Source: Liberalism, Neoliberalism, and the Literary Left Interview by W. Stockton and D. Gilson (forthcoming).
Deirdre McCloskey on the origins of the #minimumwage
01 Dec 2016 Leave a comment
in applied price theory, economic history, history of economic thought, labour economics, minimum wage Tags: Deirdre McCloskey, eugenics, Leftover Left, New Left, Old Left
Aren’t exploitative employers supposed to be unusually profitable? Living high on the hog of labour surplus?
27 Nov 2016 Leave a comment
Capitalism in the United States is ruthless—to the rich
27 Nov 2016 Leave a comment
in economic history, entrepreneurship, industrial organisation, poverty and inequality, survivor principle Tags: top 1%
Is inequality just getting worse and worse in #NewZealand?
23 Nov 2016 Leave a comment
in applied welfare economics, economic history, politics - New Zealand, poverty and inequality
Source: New Zealand Treasury Long-Term Fiscal Projections 2016.
More on the scourge of neoliberalism
18 Nov 2016 Leave a comment
in economic history, politics - USA, poverty and inequality, welfare reform
O-Ring model
18 Nov 2016 Leave a comment
in applied price theory, development economics, human capital, industrial organisation, labour supply
How did the industrial revolution impact family planning? | Robert E. Lucas
17 Nov 2016 Leave a comment
in applied welfare economics, development economics, economic history, history of economic thought, labour economics, macroeconomics, Robert E. Lucas Tags: economics of fertility, industrial revolution
#nzeq Post-disaster labour market adjustment: Alaska in the pipeline era & Darwin after Cyclone Tracy
17 Nov 2016 Leave a comment
in economics of natural disasters, labour economics, labour supply, politics - New Zealand, transport economics, urban economics Tags: Alaska, Cyclone Tracy
Experiences from abroad suggest that labour markets have a history of rapid adaptation to regional surges in construction demand and that workers are prepared to tolerate lower quality housing provided there are compensating wage premiums.
The Trans-Alaska Pipeline was the largest privately funded construction project to that time. Alaskan wages during the building period between 1974 and 1977 were very flexible in the construction and related industries.
Labour supply was responsive in terms of more hours worked per worker and more local workers entering the workforce with many others moved temporarily to Alaska even though the Alaskan climate and culture would not appeal to everyone.
The Alaskan labour force increased by 50%, from about 50,000 to about 90,000 workers, hours worked per week increased by about the same, and many people worked 2 jobs.
High school hours were moved to the morning so that students and their teachers could take an afternoon job in pipeline construction. There is hot beading of accommodation and a 1000% labour turnover rate at the local McDonald’s. By 1979, the Alaskan labour force returned pretty much to its preconstruction era size.
Moving to a region still prone to after-shocks also would not appeal to everyone. Many energy industry construction projects in modern times were completed in unappealing locations and extreme climates on land and sea.
As another and much nearer example, Cyclone Tracy destroyed about 60 per cent of the 8,000 houses in Darwin on 24 December 1974 and more than 30 per cent were severely damaged. Most of Darwin’s population of 48,000 people became homeless; 71 lives were lost.
After a mass evacuation of 35,000, Darwin’s population was 10,000 by 1 January 1975. Darwin’s population recovered to 30,000 by May 1975. This influx was dominated by newcomers, especially construction workers. Temporary housing, caravans, hotels and an ocean liner were all pushed into service.
When the Darwin Reconstruction Commission was wound up two years ahead of the initial reconstruction timeline on 12 April 1978, 3,000 new dwellings had been completed. By mid-1978, the city could again house its pre-Tracy population numbers. Darwin is now home for about 125,000 people.
Deirdre McCloskey on why intellectuals prefer socialism
13 Nov 2016 1 Comment
in history of economic thought, labour economics, Marxist economics, occupational choice Tags: Deirdre McCloskey, intellectuals and socialism
Source: Liberalism, Neoliberalism, and the Literary Left Interview by W. Stockton and D. Gilson (forthcoming).
Roland Fryer | Education, Inequality, & Incentives
11 Nov 2016 Leave a comment
in applied price theory, applied welfare economics, economics of education, human capital, labour economics, labour supply, poverty and inequality Tags: child poverty, family poverty
Skill-specific atrophy rates drive the STEM gender gap
08 Nov 2016 Leave a comment
in discrimination, economics of education, gender, human capital, labour economics, minimum wage, occupational choice Tags: gender wage gap, reversing gender gap
Rendall and Rendall (2016) found that women prefer occupations where their skills depreciate slowest when taking time out from motherhood. Verbal and reading skills depreciate at a far slower rate than mathematical and scientific skills so this gives women yet another strong reason to avoid science, technology, engineering and maths (STEM) careers.
we show that college educated women avoid occupations requiring significant math skills due to the costly skill atrophy experienced during a career break. In contrast, verbal skills are very robust to career interruptions.
The results support the broadly observed female preference for occupations primarily requiring verbal skills – even though these occupations exhibit lower average wages. Thus, skill-specific atrophy during employment leave and the speed of skill repair upon returning to the labour market are shown to be important factors underpinning women’s occupational outcomes.
Not only do women have vastly superior verbal and reading skills, worth somewhere near 6 to 12 months extra schooling, these skills do not depreciate much during career breaks. Indeed, reading and verbal skills tend to naturally increase with age until your late 60s.
Source: Reading performance (PISA) – International student assessment (PISA) – OECD iLibrary.
Maths skills get rusty if not used while knowledge of computer languages and the like and of specific technologies can be quickly overtaken by events while on maternity leave. Rendall and Rendall (2016) again
… college educated females avoid math-heavy occupations, and pursue verbal-heavy occupations instead. This is due to the high skill atrophy associated with math skills, and the ability of verbal skills to act as “skill insurance” against gaps.
Additionally, for college educated individuals, math is the skill most vulnerable to loss during employment gaps, which also implies a slow rebuilding post-break. In contrast, non-college educated individuals experience a much smaller math skill loss.
Rendall and Rendall’s point about college educated women avoiding maths heavy occupations even if it costs them wages so as to maximise the lifetime income may explain the larger gender wage gap at the top of the income distribution than at the bottom.
At the bottom of the income distribution, skill atrophy do not really matter much. At the top, it do. Women make occupational choices where annual income may be lower but lifetime income may be higher because of the lower rates of skill depreciation when they are out having children.
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