Using a newly constructed data set on outward FDI from Germany, comprising both parent and affiliate panels for the period 1989-2001, this paper studies the location choice of German parents and consequences for labor demand across locations. Results indicate that large, relative skill abundant countires attract German FDI. Firms in skill-intensive industries seek skilled labor in their foreign...

This paper argues that the interaction between inequality and the demand patterns for goods is a potential source of persistent inequality. Income distribution, in the presence of non-homothetic preferences, affects the demand for goods and, due to differences in factor intensities across sectors, it alters the return to factors of production and the initial distribution of income. Low inequali...

This paper examines the potential causes of the “ripple effect” of minimum wages. This wage spillover is thought to result from labor demand substitution: where the rising minimum increases the demand for more-skilled workers who become relatively inexpensive. However, the rising minimum also affects the relative wages across hedonically distinct occupations because it lowers compensating wage ...

We investigate the extent and type of state dependence in labor market outcomes for young low-skilled Australians. Our model allows for three labor force states, employment, unemployment and out of the labor force, and for observed and unobserved heterogeneity.We find evidence of occurrence dependence, but no lagged duration dependence. A past employment spell increases the probability of emplo...

Linked employer-employee data for Brazil over a period of large-scale trade liberalization document two salient workforce changeovers. Within the traded-goods sector, there is a marked occupation downgrading and a simultaneous education upgrading by which employers fill expanding low-skill intensive occupations with increasingly educated jobholders. Between sectors, there is a labor demand shif...

Many people in the European Union fear that Eastern Enlargement leads to major job losses. More recently, these fears about job losses have extended to high skill labor and IT jobs. The paper examines with unique firm level data whether these fears are justified for the two neighboring countries of Eastern Enlargement Austria and Germany. We find that Eastern Enlargement leads to surprising sma...

The paper quantitatively evaluates the interaction between capital-skill complementarity and endogenous low-, medium-, and high-skilled labour supply in generating wage inequality, using a dynamic computable general equilibrium (CGE) model of the Auerbach-Kotliko¤ (1987) type. The counterfactual analysis conducted shows that the German skill premium de…ned by the 9 to 1 decile limit of earnings...

We estimate that permitting inmate labor would likely increase national output, but by less than 0.2 percent of Gross Domestic Product. The largest social benefits from inmate labor are likely to come about from decreased recidivism, although the effect of inmate labor on subsequent crime and recidivism rates has not been adequately studied. The potential inmate workforce is low skilled. We est...