Now showing 1 - 10 of 36
  • Publication
    Income tax cuts and inflation in Ireland
    (Economic and Social Research Institute, 1998)
  • Publication
    An equilibrium search model of the informal sector
    (University College Dublin. School of Economics, 2006-12) ; ;
    We use an equilibrium search framework to model a formal- informal sector labour market where the informal sector arises endogenously. In our model large firms will be in the formal sector and pay a wage premium, while small firms are characterised by low wages and tend to be in the informal sector. Using data from the South African labour force survey we illustrate that the data is consistent with these predictions.
  • Publication
    Report of Independent Review of Employment Regulation Orders and Registered Employment Agreement Wage Setting Mechanisms
    (Department of Jobs, Enterprise and Innovation, 2011-04-30) ;
    An independent review of the framework of statutory wage setting mechanisms known as Employment Regulation Orders (ERO) and Registered Employment Agreements (REA). The review was a commitment under the provisions of the joint EU-IMF Programme for Ireland. The Review was conducted jointly by Mr. Kevin Duffy, Chairman of the Labour Court, acting in an ad hoc capacity, and by Dr. Frank Walsh, Lecturer, School of Economics, University College Dublin, having regard to the need for this independent review to draw both on particular knowledge of the operation of wage setting mechanisms and independent economic expertise.
  • Publication
    Minimum wages for Ronald McDonald monopsonies : a theory of monopsonistic competition by V Bhaskar and Ted To - a comment
    (University College Dublin. School of Economics, 2001-09)
    Bhaskar and To (1999) develop a model of monopsonistic competition and solve explicitly for equilibrium. While a minimum wage set just above the unconstrained optimum leads firms to increase employment it also causes firm exit as profits fall. In this note I show that the employment and welfare effects of the minimum wage which Bhaskar and To had thought to be ambiguous when firm exit was accounted for are in fact unambiguously positive.
  • Publication
    Monopsony power with variable effort
    (University College Dublin. School of Economics, 2000-11)
    A monopsony model of the labour market is developed where wages and the effort level are chosen by the firm. Higher wages raise labour supply while higher effort reduces it. Wages will be below the socially optimal level while effort will be too high. Under a sufficient condition which is satisfied in many reasonable cases a minimum wage policy (with the effort level unrestricted) will lower worker utility and welfare. Under a sufficient condition a maximum effort level (with wages unrestricted will raise employees utility but lower welfare. To be confident that regulatory policies improve welfare the government must be confident that it can choose and enforce the regulated levels of wages and effort correctly. By contrast an employment subsidy which depends only on the slope of the firms labour supply curve can achieve the social optimum. The model can be thought of as a generic monopsony model where wage is input price, effort input quality and workers utility the input suppliers profit. A simplified version of Bhaskar and To’s (1999) model is used to illustrate. The cost of the employment subsidy which achieves the social optimum (and is equal to the transport costs of the marginal worker) is equal to monopsony profits.
  • Publication
    Changes in the gender wage gap and the returns to firm specific human capital
    (University College Dublin. School of Economics, 1999-03) ;
    If employers believe females are more likely to separate from a job than males, efficient cost sharing of on-the-job training implies that females will have higher returns to tenure. Becker and Lindsay (1994) argue that this is true empirically. (1994). Updating the analysis we find that that there is no longer a difference in the probability of leaving jobs or in returns to tenure by gender. Differences in contracts to finance on the job training can no longer explain any of the “discrimination” component in the gender wage gap.
  • Publication
    A multisector model of efficiency wages
    (University College Dublin. School of Economics, 1995-01)
  • Publication
    Productivity, Non-Compliance and the Minimum Wage
    (University College Dublin. School of Economics, 2021-11) ;
    Many informal firms in developing countries would not be viable if they were to comply with the minimum wage law. This means the authorities have an incentive to turn a blind eye to non-enforcement in a substantial share of firms. We also survey enforcement mechanisms for the minimum wage across developing countries and find that worker complaints are an important element in determining whether firms will be inspected for non-compliance or not. We develop a theoretical monopsony model which rationalises the stylised facts we observe. For a given minimum wage, the government can choose a level of enforcement and penalties for non-compliance such that employment will not fall for any optimising firm, irrespective of their productivity. Low productivity firm’s optimal choice of employment and wage will be unaffected by the introduction of the minimum wage. High productivity firms comply so that wage and employment effects are non-negative for these firms.
  • Publication
    The minimum wage and hours per worker
    (University College Dublin. School of Economics, 2010-10) ;
    In a competitive model we ease the assumption that efficiency units of labour are the product of hours and workers. We show that a minimum wage may either increase or decrease hours per worker and the change will have the opposite sign to the slope of the equilibrium hours hourly wage locus. Similarly, total hours worked may rise or fall. We illustrate the results throughout with a Cobb-Douglas example.