The impact of a stronger work requirement for welfare recipients in a workfare program is studied in an efficiency wage model where a representative firm chooses its level of monitoring activities. A stricter workfare policy raises employment and monitoring activities. It typically increases profits and reduces the tax rate. The impact on the net wage is ambiguous. Utility levels of employed wo...

One of the stylized facts from the past thirty years has been the declining rate of first births before age 30 for all women and the increase rate of first births after age 30 among women with four-year college degrees (Martin 2000). What are some of the factors behind women's decision to postpone their childbearing? We hypothesize that the wage difference often observed between like-educated m...

One of the most puzzling facts in economics is the firm size-wage effect. After controlling for the observable characteristics of workers (age, gender, education, residence etc.), firms (industry, occupation, work conditions etc.) and negotiation effect (unionization), one still finds that the sheer size of a firm increases the wage, contrary to the one-good one-price doctrine. We provide a sim...

The perspective of modern macroeconomic theory, be it new classical or old and new Keynesian, is that unemployment can be reduced only if real wages are cut. The modern Keynesians, basing themselves upon the microfoundations of efficiency wage theory, argue that real wages cannot and will not be cut by firms for efficiency wage reasons. This generates involuntary unemployment based on a market ...

We study the e¤ects of additional distortions or shocks, such as a fair-wage constraint and/or the possibility of o¤shoring unskilled jobs, in a two-factor general equilibrium model of unemployment with search frictions. While the direct point of impact of such shocks is on unskilled workers, we also …nd interesting indirect spillover e¤ects on skilled workers. A binding fair-wage constraint in...

Since Friedman (1968), the traditional derivation of the accelerationist Phillips curve has related expected real wage inflation to the unemployment rate and then invoked markup pricing and adaptive expectations to generate the accelerationist price inflation equation. Blanchflower and Oswald (1994) have argued that microeconomic evidence of a low autoregression coefficient in real wage regress...

the minimum wage determination is one of the most significant economic issues exerting effects on macroeconomic variables. this study provides an empirical model using var method to analyze the long run relationships and short run dynamisms of factors affect general price level (with emphasis on minimum wage) during the period of 1978-2010. to examine long run relationships we used johansen-jus...

the main purpose of this paper is to investigate the impact of trade openness on the employment and the real wage for the iranian food and beverage industries over the year 2007. for this purpose in this study, the ratio of export to production value has been considered as a proxy for trade openness and the main model has been estimated using a dynamic panel data (dpd) approach. the main findin...

Income taxes distort the relationship between wages and non-taxable amenities. When the marginal tax rate increases, amenities become more valuable as the compensating differential for low-amenity jobs is taxed away. While there is evidence that the provision of amenities responds to taxes, the literature has ignored the consequences for job characteristics which cannot fully-adjust. This paper...