This article is concerned with the determinants of English-language fluency among immigrants and the effects of fluency on earnings. Using special survey data on a sample of over eight hundred aliens, the analysis shows the importance of certain variables not previously available, speaking fluency at migration and English reading fluency. English speaking and reading fluency both increase with duration in the United States, and the increase with duration is greater for those with more schooling and who are not Hispanic. The article shows that reading fluency is more important than speaking fluency as a determinant of earnings.

This article examines the properties and prevalence of measurement error in longitudinal earnings data. The analysis compares matched Current Population Survey data to administrative Social Security payroll tax records. In contrast to typically assumed properties of measurement error, the results indicate that errors are serially correlated over two years and negatively correlated with true earnings (i.e., mean reverting). In a cross section, the ratio of the variance of the signal to the total variance is 0.82 for men and 0.92 for women. These ratios fall to 0.65 and 0.81 when the data are specified in first differences. Longitudinal earnings data may be more reliable than previously believed.

The influence of birth order and childhood family size on future achievement is discussed. Two major empirical findings are presented by the author. "First, neither birth order nor childhood family size significantly influences the level or growth rate of wages, a result that is consistent with previous research. Second, family size is both a statistically and economically significant determinant of women's employment status: women from small families work less than women from large families when they are young and more than women from large families when they are more mature." The geographical focus is on the United States

Separability between parents' and children's consumption is a necessary assumption in any attempt to impute the intrafamily allocation of goods. This assumption implies an estimation procedure where the observed effect of demographic variables on the marginal propensity to consume adult goods is used as a key for identifying the rule governing the distribution between children's and parents' consumption. Using the U.S. 1972 Consumption Expenditure Survey, I found that white and black families tend to allocate three-quarters of their consumption to parents and one-quarter to children. Tests for robustness, for selectivity bias, and of the separability assumption itself uphold these findings.

The free market may not lead to the efficient level of just-cause employment protection if workers are heterogeneous. Any firm that switches to just cause will attract a disproportionate share of workers that provide low effort yet are difficult to dismiss with cause. Thus, there is an externality concerning each firm's just-cause policy. If all firms had just-cause policies, then the efficiency gains of just cause might outweigh the burden of the undesirable workers. Nevertheless, no single firm may find it in its interest to switch to just cause. It is possible for laws that require just cause to increase efficiency.

This article examines the impact of unemployment insurance (UI) on the allocation of labor across industries. An overlooked aspect of UI is the effect of imperfect experience rating on hiring. Firms in more stable industries generally pay more into the UI system than their workers ever receive in benefits, thus subsidizing more volatile industries. The results indicate that industry employment shares are significantly affected by UI and that there is a net shift of resources from the service industry to the construction industry. The estimates also imply that layoff unemployment is increased by about 5% because of UI-induced employment shifts.

This article examines the effects of cocaine and marijuana use on the wages of young adults. The endogeneity of drug use in a wage equation is considered, and a two-stage least squares procedure is implemented. The results suggest that increased use of marijuana or cocaine is associated with higher wages. The positive relationship between drug use and the wage does not diminish with age. I also investigate whether systematic differences in the return to measures of human capital investments can explain the positive relationship between drug use and wages.

This article examines the reasons for the observed discrepancy between workers' actual and required levels of schooling and the resulting differences in returns to schooling. "Overeducated" workers are found to be younger and to have lower amounts of on-the-job training than workers with the required level of schooling. They also have higher rates of firm and occupational mobility, characterized by movement of higher-level occupations. The findings suggest that overeducation can be explained by the trade-off between schooling and other components of human capital and by the mobility patterns of overeducated workers.

Time (hourly payoffs) and salary (the payoff does not vary with hours) account for the bulk of the payoffs on labor contracts. This article argues that the choice between time and salary centers on the presence (time) or absence (salary) of information about flows of effort or output per unit time. Without information about the flow of hourly effort or output, payoffs for time give the worker an incentive to supply hours without effort. Time can then become uninformative about output. In this situation, if the contract includes a fixed payoff, it is likely to be a salary rather than a payoff for time.