nep-ltv New Economics Papers
on Unemployment, Inequality and Poverty
Issue of 2009‒07‒11
four papers chosen by
Maximo Rossi
University of the Republic

  1. Unionization and the Evolution of the Wage Distribution in Sweden: 1968 to 2000 By Albrecht, James; Björklund, Anders; Vroman, Susan
  2. Birth Weight and the Dynamics of Early Cognitive and Behavioural Development By Del Bono, Emilia; Ermisch, John
  3. Job Satisfaction and the Labor Market Institutions in Urban China By Heywood, John S.; Siebert, W. Stanley; Wei, Xiangdong
  4. Glück: Die ökonomische Analyse (Happiness: The Economic Analysis) By Bruno S. Frey; Alois Stutzer

  1. By: Albrecht, James (Georgetown University); Björklund, Anders (SOFI, Stockholm University); Vroman, Susan (Georgetown University)
    Abstract: We examine the evolution of the Swedish wage distribution over the periods 1968-1981 and 1981-2000. The first period was the heyday of the Swedish solidarity wage policy with strongly equalization clauses in the central wage agreements. During the second period, there was more scope for firm-specific factors to affect wages. We find a remarkable compression of wages across the distribution in the first period, but in the second period, wage growth was quite uniform across the distribution. We decompose these changes across the distribution into two components – those due to changes in the distribution of characteristics such as education and experience and those due to changes in the distribution of returns to those characteristics. The wage compression between 1968 and 1981 was driven by changes in the distribution of returns, but between 1981 and 2000, the change in the distribution of returns was neutral with respect to inequality.
    Keywords: wage compression, unionization, quantile regression
    JEL: J31 J51
    Date: 2009–06
  2. By: Del Bono, Emilia (ISER, University of Essex); Ermisch, John (University of Essex)
    Abstract: In this paper we explore the impact of birth weight on children's cognitive and behavioural outcomes using data from the UK Millennium Cohort Study. In order to deal with the endogeneity of birth weight we use an estimator based on the eliminant method. When coupled with ordinary least squares, this estimator allows us to bound the effects of birth weight. The results show that birth weight has significant but very small effects on male cognitive development at age 3 and on female cognitive and behavioural outcomes at age 3. We also find that birth weight affects age 5 outcomes only through previous achievements, and that the overall impact fades out over time. These findings call into question the effectiveness of birth weight as a policy target.
    Keywords: birth weight, production function, child development
    JEL: I12 I21 J13 J24
    Date: 2009–06
  3. By: Heywood, John S. (University of Wisconsin, Milwaukee); Siebert, W. Stanley (University of Birmingham, UK); Wei, Xiangdong (Lingnan University)
    Abstract: The determinants of worker job satisfaction are estimated using a representative survey of three major cities in China. Legally segregated migrants, floaters, earn significantly less than otherwise equivalent non-migrants but routinely report greater job satisfaction, a finding not previously reported. We confirm a positive role for membership in the communist party but find that it exists only for non-migrants suggesting a club good aspect to membership. In contrast to earlier studies, many controls mirror those found in western democracies including the "paradox of the contented female worker."
    Keywords: job satisfaction, internal migrants, party membership, China
    JEL: J28 J61 O17 D73
    Date: 2009–06
  4. By: Bruno S. Frey; Alois Stutzer
    Abstract: In economics there is presently an almost revolutionary development. The direct measurement of subjective welfare challenges traditional economics, inspires it, and opens new avenues for scientific research. The approaches and possibilities of an economic analysis of happiness are shown and illustrated with two specific applications. The relationship between income and life satisfaction is strongly shaped by the aspiration level serving to evaluate life conditions. The aspiration levels are formed by social comparisons and adaptation processes. The Life Satisfaction Approach is a new method to capture the value of public goods. The short discussion of governmental „happiness policy“ from a constitutional viewpoint suggests a comparative institutional analysis of subjective well-being. The happiness revolution in economics is only at its beginning. More insights concerning institutions allowing people to pursue their own conception of a good life are to be expected.
    Keywords: Happiness, Life Satisfaction, Economics, Income, Terrorism
    JEL: A12 D31 H41
    Date: 2009–06

This nep-ltv issue is ©2009 by Maximo Rossi. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.