The effects of employment uncertainty and wealth shocks on the labor supply and claiming behavior of older American workers

Unemployment rates in developed countries have recently reached levels not seenin a generation, and workers of all ages are facing increasing probabilities of losingtheir jobs and considerable losses in accumulated assets. These events likely increasethe reliance that most older workers will have on public social insurance programs,exactly at a time that public finances are suffering from a large drop in contributions.Our paper explicitly accounts for employment uncertainty and unexpectedwealth shocks, something that has been relatively overlooked in the literature, butthat has grown in importance in recent years. Using administrative and householdlevel data we empirically characterize a life-cycle model of retirement and claimingdecisions in terms of the employment, wage, health, and mortality uncertainty facedby individuals. Our benchmark model explains with great accuracy the strikinglyhigh proportion of individuals who claim benefits exactly at the Early RetirementAge, while still explaining the increased claiming hazard at the Normal RetirementAge. We also discuss some policy experiments and their interplay with employmentuncertainty. Additionally, we analyze the effects of negative wealth shocks on thelabor supply and claiming decisions of older Americans. Our results can explainwhy early claiming has remained very high in the last years even as the early retirementpenalties have increased substantially compared with previous periods, andwhy labor force participation has remained quite high for older workers even in themidst of the worse employment crisis in decades.

Declining labor force attachment and downward trends in unemployment and participation

The US labor market witnessed two apparently unrelated secular movements in thelast 30 years: a decline in unemployment between the early 1980s and the early 2000s,and a decline in participation since the early 2000s. Using CPS micro data and a stock-flow accounting framework, we show that a substantial, and hitherto unnoticed, factorbehind both trends is a decline in the share of nonparticipants who are at the margin ofparticipation. A lower share of marginal nonparticipants implies a lower unemploymentrate, because marginal nonparticipants enter the labor force mostly through unemployment,while other nonparticipants enter the labor force mostly through employment.

Labor markets and monetary policy: A new-Keynesian model with unemployement

We construct a utility-based model of fluctuations, with nominal rigidities andunemployment, and draw its implications for the unemployment-inflation trade-off and for the conduct of monetary policy.We proceed in two steps. We first leave nominal rigidities aside. We show that,under a standard utility specification, productivity shocks have no effect onunemployment in the constrained efficient allocation. We then focus on theimplications of alternative real wage setting mechanisms for fluctuations in un-employment. We show the role of labor market frictions and real wage rigiditiesin determining the effects of productivity shocks on unemployment.We then introduce nominal rigidities in the form of staggered price setting byfirms. We derive the relation between inflation and unemployment and discusshow it is influenced by the presence of labor market frictions and real wagerigidities. We show the nature of the tradeoff between inflation and unemployment stabilization, and its dependence on labor market characteristics. We draw the implications for optimal monetary policy.

Ex post bargaining, labor coordination and wage formation at the firm level

We lay out a model of wage bargaining with two leading features:bargaining is ex post to relevant investments and there isindividual bargaining in firms without a Union. We compareindividual ex post bargaining to coordinated ex post bargainingand we analyze the effects on wage formation. As opposed to exante bargaining models, the costs of destroying the employmentrelationship play a crucial role in determining wages. Highfiring costs in particular yield a rent for employees. Ourtheory points to a employer size-wage effect that is independentof the production function and market power. We derive a simpleleast squares specification from the theoretical model thatallow us to estimate components of the wage premium fromcoordination. We reject the hypothesis that labor coordinationdoes not alter the extensive form of the bargaining game. Laborcoordination substantially increases bargaining power butdecreases labor's ability to pose costly threats to the firm.

Inter-firm labor mobility and knowledge diffusion: a theoretical approach

[cat] Analitzem una economia amb dues característiques principals: la mobilitat dels treballadors implica transferència de coneixement i la productivitat de l’empresa augmenta amb l’intercanvi de coneixement. Cada empresa desenvolupa un tipus de coneixement que serà trasmès a la resta de la indústria mitjançant la mobilitat de treballadors. Estudiem dues estructures de mercat laboral i utilitzant un anàlisi comparatiu derivem les implicacions del model. Els resultats revelen com la mobilitat de treballadors depèn en la varietat i nivell del coneixement, la presència de costos de mobilitat, les institucions, la capacitat d’absorvir coneixement per part de les empreses i la mida de la indústria. Els resultats no depenen de l’estructura del mercat laboral.

Inter-firm labor mobility and knowledge diffusion: a theoretical approach

[cat] Analitzem una economia amb dues característiques principals: la mobilitat dels treballadors implica transferència de coneixement i la productivitat de l’empresa augmenta amb l’intercanvi de coneixement. Cada empresa desenvolupa un tipus de coneixement que serà trasmès a la resta de la indústria mitjançant la mobilitat de treballadors. Estudiem dues estructures de mercat laboral i utilitzant un anàlisi comparatiu derivem les implicacions del model. Els resultats revelen com la mobilitat de treballadors depèn en la varietat i nivell del coneixement, la presència de costos de mobilitat, les institucions, la capacitat d’absorvir coneixement per part de les empreses i la mida de la indústria. Els resultats no depenen de l’estructura del mercat laboral.

