Three separate characteristics (Static distribution, Earnings Mobility, Earnings Class Transition) of earnings distributions were examined with data from the Panel Study of Income Dynamics on male heads of households. Static estimates of earnings inequality were generated using the Gini coefficient, the variance of logarithm and the coefficient of variation measures for the 1969-1983 period. With this sample, it was estimated that inequality was from 19 to 68% higher in 1983 than in 1969. Explanations for this rise in male earnings inequality which were examined include the size of the cohort, the aggregate unemployment rate, the sector of employment and the level of education. After controlling for these effects, the time trend remained positive over this time period. / Earnings mobility was captured in a first-order Markov model of movements across earnings deciles. Fourteen transition matrices were constructed and three scalar measures of mobility were axiomatically defended. All three revealed significantly declining mobility over the 1969-1983 period. / Finally, a hazard model of earnings quintiles was developed to examine the transitions across earnings quintiles in a multi-period model. Corrections were made for censored data and heterogeneity. The least restrictive model revealed positive duration dependence for the four lower earnings quintiles, but negative duration dependence for the highest earnings quintile. Those in this sample in the highest 20th percentile of the earnings distribution are less likely to leave the earnings quintile, the longer they stay in the quintile. / Source: Dissertation Abstracts International, Volume: 51-01, Section: A, page: 0253. / Major Professor: David W. Rasmussen. / Thesis (Ph.D.)--The Florida State University, 1989.

The purpose of this dissertation is twofold: first, to investigate determinants of international labor migration to West Germany from a group of twelve countries classified in this study as high income and low income countries; second, to analyze the impact of workers' remittances on the consumption level of two labor sending countries. / For the first objective, this study utilizes the cost-benefit or the push-pull approach to labor migration. The main statistical tools which are used are the cross-sectional heteraskedastic and time wise-autoregressive model (CHTAM) and the multiple regression model. This study demonstrates that economic factors are responsible for flow of international labor migration to West Germany. It has been found that income level is more important as a determinant than industrial output in influencing the flow of labor migration from high income countries group, whereas for low income countries it has been found that industrial output is more important as a determinant than income level in influencing the flow of labor migration from this group of countries. It has also been found that immigration policy as a variable is more effective in reducing the inflow of labor migration to West Germany from low income countries than it is from high income countries. / For the second objective, an extended version of the Keynesian consumption function has been specified to test for the impact of workers' remittances on the consumption level of Morocco and Turkey, both of which are labor sending countries. This study demonstrated that workers' remittances have a positive relationship with the level of consumption and that in countries where the economies are under-developed, remittances may have a long-term development effect. This study concludes with some policy implications and with a few suggestions for future research. / Source: Dissertation Abstracts International, Volume: 48-12, Section: A, page: 3170. / Thesis (Ph.D.)--The Florida State University, 1987.

<p>The rigorous economic analysis of peer group formation is a burgeoning subject. Much has been written about how peers influence an individual's behavior, and these effects are quite prevalent. However, less has been written on how exactly these peer groups begin and the resulting consequences of their formation. A reason for the dearth of knowledge on peer group formation is the lack of quality data sets that clearly define one's peers. To resolve this issue, the first chapter of this document explores data which allows a peer group to be defined openly through self nominations. Using these nominations as well as characteristics of the students and their friends, it is possible to see on what dimensions these individuals are sorting into friendships. The data suggests that there is heavy sorting within race and academic ability. Additionally, tests for statistical discrimination on race and academics show that it is exhibited towards blacks and Hispanics. There is also weak evidence of statistical discrimination against whites. Empirical analysis also shows that the degree of statistical discrimination decreases for blacks and Hispanics over a year; however, there is little change for whites over the same period. This result suggests a process of learning about a noisy signal on academic characteristics. Once a peer group is formed, however, the effects of the peer group become much more interesting. The second chapter of this document attempts to find an effect of having friends of a similar race and who are involved in similar activities. Using a strategy that corrects for the endogeneity of peer effects by instrumenting using variables at the ``grade within school'' level, it is shown that friendship diversity can help whites increase achievement. Although not much significance was found with other races, most of the strategies pushed towards the direction of racial diversity aiding achievement. Regarding extracurricular activities, it is found that there is a benefit in having friends in common individual academic activities, conditional on the respondent only belonging to academic or scholastic clubs. There are insignificant effects in having friends in common sports, conditional on the respondent only participating in sports. Potential future work for both chapters can include models describing the benefit of having various friends and the probability of forming those friendships, which can be used to simulate redistribution policies.</p> / Dissertation

This dissertation consists of three essays in the area of Labor Economics.

