Labor Economics Reading List (Economics 751)

September 2007
John Kennan

This is a list of stuff you would like to have read by the end of this semester. You will not read it all (I have not read it all, and it seems unlikely that anyone has read it all). If in doubt, read less, more carefully. But it is good to browse through many papers quickly early in the semester, to get an initial impression of where things fit in, and to get ideas for research papers. Asterisks are used to mark things that seem important, but this is just a rough guide. You should not infer that papers not listed are not worth reading: lists like this are subjective, and sometimes just whimsical.

Papers that are more than five years old can usually be found in the JSTOR archive. In addition, some papers can be obtained through the library.

Labor Supply

Ashenfelter, Orley and Mark W. Plant, "Nonparametric Estimates of the Labor Supply Effects of Negative Income Tax Programs," Journal of Labor Economics 8, January 1990 (part 2), S396-S415.

* Ben-Porath, Yoram, " The Production of Human Capital and the Life Cycle of Earnings ," The Journal of Political Economy, Vol. 75, No. 4, Part 1. (Aug., 1967), pp. 352-365.

* Blundell, Richard, and Thomas MaCurdy, "Labor Supply: A Review of Alternative Approaches," in Orley Ashenfelter and David Card, eds., Handbook of Labor Economics, Volume 3, North-Holland,1999.

* Browning, Martin, Angus Deaton and Margaret Irish: " A Profitable Approach to Labor Supply and Commodity Demands Over the Life-Cycle." Econometrica, 53(3), May 1985, 503-543.

Deaton, Angus and John Muellbauer, Economics and Consumer Behavior, Cambridge University Press, 1980.

* Imai, Susumu and Michael Keane, “Intertemporal Labor Supply and Human Capital Accumulation,” International Economic Review, 45:2, May 2004, p. 601-641.

* Heckman, James J., "Shadow Prices, Market Wages, and Labor Supply," Econometrica, Vol. 42, No. 4. (Jul., 1974), pp. 679-694.

* Heckman, James J., "Sample Selection Bias as a Specification Error," Econometrica, Vol. 47, No. 1. (Jan., 1979), pp. 153-162.

* Pencavel, John, "Labor Supply of Men: A Survey," in Orley Ashenfelter and Richard Layard, eds., Handbook of Labor Economics, North-Holland, 1986.

* Rust, John and Christopher Phelan, "How Social Security and Medicare affect Retirement Behavior in a World of Incomplete Markets," Econometrica,65 (4), July 1997, 781-831.

Prescott, Edward C., “Why Do Americans Work So Much More Than Europeans?Federal Reserve Bank of Minneapolis Quarterly Review Vol. 28, No. 1, July 2004, pp. 2-13.

Labor Demand

Hamermesh, Daniel S. Labor Demand. Princeton: Princeton University Press, 1993.

Hicks, J.R.: The Theory of Wages. London: Macmillan, 1932.

* Notes on Hicks.

Kennan, John, "The Elusive Effects of Minimum Wages," Journal of Economic Literature, December 1995.

* Sargent, Thomas J.: "Estimation of Dynamic Labor Demand Schedules Under Rational Expectations," in Lucas, Robert E. Jr., and Thomas J. Sargent, eds.: Rational Expectations and Econometric Practice, Minneapolis: The University of Minnesota Press, 1981.

Equilibrium Wage and Employment Determination

* Burdett, Kenneth and Dale T. Mortensen, "Wage Differentials, Employer Size, and Unemployment" International Economic Review, Vol. 39, No. 2. (May, 1998), pp. 257-273.

* Coate, Stephen and Glenn C. Loury, " Will Affirmative Action Policies Eliminate Negative Stereotypes? " American Economic Review, 83, December 1993, 1220-40.

Eckstein, Zvi and Kenneth I. Wolpin, "Duration to First Job and the Return to Schooling: Estimates from a Search-Matching Model," Review of Economic Studies 62 (2), April 1995, 263-286.

Ekeland, Ivar, James J. Heckman and Lars Nesheim, "Identification and Estimation of Hedonic Models," The Journal of Political Economy, Vol. 112, No. 1, Part 2. (Feb., 2004), pp. S60-S109.

* Jovanovic, Boyan, "Job Matching and the Theory of Turnover ," The Journal of Political Economy, Vol. 87, No. 5, Part 1. (Oct., 1979), pp. 972-990.

* Jovanovic, Boyan, "Firm-specific Capital and Turnover," The Journal of Political Economy, Vol. 87, No. 6, (Dec., 1979), pp. 1246-1260.

Kennan, John, "An Econometric Analysis of Fluctuations in Aggregate Labor Supply and Demand," Econometrica, 56(2), March 1988, 317-333.

