Myth and measurement Card, David; Krueger, Alan B; Card, David
2016., 2016-01-01
eBook
David Card and Alan B. Krueger have already made national news with their pathbreaking research on the minimum wage. Here they present a powerful new challenge to the conventional view that higher ...minimum wages reduce jobs for low-wage workers. In a work that has important implications for public policy as well as for the direction of economic research, the authors put standard economic theory to the test, using data from a series of recent episodes, including the 1992 increase in New Jersey's minimum wage, the 1988 rise in California's minimum wage, and the 1990-91 increases in the federal minimum wage. In each case they present a battery of evidence showing that increases in the minimum wage lead to increases in pay, but no loss in jobs. A distinctive feature of Card and Krueger's research is the use of empirical methods borrowed from the natural sciences, including comparisons between the "treatment" and "control" groups formed when the minimum wage rises for some workers but not for others. In addition, the authors critically reexamine the previous literature on the minimum wage and find that it, too, lacks support for the claim that a higher minimum wage cuts jobs. Finally, the effects of the minimum wage on family earnings, poverty outcomes, and the stock market valuation of low-wage employers are documented. Overall, this book calls into question the standard model of the labor market that has dominated economists' thinking on the minimum wage. In addition, it will shift the terms of the debate on the minimum wage in Washington and in state legislatures throughout the country. With a new preface discussing new data, Myth and Measurement continues to shift the terms of the debate on the minimum wage.
Immigration and Inequality Card, David
The American economic review,
05/2009, Letnik:
99, Številka:
2
Journal Article
Recenzirano
Odprti dostop
This paper presents an overview and synthesis of research on the connection between immigration and wage inequality, focusing on the evidence derived from comparisons across major US cities.
We summarize the estimates from over 200 recent studies of active labor market programs. We classify the estimates by type of program and participant group, and distinguish between three different ...post-program time horizons. Using regression models for the estimated program effect (for studies that model the probability of employment) and for the sign and significance of the estimated effect (for all the studies in our sample) we conclude that: (1) average impacts are close to zero in the short run, but become more positive 2–3 years after completion of the program; (2) the time profile of impacts varies by type of program, with larger average gains for programs that emphasize human capital accumulation; (3) there is systematic heterogeneity across participant groups, with larger impacts for females and participants who enter from long term unemployment; (4) active labor market programs are more likely to show positive impacts in a recession.
Who Set Your Wage? Card, David
The American economic review,
04/2022, Letnik:
112, Številka:
4
Journal Article
Recenzirano
I discuss the recent literature that has led to new interest in the idea of monopsonistic wage setting. Building on advances in search theory and in models of differentiated products, researchers ...have used a number of different strategies to identify the elasticity of firm-specific labor supply. A growing consensus is that firms have some wage-setting power, though many questions remain about the sources of that power. (JEL B21, D21, D24, D43, J22, J31, J42)
We study editorial decisions using anonymized submissions matched to citations at four leading economics journals. We develop a benchmark model in which editors maximize the expected quality of ...accepted papers and citations are unbiased measures of quality. We then generalize the model to allow different quality thresholds, systematic gaps between citations and quality, and a direct impact of publication on citations. We find that referee recommendations are strong predictors of citations and that editors follow these recommendations closely. We document two deviations from the benchmark model. First, papers by highly published authors receive more citations, conditional on the referees' recommendations and publication status. Second, recommendations of highly published referees are equally predictive of future citations, yet editors give their views significantly more weight.
We review Immigration Economics by George J. Borjas, published in 2014 by Harvard University Press. The book is written as a graduate-level textbook, and summarizes and updates many of Borjas's ...important contributions to the field over the past thirty years. A key message of the book is that immigration poses significant costs to many members of the host-country labor market. Though the theoretical and econometric approaches presented in the book will be very useful for students and specialists in the field, we argue that the book presents a one-sided view of immigration, with little or no attention to the growing body of work that offers a more nuanced picture of how immigrants fit into the host-country market and affect native workers.
Firms and Labor Market Inequality Card, David; Cardoso, Ana Rute; Heining, Joerg ...
Journal of labor economics,
01/2018, Letnik:
36, Številka:
S1
Journal Article
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Odprti dostop
We synthesize two related literatures on firm-level drivers of wage inequality. Studies of rent sharing that use matched worker-firm data find elasticities of wages with respect to value added per ...worker in the range of 0.05–0.15. Studies of wage determination with worker and firm fixed effects typically find that firm-specific premiums explain 20% of overall wage variation. To interpret these findings, we develop a model of wage setting in which workers have idiosyncratic tastes for different workplaces. Simple versions of this model can rationalize standard fixed effects specifications and also match the typical rent-sharing elasticities in the literature.
We study the effect of disclosing information on peers' salaries on workers' job satisfaction and job search intentions. A randomly chosen subset of University of California employees was informed ...about a new website listing the pay of University employees. All employees were then surveyed about their job satisfaction and job search intentions. Workers with salaries below the median for their pay unit and occupation report lower pay and job satisfaction and a significant increase in the likelihood of looking for a new job. Above-median earners are unaffected. Differences in pay rank matter more than differences in pay levels. (JEL I23, J28, J31, J64)
We study the role of establishment-specific wage premiums in generating recent increases in West German wage inequality. Models with additive fixed effects for workers and establishments are fit into ...four subintervals spanning the period from 1985 to 2009. We show that these models provide a good approximation to the wage structure and can explain nearly all of the dramatic rise in West German wage inequality. Our estimates suggest that the increasing dispersion of West German wages has arisen from a combination of rising heterogeneity between workers, rising dispersion in the wage premiums at different establishments, and increasing assortativeness in the assignment of workers to plants. In contrast, the idiosyncratic job-match component of wage variation is small and stable over time. Decomposing changes in mean wages between different education groups, occupations, and industries, we find that increasing plant-level heterogeneity and rising assortativeness in the assignment of workers to establishments explain a large share of the rise in inequality along all three dimensions.
BARGAINING, SORTING, AND THE GENDER WAGE GAP Card, David; Cardoso, Ana Rute; Kline, Patrick
The Quarterly journal of economics,
05/2016, Letnik:
131, Številka:
2
Journal Article
Recenzirano
Odprti dostop
There is growing evidence that firm-specific pay premiums are an important source of wage inequality. These premiums will contribute to the gender wage gap if women are less likely to work at ...high-paying firms or if women negotiate (or are offered) worse wage bargains with their employers than men. Using longitudinal data on the hourly wages of Portuguese workers matched with income statement information for firms, we show that the wages of both men and women contain firm-specific premiums that are strongly correlated with simple measures of the potential bargaining surplus at each firm. We then show how the impact of these firm-specific pay differentials on the gender wage gap can be decomposed into a combination of sorting and bargaining effects. We find that women are less likely to work at firms that pay higher premiums to either gender, with sorting effects being most important for low- and middle-skilled workers. We also find that women receive only 90% of the firm-specific pay premiums earned by men. Importantly, we find the same gender gap in the responses of wages to changes in potential surplus over time. Taken together, the combination of sorting and bargaining effects explain about one-fifth of the cross-sectional gender wage gap in Portugal.
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