Divergent Reactions to Globalization: Labor Unions and the Nafta and the EU Enlargement Process

The 1990s witnessed the launching of two ambitious trade regionalization plans, the Nafta and EU enlargement to Central and Eastern Europe. In contrast to previous projects for the creation or expansion of regional trade blocs, these two projects concerned states at dramatically different levels of economic development: The Nafta involved the very wealthy economies of Canada and the USA and the significantly poorer economy of Mexico, whereas EU enlargement involved the very wealthy economy of the 15 member-state European Union and the significantly poorer economies of former Communist states in Central and Eastern Europe. Ultimately, the Nafta and EU enlargement are responses to the challenges of globalization. Paradoxically, however, they have been met with radically different societal reactions in the wealthy partners that participated in the launching of these processes. This paper focuses on the reaction by labor unions on both sides of the Atlantic. I conclude that while labor relations and welfare institutions constrained the trade policy choices made by labor unions in the United States and Europe, they do not tell the whole story. It would seem that United States labor unions were more sensitive to the potential risks for workers associated to the liberalization of trade than were their European counterparts.

Incomplete markets, labor supply and capital accumulation

In this paper we explore the accumulation of capital in the presence oflimited insurance against idiosyncratic shocks, borrowing constraintsand endogenous labor supply. As in the exogenous labor supply case(e.g. Aiyagari 1994, Huggett 1997), we find that steady states arecharacterized with an interest rate smaller than the rate of timepreference. However,wealsofind that when labor supply is endogenous thepresence of uncertainty and a borrowing limit are not enough to giverise to aggregate precautionary savings .

Union power, minimum wage legislation endogenous labor supplies and production

The objective of this work is to study the impact of the unions' bargaining power on production and wages. We present a model where a competitive final good is produced through two substitutable intermediate goods, one produced by unskilled labor and the other by skilled labor. Potential workers decide at their cost to become skilled or unskilled and, thus, labor supplies are determined endogenously. We find that the reallocation of the labor supplies due to changes in the unskilled (or skilled) unions¿ bargaining power may have a positive impact on the final goods production. At the same time, total labor earnings increase with the unskilled unions¿ bargaining power if the final goods production increases too. We also show that the minimum wage legislation has efects similar to an increase in the bargaining power of the unskilled unions.

Energy and structure of dilute hard- and soft-sphere gases

The energy and structure of dilute hard- and soft-sphere Bose gases are systematically studied in the framework of several many-body approaches, such as the variational correlated theory, the Bogoliubov model, and the uniform limit approximation, valid in the weak-interaction regime. When possible, the results are compared with the exact diffusion Monte Carlo ones. Jastrow-type correlation provides a good description of the systems, both hard- and soft-spheres, if the hypernetted chain energy functional is freely minimized and the resulting Euler equation is solved. The study of the soft-sphere potentials confirms the appearance of a dependence of the energy on the shape of the potential at gas paremeter values of x~0.001. For quantities other than the energy, such as the radial distribution functions and the momentum distributions, the dependence appears at any value of x. The occurrence of a maximum in the radial distribution function, in the momentum distribution, and in the excitation spectrum is a natural effect of the correlations when x increases. The asymptotic behaviors of the functions characterizing the structure of the systems are also investigated. The uniform limit approach is very easy to implement and provides a good description of the soft-sphere gas. Its reliability improves when the interaction weakens.

Union power, minimum wage legislation endogenous labor supplies and production

The objective of this work is to study the impact of the unions' bargaining power on production and wages. We present a model where a competitive final good is produced through two substitutable intermediate goods, one produced by unskilled labor and the other by skilled labor. Potential workers decide at their cost to become skilled or unskilled and, thus, labor supplies are determined endogenously. We find that the reallocation of the labor supplies due to changes in the unskilled (or skilled) unions¿ bargaining power may have a positive impact on the final goods production. At the same time, total labor earnings increase with the unskilled unions¿ bargaining power if the final goods production increases too. We also show that the minimum wage legislation has efects similar to an increase in the bargaining power of the unskilled unions.

Temporal variation of the biomass and structure of Caulerpa prolifera (Forsskal) Lamouroux meadows in the Mar Menor lagoon (SE Spain).