This dissertation consists of three essays which combine studies of Industrial Organization and Labor Economics to investigate how institutions, like the intellectual property regime and funded R&D affect the production of patents and engineering degrees. Also occupational mobility in engineers is investigated as a source of additional supply of engineers. In the last two decades there have been significant changes in the interpretation of patent-law in the U.S. Most important for this study, software became a 'patentable subject matter' by 1995. Since 1995 the number of software patents has increased annually at an approximate rate of 15%. In the first essay I examine the impact of this treatment of property rights in patents, with the help of a self-compiled data set that matches firms' patent-portfolios with their financial variables, for the period 1986--2001. The last two essays examine the labor markets and the development of human capital in the engineering profession. I first model the annual production of engineers at the three degree levels (B.S., M.S., and Ph.D.) and four engineering sub-fields over the time period of 1970--1998. Unlike previous models, I disaggregate R&D by the two main performing groups: industry and university. Industry performed R&D is treated as a demand-side variable, while university performed R&D is treated as a supply side variable, through its impact on funding for higher education in engineering. Distributed lags of R&D spending are used as indicators of the extent of long-run opportunities in engineering. Starting salaries are interpreted as indicators of spot labor market conditions for newly minted degrees. A system of equations, models the number of engineering degrees at one degree-level as a potential applicant pool for the next higher degree-level. The availability of foreign students in the applicant pool is also accounted for. One of the major worries in engineering training is the extent to which the number of engineers in subfields in engineering will be mismatched with the demand for engineers in these subfields. Parts of the second and the entire third essay further examine mobility of engineers across engineering sub-fields. (Abstract shortened by UMI.)

This dissertation aims at enhancing the knowledge about dual job holding. While most studies in labor economics assume that each person holds only one job, a significant part of the work force holds two jobs simultaneously. The first part of the dissertation empirically analyzes the determinants of wages for dual jobholders, with an emphasis on the contribution of the "on the job" human capital accumulation. In order to increase the number of observations, data from 1990 to 1994 have been pulled together, thus resulting in a panel. The usual problem associated with panel data, together with the need to control for the selection bias, makes the full information maximum likelihood estimation very challenging. New econometric techniques developed by Wooldridge (Journal of Econometrics, 1995) and Vella and Verbeek (Journal of Econometrics, 1999) are used to overcome this problem. We found some evidence that the motivation behind the decision to hold two jobs may play an important role in determining the market return of moonlighting. Given the results of the first study, I explore the motivations that induce workers to hold two jobs and I explicitly design a labor supply function that includes these different motivations. I identify two major motivations: I call the first motivation the "hours constraint model". The hours constraint model says that workers underemployed will seek a second job in order to fulfill the gap in their work schedule. Yet, some workers may decide to hold two jobs simply because each job has some peculiar characteristics that makes it appealing to the worker. I call this motivation the "job portfolio model". The last part of the dissertation looks at the impact of hours regulation on the decision to hold two jobs. The understanding of this relationship is important in order to address the real impact of time-sharing policies on reducing unemployment. By enforcing stricter working week standards, labor policies aim at creating new jobs by inducing employers to shift from an intensive to and extensive use of workers. However I found that reducing the working week causes some workers to be underemployed, thus increasing the number of moonlighters.

<p>This dissertation is composed of three essays. In the first essay of this dissertation, I reexamine the effect of industrial mobility on the cost of worker displacement. While the human capital implications of this regularity are well understood, no current model can explain why a displaced worker would ever choose to "switch." I develop a match-based model of wages and endogenous mobility and show that switching industries may, indeed, be optimal for some "mismatched" workers. I then use data on displaced workers to re-estimate the cost of switching industries that controls for the endogeneity of industrial mobility. I find that switching industries is an optimal decision from the point of view of individual displaced workers &mdash; i.e. that losses would have been even larger had they "stayed." The results suggest that skill mismatch and the resulting inability of some workers to re-match their task-specific skills via reemployment is an important determinant of the observed costs of worker displacement. </p><p> In the second essay, I estimate the degree of heterogeneity in the outcomes of displaced workers and analyze the extent to which these heterogeneous experiences can be explained by observable (or "systematic") factors as opposed to unobserved (or "idiosyncratic") factors. To this end, I use data on displaced workers to estimate the standard deviation of earnings losses following displacement. I find statistically significant heterogeneity at the lower bound, which is equal to about half of the mean effect each year following displacement. Once I control for systematic differences in observable characteristics, the remaining idiosyncratic variation is estimated to be about 20%-40% less than the total variation in the first few years following displacement and 50%-80% less than the total variation six to eight years after displacement. Systematic variation, however, remains fairly large and constant over time. These results suggest that idiosyncratic factors, such as luck or unobserved quality, have largely transitory effects on the outcomes of displaced workers while systematic factors, such as industrial mobility and unemployment duration, disproportionately explain the persistent heterogeneity in the costs of worker displacement. </p><p> The third essay explores the potential causes of spillovers in the wage distribution that occur when the minimum wage increases. This empirical phenomenon, known as the "ripple effect" of minimum wage laws, is typically explained in terms of demand substitution: where the rising minimum increases the demand for more-skilled workers who become relatively inexpensive compared to less-skilled workers. I show that workers will also respond to changes in the minimum wage by re-optimizing their labor supply since an increase in the minimum wage leads to lower compensating wage differentials. The resulting decline in labor supply at hedonically less desirable (and hence, higher paying) jobs could also cause the ripple effect. I combine labor market data on individuals with occupation-level hedonic data and provide evidence that the ripple effect is largely caused by labor supply substitution and <i>not</i> labor demand substitution as previously believed. </p><p> Keywords: Job Displacement, Tasks, Mismatch, Human Capital, Heterogeneous Treatment Effects Minimum Wage, Ripple Effect, Hedonic Wages. </p>

