Solomon William Polachek, Occupational Self-Selection: A Human Capital Approach to Sex Differences in Occupational Structure, The Review of Economics and Statistics, Vol. 63, No. 1 (Feb., 1981), pp. 60-69

T WO recent studies have indicated on any given day about 3% to 4% of all workers do not report to their jobs. The Bureau of National Affairs (BNA) has reported absence data for a sample of several hundred establishments since January 1974. The median absence rate for the entire sample was 3.4% in 1974, 3.0% in 1975 and 1976, 2.8% in 1977, and 2.9% in 1978.1 Absence rates vary widely across establishments; in December 1978 they ranged from 0 to 23.0%. Recent changes in the Current Population Survey permit the computation of work time lost to absenteeism with household data. In May 1976 Hedges (1977) reported full time workers missed about 3.5% of scheduled hours for health and personal reasons. It is interesting to note in comparison in the same month (1) less than one-third of 1% of scheduled hours were lost to strikes, and (2) 3.4% of the labor force were out of work because they had lost their previous job. Economists have paid little attention to absenteeism despite the sizable number of man-hours involved and the probable impacts on productivity and income distribution. Most of the previous research on work attendance has been done by applied psychologists, who generally argue, according to a recent survey article by Steers and Rhodes (1978), that job dissatisfaction represents the primary cause of absenteeism.2 Another widely held view is absenteeism results from inadequate managerial concern for the problem. Countless authors of articles in personnel and business journals have argued any firm can control absenteeism by keeping adequate records, establishing guidelines for permissible absences, or rewarding workers who attend regularly. Given efficient markets for entrepreneurial expertise, it is unclear why such measures have not already been taken. The purpose of this paper is to suggest an alternate interpretation of absenteeism and to develop an empirical model to test various hypotheses about its incidence. Absences result when an individual decides to engage in nonwork activity throughout a scheduled work period. It will be argued below utility increments obtained by not reporting are likely to vary across individuals and the cost of absenteeism will not be identical across employers. Employers can reduce absenteeism in three ways. One option is to make it more costly to employees, e.g., through decisions regarding promotions, merit wage increases, dismissals, and the availability of sick leave and attendance bonuses. Another is to reduce the worker's demand for absences by making schedules more flexible. In cases where substitute workers are available at no extra cost, absenteeism is costly only when it is unexpected. Both the firm and the worker will then be better off if they agree to adjust the worker's schedule in advance. A final

We estimate substitution possibilities among a set of age-race-sex groups in the labor force. The estimates are based on cross-section data from SMSAs in 1969, and they allow us to consider how substitutable adult women are for young women or young men. The estimates are used, along with assumptions about the extent of wage rigidity and elasticities of labor supply, to simulate the direct and indirect effects of the growth of the female labor force on job opportunities for youth, assuming rigid wages for young workers, and on the wage rates of adult males, assuming these wages are flexible.

effects of the tax holiday program in Puerto Rico on the behavior of firms locating there. The tax holiday program in Puerto Rico was initiated in 1949, and is often cited as the most successful example of the use of incentives to encourage the location of industry. Discussions of the costs and benefits of this type of program generally focus

THE impact of unionism on relative wage rates is a topic of long-standing interest in labor economics. Over the years researchers have used a variety of approaches to estimate the wage advantage associated with union membership. Initially, researchers compared the average wages of union and nonunion workers in specific sectors, such as an industry.' This approach has the obvious limitation of not accounting very well for the various quality or productivity differences that exist among workers-differences that command compensating wage payments. More recent studies have used cross-section wage regressions to control for these other determinants of wages and thereby improve estimates of the union wage effect. Using large microeconomic data files containing detailed information on characteristics of individual workers, numerous studies have estimated wage regressions that include controls for worker characteristics (education, experience, etc.) and a dichotomous variable indicating union membership status as explanatory variables.2 The coefficient of the union membership variable in these regressions is taken as an estimate of the average impact that unionism has on wage rates, controlling for measured differences in characteristics among workers. Unfortunately, the wage regression approach does not completely resolve the problem of standardizing the union-nonunion wage comparison for differences in worker quality. Even with detailed microdata on the characteristics of individual workers, it is simply not possible to specify a set of variables that completely captures all worker-specific differences in productive ability. Some aspects of human capital are too subtle to be operationally specified and included in a wage regression, although they are recognized and paid for by employers. To the extent that these unmeasured worker-specific differences are correlated with union membership, the wage regression will incorrectly attribute a relative wage impact to unionism.3 An alternative measurement approach that has several advantages over the wage regression is to compare the wage received by the same worker as a union and nonunion member. In the past, data limitations have prevented researchers from making such a comparison. Since only a small portion of workers change union status in a given period, an unusually large longitudinal file is needed to yield a sufficient number of observed changes for a meaningful analysis.4 Recently, however, large longitudinal data files on individuals participating in the Current Population Survey have become available. This paper uses these data to estimate the impact a change in union status has on the worker' s wage. The

Edwin Mansfield, Composition of R and D Expenditures: Relationship to Size of Firm, Concentration, and Innovative Output, The Review of Economics and Statistics, Vol. 63, No. 4 (Nov., 1981), pp. 610-615

