Showing papers in "Journal of Human Resources in 1989"
TL;DR: The authors found that a family's official income-to-needs ratio explained 24 percent of the variance in the amount of material hardship it reported, while adjustment for family size, age, health, noncash benefits, home ownership, and access to credit explained another 15 percent.
Abstract: Public concern with poverty derives in large part from the assumption that low income families cannot afford necessities. Yet official poverty statistics focus on measuring income, not on measuring material hardship. Two surveys of Chicago residents measure whether families could afford food, housing and medical care. A family's official income-to-needs ratio explained 24 percent of the variance in the amount of material hardship it reported. Adjustments for family size, age, health, noncash benefits, home ownership, and access to credit explain another 15 percent. Variations in permanent income explain almost none of the remaining variance in hardship. Among families with the same official income-toneeds ratio, material hardship varies by age, family size and composition.
577 citations
TL;DR: In this article, the problem of estimating a regression when realizations of (y, x) are sampled randomly but y is observed selectively is considered, and the problem faced by the researcher is to find correct prior restrictions which, when combined with the data, identify the regression.
Abstract: This article considers anew the problem of estimating a regression E(y|x) when realizations of (y, x) are sampled randomly but y is observed selectively The central issue is the failure of the sampling process to identify E(y|x) The problem faced by the researcher is to find correct prior restrictions which, when combined with the data, identify the regression Two kinds of restrictions are examined here One, which has not been studied before, is a bound on the support of y Such a bound implies a simple, useful bound on E(y|x) The other, which has received much attention, is a separability restriction derived from a latent variable model
557 citations
TL;DR: This article examined the impact of overeducation (or surplus schooling) on earnings and found that those with educational attainments substantially above the mean for their specific occupations often earn less than their adequately educated and undereducated counterparts.
Abstract: This paper examines the impact of overeducation (or surplus schooling) on earnings. Overeducated workers are defined as those with educational attainments substantially above the mean for their specific occupations. Two models are estimated using data from the 1980 census. Though our models, data, and measure of overeducation are different from those used by Rumberger (1987), our results are similar. Our results show that overeducated workers often earn less than their adequately educated and undereducated counterparts.
534 citations
TL;DR: In this paper, the effect of disability on labor force participation by using symptoms or diseases as instruments in a simultaneous equations model of endogenous reported disability and L1 participation was investigated. But the results showed that each measure of disability explains a significant amount of variation in L1 disability, and there is only weak evidence of endogeneity of the disability variables.
Abstract: This paper estimates the effect of disability on labor force participation by using symptoms or diseases as instruments in a simultaneous equations model of endogenous reported disability and labor force participation The results show that each measure of disability explains a significant amount of variation in labor force participation, though the two are not perfect substitutes There is only weak evidence of endogeneity of the disability variables For cases where there is evidence of endogeneity, the bias it causes has the opposite effect of that hypothesized in the literatute (ie, stress causes health to deteriorate with labor force participation) Furthermore, it has only insignificant effects on the coefficients for other variables
382 citations
TL;DR: This study investigates the validity of alternative explanations for the observed schooling-health correlation and results uniformly indicate that the direct effect of schooling on health is more important than the effect of unobservables.
Abstract: Economists have long realized that schooling and good health are strongly positively correlated. Some conclude that schooling has a direct positive effect on the production of good health while others argue that some unobserved variable such as rate of time discount positively affects both health and schooling. This study investigates the validity of alternative explanations for the observed schooling-health correlation. Models are estimated using four different measures of overall health: disability, functional limitations, and systolic and diastolic blood pressures. The results uniformly indicate that the direct effect of schooling on health is more important than the effect of unobservables.
306 citations
TL;DR: In this paper, the authors quantify the returns to a career in the United States Congress using a dynamic model of career decisions of a member of Congress and estimate this model using a newly collected dataset given estimates of the structural model.
Abstract: Our main goal is to quantify the returns to a career in the United States Congress We specify a dynamic model of career decisions of a member of Congress and estimate this model using a newly collected dataset Given estimates of the structural model, we
263 citations
225 citations
TL;DR: The authors examined the relationship between wages, firm size, and plant size in the National Longitudinal Survey of Young Men and the Current Population Survey for 1983 and found that better educated and more stable workers are in larger firms.
Abstract: This paper uses data from the National Longitudinal Survey of Young Men and the Current Population Survey for 1983 to examine the relationships among wages, firm size, and plant size. We reach three key findings. First, plant size has little independent effect on wages once we have controlled for firm size for firms with fewer than 1,000 employees. Second, we find evidence of sorting on observed and unobserved ability characteristics across firm sizes. Better educated and more stable workers are in larger firms. Third, results from a first-difference estimator indicate that about 60 percent of the wage-size effect is due to unobserved heterogeneity when all firms are considered and about 100 percent when firms with 25 or more employees are considered.
