District elections and the power of municipal employee unions

Very little prior research has been devoted to the effects of the institutional structure of local government on public sector labor markets. This study addresses the differential effects of the two main systems used to elect city council members — district versus citywide (at-large) elections. The study hypothesizes that, in district-election cities, municipal employees, especially those who are unionized, face a lower cost of influencing city council candidates and, consequently, will have greater power to influence employment conditions. To test this hypothesis, data on U.S. cities over 25,000 population are used to estimate both reduced form and structural wage and employment equations. The results are consistent with the basic hypothesis: district elections provide a more fertile ground for municipal employees, especially those organized in unions, to affect their employment conditions. The authors acknowledge the helpful comments of Tim Sass, Tom Means, and participants in a session at the 1991 Public Choice Society meetings.     

The effects of regulation on public sector labor relations: Theory and evidence

This paper assesses the effects of public sector collective bargaining laws on employee unionization, the bargaining process and bargaining outcomes, including pay, benefits and nonmonetary aspects of employment. Although several specific effects — positive and negative, direct and indirect — of regulation in this area have been reported by researchers, most studies do not deal adequately with the issues of model specification or simultaneity, thus calling their validity into question. The helpful comments of Professors John T. Delaney, Craig Olson, and Donna Sockell are gratefully acknowledged.     

Public and private employment over the business cycle: A ratchet theory of government growth

Previous researchers have attempted to explain the growth in the size of government over time. Some have observed a “ratchet” effect and have attributed these observed jumps in the relative size of government to ideological shifts in response to severe crises. We explain these observed ratchets as the consequence of asymmetries in the response of government employment to the business cycle. A public-choice oriented model of the employment response to the cycle is developed and applied to state and local government employment data. The data confirm the presence of ratchet effects that correspond to the business cycle. Moreover, virtually all of the growth in the ratio of state and local government employment to private employment has occurred during recessions. The authors greatly appreciate the extensive comments of Randall 0. Holcombe and the late Richard McHugh on an earlier draft of this paper. Don Bellantés work on this paper was aided by a grant from the John M. Olin Institute for Employment Practice and Policy.     

Employment growth in the temporary help supply industry

During the 1980s, a significant increase occurred in the employment of temporary workers — employees hired for a specific task and for a limited duration — because of changing economic conditions that raised both the demand for and supply of temporary workers. Using time-series data, we investigate the factors that influenced temporary employment growth by analyzing the expansion in the temporary help supply (THS) industry. On the demand side, increasing aggregate output and heightened foreign competition were the most important factors that encouraged firms to hire temporary workers. On the supply side, increasing participation of certain demographic groups, notably married women, shifted the supply curve of temporary workers outward. We thank Nathan Balke, Bonnie Fisher, and Jeff Mills for helpful comments.     

The Effects of First Occupation on Long Term Health Status: Evidence from the Wisconsin Longitudinal Study

In this paper, we use a longitudinal survey that has collected information for 50 years on a large cohort of Wisconsin high school graduates and their siblings to examine the long term impact of early occupational choice on health status. We find evidence that beginning a career in a blue collar occupation is correlated with several measures of poor health outcomes at ages 50–65. Since our dataset includes usually unobserved pre-labor market characteristics, including IQ and childhood health status, we can show that controlling for these variables is important for many results and suggests a high level of selection into occupation based on health and ability. We also provide evidence of gender differentials in the association between first occupation and later health. Then, we replace our basic measure of occupational categories with summary measures of job characteristics and find that employment at “bad jobs” at the beginning of an individual’s career predicts later health outcomes. Finally, we use sibling information in the dataset to show that unmeasured family background factors explain a large share of the effects of occupation on later health. Overall, the evidence points to limited, though heterogeneous, long term effects of health from blue collar employment.     

Minimum wages and the wessels effect in a monopsony model

The Wessels model suggests that firms respond to increases in the minimum wage rate by decreasing the level of fringe benefits — an action which produces an inefficiency effect that lowers workers’ utility and the supply of labor. Standard models of monopsony, however, argue that wage floors prevent the exercise of market power and increase employment. I show that wage floors, even with fringe benefit curtailment, may increase employment by lowering the marginal expense of labor. Employee utility and employment will rise somewhat but not as much had the firm acted competitively in setting both wages and fringes.     

