We provide a Bayesian inference for a mixture of two Pareto distributions which is then used to approximate the upper tail of a wage distribution. The model is applied to…
We provide a Bayesian inference for a mixture of two Pareto distributions which is then used to approximate the upper tail of a wage distribution. The model is applied to the data from the CPS Outgoing Rotation Group to analyze the recent structure of top wages in the United States from 1992 through 2009. We find an enormous earnings inequality between the very highest wage earners (the “superstars”), and the other high wage earners. These findings are largely in accordance with the alternative explanations combining the model of superstars and the model of tournaments in hierarchical organization structure. The approach can be used to analyze the recent pay gaps among top executives in large firms so as to exhibit the “superstar” effect.
Recent work on the econometric specification of the consumptionfunction by London Business School (LBS) forecasters has argued that theinclusion of a variable capturing…
Recent work on the econometric specification of the consumption function by London Business School (LBS) forecasters has argued that the inclusion of a variable capturing movements in demographic structure is essential to the explanation of the recent sharp drop in the UK personal savings ratio. It is shown that the inclusion of demographic factors does not provide a model that is robust to alternative data formulations. On the contrary, an adequate explanation for recent movements in aggregate consumers′ expenditure can be found using the LBS data by specifying a consumption function that incorporates adjustment of income to control for the maintenance of the real value of asset holdings, following Hendry and Von Ungern‐Sternberg (1981).
The purpose of this paper is to estimate a reduced form model of expectations-based reference-dependent preferences to explain job retention of older workers in Europe in…
The purpose of this paper is to estimate a reduced form model of expectations-based reference-dependent preferences to explain job retention of older workers in Europe in the context of the 2009 economic crisis.
Using individual micro-economic longitudinal data from the Survey of Health, Ageing, and Retirement in Europe between 2006 and 2011, the authors derive a measure of “good, bad or no surprise” from workers’ anticipated evolution of their standard of living five years from 2006 (reference point) and from a comparison of their capacity to make ends meet between 2006 and 2011.
The authors find that the probability to remain on the labour market in 2011 is significantly higher for individuals who experienced a lower than expected standard of living. The effect of a “bad surprise” on job retention is larger than the effect of a “good surprise” once netted out from the effects of expectations at baseline, change in consumption utility, and the usual life-cycle determinants on job retention of older workers.
The authors interpret this result as an evidence of loss aversion in the case the reference point is based on individuals’ expectations. The authors also find that loss aversion is more common among men, risk-averse individuals and those with a higher perceived life expectancy.
Briefly reviews the Social Protocol attached to the MaastrichtTreaty. Addresses the debate between those advocating the minimalharmonization of labour legislation…
Briefly reviews the Social Protocol attached to the Maastricht Treaty. Addresses the debate between those advocating the minimal harmonization of labour legislation necessary for the establishment of fair competition within the single market, on the one side, and those arguing for a more interventionist approach to avoid the consequences of social dumping, on the other. Then examines the implications for this debate of the rise of flexible production, with its demand for increased human capital investment and long‐term employment relationships.
Reviewing the persistence of high levels of unemployment in the EU, finds that this has been accompanied by an increasing incidence of low pay and the adoption of “atypical” employment contracts. The policy response, drawing on the experience of the US economy, has been to advocate the creation of flexible labour markets. It suggests that it is not possible to account for the deterioration in the European labour market in terms of an increase in the supply of labour. The fall in demand for labour is examined in terms of long‐run structural changes and in particular it draws attention to the impact of increased import penetration. Finally it discusses the consequences for public funding of welfare, investment in education and training, and the emergence of a permanent labour surplus economy.
What matters most for improving work quality and who can make a difference are perennial topics in employee relations research. The literature on work quality provides…
What matters most for improving work quality and who can make a difference are perennial topics in employee relations research. The literature on work quality provides answers to these with regard to various constructs on a continuum from “soft” to “hard” variables and stakeholders seeking to influence employers who fall short of reasonable expectations with regard to these. A construct of “decent work” with both soft and hard variables was adopted for research and methods which were collaborative and participative with stakeholders in one national context.
The “decent work” construct was operationalised from the literature and refined by collaborative and participative research. Exploring the relative importance of the constituent parts of decent work involved research with a range of stakeholders; employees, employers and advocates. The study involved most prominently low-paid workers, with employers and advocates also engaged through interviews.
Primarily hard “decent work” variables were identified among employees, primarily soft variables among employers and a mix of hard and soft among advocates. There are some common priorities across these stakeholders.
The main implication is that to engage a range of stakeholders requires a combination of soft and hard variables to be included in research and policy development. However, generalisation about what matters most and who makes a difference to work quality is intrinsically limited in context and time. In this research, the extent of employer engagement in the collaboration initiated by advocates and concerned most with the experiences of low-paid workers is a limitation.
What matters most are a set of soft and hard priorities to engage across stakeholders. Pay is an abiding priority among these and the priority most prominent for many advocates seeking to make a difference through influencing low-paying employers to provide a living wage. While the living wage is a significant focus for work quality, it is not in itself sufficient, as other soft and hard variables in the workplace matter as well. Those who can make a difference are the employers falling short of benchmark standards. Influence on these may emerge through decent work knowledge and skills in management and professional development programmes as well as in initiatives advocating wider adoption of the living wage.
Problem areas of work quality, and problem employers, can be influenced by strategies shaping “hard” factors, including legislation. This needs to be complemented and integrated with strategies on “soft” factors, including identifying positive role models on themes of well-being, work–life balance and precarious forms of employment, as well as pay.
The identification of what matters and who can make a difference is based on an original, collaborative, research project, in one national context, offering analytical generalisability about “decent work” and an experience of collaborative research.