Contemporary Labor Economics

by McConnell, Campbell R.

• ISBN13: 9780072978605
• ISBN10: 0072978600
• Edition: 7th
• Format: Hardcover
• Copyright: 2005-01-26
• Publisher: McGraw-Hill/Irwin

Summary

Contemporary Labor Economics, 7e presents the "new" labor economics. In the past, study of labor was highly descriptive, emphasizing historical developments, facts, institutions, and legal considerations. Labor markets and unemployment was accorded some attention, but the analysis was typically minimal. This state of affairs has changed significantly in recent decades. Economists have achieved important breakthroughs in studying labor markets and problems. Labor economics is increasingly an applied field of micro and macro theory and has become a critical part of the core of analytical economics. As a result, the focus of the text is on the "new" labor economics. However, it also presents traditional topics such as labor law, structure of unions, and collective bargaining since these issues also play an important role in labor markets.

Table of Contents

Preface	iv
Labor Economics: Introduction and Overview	1	(13)
Labor Economics as a Discipline	1	(2)
The ``Old'' and the ``New''	3	(1)
Economic Perspective	4	(2)
World of Work 1.1: Gary Becker: Nobel Laureate	6	(1)
Overview	6	(4)
World of Work 1.2: Lotto Winners: Who Quit?	10	(1)
Payoffs	11	(3)
The Theory of Individual Labor Supply	14	(37)
The Work--Leisure Decision: Basic Model	14	(16)
World of Work 2.1: Sleep Time Linked to Earnings	30	(1)
Applying and Extending the Model	31	(4)
World of Work 2.2: The Carnegie Conjecture	35	(3)
World of Work 2.3: New Overtime Rules	38	(8)
World of Work 2.4: The Labor Supply Impact of the Earned Income Tax Credit	46	(5)
Population, Participation Rates, and Hours of Work	51	(33)
The Population Base	52	(1)
Becker's Model: The Allocation of Time	53	(1)
World of Work 3.1: The Changing Face of America	54	(4)
Participation Rates: Defined and Measured	58	(1)
Secular Trend of Participation Rates	59	(1)
World of Work 3.2: Fewer Teens Have Summer Jobs	60	(4)
World of Work 3.3: The Later Male Retirement Puzzle	64	(2)
World of Work 3.4: Many Wives Outearn Their Husbands	66	(3)
World of Work 3.5: Economics and Fertility	69	(4)
World of Work 3.6: Family and Medical Leave Act of 1993	73	(2)
Cyclical Changes in Participation Rates	75	(2)
Hours of Work: Two Trends	77	(2)
World of Work 3.7: Are Americans Overworked?	79	(5)
Labor Quality: Investing in Human Capital	84	(42)
Investment in Human Capital: Concept and Data	85	(1)
The Human Capital Model	86	(8)
World of Work 4.1: Recessions and the College Enrollment Rate	94	(2)
World of Work 4.2: Twins, Education, and Earnings	96	(4)
World of Work 4.3: Higher Education: Making the Right Choices	100	(3)
Human Capital Investment and the Distribution of Earnings	103	(8)
On-the-Job Training	111	(6)
Criticisms of Human Capital Theory	117	(4)
World of Work 4.4: How Much Is a Standardized Test Point Worth?	121	(5)
The Demand for Labor	126	(43)
Derived Demand for Labor	126	(1)
A Firm's Short-Run Production Function	127	(5)
Short-Run Demand for Labor: The Perfectly Competitive Seller	132	(2)
Short-Run Demand for Labor: The Imperfectly Competitive Seller	134	(3)
The Long-Run Demand for Labor	137	(4)
The Market Demand for Labor	141	(1)
World of Work 5.1: Why Has Manufacturing Employment Fallen?	141	(3)
World of Work 5.2: Comparative Advantage and the Demand for Labor	144	(1)
Elasticity of Labor Demand	144	(6)
Determinants of Demand for Labor	150	(4)
World of Work 5.3: Offshore Outsourcing of White-Collar Jobs	154	(1)
