Effects of Minimum Wages on Youth Employment: the Importance of Accounting for Spatial Correlation

The relationship between minimum wage increases and youth employment is investigated using county-level data and spatial econometric techniques. Results that account for spatial correlation indicate that a 10% increase in the effective minimum wage is associated with a 3.2% decrease in youth employment, a result that is 28% higher than the corresponding estimate that does not control for spatial correlation. Thus, estimates that do not take into account spatial correlation may significantly underestimate the negative effect of the minimum wage on teenage employment. Improperly controlling for factors that vary systematically over space can lead to incorrect inferences and misinform policy.

The working spouse penalty/premium and married women’s labor supply

Using data drawn from the Current Population Surveys, this paper provides a consistent explanation for why the presence of a working wife reduces the husband’s wage among managers, but increases the husband’s wage among non-managers. It is not husband’s occupation per se but rather the distribution of husbands’ wage levels that underlies the working spouse penalty or premium. Positive correlations in earnings between married couples that arise from assortative mating make the cross-wage effects of the husbands’ wages on the wives’ hours of work first positive, then negative in cross-sectional data. The phenomenon of a working spouse penalty/premium is simply the flip side of this relationship.

Testing Fair Wage Theory

Fairness considerations often are invoked to explain wage differences that appear unrelated to worker characteristics or job conditions, but non-experimental tests of fair wage models are rare because market data rarely permit researchers to measure individual workers’ productivity and its value. We use data from the baseball labor market to address this problem, and find no support for fair wage theory. We do find, however, that fairness premia can be illusory: Wages appear to incorporate fairness premia in regressions that control for variation in individuals’ physical output, but such premia evaporate when the value of that output is held constant.

How Living Wage Legislation Affects U.S. Poverty Rates

I investigate how living wage legislation affects poverty. I find evidence that living wage ordinances modestly reduce poverty rates where such ordinances are enacted. However, there is no evidence that state minimum wage laws do so. The difference in the impacts of the two types of legislation conceivably stems from a difference in the party responsible for bearing the burden of the cost.

Parenthood and Commitment to the Legal Profession: Are Mothers Less Committed than Fathers?

This research examined the relationship between parenthood and career commitment. Karasek’s (Administrative Science Quarterly 24:285–308, 1979) Job Demand-Job Control Model was used as a theoretic framework for hypothesizing the relationships between work and family demands, job control and social support and parents’ career commitment. Questionnaire data from a sample of practicing lawyers with children were used to test this model. The results show fathers generally reported more work demands than mothers; whereas, mothers reported more family demands than fathers. Job control and social support did not moderate relationships between work and family demands and parents’ career commitment. Perhaps the most surprising finding of this study, contrary to assumptions in the literature and the workplace, was that mothers practicing law are significantly more committed to their careers than fathers. This paper closes by discussing possible explanations for these findings.

The Decomposition of Firm-size Wage Differentials

No completely satisfactory explanation for the persistent and well-documented large-firm wage premium has been found. I use a novel adaptation of the Oaxaca/Blinder wage discrimination model to examine the firm-size wage differential which allows the wage differential to be decomposed into the portions attributable to (1) differences in employee endowments, (2) how the firm values these endowments, and (3) residual differences. Small firms actually pay higher wages based on how they value their workers’ endowments, but this wage premium was overshadowed by the superior endowments of workers in large firms and a residual differential in favor of large firms.

The Effects of Minimum Wage Increases on Retail Employment and Hours: New Evidence from Monthly CPS Data

Proponents of state and federal minimum wage increases argue that past minimum wage hikes have not adversely affected retail employment. However, the existing empirical evidence is mixed. This study uses monthly data from the 1979–2004 Current Population Survey to provide new estimates of the effect of minimum wage increases on retail employment and hours worked. The findings suggest evidence of modest adverse effects. A 10% increase in the minimum wage is associated with a 1% decline in retail trade employment and usual weekly hours worked. Larger negative employment and hours effects are observed for the least experienced workers in the retail sector. These results are robust across a number of specifications, but are sensitive to controls for state time trends.