182 citations
TL;DR: Estimates show that employees are very sensitive to the out-of-pocket premium for each plan, controlling for other plan characteristics, which is important both for public policy and for employers who offer multiple health plans.
Abstract: We estimate the demand for health plans by employees in 17 Minneapolis firms. The data set has approximately 900 employees who chose a single-coverage health plan and 2,100 employees who chose family coverage. A nested logit model is empirically shown to be the right approach for modeling health plan choice, with freedom to choose your own doctor being the variable that distinguishes health plan nests. Our estimates show that employees are very sensitive to the out-of-pocket premium for each plan, controlling for other plan characteristics. These results are important both for public policy and for employers who offer multiple health plans.
178 citations
TL;DR: After controlling for acquired human capital and other attributes of medical school applicants, this paper cannot reject nepotism as a cause-children of doctors are nearly 14 percent more likely to be admitted into medical school than are comparable nonfollowers.
Abstract: In this paper we document a statistically significant, marginally greater probability of admittance into (at least one) medical school for children of doctors as compared to children of non-doctors. This fact can plausibly be explained as resulting from nepotism, in various forms, as well as from human capital transfers from first to (would-be) second generation doctors. After controlling for acquired human capital and other attributes of medical school applicants, we cannot reject nepotism as a cause-children of doctors are nearly 14 percent more likely to be admitted into medical school than are comparable nonfollowers.
140 citations
TL;DR: The Medically Needy program appears to be used by households which experience significant medical problems, but which would be uninsured if this program were not available, and neither the presence of a Medically needy program nor the value of Medicaid insurance coverage has significant effects on AFDC usage.
Abstract: This paper investigates the need for medical insurance and the effect of Medicaid eligibility rules on the behavior offemaleheaded households with children, using 1980 data from the National Medical Care Utilization and Expenditure Survey. It estimates the extent to which health problems and the parameters of the Medicaid program affect AFDC participation, labor market involvement, and Medicaid usage among the Medically Needy. Health problems significantly increase AFDC participation, but neither the presence of a Medically Needy program nor the value of Medicaid insurance coverage has significant effects on AFDC usage. The Medically Needy program appears to be used by households which experience significant medical problems, but which would be uninsured if this program were not available.
TL;DR: In this article, a model of simultaneous occupational choice and earnings is estimated for foreign born Hispanic men, foreign born East Asian men and for native white men to test the general hypotheses of assimilation.
Abstract: The work in this paper contributes to the debate on the economic assimilation of immigrant workers in the U.S. labor market. A model of simultaneous occupational choice and earnings is estimated for foreign born Hispanic men, foreign born East Asian men and for native white men to test the general hypotheses of assimilation. An important distinction is made between those who migrated as adults and those who migrated as children. The results suggest that the appearance of assimilation may be the outcome of pre-labor market experiences of individuals who migrate as children, along with changes in U.S. immigration law that have relaxed skill criteria for entering immigrants.
TL;DR: In this article, the authors examined the impact of women's schooling on women's health and nutrition with and without controls for unobserved childhood background factors related to ability and motivation using data on adult sisters.
Abstract: There is debate on whether schooling causes increases in productivity or whether the estimated relationships reflect ability, knowledge, tastes etc., that are associated with schooling. This paper examines the impact of women's schooling on women's health and nutrition with and without controls for unobserved childhood background factors related to ability and motivation. Random and fixed effects models are estimated using data on adult sisters. Both sets of estimates reinforce the relationships found in standard estimates-that women's schooling positively affects their health and nutrient intakes; the latter result is particularly robust.
TL;DR: This paper examined the effects of pay incentives on teacher absence in one New York district and found that teacher absence declined significantly and perfect attendance rose from 8 percent to 34 percent during the first year of an attendance incentive plan.
Abstract: This study examines the effects of pay incentives on teacher absence in one New York district. Paired sample t-tests of 292 teachers revealed that teacher absence declined significantly and perfect attendance rose from 8 percent to 34 percent during the first year of an attendance incentive plan. The study also revealed that the significant reduction in sick leave was accompanied by a significant increase in the use of personal days. The implications of these findings for practice and future research are discussed.
TL;DR: This paper used a hazards model with endogenous covariates to estimate the effects of family background, employment opportunity, and childbearing on the school dropout of youths from low-income households.
Abstract: This paper uses a hazards model with endogenous covariates to estimate the effects of family background, employment opportunity, and childbearing upon the school dropout of youths from low-income households. Family background and employment opportunity are found to be significant, but when the effect of childbearing is properly estimated, it is not significant. The authors conclude that childbearing and dropout are jointly determined, but that when this is properly accounted for, childbearing appears to exert little effect upon dropout.