Residence laws and unionization in municipal labor markets: The case of firefighters

An estimate is made of the impact of residence laws and unionization on compensation (wages plus major fringe benefits) as well as on employment of municipal firefighters. In addition, hypotheses about the manner in which residence laws exert these effects are econometrically tested using data obtained by surveying the mayors of 560 municipalities. The standard view — that is, that residence laws restrict labor supply — is not supported by the empirical evidence. Rather, the data are consistent with the hypothesis that residence laws affect compensation by altering the bargaining environment; for example, effects of unions are weaker when there are residence laws. The authors would like to express their appreciation to David Lewin and Ronald Ehrenberg for their helpful advice and thoughtful comments, and to two anonymous referees for suggestions which indubitably improved the paper. Significant research assistance was provided by Glen Elder. Financial support by the Institute of Industrial Relations is gratefully acknowledged.     

The impact of organized labor on public employment: A comparative analysis

This paper examines the political economy of public employment, specifically the impact of labor unions on public employment across 20 OECD nations during the 1965–1983 period. A theoretical paradigm based on exchange theory is used to explain the rationale for organized labor’s role in public employment. A model is then presented and tested to explain variation in public employment levels across the 20 nations. The results of the analyses support the central hypothesis that labor union power is positively correlated with public employment. Following the data analysis, the conclusions and implications of the findings are discussed as they pertain to the political economy in advanced industrial democracies.     

Fiscal austerity and public servant quality

In this article we use a simple model to analyze the forces that determine the size of the public sector and the quality of workers employed in that sector. Workers are heterogeneous, and the public sector chooses an employment strategy which maximizes a utility function U(s, Y) that depends on the share of the labor force employed in public service s and private sector output Y. The government is fully informed about worker productivity. We characterize the behavior of the public sector, and explore the efficiency and employment consequences of imposing fiscal constraint on the government.     

The impact of unionization on labor’s share of income

This study examines the effect of unions on labor’s share of income. Because economic conditions within each industry are important in addressing this issue, this analysis incorporates a more disaggregated approach than has been previously used. Cross-sectional data for the 1950s — a period of more stable unionization — permit an examination of the long-run effect of wage increases on labor’s share. The empirical analysis suggests that higher labor prices have no long-run impact on labor’s share in manufacturing.     

Legal aspects of exclusive representation: Ruminations on the private-public sector analogy

From the perspective of a management labor lawyer, this article argues that any legitimate theory of employment rights must be founded on the premise that employment is a voluntary relationship governed by mutual consent. In contrast, the erosion of the doctrine of at-will employment and the substitution of its legal antithesis, the tort of wrongful discharge, depend on a conception of employment rights as something the employee possesses at the employer’s expense, that is, without the employer’s consent. The theme of this article is that an employment right does not exist apart from contract. The government cannot violate an employment right unless it prevents a willing employee and a willing employer from making a contract concerning a proper subject on terms satisfactory to both. In public sector employment, the state is one of the parties to the employment contract. In most cases, a public employer cannot be “willing” if the same sovereign or polity has enacted conditions on public employment, that is, has placed limitations on itself. This article analyzes the legal aspects of exclusive union representation and related union security arrangements within this conceptual framework. Member, State Bar of California. Associate, Latham & Watkins, Los Angeles and San Diego. I wish to thank my colleague, Mark W. Smith, for his helpful suggestions and comments during the preparation of this paper. The views expressed here are solely those of the author.     

Municipal residency laws: Effects on police employment,compensation, and productivity

This paper offers an alternative model of the effects of residency laws in municipal labor markets. Unlike previous studies, the model assumes that public employee labor markets are characterized by conditions of excess supply and that public services are produced under noncompetitive conditions. The model also implies that productivity improvements increase rather than reduce labor demand, yielding different results with respect to the wage and employment effects of residency requirements. The non-clearing market model is tested using data on municipal police officers. The results are more compatible with the disequilibrium model than with models based on a competitive equilibrium.     

