This paper describes the background and objectives of a series of papers written fifty years ago at the London School of Economics (LSE). One objective was to encourage the use of accounting numbers in economic research. A second objective was to improve the theory and practice of accounting. Understanding cost accounting and opportunity costs within a firm was tied to understanding the organization of firms. The theory of the accounting system is part of the theory of the firm. Like a similar request made fifty years ago, the paper concludes with a call for interdisciplinary studies between economics and accounting.

Journal Article Optimal Trade Policies and Non-Economic Objectives in Models Involving Imported Materials, Inter-Industry Flows and Non-Traded Goods Get access Augustine H. H. Tan Augustine H. H. Tan University of Singapore Search for other works by this author on: Oxford Academic Google Scholar The Review of Economic Studies, Volume 38, Issue 1, January 1971, Pages 105–111, https://doi.org/10.2307/2296625 Published: 01 January 1971

Journal Article Patterns of Trade and Investment in a Dynamic Model of International Trade Get access H. Oniki, H. Oniki The University of Chicago Search for other works by this author on: Oxford Academic Google Scholar H. Uzawa H. Uzawa The University of Chicago Search for other works by this author on: Oxford Academic Google Scholar The Review of Economic Studies, Volume 32, Issue 1, January 1965, Pages 15–37, https://doi.org/10.2307/2296328 Published: 01 January 1965

Over the past 3 decades, the U.S. Temporary Help Services (THS) industry grew five times more rapidly than overall employment. Contemporaneously, courts in 46 states adopted exceptions to the common law doctrine of employment at will that limited employers' discretion to terminate workers and opened them to litigation. This article assesses the contribution of "unjust dismissal" doctrine to THS employment specifically, and outsourcing more generally, finding that it is substantialexplaining 20% of the growth of THS between 1973 and 1995 and contributing 500,000 additional outsourced workers in 2000. States with smaller declines in unionization also saw substantially more THS growth.

This article presents evidence that turnover is negatively selective on a worker's job performance. At establishments with about seventeen employees, workers who are one standard deviation (21 percent) less productive than average during the first few months on the job are 11 percentage points more likely to be laid off or fired and 7 percentage points more likely to quit during the succeeding year. At large nonunion establishments and in small labor markets, productivity has large effects on involuntary separations, but almost no effect on quits. Productivity appears to be positively related to layoffs and quits at unionized establishments.

We examine Henry Ford's introduction of the five-dollar day in 1914 in an effort to evaluate the relevance of efficiency wage theories of wage and employment determination. We conclude that the Ford experience strongly supports the relevance of these theories. Ford's decision to increase wages dramatically is most plausibly the consequence of labor problems of the kind efficiency wage theorists stress. The structure of the five-dollar day program is consistent with the predictions of efficiency wage theories. There is vivid evidence that the introduction of the five-dollar day resulted in substantial queues for Ford jobs. Significant increases in Ford productivity and profits accompanied the new regime.

In labor market equilibrium, sectoral differences in "natural" rates of unemployment generate a conformable distribution of wage differentials that compensate workers for bearing unemployment risk. This paper offers new empirical evidence on the determinants of this equilibrium. The analysis consists of two stages. First, I estimate a three-state model of employment and unemployment that identifies the determinants of individuals' rates of entering and leaving unemployment spells. Sectoral, demographic, and policy-induced differences in unemployment probabilities evolve naturally from this framework. Second, I estimate the impact of these differences on the distribution of wages. An important finding is the powerful impact of the unemployment insurance (UK) system both on unemployment and on equalizing wage differences. The evidence is strong that the availability of UK increases unemployment, while simultaneously reducing the magnitude of compensating wage differentials. Most of the effect of UK on unemployment is due to an increased probability of entering spells of unemployment, mainly temporary layoffs, though the duration of spells is also affected. Neglect of the role of UK as a substitute for wages partially accounts for the small compensating differentials estimated in previous research. In the absence of UK, each point of anticipated unemployment raises an individual's wage by about 2.5%.

The ability of unions to raise the wages of their members above the wages of similar but nonunionized workers is well documented. This paper examines empirically the implications of that wage differential for resource allocation and economic efficiency. This is accomplished by explicitly solving a numerically specified general equilibrium system with and without the wage differential. Comparison of the two solutions yields the desired information. The findings indicate that the wage premium results in adjustments in prices and quantities of factors and commodities that vary widely across industries. These adjustments are found to carry a small deadweight loss, as measured by the Hicksian equivalent variation.