Real-World Applications	154	(2)
World of Work 5.4: Occupational Employment Trends	156	(6)
Appendix: Isoquant--Isocost Analysis of the Long-Run Demand for Labor	162	(2)
Isoquant Curves	164	(1)
Isocost Curves	164	(1)
Least-Cost Combination of Capital and Labor	165	(1)
Deriving the Long-Run Labor Demand Curve	166	(3)
Wage Determination and the Allocation of Labor	169	(39)
Theory of a Perfectly Competitive Labor Market	169	(6)
World of Work 6.1: The Fall and Rebound of Real Earnings, 1979--2003	175	(4)
Wage and Employment Determination: Monopoly in the Product Market	179	(2)
Monopsony	181	(4)
Unions and Wage Determination	185	(1)
World of Work 6.2: Pay and Performance in Professional Baseball	186	(3)
World of Work 6.3: The WTO, Trade Liberalization, and Labor Standards	189	(6)
World of Work 6.4: Has Deunionization Increased Earnings Inequality?	195	(1)
Bilateral Monopoly	196	(2)
Wage Determination: Delayed Supply Responses	198	(1)
World of Work 6.5: NAFTA and American Labor	199	(9)
Alternative Pay Schemes and Labor Efficiency	208	(33)
Economics of Fringe Benefits	208	(3)
Theory of Optimal Fringe Benefits	211	(7)
World of Work 7.1: Does Health Insurance Cause ``Job Lock''?	218	(1)
The Principal--Agent Problem	219	(1)
Pay for Performance	219	(2)
World of Work 7.2: Why Is There Academic Tenure?	221	(7)
World of Work 7.3: Company Stock in Pension Plans	228	(3)
World of Work 7.4: What Is a Good CEO Worth?	231	(1)
Efficiency Wage Payments	231	(3)
World of Work 7.5: The Ford Motor Company's $5 per Day Wage	234	(3)
Labor Market Efficiency Revisited	237	(4)
The Wage Structure	241	(33)
Perfect Competition: Homogeneous Workers and Jobs	241	(1)
The Wage Structure: Observed Differential	242	(3)
Wage Differentials: Heterogeneous Jobs	245	(3)
World of Work 8.1: The Economics of the Oldest Profession	248	(4)
World of Work 8.2: Wage Inequality and Skill-Biased Technological Change	252	(2)
World of Work 8.3: Smoking Is Bad for Your Financial Health	254	(1)
Wage Differentials: Heterogeneous Workers	254	(3)
World of Work 8.4: Wage Differentials: Married versus Single Males	257	(2)
The Hedonic Theory of Wages	259	(4)
World of Work 8.5: Compensating Pay for Shift Work	263	(2)
World of Work 8.6: Placing a Value on Human Life	265	(1)
Wage Differentials: Labor Market Imperfections	265	(9)
Mobility, Migration, and Efficiency	274	(29)
Types of Labor Mobility	274	(2)
Migration as an Investment in Human Capital	276	(1)
World of Work 9.1: Determinants of Occupational Tenure	277	(1)
The Determinants of Migration: A Closer Look	278	(4)
The Consequences of Migration	282	(10)
Capital and Product Flows	292	(2)
U.S. Immigration Policy and Issues	294	(2)
World of Work 9.2: Are Immigrants Who Have Information Technology Skills Taking Jobs from Americans?	296	(7)
Labor Unions and Collective Bargaining	303	(29)
Why Unions?	303	(1)
Labor Unionism: Facts and Figures	304	(9)
Unionism's Decline	313	(4)
World of Work 10.1: Should the Right to Hire Permanent Strikebreakers Be Rescinded?	317	(3)
World of Work 10.2: Will the Internet Help Revive Unions?	320	(1)
What Do Unions Want?	321	(4)
Strikes and the Bargaining Process	325	(7)
The Economic Impact of Unions	332	(32)
The Union Wage Advantage	332	(8)
World of Work 11.1: A Tale of Two Industries	340	(3)
Efficiency and Productivity	343	(5)
World of Work 11.2: Labor Strife and Product Quality	348	(5)
World of Work 11.3: Unions and Investment	353	(1)
Firm Profitability	354	(1)
Distribution of Earnings	355	(4)
Other Issues: Inflation, Unemployment, and Income Shares	359	(5)