McCall, B. P. and J. J. McCall (1987) "A Sequential Study of Migration and Job Search," Journal of Labor Economics 5 (October 1987), 452-476.

Mortensen, Dale T. (2003). Wage Dispersion: Why Are Similar Workers Paid Differently?, MIT Press.

* Mortensen, Dale T. and Christopher A. Pissarides, "Job Creation and Job Destruction in the Theory of Unemployment," Review of Economic Studies 61(3), July 1994, 397-415.

* Neal, Derek and Sherwin Rosen, "Theories of the Distribution of Earnings," in Atkinson, A.B. and F. Bourguignon, eds, Handbook of Income Distribution, New York: North-Holland, 2000.

* Pissarides, C.A. (2000). Equilibrium Unemployment Theory, MIT Press.

* Postel-Vinay, Fabien and Jean-Marc Robin, “Equilibrium Wage Dispersion with Worker and Employer Heterogeneity ”, Econometrica,70 (6), November 2002, 2295-2350.

Rosen, Sherwin, “Hedonic Prices and Implicit Markets”, Journal of Political Economy 82 (1), January-February 1974, 34-55.

* Rosen, Sherwin: "The Theory of Equalizing Differences," Handbook of Labor Economics. New York: North-Holland, 1986.

* Roy, A. D. “Some Thoughts on the Distribution of Earnings,” Oxford Economic Papers (New Series) 3, June 1951, 135-146.

Rubinstein, Yona and Yoram Weiss, "Post Schooling Wage Growth: Investment, Search and Learning," in Hanushek, E. and F. Welch, eds., Handbook of the Economics of Education, 2006.

* Shapiro, Carl and Joseph E. Stiglitz, "Equilibrium Unemployment as a Worker Discipline Device," American Economic Review, 74, (June 1984), 433-444.

* Smith, Adam. The Wealth of Nations. New York: The Modern Library 1937 (originally published 1776). Chapter X, Of Wages and Profit in the Different Employments of Labour and Stock , pages 99-143.

* Walsh, Frank, “A Multisector Model of Efficiency Wages,” Journal of Labor Economics, Apr 1999; Vol. 17, Iss. 2; pg. 351-77.

Willis, Robert J. and Sherwin Rosen, "Education and Self Selection ," JPE 87, no. 5, pt. 2 (1979), S7-S36.

Labor Contracts

* Felli, Leonardo and Christopher Harris, " Learning, Wage Dynamics and Firm-Specific Human Capital ," Journal of Political Economy, 104(4), August 1996, 838-868.

Gibbons, Robert and Michael Waldman "A Theory of Wage and Promotion Dynamics Inside Firms," Quarterly Journal of Economics, 114(4), November 1999, pages 1321-58.

Gibbons, Robert and Michael Waldman, (2006), "Enriching a Theory of Wage and Promotion Dynamics Inside Firms," Journal of Labor Economics, 24, pp. 59-107

* Harris, Milton and Bengt Holmstrom, " A Theory of Wage Dynamics ," Review of Economic Studies, Vol. 49, No. 3. (Jul., 1982), pp. 315-333.

Holmstrom, Bengt and Paul Milgrom, "Aggregation and Linearity in the Provision of Intertemporal Incentives," Econometrica,70 (6), March, 1987, 303-328.

Malcomson, James M. (1999), "Individual employment contracts," in: Orley C. Ashenfelter and David Card, Editor(s), Handbook of Labor Economics, Elsevier, Volume 3, Part 2, pages 2291-2372.

* Lazear, Edward and Sherwin Rosen (1981), " Rank-Order Tournaments as Optimum Labor Contracts ," Journal of Political Economy, Vol. 89, No. 5, pp. 841-864.

Prendergast, Canice, "The Provision of Incentives in Firms," Journal of Economic Literature, March 1999, 37, 7-63.

Prendergast, Canice, (2002), "The Tenuous Trade-off between Risk and Incentives," Journal of Political Economy 110: 1071-1102.

Rosen, Sherwin, "The Economics of Superstars," American Economic Review, Vol. 71, No. 5. (Dec., 1981), pp. 845-858.

Empirical Analysis of Wages and Employment

Altonji, Joseph G. and Pierret Charles R., “Employer Learning and Statistical Discrimination,” Quarterly Journal of Economics, February 2001, vol. 116, no. 1, pp. 313-350.

Bound, John and George Johnson, "Changes in the Structure of Wages in the 1980's: An Evaluation of Alternative Explanations," American Economic Review, 82, June 1992, 371-392.

* Card, David, "The Causal Effect of Education on Earnings," in Orley Ashenfelter and David Card, eds., Handbook of Labor Economics, Volume 3, North-Holland, 1999.

