The HIV epidemic has dramatically decreased labor supply among prime-age adults in Sub-Saharan Africa. Using within-country variation in regional HIV prevalence and a synthetic panel, I find that HIV significantly increases the capital-labor ratio in urban manufacturing firms. The impact of HIV on average wages is positive but imprecisely estimated. In contrast, HIV has a large positive impact ...

Wage rigidity, stemming from highly distortive labor market policies, is a natural candidate to explain the over-valuation of the CFA Franc after the adverse external shocks of the 1980s. This paper uses a variety of data sources to assess the actual rigidity of wages in CFA countries and to analyze how it relates to their labor market policies. The paper shows that wages are high in CFA countr...

We estimate the employment effects of changes in national minimum wages using a pooled crosssection time-series data set comprising 17 OECD countries for the period 1975-2000, focusing on the impact of cross-country differences in minimum wage systems and in other labor market institutions and policies that may either offset or amplify the effects of minimum wages. The average minimum wage effe...

As in many European countries, labour productivity in the UK has been stagnant since the start of the Great Recession. This paper uses individual data on employment and wages to try to understand whether real wage flexibility can help shed light on the UK’s productivity puzzle. It finds, perhaps unsurprisingly, that workforce composition cannot explain the reduction in wages and hence productiv...

This study investigates the role of immigrant composition in creating the observed negative correlation between immigrant supply and immigrant wages in US time series, which has recently been interpreted as evidence of immigrant-native complementarities in production. The main finding is that compositional effects fully explain this empirical pattern. Newlyarrived immigrants, notably Latin Amer...

In this chapter, the focus shifts away models with ‡exible wages and prices to models of sticky wages and prices. We begin this chapter with a simple example of a model with nominal wage rigidities that last for one period. We then review models that account for the observation that prices and wages may take several periods to adjust to changes in macroeconomic conditions. Time-dependent and st...

We analyze how the financial conditions of the firm affect the compensation structure of workers, the size of the firm, and its dynamics. Firms that are financially constrained offer long-term wage contracts characterized by an increasing wage profile, that is, they pay lower wages today in exchange of higher future wages, effectively borrowing from their employees. Because constrained firms al...

as the analytical framework. Despite the many estimates presented in the literature, there is little agreement on a point estimate of the gross effect of the wage rate on weekly hours of work, except that it is generally negative (i.e., the income effect dominates).2 The fact that the wage elasticity is negative has been used to explain the secular decline of hours of work and is important in c...

In this paper we study whether location-speci...c price variation likely a¤ects statistical inference and theoretical interpretation in the empirical implementation of human capital earnings functions. We demonstrate, in a model of local labor markets, that the “return to schooling” is a constant across locations if and only if preferences are homothetic— a special case that seems unlikely to g...

We explore the implications of labour demand constraints on the propensity to experience poverty. Since these constraints can manifest themselves in terms of both prices and quantities, we focus particularly on the relative contributions of underemployment and underpayment. Our analysis suggests that there has been a significant increase in working poverty in Britain over the period 1985-1996, ...