A growing body of evidence shows that social programs, beyond their direct e ect on bene ciaries, can also a ect non bene ciaries, via changes in market equilibrium. We still know very little, however, about the e ects of social programs on labor markets. In particular, public employment schemes, which are a popular form of poverty relief in developing countries, may crowd out private sector wo...

We exploit data from the 1986–87 Washington Alternative Work Search experiment (merged with nine years of follow-up administrative wage records) to estimate the causal effects of eliminating the unemployment insurance (UI) work search requirement (WSR) on duration of nonemployment, tenure with first post-claim employer, number of post-claim employers, long­ term earnings, employment, and hours ...

This paper studies the effect of human capital depreciation and duration dependence on the design of an optimal unemployment insurance (UI) scheme. Our results partially confirm those obtained in most previous studies: benefits should decrease with unemployment duration. The optimal program also generates two main novel features, which are not present in stationary models. First, if human capit...

The Effect of the Minimum Wage on Prices in Brazil There is very little empirical evidence on the effects of the minimum wage on prices in the international literature and none whatsoever for developing countries. This paper estimates the minimum wage price effect using monthly Brazilian household and firm data from 1982 to 2000 aggregated at a regional level. Empirical evidence on price effect...

In the modern welfare state, people who cannot make a living usually receive financial assistance from public funds. Accordingly, the so-called social work norm against living off other people is violated, which may be the reason why the unemployed are so unhappy. If so, however, labour market concepts based on the notion of promoting low-paid jobs that are subsidised if necessary with addition...

Do Employees Profit from Profit Sharing? Evidence from Canadian Panel Data Using panel data from a large sample of Canadian establishments, this paper examines whether employee earnings increase, decrease, or do not change in the period subsequent to adoption of profit sharing, relative to establishments that do not adopt profit sharing. Our research contributes to knowledge by utilizing longit...

This paper characterizes the optimal labor market policy within a dynamic search model of the labor market which allows for workers’ risk aversion. In a …rst-best allocation of resources, unemployment bene…ts should provide perfect insurance against the unemployment risk, layo¤ taxes are necessary to induce employers to internalize the cost of dismissing an employee but should not be too high i...

Are Wage and Employment Effects Robust to Alternative Minimum Wage Variables? A national minimum wage cannot explain variation in wages or employment across regions. Identification of the effect of the minimum wage separately from the effect of other variables on wages or employment requires regional variation. Many minimum wage variables with regional variation have been suggested in the liter...

This paper first examines the question “what is a living wage” and provides a range of specific dollar amounts derived a conceptual assessment of the term. I then provide a series of cost estimates of living wage laws in various cities. Based on these cost estimates, I examine a set of alternative adjustments that covered firms could make to absorb these costs, including raising prices and prod...

The prevailing labor market models assume that minimum wages do not affect the labor supply schedule. We challenge this view in this paper by showing experimentally that minimum wages have significant and lasting effects on subjects’ reservation wages. The temporary introduction of a minimum wage leads to a rise in subjects’ reservation wages which persists even after the minimum wage has been ...