The potential for international and transnational public service advertising in public spaces in American and Chinese global cities: Conclusions from a 2010 survey of advertisements in subways in Beijing,New York,Shanghai and Washington,DC

Can we construct transnational or international public service advertising to counterbalance the proliferation of transnational commercial advertising? As an important first step in exploring the possibility of such an application of shared media public diplomacy among nations, this paper describes a complete survey of commercial and public service advertisements collected from the public spaces of subway systems in American and Chinese cities in 2010 – New York, Washington, DC, Shanghai and Beijing – to reveal the range of themes of commercial and public service ads in these spaces. The study reveals first that analogous commercial and public service ads are ubiquitous in the public spaces of both Chinese and American cities. Second, many of the themes that might appear in international or transnational public service ads are already being portrayed in ads created by local or national governments or NGOs, although these themes are portrayed in ads created by different sets of actors in China and in the US: government actors and a few international NGOs in Chinese cities, and governments, corporations and non-profit organizations in the case of American cities. Finally, the survey reveals that in all four cities there are many commercial advertisements that appeal to the identity of a transnational consumer, but that there are almost no public service ads that appeal to the identity of a transnational citizen: merely local or national ones who can solve such public problems as global warming, education, and health issues.     

Emerging Networks of Organized Urban Poor: Restructuring the Engagement with Government Toward the Inclusion of the Excluded

Aim of this article is to address the issue of citizen participation and democratic engagement within a specific area—slum upgrading—presenting and theoretically discussing the approach of an international network called Shack/Slum Dwellers International (SDI), which represents member federations of urban poor and homeless groups from about 30 countries in Asia, Africa, and Latin America. The article addresses the model of intervention embraced by the network, the activities carried out, its philosophy, etc., mainly focusing on the way it envisions and pursues the engagement of local governments in upgrading slum dwellers living conditions. The basic idea within SDI is that the lack of participation by the urban poor has historically been one of the major obstacles to achieve real development: either the government or the donors’ agencies, in fact, usually treat the poor as beneficiaries of someone else’s actions, thus undervaluing their knowledge and skills. Radically opposing this view, SDI interprets its role not as an intermediary agency of slum dwellers in the engagement/negotiation with local governments but rather as an “enabling tool” of direct negotiation between the urban poor and the public institutions. SDI’s most relevant feature, in fact, is surely the genuine leading role assigned to the slum dwellers grassroots organizations.     

Bureaucracy,Democracy and <Emphasis Type="Italic">Ex</Emphasis>clusion: Why Indigenous Knowledge Holders Have a Hard Time Being Taken Seriously

This paper explores inherent tensions between two democratic ideals: citizen representation and accountability of the state. Specifically, I argue that the method by which state officials make themselves accountable—through their creation of the appearance of transparency—results in the exclusion of alternative, non-scientific ways of knowing, including those that are gendered, local and indigenous, because these ways of knowing often employ non-standardized methods which are not “transparent” in the same way as science and therefore easily dismissed by state officials as indefensible to citizens’ questioning. I explore this tension by drawing on examples from ethnographic work I completed with two groups of knowledge practitioners, Kwakwaka’wakw First Nations (Native American) traditional marine harvesters and government biologists, both of whom work with clams.     

Understanding the workweek of foreign born workers in the United States

I analyze the length of the workweek of foreign-born workers in the US I concentrate on workers supplying long hours of work—50 or more weekly hours and document that immigrants are less likely than natives to work long hours. Surprisingly, these differences are greatest among highly educated and salary paid workers, and persists even after conditioning for demographic characteristics. I explain these differences with two within occupation characteristics. First, relative to natives, immigrants are less likely to supply long work weeks if they work in occupations where the immigrant-native earnings differential is big. Second, immigrants are also less likely to supply long work weeks when they work in occupations with a wide dispersion of earnings. This second result is important, because the occupation dispersion of earnings has been used to characterize changes of the worker’s earnings over the worker life cycle (Bell and Freeman, Labour Economics: 8(2), 2001a; Working Time in Comparative Perspective, 2001b; Kuhn and Lozano, Journal of Labor Economics:26(2), 311–344, 2008), and a good measure of the incentives to supply long hours of work.     

