Syllabus
|
Instructor:
Mark C. Foley |
Office: Chambers 3140 |
|
Class
hours: 1-2:15 p.m. TTh |
Office
hours: MW 10-11, TTh 230-330, and
by appointment |
|
Location: Chambers 2146 |
Phone: 894-2248 (home = 878-6137) |
|
Email: mafoley@davidson.edu |
|
|
URL: www.davidson.edu/academic/economics/foley/labor/index.html |
|
Course Description
This
course is an introduction to the economic methods used to analyze labor supply,
labor demand, and wage determination.
The course emphasizes neoclassical models of utility and profit
maximization. Topics to be covered
include household production, human capital investment, unemployment,
discrimination, wage differentials, international trade, contracts and
incentives, immigration, and unions.
Course Requirements and Policies
There
are two lectures each week. There will
be problem presentations, 3 reviews (2 oral and 1 take-home), a wage regression
paper, an oral “workshop” presentation, and a regression analysis paper on a
topic of your choice. The exams will be
given on September 18 (take-home), October 23 (oral), and December 2 (oral). Oral examinations will last 35 minutes. Details on the precise format will be
discussed in class. If a student is
unable to take an examination or turn in a scheduled assignment, it is the student’s responsibility to contact the
instructor prior to the scheduled completion date; students who miss an exam
and fail to make alternative prior arrangements will receive a grade of zero
for the assignment. Late work is
penalized 10% per day. The following weights will be applied in
determining the final grade:
Final Grade =
(0.10*PP + 0.15*WDP + 0.15*Ri + .10*WPQ + 0.20*RAP)
where PP = Problem Presentations,
WDP = Wage Determination Paper, Ri = Review i, i Î{1,2,3}, WPQ = Workshop Proposal and Questions, and
RAP = Regression
Analysis Paper.
Course Requirements and Policies (continued)
There
are two oral presentations. In the
first, each student will present to the class an assigned problem and its
solution (if time permits, more than 1 of these may be assigned). The second
involves giving a brief “workshop presentation” (15 minutes) on the topic you
wish to research for your final paper.
This will include turning in a short paper proposal with an introduction
to and motivation of the topic, a brief literature review, and a statement of
the specific research question. In
addition, each student must submit at least one question or comment for all
other papers, the quality of questions and comments you provide to be
incorporated into your workshop grade.
The regression analysis project consists of refining the research
question based on your workshop, conducting a statistical regression analysis,
and writing up the results in a research paper. Further details on requirements and constraints will be discussed
in class.
My office hours are as indicated above. However, I operate on an “open-door” policy
and encourage you to stop by anytime during the day.
Attendance
is not required. Students are
responsible for all work from all class meetings. We will work under the default attendance policy in the Davidson
Catalog of Announcements, namely, missing more than one-fourth of the course
meetings automatically results in a failing grade.
I will sign you up for the class distribution list,
which will be used for class announcements and discussion. My Powerpointă presentations will be made available on the
website. They are designed to aid in
your comprehension of the material, not to serve as a substitute for taking
notes or attending class.
The Honor Code is a valuable and venerable tradition
at Davidson and applies to all work.
For this class, group study is encouraged,
particularly in preparation for oral exams, and in discussing ideas for your
research paper. These shall not be
honor code violations. The writing of
the research papers (WDP and RAP) are to be your own work. See me if you have any questions.
Prerequisites
A
detailed understanding of microeconomic theory and statistics via Economics 202
and Economics 204. Basic algebra,
calculus, statistics, and econometrics will be used throughout the course.
Labor Economics, by George J. Borjas, 2nd edition, is
required and available at the bookstore.
Additional readings will be assigned throughout the semester. Lectures and exams will contain material not
covered in the text (i.e., articles).
The publisher operates a book website, which you can access at www.mhhe.com/economics/borjas/. The following journal abbreviations are
used below: AER = American
Economic Review, QJE = Quarterly Journal of Economics, JEP =
Journal of Economic Perspectives, JEL = Journal of Economic Literature, JoLE
= Journal of Labor Economics, REStat = Review of Economics and
Statistics, JoHE = Journal of Health Economics, OEP = Oxford
Economic Papers, and ILRR = Industrial and Labor Relations Review.
Course Outline and Readings
|
1. Introduction & Overview of the Labor Market Chapter 1 Goldin, “Labor Markets in
the Twentieth Century,” unpublished
manuscript. Mankiw, Principles of
Economics, 2nd ed., Ch. 18, “The Markets for Factors of
Production” |
|
2. Labor Supply A. Static Decision to Work and Policy
Applications Chapter 2 Eissa & Liebman, “Labor Supply Response to the
Earned Income Tax Credit,” QJE, 111 (May 1996),
pp. 605 – 37.