Gender wage differences and human capital in the early twentieth century: the case of the paper box industry in New York

Women employed in the New York paper box industry in 1913–1914 earned about 60% of what men did. This paper employs the human capital framework to analyze the wage differential due to productivity related factors versus discriminatory nepotism towards men. Years of schooling, years of experience in the paper box trade, and legislative restrictions on working hours of women account for virtually all of the observed wage differential, both for all men and women in the paper box industry, and between the skilled occupations of cutters and strippers.

The Impact of Privatization on the Earnings of Restructured Workers: Evidence From the Oil Industry

We study the long-term impact of job displacement from a big state owned enterprise as a result of its privatization in a developing country. Our results suggest large reductions in earnings, which persist throughout the years. However, we also find that the displaced worker’s post-displacement earnings are in line with competitive market wages, and unrelated to sector of employment or to tenure losses, indicating that the long-term reduction in earnings as a result of displacement because of privatization can be traced to the loss of wage rents. Our results indicate that job displacement in SOEs may have very large redistributive implications for the workers involved but that this loss does not necessarily reflect the loss of specific human capital associated to these jobs.

Union Worker Wage Effect in the Public Sector

This study examines union wage premiums in the public sector for the 1998–2004 period. Unlike previous studies, our approach estimates union wage premiums considering differences in the rewards to education, experience, and other personal characteristics for union and non-union workers. The approach provides a larger estimated wage gap than the traditional approach, and allows for simulations of union–nonunion wage gaps for different types of workers. Moreover, we use an Oaxaca decomposition to explain the larger union–nonunion wage gap in the private sector in comparison to that in the public sector. We find that between 50% and 60% of the difference in union wage premiums between the private and public sectors is due to differences in the way unionized workers are rewarded in the private and public sectors, while the remaining portion is due to differences in personal characteristics of private and public sector workers.

The Evolution of Skill-Biased Effects on American Wages in the 1980s and 1990s

This study estimates the contributions of skill-biased technological change and international trade to the rise in the skill premium during the 1980s and 90s using the Feenstra and Hanson (Q J Econ 114(3):907–940, 1999) two-stage methodology. Newly available data on high-technology capital provide separate measures of computer and software investment. New estimates suggest that investment in software contributed to a substantial portion of the observed increase in the skill premium while investment in computers lead to a reduction in the rate of skill premium growth. Contrary to the findings of Feenstra and Hanson for the 1980s, neither software nor computers had a significant effect on wages during the 1980s. Foreign outsourcing does not appear to have significantly affected wages during the 1990s. The contribution to theory is that software is more complementary to increases in worker productivity due to human skills. Computers, on the other hand, reduced the growth of wage inequality by giving unskilled labor a more efficient set of tools with which to work.

Unions and Employment Growth: Evidence from State Economic Recoveries

We test the hypothesis that in an economic recovery, unionization negatively affects job creation. We examine state-level job growth following two recent recessions, those with troughs in November 1982 and March 1991. In the five years following the troughs, we assess whether variations across states in union membership and right-to-work laws affect the rate of job growth. We find evidence that links union influence to slower job growth during an economic recovery, a finding consistent with previous studies reporting that unions negatively affect average employment and employment growth.

Constructing Gay and Lesbian Parent Families “Beyond the Closet”

This paper provides a multilayered analysis of how lesbian mothers and gay fathers construct their families in a social context that has been described by Steven Seidman (2004) as “beyond the closet.” We stress how our participants’ family-building experiences are comparable to other non-biologically related families, but distinct due to heterosexual dominance. Using in-depth qualitative interviews with 18 lesbian birth mothers and 22 gay fathers, the authors discuss how participants navigate heterosexual dominance in institutions and in personal interactions.

