Knowledge that Transforms

Previous analyses of postwar black/white earnings ratios have found a more rapid rate of increase in the period since 1964 than before. The reason for this acceleration is unresolved. One view is that federal equal-employment activities have increased the relative demand for black labor. An alternative view is that rising relative earnings reflects (1) reductions in relative supply and (2) the "statistical" effect of low earners raising median earnings by withdrawing from the labor market. This study differs from previous work on the subject in two ways. First, the restrictions on the universe from which published median earnings data by race are calculated are discussed explicitly. The restrict ion most commonly addressed in previous work (having positive earnings in the year in question) is found to be less important than an undiscussed restriction (being employed as a wage and salary worker the following March). Second, data on the distribution of earnings are used to determine the effect of labor market dropouts on median earnings, instead of trying to estimate this effect (as well as demand and supply effects) from time series data. This permits comparison of "corrected" and "uncorrected" post-1964 trends. For males, about half of the "uncorrected" trend remains after the relative earnings variable is corrected for labor market withdrawals. For females, between half and four fifths remains.

Journal Article Domestic Policies and Foreign Resource Requirements: A Reply Get access M. G. Quibria M. G. Quibria Nuffield College, Oxford, and, University of Dacca, Bangladesh Search for other works by this author on: Oxford Academic Google Scholar The Quarterly Journal of Economics, Volume 99, Issue 1, February 1984, Pages 207–209, https://doi.org/10.2307/1885729 Published: 01 February 1984

Basic production theory concepts of separability and externalities are used to provide an intuitive, unifying explanation of Arrow's original possibility theorem and later variants of it due to Sen, Wilson, Mas-Colell, and Sonnenschein, of the libertarian paradoxes of Sen and Gibbard, and of the single-profile possibility theorem of Parks. These important results in collective choice theory are shown to be the result of imposing on a multiple-output production process both externality-requiring and externality-denying characteristics. In each of these cases various consistency conditions on social preference and input-output links like citizens' sovereignty or the Pareto principle create external effects in production that interact with an externality-denying characteristic of separability to create a production process with zero marginal input productivity in certain regions of input space.

Journal Article Domestic Policies and Foreign Resource Requirements: Comment Get access Sebastian Edwards Sebastian Edwards University of California, Los Angeles Search for other works by this author on: Oxford Academic Google Scholar The Quarterly Journal of Economics, Volume 99, Issue 1, February 1984, Pages 201–206, https://doi.org/10.2307/1885728 Published: 01 February 1984

Frank Milne, Hersh M. Shefrin; Clarifying Some Misconceptions About Stock Market Economies*, The Quarterly Journal of Economics, Volume 99, Issue 3, 1 Augu

Commercial policy is often advocated as a useful tool for combating such macroeconomic ills as unemployment and chronic balance of payments deficits. This paper examines the role of expectations in determining the output and employment effects of various commercial policies. In a rational expectations framework in which workers have incomplete information, it is shown that (i) the short-run output and employment effects of commercial policy changes depend crucially on the correlation between real and nominal wages and that (ii) the use of commercial policy as an instrument of short-run stabilization policy cannot be divorced from its long-run effects on real wages, output, and employment.

Martin Feldstein, Joel Slemrod, Shlomo Yitzhaki; The Effects of Taxation on the Selling of Corporate Stock and the Realization of Capital Gains: Reply, The

Journal Article The Remembrance of Things Past: Rings and Mules Revisited Get access Lars G. Sandberg Lars G. Sandberg Ohio State University Search for other works by this author on: Oxford Academic Google Scholar The Quarterly Journal of Economics, Volume 99, Issue 2, May 1984, Pages 387–392, https://doi.org/10.2307/1885534 Published: 01 May 1984