Rizzo
& Blumenthal,
“Physician Labor Supply: Do Income Effects Matter?”, JoHE (1994)
B. Life-Cycle Labor Supply Chapter 3,
pp. 69-84 C. Household Production Chapter 3, pp. 87-94 Hersch
and Stratton,
“Housework, Wages, and the Division of Housework Time for Employed Spouses,” AER, May 1994,
pp. 120-125. |
3. Labor Demand A.
Competitive
Markets Chapter 4, pp. 103-125 B.
Non-competitive
Markets Chapter 5, pp. 185-199 C.
Labor
Demand Elasticities Chapter 4, pp. 125-136 D.
Employment
Effects of Minimum Wages Chapter 4,
pp. 138-149 Card & Krueger (1995), Chapters 1 & 2, “Introduction & Overview” in Myth
and Measurement Card & Krueger (1994), “Minimum
Wages and Employment: A Case Study of the Fast-Food Industry in New Jersey
and Pennsylvania,” AER, 84 (4), pp. 772-793. Neumark
& Wascher, “Minimum Wages and
Employment: Comment,” AER, 90 (5), pp. 1362- 95.
E.
International
Trade and Labor Demand Krugman, The Accidental Theorist, Introduction and Part I Ruhm, “Are Workers Permanently Scarred by Job Displacements?” AER, March
1991, 81 (1), pp. 319-324. |
|
4. Wage Determination and Wage
Differentials A. Compensating Wage Differentials Chapter 6 Cousineau,
Lacroix, and Girard, “Occupational Hazard and Wage Compensating
Differentials,” ReStat,
1992, 74 (1), pp. 166-169 Freeman, “Are your Wages
Set in Beijing?” JEP, Summer 1995, pp. 15-32 B. Human Capital Investment 1. Individual Investment Chapter 7,
pp. 226-256 Cameron &
Heckman, “The Nonequivalence of High School Equivalents,”
JoLE (Jan 1993) Weiss, Human Capital vs.
Signaling Explanation of Wages, JEP, Fall 1995, pp. 133-154 Roy, “Some Thoughts on
the Distribution of Earnings,” OEP, 3, (1951) Mincer, Jacob, Schooling, Experience, and Earnings, 1974, pp. 7-23. Willis, “Wage determinants: a survey and reinterpretation of human capital earnings functions,” in Ashenfelter and Layard, eds., Handbook of Labor Economics Kaestner, “New Estimates of
the Effect of Marijuana and Cocaine Use on Wages,” ILRR, 47 (April
1994), pp. 454 – 70. 2. Firm Investment Chapter
7, pp. 257-273 and Chapter 4 pp. 149-155 |
|
4. Wage Determination and Wage
Differentials (continued)
C. Gender,
Race, & Ethnicity Chapter 10 Oaxaca, Ronald L., “Male-Female Wage Differentials in Urban Labor Markets,” International Economic Review, 14 (Oct 1973), pp. 693 – 709. Donahue
and Heckman,
“Continuous versus Episodic Change: Impact of Affirm Action on Blacks,” JEL (Dec 1991). Gerhart, “Gender
Differences in Current Starting Salaries: The Role of Performance, College Major and Job Title,” ILRR, 43, no. 4 (April 1990), pp.
418 – 33. D. Inequality Autor, Katz, and
Krueger, “Computing Inequality: Have Computers
Changed the Labor Market?” QJE,
November 1998. Krueger,
“How Computers Have Changed the Wage Structure: Evidence from Microdata,
1984- 1989,” QJE, February
1993. |
|
5. Labor Market Contracts and Work
Incentives Chapter 12 Ehrenberg
and Bognanno,
“Do Tournaments Have Incentive Effects?” JPE, 1990, 98 (6), pp. 1307 – 1324. |
|
6. Labor Mobility and Immigration Chapter 9
and Chapter 5, pp. 172 – 82 Card, “Impact of Mariel
Boatlift,” ILRR (Jan 1990) Borjas, “The Economic
Benefits of Immigration”, JEP, Spring 1995 |
|
7. Unemployment Chapter 13 Siebert, “Labor Market
Rigidities: At the Root of Unemployment in Europe,” JEP, Summer 1997, pp. 37 – 54 Nickell, “Unemployment and
Labor Market Rigidities: Europe versus North America,” JEP, Summer
1997, pp. 55 – 74. |
|
8. Unions and Bargaining Chapter 11 |