Showing papers on "Negative relationship published in 1988"

Labour market institutions and economic performance

Abstract: Labour markets Richard Freeman Do particular types of labour market institution hold the key to economic success? Should other countries try to emulate the flexibility of the American labour market or the centralization of Swedish-style corporatism? Since 1970 within the OECD there has been a sharp divergence both of economic performance and of indicators of labour market structure. The paper uses union density and the degree of wage dispersion across industries to proxy a country's underlying labour market institutions. In assessing economic performance, it is argued that cross-country differences in output growth were much smaller than differences in employment growth. For given output growth, there is a clear negative relationship between employment growth and real wage growth across countries. Why do different countries find themselves at different points on this trade-off? The final part of the paper examines the correlation between indicators of labour market structure and the position on the wage-employment trade-off. It concludes that the degree of wage dispersion across industries is the most important indicator of market structure and that countries with very high or very low dispersion, typically the countries with highly centralized or highly decentralized bargaining in the labour market, have better employment performance than countries with intermediate degrees of centralization and wage dispersion.

Reassessing Economic Dependency and Uneven Development: The Kenyan Experience

Abstract: Over the past decade, students of development have conducted a substantial number of quantitative cross-national studies. On balance, these studies provide support for some portions of the dependency/world-system theory, showing a negative relationship between foreign capital penetration and both economic growth and equality. However, case studies indicate that the dependency perspective should not be generalized across countries. Individual countries have unique circumstances that govern the level and type of economic dependency affecting them. This paper uses time-series analysis to test the validity of dependency arguments in post-independence Kenya. The results suggest that Kenya is experiencing a transition from classical dependency to dependent development. This process is characterized by an increase in foreign investment in manufacturing, prompting economic expansion in the "modern" sectors of the country. Such uneven development tends to enrich elites associated with foreign capital.

Local Area Variations in Reproductive Behaviour in the People's Republic of China, 1973–1982

Abstract: Chinas spectacular fertility decline and awesomely powerful family planning program have been well documented at the national and provincial levels. This paper provides systematic data at the community level for 4 provinces based on the 1/1000 Fertility Survey. It demonstrates considerable local variability in reproductive behavior among production brigades. This is true not only for fertility contraception and nuptiality but also for such program-related variables as the 1-child certificate rate. That rate a possible proxy for program effort correlates with fertility for several provinces considered. The paper also shows that the educational level of the community has a macro-effect independent of the education of the individual women. The distance of the production brigade from a large city is also shown to have a negative relationship to fertility net of its relationship to educational levels. (authors)

Static versus dynamic analysis of the interaction between female labour force participation and fertility.

Abstract: Numerous studies have found a negative relationship between female labour-force participation and fertility. In theory, there could be three explanations of this finding: (i) causality runs from labour-force participation to fertility, (ii) causality runs from fertility to labour-force participation, (iii) causality runs both ways. Alternatively, the relationship may not be a causal one. In practice, empirical studies covering a wide range of Western countries at different times, and utilizing a great variety of methods and techniques, have shown all four possibilities to be plausible. This may be because outcomes differ from country to country for socio-cultural reasons, or from period to period for historical ones. If so, applying various methodologies to data for one country at a particular point in time should yield consistent results that all point in one direction only. If they did not outcomes would appear to be method-dependent. The single data set used in this study refers to the Netherlands in 1984 (ORIN project). The relationship between fertility and labour-force participation in this data set is investigated by means of three methodologies, ranging from ‘static’ to ‘dynamic’, i.e., differing according to the degree in which they take the temporal aspects of the decision-making process underlying this relationship into account: simultaneous logit analysis, Granger analysis and Markov analysis. Each main approach is applied in two different ways or on two different subgroups, for a total of six applications. In spite of diverging operationalizations of the basic variables, it turns out that four of these six analyses favour the inference that fertility decisions do have an impact on labour force participation decisions but not the other way around, whereas the other two confirm earlier findings (from data sets collected during the 1970s) that the relationship is reciprocal. Substantively, this might indicate that the pattern of covariance is changing. But ‘static’ simultaneous logit analysis is the only method to consistently point at this causal unidirectionality, while outcomes from Granger and Markov analysis depend on the modality applied. Methodologically, this means that the issue of method-dependency, at least in this area, remains largely unresolved.

Measuring the impact of minimum wage policies on the economy

Abstract: This paper undertakes a statistical analysis of the effect of minimum wages (MWs) on different population groups. The underlying question for this analysis relates to the probability bias exerted by certain protective government regulations in terms of the unemployment prospects of specific groups. Several cross-sectional data and a standard human capital model corrected for selectivity bias are used to analyze the case of Chile, where high structural unemployment has been a remarkable feature of the 1970s and 1980s. The main conclusions show that the coverage of the MW is more significant for the young and the less educated, and there exists a negative relationship between human capital stock and actual coverage of MWs. It is also shown that previous statistical analysis of this issue, both in the case of Chile and in industrial countries may have underestimated the negative impact of MWs because they do not correct for selectivity bias.

Stylised facts and the labour demand curve

Abstract: The paper demonstrates that there is a simple, robust negative relationship between employment and real wages, detectable in the macroeconomic data of most countries, if it is looked for in the right way. This is the stylised fact of the title.

Compliance with international trade regime norms and the effects of regime change

Abstract: Research on change in international regimes usually examines noncompliance with regime norms. In studies of international trade regimes, this means a focus on the imposition of trade barriers rather than liberalization. Developing a measure of compliant as well as noncompliant government intervention in trade for the Contracting Parties to the General Agreement on Tariffs and Trade gives a fuller indication of regime strength. Regressing these measures against the rate of change in export volumes for the market economies allows an examination of the effects of changes in regime strength and system performance. At this level of the international system, the analysis points to a strong negative relationship between protectionist acts and the rate of growth in the export volume of the market economies; however, detrending and deserializing the independent variables results in a strong negative relationship between changes in export volume and the percentage of countries that both increase and decrease protec...

Financing the unemployment insurance system and the interest group theory of government

Abstract: responsibility for the administration of its unemployment insurance program subject to the mandate that it maintain an 'adequate' balance in its individual trust fund.1 In each state, employers pay a tax rate based on their unemployment experience, starting with some set minimum rate for relatively low unemployment firms and increasing to some set maximum rate for relatively high unemployment firms. The extent of experience rating, as measured by the spread between the minimum and maximum rates, varies substantially across the states. This paper uses the rent-seeking model of regulation to explain the pattern of unemployment insurance tax rates across the states. Unlike most observers, we recognize that government provision of unemployment insurance, even in the public interest, will have the natural and unavoidable consequences of increasing unemployment and creating cross subsidies. Hence, these results, which so many researchers have found, are not sufficient evidence to reject the public interest model or to suggest changes in the system. We identify a private interest model in which a state's dominant industry will attempt to manipulate the tax rate structure. This industry will attempt to generate greater subsidies if it is characterized by high unemployment, or to reduce the degree of unemployment subsidization if this industry is characterized by low unemployment. As predicted by the rent-seeking model of government, we find a negative relationship between the unemployment level of the state's dominant industry and the experience rating of the state's UI program.