TL;DR: This article extended previous work on labor supply in Japan by treating the simultaneous labor force participation and hours of work decisions for Japanese wives, both employees and family workers, and estimated a trichotomous participation model for a sample from the Tokyo Metropolitan Area, and then estimated hours and wage equations, and aggregate labor supply elasticities.
Abstract: This paper extends previous work on labor supply in Japan by treating the simultaneous labor force participation and hours of work decisions for Japanese wives, both employees and family workers. It estimates a trichotomous participation model for a sample from the Tokyo Metropolitan Area, and then estimates hours and wage equations, and aggregate labor supply elasticities. The empirical results generally confirm the economic model's theoretical predictions. Although the estimated aggregate wage and income elasticities for employees are somewhat higher than previous estimates for the U.S., they are of the same order of magnitude. However, the level of the husband's income has an unexpected positive effect on the annual hours that employees work and the elasticities estimated for family workers are usually large.
TL;DR: The authors analyzed the relationship between AFDC benefits and a single mother's propensity to reside within another family rather than in her own independent household and found that the lower benefits paid to subfamilies have discernible but small effects.
Abstract: This paper analyzes the relationship between AFDC benefits and a single mother's propensity to reside in a subfamily-i.e., within another family rather than in her own independent household. We find that some states pay lower benefits to mothers living in subfamilies. In those states, a single mother may forego a substantial amount of AFDC benefits if she chooses to reside in a subfamily rather than establish her own household. Using data from the 1984 Current Population Survey, we address the question of whether differences in AFDC benefits affect the probability that a mother will reside in a subfamily. We find that the lower benefits paid to subfamilies have discernible but small effects, and that the overall level of AFDC benefits has no effect.
TL;DR: This paper found evidence of unobservable differences between women who receive child support and those who do not, finding that women who received child support have higher earnings and work longer hours than women who did not.
Abstract: Recent Census Bureau statistics show that women who receive child support payments have higher earnings and work longer hours than women who do not. Does this suggest that child support-unlike all other nonwage income-does not deter work effort, or are women who receive it simply different? We use 1979/1982 CPS data on divorced or separated women to estimate the determinants of hours worked when AFDC participation and child support are endogenous. We find evidence of unobservable differences between women who receive child support and those who do not. Controlling for these, both child support and other nonwage income appear to reduce hours worked, but the deterrent effect of child support is considerably less.
TL;DR: This paper found evidence that much of the variation in academic performance of young children from low-income black families results from differences in behavior and attitudess among the families, and that there are substantial variations in children's outcomes across families that are identical in parents' education and work history, family income, family size, and other standard measures of social and economic well-being.
Abstract: Although parents' socioeconomic status has large and important effects on their children's school achievement, it is clear that there are substantial variations in children's outcomes across families that are identical in parents' education and work history, family income, family size, and other standard measures of social and economic well-being. This paper finds evidence that much of the variation in academic performance of young children from low-income black families results from differences in behavior and attitudess among the families.
TL;DR: In this article, the authors examined the combined impact of the employment guarantee for graduates and public sector compensation policies on the Egyptian labor market and concluded that these policies contribute to an unsustainable rate of growth in the government labor force.
Abstract: This article examines the combined impact of the employment guarantee for graduates and public sector compensation policies on the Egyptian labor market. Besides contributing to an unsustainable rate of growth in the government labor force, these ...
TL;DR: The NAS-NRC Twin Offspring data support the proposition that for those with low levels of education, earnings may be an adequate proxy for compensation, whereas the opposite holds for highly educated individuals as discussed by the authors.
Abstract: The NAS-NRC Twin Offspring data support the proposition that for those with low levels of education, earnings may be an adequate proxy for compensation, whereas the opposite holds for highly educated individuals The inclusion of variables that control for reasons (monetary or nonmonetary) individuals chose their occupation explains an additional 9 percent of the variation in earnings for those with 16 or more years of education (and lowers the male female wage gap by almost 40 percent) and only an additional 2 percent for those with 15 years or less (no affect on male-female wage gap)
TL;DR: In this paper, the authors examine the CPS unemployment experience data, which gives the number of weeks of unemployment and number of spells of unemployment experienced by a sample of people in a year, focusing on both the entry rate or frequency and the exit rate or duration (probability of exiting) of unemployment spells.
Abstract: This chapter is empirical and descriptive rather than theoretical. It examines the CPS unemployment experience data, which gives the number of weeks of unemployment and the number of spells of unemployment experienced by a sample of people in a year. This chapter focuses on both the entry rate or frequency (probability of entering) and the exit rate or duration (probability of exiting) of unemployment spells, for it is on both the entry and exit rates that the level and distribution of unemployment depends. The conclusion is that entry rates and differences in entry rates across people are of primary importance in explaining unemployment experience.
TL;DR: In this paper, a method for empirically estimating the consumption value of schooling as a vehicle to avoid the Vietnam War draft is presented, and the authors demonstrate by example that human capital is more than just a capital good in the strictest sense of the term.
