Do Markets Respond More to More Reliable Labor Market Data? A Test of Market Rationality

Since 1979, the Bureau of Labor Statistics (BLS) has nearly quadrupled the size of the sample used to estimate monthly employment changes. Although first-reported employment estimates are still noisy, the magnitude of sampling variability has declined in proportion to the increase in the sample size. A model of rational Bayesian updating predicts that investors would assign more weight to the BLS employment survey as it became more precise. However, a regression analysis of changes in interest rates on the day the employment data are released finds no evidence that the bond market's reaction to employment news intensified in the late 1980s or early 1990s. For the time period as a whole, an unexpected increase of 200,000 jobs is associated with an 8 basis point increase in the interest rate on 30 year Treasury bonds, and a 9 basis point increase in the interest rate on 3 month bills, all else equal. Additionally, announced hourly wage increases are associated with higher long-term interest rates rate and revisions to past months' employment estimates have a statistically insignificant effect on long-term interest rates.

The Effect of the Minimum Wage When It Really Bites: A Reexamination of the Evidence from Puerto Rico

This paper reinvestigates the evidence on the impact of the minimum wage on employment in Puerto Rico. The strongest evidence that the minimum wage had a negative effect on employment comes from an aggregate time series analysis. The weakest evidence comes from cross-industry analyses. The main finding of the paper, however, is that the statistical evidence of a negative employment effect of the minimum wage in Puerto Rico is surprisingly fragile.

The Determinants of Queues for Federal Jobs

This paper examines the determinants of the number and quality of outside applicants for federal job openings using a variety of time-series, cross-sectional and panel data sets. The main finding is that the application rate for government jobs increases as the ratio of federal to private sector earnings Increases, but does not appear to be related to the relative level of fringe benefits. Furthermore, an Increase in the federal-private sector earnings differential is associated with an increase in the average quality of applicants for federal jobs. The paper discusses the implications of these findings for wage determination and recruitment in the federal government.

Are We Having More Fun Yet? Categorizing and Evaluating Changes in Time Alloction

macroeconomics, Time Alloction

Workers' Compensation Insurance and the Duration of Workplace Injuries

This paper uses a new administrative micro-data set to examine the effect of a legislated increase in the minimum and maximum workers' compensation benefit on the duration of workplace injuries in Minnesota. As a result of legislation, workers in some earnings groups received higher benefits if they were injured after the effective date of the benefit increase, while workers in other earnings groups received the same benefit regardless of when they were injured. The analysis compares the change in mean log injury duration for workers who were affected by the benefit increase to that of workers who were not affected by the benefit increase. The findings indicate that the duration of injuries increased by 8 percent more for the group of workers that experienced a 5 percent increase in benefits than for the group of workers that had no change in their benefit. Additional findings suggest that employees of self-insured firms who are injured on the job tend to return to work faster than employees of imperfectly experience rated firms who incur similar injuries.

The Evolution of Unjust-Dismissal Legislation in the United States

In the last decade, state courts in many areas of the United States have ruled in favor of employees alleqing they were improperly dismissed. Many economists have contended that any judical or legislative departure from the employment-at-will doctrine is regressive and inefficient because it restricts employment flexibility and freedom of contact. This paper advances an evolutionary theory of unjust-dismissal leqislation in which employer groups eventually support unjust-dismissal leqislation in response to the threat of large and variable damage awards imposed by the judicial system. Legislation is sought to clearly define property rights and to limit employer liability. In comparison to the common law, the unjust-dismissal laws that have been proposed are likely to result in smaller awards, reduce uncertainty, resolve disputes rapidly, and reduce legal and other transaction costs. An institutional and empirical analysis supports the conclusion that the proposal of unjust-dismissal leqislation is a response to court rulings that weaken and obfuscate the employers' right to dismiss employees at will. This evidence is inconsistent with the conventional political-economy view of unjust-dismissal leqislation.

Reassessing the view that American schools are broken

The author evaluates the popular belief that the U.S. public school system is flawed and can be corrected only through fundamental changes in the institutions governing education. He finds that the system is not inherently flawed, and may actually be reasonably effective. Based on these findings, he offers incremental proposals to improve U.S. schools.Education

What Makes a Homegrown Terrorist? Human Capital and Participation in Domestic Islamic Terrorist Groups in the U.S.A.

This paper compares the characteristics of 63 alleged homegrown Islamic terrorists in the U.S.A. to a representative sample of 1,000+ Muslim Americans. The alleged terrorists have about average level of education. Those with higher education were judged closer to succeeding.terrorism; homegrown terrorism; human capital

Hispanics and the Current Economic Downturn: Will the Receding Tide Sink Hispanics?

Explores the progress made by Hispanics during the economic boom of the 1990s, and examines the potential impact of the 2001/2002 economic slowdown on Hispanic workers and families