The temporal changes in the structure, biomass and C, N and P content of meadows of Caulerpa prolifera (Forsskal) Lamouroux in the Mar Menor coastal lagoon (SE Spain) are described over the period from November 1986 to March 1989. C. prolifera meadows showed a unimodal pattern of vegetative development with maximum biomass values (168-173 g d.w. m-2) reached in summer and maintained during autumn, and minimum biomass values (0-57 g d.w. m-2) during late winter and early spring. Leaf area index values changed between 0.37-0.40 m2 m-2 in January-February and 2.60-7.06 m2 m-2 in July. The seasonality in the biomass and structure of the meadow was mainly related to the vegetative development of the secondary fronds. Carbon and phosphorus content of the thallus (32.5-34.8% d.w. and 0.065-0.069% d.w., respectively) had no seasonality, but nitrogen content showed a bimodal annual pattern with higher values in spring and fall (>2.5% d.w.) than in summer and winter (<2.5% d.w.).

Labor Mobility and Productivity Growth

[cat] Els models de creixement amb aprenentatge suposen que el coneixement après en producció es transmet de forma lliure i instantània a tota l'economia. En con- seqüència, l'economia presenta economies d'escala creixents i el creixement de la productivitat (TFP) és endògena. No obstant, el supòsit de difusió instantània del coneixement és poc realista. La difusió del coneixement necessita temps i algun canal de transmissió. En aquest article suposem que el coneixement es transmet amb la contractació de treballadors nous (learning-by-hiring). En el nostre model la difusió instantània i lliure de coneixement pot ocórrer només dins d'un sector. La difusió de coneixement entre sectors pot ocórrer només a través de la mobilitat de treballadors, i per tant, el mercat de treball determina el nivell i la taxa de creixement de productivitat (TFP). Estudiem com els costos de mobilitat laboral modifiquen l'equilibri sota dos escenaris: creixement endogen i exogen. A més, demostrem que d'altres ineficiències del mercat laboral, com són les taxes o els costos de cerca, poden reduir la mobilitat laboral, i per tant, modificar la TFP.

Labor Mobility and Productivity Growth

[cat] Els models de creixement amb aprenentatge suposen que el coneixement après en producció es transmet de forma lliure i instantània a tota l'economia. En con- seqüència, l'economia presenta economies d'escala creixents i el creixement de la productivitat (TFP) és endògena. No obstant, el supòsit de difusió instantània del coneixement és poc realista. La difusió del coneixement necessita temps i algun canal de transmissió. En aquest article suposem que el coneixement es transmet amb la contractació de treballadors nous (learning-by-hiring). En el nostre model la difusió instantània i lliure de coneixement pot ocórrer només dins d'un sector. La difusió de coneixement entre sectors pot ocórrer només a través de la mobilitat de treballadors, i per tant, el mercat de treball determina el nivell i la taxa de creixement de productivitat (TFP). Estudiem com els costos de mobilitat laboral modifiquen l'equilibri sota dos escenaris: creixement endogen i exogen. A més, demostrem que d'altres ineficiències del mercat laboral, com són les taxes o els costos de cerca, poden reduir la mobilitat laboral, i per tant, modificar la TFP.

A novel approach to analysing the regimes of temporary streams in relation to their controls on the composition and structure of aquatic biota

Temporary streams are those water courses that undergo the recurrent cessation of flow or the complete drying of their channel. The structure and composition of biological communities in temporary stream reaches are strongly dependent on the temporal changes of the aquatic habitats determined by the hydrological conditions. Therefore, the structural and functional characteristics of aquatic fauna to assess the ecological quality of a temporary stream reach cannot be used without taking into account the controls imposed by the hydrological regime. This paper develops methods for analysing temporary streams' aquatic regimes, based on the definition of six aquatic states that summarize the transient sets of mesohabitats occurring on a given reach at a particular moment, depending on the hydrological conditions: Hyperrheic, Eurheic, Oligorheic, Arheic, Hyporheic and Edaphic. When the hydrological conditions lead to a change in the aquatic state, the structure and composition of the aquatic community changes according to the new set of available habitats. We used the water discharge records from gauging stations or simulations with rainfall-runoff models to infer the temporal patterns of occurrence of these states in the Aquatic States Frequency Graph we developed. The visual analysis of this graph is complemented by the development of two metrics which describe the permanence of flow and the seasonal predictability of zero flow periods. Finally, a classification of temporary streams in four aquatic regimes in terms of their influence over the development of aquatic life is updated from the existing classifications, with stream aquatic regimes defined as Permanent, Temporary-pools, Temporary-dry and Episodic. While aquatic regimes describe the long-term overall variability of the hydrological conditions of the river section and have been used for many years by hydrologists and ecologists, aquatic states describe the availability of mesohabitats in given periods that determine the presence of different biotic assemblages. This novel concept links hydrological and ecological conditions in a unique way. All these methods were implemented with data from eight temporary streams around the Mediterranean within the MIRAGE project. Their application was a precondition to assessing the ecological quality of these streams.