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Since the oil crisis of the 1970s, increased labor market flexibility seems to have become an indispensable ingredient of economic success. This book examines the critical issues that affect labor market flexibility and job security in the main industrialized economies of the United States, Japan, West Germany, the United Kingdom, and Europe, in an attempt to more fully understand the complex forces at work within such labor markets. Employment Security and Labor Market Flexibility originated from The International Symposium on Labor Market Flexibility in Yokohama, Japan, in 1986, in which scholars in economics, industrial relations, and labor law scholars scrutinized the similarities and differences of the labor markets in these countries. They focused on three main topics: wage flexibility in response to changing economic conditions, the legal and institutional framework for employment security, and international comparison of employment adjustment. Comparison of wage flexibility as well as numerical and functional flexibility among these countries were examined by both qualitative and quantitative analyses. The labor market cannot be treated in the same way as other markets because it deals directly with human beings who are less likely to obey the immutable laws of the market mechanism. Nevertheless, Kazutoshi Koshiro asserts that it is still important to build a framework on which to understand and assess the role of labor flexibility in the competitive process, and it is with this framework in mind that these chapters have been assembled into one volume. Individual chapters compare the relative flexibility of compensation and employment over the business cycle in the United States with that of Japan; analyze the relative flexibility of Japanese wages; unravel some of the underlying forces that comprise the employment security situation in the United States; study the important relationship between economic conditions and the labor market and explain the difference between the employment protection legislation of the United States on the one hand, and Europe and Japan, on the other; and compare the nature of labor markets and employment adjustment techniques of the United States, Europe, and Japan.
Presenting a radically different view of the operations of the labor market, in this 1999 book Professors Pryor and Schaffer explain the growing inequality in wages and how those with the least education are being squeezed out of the labor market. Why have wages in those jobs requiring extra-high cognitive skills risen while all other wages have stagnated or fallen? And why are more university graduates taking high-school jobs? The authors of this volume present data revealing that jobs which require a high educational level are increasing more slowly than those with somewhat lower requirements. However such jobs are increasing faster than those requiring still less formal education. Professors Pryor and Schaffer also show how women are replacing men in jobs which require higher levels of education and, moreover, how those with high cognitive skills are replacing those with lower cognitive skills.
Labor market indicators are critical for policymakers, but measurement error in labor force survey data is known to be substantial. In this paper, I quantify the implications of classification errors in the U.S. Current Population Survey (CPS), in which respondents misreport their true labor force status. Once I correct for measurement error using a latent variable approach, the unemployment rate is on average 0.8 percentage points (ppts) higher than the official unemployment rate, with a maximum of 2.0 ppts higher between 1996 and 2018. This paper further quantifies the contributions to business-cycle fluctuations in the unemployment rate from job separation, job finding, and participation. Correcting for misclassification changes previous studies' results about the contributions of these transition probabilities: job separation accounts for more of the unemployment fluctuations, while participation accounts for fewer. The methodology I propose can be applied to any other labor force survey in which labor force status is observed for three periods.
"Prepared for the Manpower Administration, U.S. Department of Labor." Includes bibliographical references.
This second volume from the Swedish Trade Union Research Institute looks at recent research on labor market policies. The question of the extent of government intervention is examined between the two extremes of the effects of unrestricted and unhampered markets on the one hand, and the old Keynesian view of benevolent governments on the other. Job creation policies and labor market programs both in Europe and the United States are reviewed and cost-benefit rules for job-training programs are proposed. Also discussed are general issues concerning unemployment insurance and incentives.
How do changes at home, in the labor market and on the job affect worker well-being? This volume of Research in Labor Economics contains eight original and insightful articles answering this question. Seven deal with demographic and labor market change, and one deals with wage differences essentially at a point in time.
While offering a comparison of employment stability and flexibility in 16 OECD countries, the book provides a detailed analysis on the type of labor market regulations needed to ensure a balance of employment flexibility and security.
This book provides an accessible, balanced account of the insider-outsider theory of labor market activity. It focuses on how "insiders" (experienced incumbent employees whose jobs are protected by various labor turnover costs) get market power, what they do with that power, and how their activities affect the "outsiders" (who are either unemployed or work in the informal sector). The book examines the effect of insiders' activities on wages, employment, and unemployment, discusses the associated policy implications, and relates the insider-outsider theory to other theories of labor market activity. The central part of the book consists of a series of previously published articles that have been edited to convey a single coherent account of a theory of unemployment that is growing in popularity. Chapters are preceded by overviews summarizing the main ideas and relating them to the book's underlying theme. The concluding chapter points out the predictions and policy implications of the theory. Lindbeck and Snower have taken care to make the main ideas accessible to a wide audience, without sacrificing analytical rigor."The insider-Outside Theory of Employment and Unemployment is concerned with both the causes and consequences of insider power. It emphasizes unemployment in chapters that survey modern unemployment theories and provide a formal comparison of the insider-outsider and efficiency-wage explanations of involuntary unemployment. Other topics include labor turnover costs (how they arise from insiders' activities and from job security legislation, and how they give rise to insider power), Union activities (how unions can amplify labor turnover costs, and provide insiders with newtools of rent-creation, such as strikes and work-to-rule actions), and the effect that insider activities can have in perpetuating the effects of temporary macroeconomic shocks. Assar Lindbeck is Professor of International Economics and Director of the Institute of International Economics at the University of Stockholm. Dennis J. Snower is Professor of Economics, Birbeck College, University of London.