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Articles 1 - 4 of 4
Full-Text Articles in Social and Behavioral Sciences
Measuring Labor Market Segmentation From Incomplete Data, Noe Wiener
Measuring Labor Market Segmentation From Incomplete Data, Noe Wiener
Economics Department Working Paper Series
This paper proposes a measure of the intensity of competition in labor markets on the basis of limited data. Large-scale socioeconomic surveys often lack detailed information on competitive behavior. It is particularly difficult to determine whether a worker moves between the different segments of the labor market. Here, the Maximum Entropy principle is used to make inferences about the unobserved mobility decisions of workers in US household data. A class of models is proposed that reflects a parsimonious conception of competition in the Smithian tradition, as well as being consistent with a range of detailed behavioral models. The Quantal Response …
Wage Inequality And Overeducation In A Model With Efficiency Wages, Peter Skott
Wage Inequality And Overeducation In A Model With Efficiency Wages, Peter Skott
Economics Department Working Paper Series
This paper shows that the existence and persistence of ‘overeducation’ can be explained by an extension of the efficiency wage model. When calibrated to fit the amounts of overeducation found in most empirical studies, the model implies that both the relative wage and the relative employment rate of high-skill workers depend inversely on aggregate economic activity. Keeping aggregate employment constant, furthermore, low-skill unemployment rises following an increase in the relative supply of high-skill labor, and relative wages may be insensitive to changes in relative labor supplies. The model may help explain rising wage inequality in some countries since the early …
Power-Biased Technological Change And The Rise In Earnings Inequality, Frederick Guy, Peter Skott
Power-Biased Technological Change And The Rise In Earnings Inequality, Frederick Guy, Peter Skott
Economics Department Working Paper Series
New information and communication technologies, we argue, have been ‘power- biased’: they have allowed firms to monitor low-skill workers more closely, thus reducing the power of these workers. An efficiency wage model shows that ‘power-biased technical change’ in this sense may generate rising wage inequality accompanied by an increase in both the effort and unemployment of low-skill workers. The skill-biased technological change hypothesis, on the other hand, offers no explanation for the ob- served increase in effort.
Fairness As A Source Of Hysteresis In Employment And Relative Wages, Peter Skott
Fairness As A Source Of Hysteresis In Employment And Relative Wages, Peter Skott
Economics Department Working Paper Series
This paper analyses the inlfuence of norms of fairness on wage formation. Fairness is defined by 'real-wage' and 'relative-wage' norms that relate wage offers to workers' own current wage and to the wages of other groups of workers, and, to avoil shirking, firms pay their wages. The wage norms change endogenously, and the result is hysteresis with respect to both employment and the distribution of wages. An extention of the model that allows 'induced overeducation' may help explain trends in wage inequality.