This dissertation consists of three empirical essays on the economic adjustments that followed trade liberalization and other market-oriented reforms in Mexico during the 1980s and 1990s. In the first essay, I use micro data from the Mexican Population Census to explain the recent reversal in economic convergence between Mexican states. I decompose the divergence into components due to economy-wide changes in skill prices and components due to state-specific changes in the composition of workers. I find that the rise in the education premium hindered the progress of poor states and raised the variance of average state wages. However, educational attainment mostly compensated for this income widening effect. State-level regressions reveal that initial level of education, size of the agricultural sector, and distance to the U.S. border were important factors while public infrastructure was not. In the second essay, I use Mexican Income-Expenditure Surveys to examine relative wages and employment of women in Mexico during the trade liberalization period. The gender wage gap was relatively stable during 1989--2000 while the relative supply of women increased, suggesting that relative demand for women also increased. I find that industrial change, such as the decline of agriculture and the expansion of services and light manufacturing, moved in favor of women. Using state-level data, I find that the wage bill share of women is negatively related to agricultural employment and positively related to maquiladora employment, a proxy for foreign direct investment. In the third essay, I use micro data from the Mexican Population Census to study the effects of trade liberalization and domestic reforms on rural-urban migration in Mexico. To take better advantages of the new rules of international trade, a new agrarian law gave property rights to communal farmers. At the same time, tariff and quota protection for agriculture as well as price supports, credits and subsidies to this sector were virtually dismantled. I find that in addition to city-village wage differences and after controlling for self-selection, the share of former communal land within a community has an important positive effect on the probability of individual migration.

Utilizing a unique and comprehensive data set on the personal and job characteristics of workers from three firms, we test the equalizing wage differential theory and study the determinants of the persistent male-female earnings gap. Access to information on the point-grading systems used by the three firms to set their wages, permits us to expose the methodology behind the systems which are being considered by Comparable Worth advocates as potential substitutes for the market in the determination of wages. Our data on grades, and on directly observed job characteristics that are homogeneous across firms, reduce the biases of the traditional wage hedonic estimators and enhances their efficiency. Our results show systematic support for the theory of equalizing wage differentials. The inclusion of grade information increases the flexibility of traditional models by complementing human capital theory with important administrative constraints that usually accompany internal labor markets. Our model reduces the unexplained portion of the observed earnings gap between males and females and highlights the difficulties associated with using inter-firm data from national samples. Using an arbitrary set of job characteristics we explain approximately 80 percent of the grades used in the firms under study. By contructing a variable to simulate the job analyst's estimate of the sex of the worker, we show that analysts can, by choosing the appropriate weights, set wages and manipulate grades to perpetuate the earnings gap. A high correlation between market wages and grades is found, which confirms that it is impossible to escape market realities using grading systems in their present form. Therefore, if, as Comparable Worth advocates desire, grading system are to be used to set wages for all workers across the country in a way that market distortions are not reflected by the grades, the existing systems are not adequate. We show that if analysts were forced to use the same weights across firms the flexibility of their system to adapt to local market conditions would be severely hindered.

The purpose of these essays is to test empirically a model of wage contract duration developed by Gray (1978). The focus is on wage agreements negotiated between unions and firms. In most contract length models negotiating agents seek to minimize an objective function comprised of costs associated with a contract. This objective function has two components, a fixed cost borne each time negotiations are undertaken and a variable cost which increases with the level of uncertainty confronting the firm and as the bargain becomes longer. The presence of the fixed cost usually makes a spot market suboptimal while the variable component prevents the agreement from being of infinite duration. These models suggest that contracts will become shorter as price or output uncertainty increases. The initial empirical findings, surprisingly, suggest that contracts become longer, not shorter, as output fluctuations, measured by the output forecast standard error, increase; a result opposite to that predicted by the theoretical models. There are several possible explanations for such a result. First, and most obviously, the theory may be wrong. Second, a missing variable such as the degree of wage indexation may affect both contract length and the uncertainty measure thus obscuring the true relationship between the two included variables. Third, econometric problems including bias, heteroscedasticity, and autocorrelation may be affecting the estimated coefficients. An alternative estimation procedure using individual firm data indicates that, for some industries, contract length is positively related to uncertainty caused by productivity (industry-specific) shocks and negatively related to money supply shocks. In other instances the results suggest no significant relationship between contract duration and the uncertainty measures. Using pooled data adjusted to eliminate heteroscedasticity and introducing industry dummy variables into the estimations indicates that contract length is not significantly related to the industry-specific shock measure. At the 95% confidence level contract duration is negatively affected by money supply uncertainty only among durable goods producers.