Knowledge that Transforms

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.

Livelihood measures of foregone and compensating earnings are frequently used as measures of economic losses due to realized or potential damages to the health of labor in-puts. Both measures as they have been used are incomplete, though for quite different reasons. The narrowness of the foregone earnings mea-sure is widely acknowledged. As set forth in Smith (1974), Thaler and Rosen (1976), and Viscusi (1979), the compensating earnings measure, with its emphasis upon the earnings premia workers require to be willing to be exposed to job hazards they perceive, certainly has broader analytical appeal. However, as empirically implemented, these studies too are incomplete: they deal with worker and time aggregates allowing only crude measures of differences in reward structures, mixes of complementary inputs, work-day lengths, risk aversions, worker effort, and other dissimilar factors across individuals, firms, and industries. In this paper, the productivity changes and consequent earnings adjustments that occur under differing work conditions for 17 individual citrus pickers in southern California are assessed. Interest is centered upon the acute effects of two environmental factors, ambient ozone (03) and ambient temperature, upon the daily work performances of these individuals. Since each individual is separately analyzed, the host of plausible confounding influences (e.g., experience, biological endowments, health histories, etc.) to which one must devote attention when dealing with the fictional "representative" individual are relevant here only insofar as they change within the short time periods being considered.

Existence and characterization of optimal growth paths including models with non-convexities in utilities and technologies.

of Mannheim University has brought to my attention an error in my paper "Large Economies with Trading Uncertainty". The example of an allocation mechanism described on pp. 329-332 does not satisfy the condition of relative continuity as claimed on p.332. The reason is that the definition, as given in the paper, is a rather gross misstatement of what I had in mind and makes some of the accompanying analysis nonsensical. Fortunately, the matter is not hard to put right. Two passages in the text must be rewritten as follows.

Part of the "conventional wisdom " on the subject of the size distribution of earnings is that earnings are approximately lognormal, but with an upper tail which is better described by the Pareto function. 1 The primary purpose of this paper is to re-examine these propositions, using British New Earnings Survey data disaggregated by occupational groups. We have several reasons for feeling that such a re-examination is timely. First, most previous studies have considered the distribution among all employees, while theoretical considerations suggest that disaggregated data might be more appropriate. We elaborate this point in Section 1 of the paper. Second, the method of estimating the parameters of the Pareto and lognormal functions has not always been given the attention it deserves. In Section 2 we address this issue, and also refer briefly to the related one of goodness of fit. The remainder of the paper presents parameter estimates for the Pareto and lognormal functions, using first aggregate data (Section 3), and then distributions within occupational groups (Section 4). Section 5 compares these two sets of results, and at the

Stiglitz dispels traditional notions that competition increases welfare.

Stiglitz and Weiss explain credit rationing in markets with imperfect information.

This paper tests Mincer's minimum-wage model by estimating reduced-form wage and employment equations for both the covered and uncovered sectors in nine regions of the United States. As theory predicts, in regions with comparatively small covered-sector demand elasticities, the northern and midwestern regions, the uncovered-sector wage increases after a minimum-wage hike; and in regions with comparatively large demand elasticities, the southern and western regions, the uncovered-sector wage decreases. Because of data limitations the uncovered-sector employment effect could not be estimated sharply, and so its relationship to the covered-sector demand elasticity is weak.

This paper develops and estimates a model of the joint determination of the exchange rate, international reserves, and the rate of inflation under a crawling-peg system. The framework presented, which is an extension of previous work on the monetary approach, generates short-run deviations from purchasing power parity that occur simultaneously with movements in both international reserves and the exchange rate. The model is estimated by full-information maximum likelihood on the basis of quarterly data for Brazil.

Some standard topics in the theory of international trade are reconsidered in this paper by distinguishing between national and aggregate income when fixed supplies of foreign inputs are present within the home country. Under conditions that would ensure a national welfare gain if foreign ownership were absent, international transfer, economic growth, or tariff policy might cause a national welfare loss in the presence of foreign ownership. The techniques developed could be applied to other domestic distinctions (such as those based on race, sex, age, or ethnicity) and to the theory of customs unions in a three-country world.