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Report of the Committee on the Status of Women in the Economics Profession

Robin L. Bartlett
American Economic Review 1999 89(2), 492-498
The American Economics Association (AEA) has charged the Committee on the Status of Women in the Economics Profession ( CSWEP ) with monitoring the position of women in the profession and with undertaking activities to improve that position. This report presents information on the position of women graduate students and faculty in academic economics departments and reports on the committee’s activities during 1998.

Workers Are More Productive in Large Firms

Todd L. Idson; Walter Y. Oi
American Economic Review 1999 89(2), 104-108
Wages are positively related to firm size. This relation was discovered by Henry L. Moore (1911) and later confirmed by, among others, Charles Brown and James Medoff (1989). The wage premium associated with working at a larger firm or plant is ubiquitous, but its magnitude varies across countries and over time. The reason for a size-related wage premium is harder to pin down. Paying supernormal wages to deter shirking, thereby saving monitoring costs, seems plausible, but a closer examination has led us to reject this explanation (Oi and Idson, 1999). At a big firm, the workplace is safer, and fringes are superior, so that these factors cannot be the source of a positive premium. It must be something else such as work effort. The theory that we advance is that employees at larger firms are more productive and hence command higher wages in a competitive labor market. The shape of the size–wage relation depends on technology, worker preferences, and working conditions other than size. It will change over time and across occupations.

The Twin Crises: The Causes of Banking and Balance-of-Payments Problems

Graciela L. Kaminsky; Carmen Reinhart
American Economic Review 1999 89(3), 473-500
In the wake of the Mexican and Asian currency turmoil, the subject of financial crises has come to the forefront of academic and policy discussions. This paper analyzes the links between banking and currency crises. We find that: problems in the banking sector typically precede a currency crisis—the currency crisis deepens the banking crisis, activating a vicious spiral; financial liberalization often precedes banking crises. The anatomy of these episodes suggests that crises occur as the economy enters a recession, following a prolonged boom in economic activity that was fueled by credit, capital inflows, and accompanied by an overvalued currency.

Monopoly Rights: A Barrier to Riches

Stephen L. Parente; Edward C. Prescott
American Economic Review 1999 89(5), 1216-1233
Our thesis is that poor countries are poor because they employ arrangements for which the equilibrium outcomes are characterized by inferior technologies being used, and being used inefficiently. In this paper, we analyze the consequences of one such arrangement. In each industry, the arrangement enables a coalition of factor suppliers to be the monopoly seller of its input services to all firms using a particular production process. We find that eliminating this monopoly arrangement could well increase output by roughly a factor of 3 without any increase in inputs.

Population and Economic Growth

Gary S. Becker; Edward L. Glaeser; Kevin Murphy
American Economic Review 1999 89(2), 145-149
This paper examines the relationship between population and economic growth. It analyzes the implications of the effects of higher population density on per capita incomes and other variables in different countries and other geographic regions. Several statistical models that interpolate population to cities investment in human capital and economic growth were utilized to help analyze population growth. Generally economists along with others have believed that higher population lowers per capita incomes by diminishing returns. On the contrary there are few proofs demonstrating that higher population in more developed economies reduce per capita incomes. Population may reduce productivity secondary to traditional diminishing returns from more intensive use of land and other natural resources. However large populations encourage greater specialization and increased investments in knowledge. Therefore the net relation between greater population and per capita incomes relies on whether the inducements to human capital and expansion of knowledge are stronger than diminishing returns to natural resources.