ECONOMISTS and statisticians who construct estimates of total factor productivity or who estimate production functions or systems of consumer demand functions are often forced to aggregate subsets of their data. In order to perform this aggregation, an index number formula is generally used. A price index P(pO, pl, x?, xI) is defined to be a function P of the prices of the N commodities to be aggregated in periods 0 and 1,p?-(pll, . . . , PNO) and pl (pl,.'.. PN'), respectively, and of the corresponding quantities utilized during periods 0 and 1, x? (xi?, . . .,XNO) andX1 _ (xi', . . .,XN1), respectively. A quantity index Q(p0, pl, x?, xl) is defined to be another function Q of the price and quantity vectors for the two periods. Generally, we assume that P and Q satisfy Fisher's (1922) weak factor reversal test:

A potentially important parameter that has not yet been convincingly estimated is the critical concentration ratio. This paper attempts to estimate it in three types of market. The estimation of a critical concentration ratio, if one exists, seems of potentially great importance because of its implication for antitrust policy. If a critical concentration ratio were found and if concentration had no effect below that level, it would seem to follow that a horizontal merger in a market where concentration was below the critical level and where the merger could not increase concentration to the critical level could not substantially lessen competition or tend to create monopoly

T HE present study estimates the effects of trade unions, Hitler's regime, and codetermination on relative wages in Germany. I Each of these establishments is considered to have had important implications for Germany's labor market. Moreover, a thorough understanding of their effects can be valuable for comparative purposes. Following a brief discussion of these phenomena and their hypothesized effects on wages, the analytical model is developed in section II. The empirical results are reported in section III and section IV contains the summary and conclusions. The extensive literature on the relative wage effects of trade unions has focused almost exclusively on the union impact in North America2 and, more recently, in Great Britain.3 Since the German institutions of industrial and labor relations differ considerably from their AngloAmerican counterparts4 and often have been studied as a successful (possibly superior) system which might be adopted by others, it is worthwhile exploring the magnitude of the union wage effect in the German institutional setting. In particular it has been argued that, compared to their American and British counterparts, the continental unions tend to place more emphasis on political and social, rather than economic achievements.5 If this hypothesis is correct, then, ceteris paribus, the estimated relative wage effect of German unions ought to be smaller than that found in the United States and Great Britain. With the advent of Hitler's regime in 1933 there was a dramatic transformation of the existing political and economic institutions. Trade unions, which in 1932 represented over 40% of the industrial labor force, were promptly abolished6 and replaced by a government-operated Front.7 Strikes and lockouts were forbidden and wages were determined centrally.8 While the effects of these changes on the cultural, political and social life have been well documented, few economic studies attempted to analyze the effect of Hitler's regime on wages and incomes. Moreover, those that did, used a qualitative or only a loose quantitative approach, partially as a result of the lack of a systematic wage series prior to 1934.9 W. Krelle (1962, p. 17) has shown, for example, that labor income Received for publication July 30, 1979. Revision accepted for publication May 1, 1980. Cornell University. I would like to thank Orley Ashenfelter, Albert Rees and two anonymous referees for helpful comments. I have also benefited from discussions with J. S. Butler, William Greene, Louis Phlips and Katherine Terrell. Any remaining errors are, of course, my own. This research was in part supported by a grant to the Princeton University Economics Department from the Sloan Foundation. I The term codetermination refers to the German participatory system of management, as it was originally established in the Federal Republic by the 1951 Codetermination Act and the 1952 Works Constitution Act. 2 The most important work and collection of references on the subject is still Lewis (1963). Among the later studies in the private sector are Ashenfelter (1972), Ashenfelter and Johnson (1972), Bloch and Kuskin (1978), Boskin (1972), de Menil (1971), Rosen (1969) and Schmidt and Strauss (1976). Public sector studies are summarized by Lewin (1977). X See especially Pencavel (1974), Mulvey (1976) and Metcalf (1977). 4 Needless to say there are important differences between the U.S. and British systems of industrial and labor relations. They exhibit considerable homogeneity, however, when compared to the systems in continental Europe. Historically, the relatively most salient features of the German system have been (1) trade union affiliation with political parties and/or religioiis organizations, (2) industrial unionism. (3) governmental interference in industrial and labor relations, and (4) paternalistic management. World War II led to the unification of the formerly splintered unions in the Deutsches Gewerkschafts Bund (DGB), close collaboration with the Social Democratic Party (SDP) and the establishment of codetermination. For institutional references see Almanasreh (1977), Fiirstenberg (1969, 1977), Schregle (1978) and Vollmer (1976, 1979). 5 See Kassalow (1969, 1980) and Windmuller (1969). 6 Employers associations followed their lead in 1934. 7 The Labor Front included all employees and employers. It represented the Nazi government in the factories and possessed broad powers over its member subjects. 8 In fact, the entire economy underwent considerable centralization as Hitler proclaimed his first Four Year Plan in 1933 and a second one in 1936. 9 Among the most thorough and informative of these conventional studies is that of Bry (1960). For a discussion of the data see Gerss (1977