Wages, employment and economic shocks: Evidence from Indonesia

Real wages and aggregate demand shocks: contradictory evidence from VARs

This paper revisits two recent studies that estimate the dynamic response of real wages to aggregate demand shocks. Using identical empirical techniques—structural VARs with long-run identifying restrictions—and similar post-war data, [Gamber and Joutz 83 (1993) 1387] and [Spencer 36 (1998) 120] report contradictory findings. After careful examination, I conclude that the reason for this puzzli...

Localized Shocks, Job Displacement, and Wages: Evidence from Mexico

Preliminary and incomplete: Please do not quote or cite without permission of the authors. 1 Two recent papers highlight the growing focus on wage and employment dynamics. Bergin et al. (forthcoming) describe the importance of understanding the sources and consequences of labor market volatility. Couch and Placzek (forthcoming) represents renewed interest in understanding one particular consequ...

Economic shocks, wealth and welfare: Evidence from the Indonesia Family Life Survey

Wages, Employment, and Statistical Discrimination: Evidence from the Laboratory

When membership in a particular group conveys valuable information about an individual’s skills, productivity, or other human capital characteristics, a non-prejudiced agent may still find it rational to statistically discriminate. We frame statistical discrimination in a labor market setting for a series of laboratory experiments. A main objective of our experiments is to examine how varying p...

Can Minimum Wages Cause a Big Push? Evidence from Indonesia

PRELIMINARY AND INCOMPLETE: PLEASE DO NOT CITE Big Push models suggest that local product demand can create multiple labor market equilibria: one featuring high wages, formalization, and high demand and one with low wages, informality, and low demand. I demonstrate that minimum wages may coordinate development at the high wage equilibrium. Using data from 1990s Indonesia, where minimum wages in...