Government and the Labor Market: Employment, Expenditures, and Taxation	364	(26)
Public-Sector Employment and Wages	365	(2)
World of Work 12.1: What Do Government Workers Do?	367	(3)
World of Work 12.2: Public-Sector Unions: Are They Unique?	370	(1)
The Military Sector: The Draft versus the Voluntary Army	371	(3)
Nonpayroll Spending by Government: Impact on Labor	374	(3)
Labor Market Effects of Publicly Provided Goods and Services	377	(2)
Income Taxation and the Labor Market	379	(8)
World of Work 12.3: Who Pays the Social Security Payroll Tax?	387	(3)
Government and the Labor Market: Legislation and Regulation?	390	(31)
Labor Law	390	(5)
Minimum-Wage Law	395	(6)
World of Work 13.1: Living Wage Laws	401	(2)
Occupational Health and Safety Regulation	403	(4)
World of Work 13.2: Do Computers Expand Job Opportunities for People with Spinal Cord Injuries?	407	(4)
World of Work 13.3: The Effect of Workers' Compensation on Job Safety	411	(1)
Government as a Rent Provider	412	(4)
World of Work 13.4: Lawyers Attempt to Disbar Competition from Software	416	(5)
Labor Market Discrimination	421	(38)
Gender and Racial Differences	421	(2)
World of Work 14.1: The Gender Pay Gap: An International Comparison	423	(5)
Discrimination and Its Dimensions	428	(2)
World of Work 14.2: It Pays to Be Good Looking	430	(1)
Taste-for-Discrimination Model	431	(4)
World of Work 14.3: Competition and Discrimination	435	(1)
Theory of Statistical Discrimination	436	(2)
The Crowding Model: Occupational Segregation	438	(6)
World of Work 14.4: Women's Entry into Selected Professions	444	(1)
Cause and Effect: Nondiscriminatory Factors	445	(4)
World of Work 14.5: Discrimination in Professional Sports	449	(1)
Antidiscrimination Policies and Issues	450	(3)
World of Work 14.6: Orchestrating Impartiality	453	(6)
Job Search: External and Internal	459	(20)
External Job Search	460	(2)
World of Work 15.1: Job Search and the Internet	462	(5)
Internal Labor Markets	467	(1)
World of Work 15.2: Are Long-Term Jobs Vanishing?	468	(11)
The Distribution of Personal Earnings	479	(25)
Describing the Distribution of Earnings	479	(6)
Explaining the Distribution of Earnings	485	(8)
Mobility within the Earnings Distribution	493	(2)
World of Work 16.1: Cross-Country Differences in Earnings Mobility across Generations	495	(1)
World of Work 16.2: Government Employment and the Earnings Distribution	496	(1)
Rising Earnings Inequality	496	(8)
Labor Productivity: Wages, Prices, and Employment	504	(29)
The Productivity Concept	504	(4)
Importance of Productivity Increases	508	(4)
Long-Run Trend of Labor Productivity	512	(3)
World of Work 17.1: Is Public Capital Productive?	515	(3)
Cyclical Changes in Productivity	518	(3)
Productivity and Employment	521	(6)
A ``New Economy''?	527	(6)
Employment and Unemployment	533	(29)
Employment and Unemployment Statistics	533	(7)
World of Work 18.1: New Data on Job Gains and Losses	540	(2)
Macroeconomic Output and Employment Determination	542	(2)
Frictional Unemployment	544	(2)
Structural Unemployment	546	(2)
World of Work 18.2: Downsizing and College Graduates	548	(1)
World of Work 18.3: Advanced Notification of Plant Closure or Sizable Dismissal	549	(1)
Demand-Deficient Unemployment	550	(3)
The Distribution of Unemployment	553	(4)
Reducing Unemployment: Public Policies	557	(5)
Appendix Information Sources in Labor Economics	562	(16)
Sources of Labor Statistics	562	(8)
Applications, New Theories, Emerging Evidence	570	(6)
Textbooks and Research Surveys	576	(2)
Glossary	578	(15)
Answers to ``Your Turn'' Questions	593
Index