Educational Attainment and the Lesbian Wage Premium

This paper provides insight into the wage gap between lesbians and heterosexual women. Using data from the 2000 Decennial Census, we find a lesbian premium that equals approximately 10% for women without a bachelor’s degree, and is nearly non-existent for women with higher levels of education. These findings are consistent with proposition that the gap between lesbians’ and heterosexual women’s commitment to the labor market narrows at higher levels of education. We also find that controls for industry and occupation exert only a small effect on the gap between lesbian and heterosexual women’s wages.

The economics of gay and lesbian couples: Introduction to a special issue on gay and lesbian households

This article presents a simple conceptual framework integrating three couple-related outcomes analyzed in this volume: wage differentials in earnings related to couple formation, household formation (including cohabitation and registration as Registered Domestic Partnership), and intra-household allocation of income. It also discusses some of the articles’ main findings.

The impact of biological preferences on parental investments in children and step-children

A remarriage typically involves significant changes in a family’s financial circumstance, and these changes, combined with the relative bargaining relationship between spouses, likely affect the well-being of the children who are part of the family. In this paper, I use the separate-spheres model, a theoretical model that explains the determinants of bargaining power in marriage, to analyze how a remarried couple’s bargaining relationship affects their child investment in stepfamilies. Based on this theoretical model, I build and estimate an empirical model that investigates the determinants of parental investment. As evidence of parental preference for biological children over stepchildren, I find that an increased wage rate of a biological mother significantly improves her child investment when her husband is a stepfather of the child, while there is no such effect for mothers living with the biological father of the child.

Labor Supply Decisions of Disabled Male Workers

We use unique survey data, collected by the Workers’ Compensation Board of Ontario, to estimate the labor supply response of disabled male workers to benefit payouts and their post-injury wage. Our data enable us to fill gaps in the existing literature by estimating the hours as well as the return-to-work response for younger as well as older workers, based on objective rather than subjective self-reporting of disability status. Our results suggest a strong positive incentive effect from higher wages a and that lump-sum benefit payouts that are not reduced if earnings increased generally do not have adverse incentives on the return-to-work and hours decision, except for an income effect over the longer life cycle of younger men. We also discuss the policy implications of our estimates.

Home Ownership, Social Insurance, and the Welfare State

Home ownership has potentially significant consequences for welfare state policy. High owner-occupancy rates may function as private insurance where social spending is low (a substitution effect). Alternatively, state income redistribution policies could raise the number of home owners (an income effect). Cross-national time-series data show that social spending is negatively related to home ownership, and mediates the positive relationship between income inequality and owner-occupancy rates. This suggests that owner-occupancy acts as a form of social insurance over the life course. Future welfare state researchers should consider the issue of home ownership in analyses of inequality and the social safety net.

Do Work Demands and Resources Predict Work-to-Family Conflict and Facilitation? A Study of Iranian Male Employees

This study examined the effects of some work demands-resources on two dimensions of work-to-family interface among Iranian employees. The results of canonical correlation and multiple-regression showed that among work resources (i.e., social support and autonomy), social support was associated negatively with work-to-family conflict and autonomy was associated positively with work-to-family facilitation. Also, among work demands (i.e., job demands and working hours), job demands were associated with both work-to-family conflict and work-to-family facilitation. Unlike previous studies, working hours shows a positive association with work-to-family facilitation, which may be explained by the specific cultural context in Iran. The findings of the study will be of importance to employees and organizations.

Britain’s Labor Market Under the Blair Governments

Since the Labor Party returned to power in 1997, a substantial increase in employment regulation has occurred in the United Kingdom. Britain has enacted new laws on labor union recognition, introduced a national minimum wage, enhanced employment protection legislation, strengthened anti-discrimination legislation, and imposed many new obligations on employers. Employment regulation should not, however, be looked at in isolation. The potential for job loss implicit in some of the Blair administrations’ regulation has been offset by other factors which have broadly supported labor market flexibility. This does not mean that further regulation can be imposed with impunity. Although the UK labor market continues to perform better than those of the large continental European economies, its competitiveness may be slipping. When Mr. Blair retires, the prospects may deteriorate.