Firm Ownership and Rent Sharing

In this paper we analyse—theoretically and empirically—how the degree of private versus public ownership of firms affects the degree of rent sharing between firms and their workers. Using a particularly rich linked employer-employee dataset from Portugal, covering a large number of corporate ownership changes across a wide spectrum of economic sectors over more than 20 years, we find that rent sharing is significantly higher in firms with a larger share of private ownership. Estimates from our most preferred empirical specification suggest that an increase in the private ownership share of 10 percentage points increases (on average) the rent-sharing elasticity by 0.0002. Based on a theoretical analysis that incorporates union-firm wage bargaining and efficiency wage effects within the same modelling framework, this result cannot be explained by private firms being more profit oriented than public ones. However, the result is consistent with a scenario whereby privatisation leads to less job security for workers, implying stronger efficiency wage effects.     

Racial Submarkets in Government Employment: African American Managers in New York State

This paper reports on a study of the employment situation of African American managers within New York State government. We argue that affirmative action, while having created employment opportunities for minority professionals, has also created racial submarkets in government. We identify three categories of jobs, a mainstream category and two sorts of minority categories, based on the racial composition of incumbents and constituencies that they serve. African Americans in minority submarket positions appear to have equal pay relative to comparable African Americans in mainstream jobs. They are less likely to have civil service job protection. There is limited mobility between submarkets; more professionals move from the mainstream to minority positions than vice versa. In the current period of budget reductions in state government, black professionals experience considerable job insecurity and express dissatisfaction with the policies that created the minority submarket.     

Occupational licensing in a “competitive” labor market: The case of cosmetology

A straightforward model of supply and demand is developed to analyze the regulation of a “Competitive “ industry —cosmetology —with demand shifts representing an enhancement of “quality “ and supply shifts representing restricted entry. Reducedform models are established to estimate both price and quantity shifts, adjusted for the joint determination of cosmetological prices, quantities, and state regulations. Our results reveal a significant net decrease in quantity from the imposition of state occupational regulation in the cosmetology market. Rents to cosmetologists would be on the order of $1.7 billion per year with deadweight losses totaling an additional $111 million per annum under reasonable and conservative assumptions. We are grateful to Richard Ault, Dave Kaserman, Mark Thornton, Dave Saurman, Bob Tollison, Henry Thompson, and Pete Calcagno for helpful comments on earlier drafts. Special thanks are due to Carter Hill for his advice. We are responsible for any errors.     

At the Eve of Convergence? Transformations of Social Service Provision in Denmark, Germany, and the United States

Increasing societal heterogeneity, changing demographics, and increasing public debt and fiscal constraints have recently challenged traditional “regime” approaches to welfare state development. Some scholars argue, against this background, that welfare states might plausibly move out of their “regime container” by opting in favor of similar solutions and responses. This potential trend toward “convergence” might, furthermore, be facilitated by the widespread use of new public management ideas and techniques for “reinventing government” by adopting market solutions to public problems. This article investigates whether such trends of convergence can be identified by comparing three different countries each traditionally looked upon as belonging to different welfare state regimes: Denmark, Germany, and the United States. More specifically the article looks at one important segment of welfare state activity, namely social services and related health care. To further focus the analysis, special attention is devoted to the changing role played by the third sector in delivering services. The research design, thus, differs from most comparative welfare state research. Instead of analyzing a broad set of quantitative indicators in a large number of countries, it is scrutinized how some of the same problem pressures and policy ideas are being interpreted and implemented in a small number of countries within one policy area. The analysis reveals that trends of convergence—conceptualized along four dimensions: ideas, regulation, mix of providers, and revenue mix—can be identified across the three cases, though this does not mean that the market share of nonprofit providers becomes the same. The study also reveals that fundamental aspects of state–nonprofit relations persist despite trends of convergence.