected from several restaurants to address the issue of labor market discrimination based on beauty. Specifically, do more attractive servers earn higher tips than less attractive servers? I argue that a tipping data set offers several advantages over data sets used in previous studies of the beauty wage gap. This dissertation was funded by a National Science Foundation Dissertation Enhancement Grant (NSF #427347). / Ph. D.