Davis, Steven J. and John Haltiwanger, "Gross Job Flows," in Orley Ashenfelter and David Card, eds., Handbook of Labor Economics, Volume 3, North-Holland,1999.

Juhn, Chinhui, Kevin M. Murphy and Brooks Pierce, "Wage Inequality and the Rise in Returns to Skill," Journal of Political Economy, 101 (3), June 1993, 410-442.

Katz, Lawrence F. and David H. Autor, "Changes in the Wage Structure and Earnings Inequality," in Orley Ashenfelter and David Card, eds., Handbook of Labor Economics, Volume 3, North-Holland,1999.

* Krueger, Alan B. and Lawrence H. Summers: "Efficiency Wages and the Inter-Industry Wage Structure," Econometrica, vol. 56, no. 2 (March 1988), 259-293.

Murphy, Kevin M. and Finis Welch, "The Structure of Wages," Quarterly Journal of Economics, 107, February 1992, 285-326.

Neal, Derek, "The Complexity of Job Mobility among Young Men," Journal of Labor Economics, Apr 1999; 17(2), 237-61.

* Neal, Derek and William R. Johnson, " The Role of Premarket Factors in Black-White Wage Differences," Journal of Political Economy, 104 (5), October 1996, 869-895.

Migration

* Benhabib, Jess and Boyan Jovanovic, “Optimal Migration”, NBER Working paper No. 12871, January 2007.

* Blanchard, Olivier Jean and Lawrence F. Katz (1992), "Regional Evolutions," Brookings Papers on Economic Activity, 1: 1-37.

Borjas, George J. (1999), "The Economic Analysis of Immigration," in: Orley C. Ashenfelter and David Card, Editor(s), Handbook of Labor Economics, Elsevier, Volume 3, Part 2, pages 1697-1760.

* Borjas, George J. (2003), "The Labor Demand Curve Is Downward Sloping: Reexamining the Impact of Immigration on the Labor Market," Quarterly Journal of Economics 118, (4) (November 2003): 1335-1374

Dahl, Gordon B. (2002), "Mobility and the Return to Education: Testing a Roy Model with Multiple Markets," Econometrica, Vol. 70, No. 6, pp. 2367-2420.

Gallin, Joshua Hojvat (2004), "Net Migration and State Labor Market Dynamics," Journal of Labor Economics, 22, 1-21.

Gelbach, Jonah B. (2004), "Migration, the Lifecycle, and State Benefits: How low is the bottom?" Journal of Political Economy, 112 (5), pages 1091-1130.

Gemici, Ahi, (2007), "Family Migration and Labor Market Outcomes," University of Pennsylvania.

Greenwood, Michael J. (1997), "Internal migration in developed countries," in Mark R. Rosenzweig and Oded Stark, Editor(s), Handbook of Population and Family Economics, Elsevier, Volume 1, Part 2, pages 647-720.

* Kennan, John and James R. Walker (2007) "The Effect of Expected Income on Individual Migration Decisions", University of Wisconsin-Madison.

Lalonde, Robert J. and Robert H. Topel, "Economic impact of international migration and the economic performance of migrants," in Mark R. Rosenzweig and Oded Stark, Editor(s), Handbook of Population and Family Economics, Elsevier, Volume 1, Part 2, pages 799-850.

Mincer, J. (1978) "Family Migration Decisions," Journal of Political Economy, 86 (5), 749-773.

Razin, Assaf and Efraim Sadka, "International migration and international trade," in Mark R. Rosenzweig and Oded Stark, Editor(s), Handbook of Population and Family Economics, Elsevier, Volume 1, Part 2, pages 851-887.

Bargaining Models

Coase, Ronald H., "Durability and Monopoly", Journal of Law and Economics, 1972, 15, 143-149.

Cramton, Peter C., "Strategic Delay in Bargaining with Two-Sided Uncertainty," Review of Economic Studies, 1992.

Gibbons, Robert, Game Theory for Applied Economists, Princeton: Princeton University Press, 1992.

Kennan, John, "Repeated Bargaining with Persistent Private Information," Review of Economic Studies, October 2001.

* Kennan, John and Robert Wilson, "Bargaining with Private Information," Journal of Economic Literature, March 1993.

Osborne, Martin J. and Ariel Rubinstein, Bargaining and Markets. San Diego: Academic Press, 1990.

Rubinstein, Ariel (1982), "Perfect Equilibrium in a Bargaining Model", Econometrica, 50: 97-110.

Stole, Lars and J. Zwiebel, "Organizational Design and Technology Choice under Intrafirm Bargaining," American Economic Review, 86(1), March 1996, 195-222.

Stole, Lars and J. Zwiebel, “Intrafirm Bargaining and Non-Binding Employment Contracts,” Review of Economic Studies, 63, 1996, 375-410.