It has long been recognized that consumption behavior represents mainly joint household or family decisions rather than separate decisions of family members. Accordingly, the observational units in consumption surveys are "consumer units," that is, households in which income is largely pooled and consumption largely shared. More recent is the recognition that an individual's use of time, and particularly the allocation of time between market and nonmarket activities, is also best understood within the context of the family as a matter of interdependence with needs, activities, and characteristics of other family members. More generally, the family is viewed as an economic unit which shares consumption and allocates production at home and in the market as well as the investments in physical and human capital of its members. In this view, the behavior of the family unit implies a division of labor within it. Broadly speaking, this division of labor or "differentiation of roles" emerges because the attempts to promote family life are necessarily constrained by complementarity and substitution relations in the household production process and by comparative

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

Since 1976 the gender gap in wages on average declined by about 1% per year. This article focuses on identifying the factors underlying this trend. Three data sets are analyzed-the Current Population Survey, the Panel Study of Income Dynamics, and the National Longitudinal Survey. We find that convergence in measurable work-related characteristics (schooling and work experience) explains one-third to one-half the narrowing. The remainder is attributable to a relative increase in women's returns to experience as well as to declining wages in blue-collar work and other factors.

Solomon W. Polachek, Bong Joon Yoon, A Two-Tiered Earnings Frontier Estimation of Employer and Employee Information in the Labor Market, The Review of Economics and Statistics, Vol. 69, No. 2 (May, 1987), pp. 296-302

We derive a tractable nonlinear earnings function that we estimate separately individual by individual using NLSY79 data. We obtain three ability measures, a rate of skill depreciation, a time discount rate, and a population-wide estimate of the human capital rental rate. We utilize these parameters to verify a number of heretofore untested theorems based on the life cycle model. We show how these human capital production function parameters relate to cognitive ability, personality traits, and family background. Finally, we show that accounting for individual-specific heterogeneity dramatically reduces estimates of population-wide persistence of permanent and transitory shocks by over 50 percent.

Currently, a growing literature is emerging on estimating the impact of exogenous shocks using the difference-in-difference (DD) tech? nique. Essentially, this technique compares the impact of an unexpected event in a particu? lar locale (called the treatment/experimental group) to a location or set of locations (called a control group) similar to the experimental group in all respects except for the shock itself. One challenge many DD studies face is how to choose the control group, and there is now a growing literature on this (Joshua A. Angrist and Alan B. Krueger 1999; Jeffrey D. Kubik and John R. Moran 2003; and Alberto Abadie, Alexis Diamond, and Jens Hainmueller 2007). Another challenge is whether one can general? ize one's results based on a single experimental group, as is typical for most DD analysis. This paper adopts a generalized-difference-in-dif ference (GDD) technique outlined in Ariel R. Belasen and Solomon W. Polachek (forthcom? ing) to examine the impact of hurricanes on the labor market. This technique incorporates many experimental as well as many control groups, and as such this approach addresses a number of shortcomings in current DD analyses. We find that earnings of the average worker in a Florida county rise over 4 percent within the first quarter of being hit by a major Category Four or Five hur? ricane relative to counties not hit, and rise about Wa percent for workers in Florida counties hit by less major Category One to Three hurricanes. Concomitantly, employment falls between Wi and 5 percent depending on hurricane strength. On the other hand, the effects of hurricanes on neighboring counties have the opposite effects, moving earnings down between 3 and 4 percent in the quarter the hurricane struck. To better examine the specific shocks, we also observe sectoral employment shifts. Finally, we conduct a time-series analysis and find that, over time, there is somewhat of a cobweb, with earnings and employment rising and falling each quarter over a two-year time period.

Solomon W. Polachek, Phanindra V. Wunnava, Michael T. Hutchins, Panel Estimates of Union Effects on Wages and Wage Growth, The Review of Economics and Statistics, Vol. 69, No. 3 (Aug., 1987), pp. 527-531