Abstract: The purpose of this paper is to demonstrate by example that human capital is more than just a capital good in the strictest sense of the term. Certain forms of human capital have consumption value in addition to the value of the increased stream offuture monetary and nonmonetary benefits. A methodfor empirically estimating the consumption value of schooling as a vehicle to avoid the Vietnam War draft is presented.
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TL;DR: This paper showed that the black quit rates are lower than those of whites, and that the residual race effect is positive and sufficiently large to account for all net black quits, while neglecting racial differences in quit responses to commuting time and local unemployment rates.
Abstract: Previous studies estimate that black quit rates are lower than those of whites. This paper suggests that these estimates under-state black quit propensities because they neglect racial differences in quit responses to commuting time and local unemployment rates. Ignoring these differences, the black quit effect appears to be negative. Controlling for them, the residual race effect is positive and sufficiently large to account for all net black quits.
TL;DR: The authors decompose annual earnings into hours of work and hourly earnings and analyze male-female differences in earnings inequality using Canadian data, finding that the larger female inequality in earnings is due to a greater inequality in the...
Abstract: We decompose annual earnings into hours of work and hourly earnings and analyze male-female differences in earnings inequality using Canadian data. Our results indicate that the larger female inequality in earnings is due to a greater inequality in the ...
TL;DR: This paper proposed an econometric solution to the problem of censoring desired family size by the number of children ever born (CEB) in cross-sectional fertility and household surveys.
Abstract: This paper proposes an econometric solution to the problem of censoring of desired family size (DFS) by the number of children ever born (CEB) in cross-sectional fertility and household surveys. The solution proposed is based on a bivariate ordered-probit model for both DFS and CEB. The model proposed also suggests an alternative solution to the problem of estimating the replacement effect of infant and child deaths on the number of children ever born. (EXCERPT)
TL;DR: In this paper, a detailed analysis of a model of the academic labor market for economists is presented and it is shown that such models provide little support for policies designed to offset the impact of change in cohort size on the academic labour market.
Abstract: Educational policymakers have long been concerned that baby booms and busts alternately cause shortages and surpluses in academic labor markets These concerns have been supported by models which purport to forecast the effects of change in cohort size on the academic labor market In this paper it is argued that policymakers should be more skeptical of such forecasts The basis for the argument is a detailed analysis of a model of the academic labor market for economists The inescapable conclusion is that forecasts from such models provide little, if any, support for policies designed to offset the impact of change in cohort size on the academic labor market
TL;DR: In this article, a utility maximization model of workers who make decisions to work or not over a lifetime is presented, where the objective is to maximize the presented discounted value of utility arising from the participation decisions.
Abstract: This paper presents a utility maximization model of workers who make decisions to work or not over a lifetime. The objective is to maximize the presented discounted value of utility arising from the participation decisions. In addition to duration dependence introduced through time-variant job offer and layoff probabilities, state dependence enters the model by the existence of a different risk while working, namely, the dismissal risk, than the one while not working, namely, the possibility of no job offers. A dynamic programming algorithm is solved and estimated within a maximum likelihood routine, with data from the National Longitudinal Surveys youth cohort.
TL;DR: In this paper, the optimal investment in physical and human capital when the (exogenous) rate of population growth changes is analyzed. And the optimal growth path is characterized by two groups of optimality conditions: a Generalized Golden Rule for optimal investment, and a continuum of Golden Rules of Education corresponding to the continuum of active generations.
Abstract: The paper analyses optimal investment in physical and human capital when the (exogenous) rate of population growth changes. The growth model describes a closed economy with overlapping generations and homogeneous human capital. The optimal growth path is characterized by two groups of optimality conditions: a Generalized Golden Rule for optimal investment in physical capital; and a continuum of Golden Rules of Education corresponding to the continuum of active generations. These conditions for optimal investment in human capital can be interpreted in terms of the familiar equality of discounted costs and returns. The model is illustrated with a numerical simulation. (EXCERPT)
TL;DR: In this paper, a simple pricing model was proposed in which providers' profit maximizing prices depend on the market shares and cost control strategies of different insurers, and data from a recent national survey of physicians were then used to estimate fee elasticities for this model and to compare its implications with those of an alternative proposed by Sloan (1982).
Abstract: Although there is general agreement that insurance has played a central role in medical price inflation, this consensus is not based on convincing empirical evidence. Indeed, the best available estimates assign insurance a minor role. This paper begins by proposing a simple pricing model in which providers' profit maximizing prices depend on the market shares and cost control strategies of different insurers. Data from a recent national survey of physicians are then used to estimate fee elasticities for this model and to compare its implications with those of an alternative proposed by Sloan (1982). Respecification plus more recent data dramatically increase the estimated impact of insurance on prices