Results

CEP discussion paper

Do larger firms exert more market power? Markups and markdowns along the size distribution

Several models posit a positive cross-sectional correlation between markups and firm size, which characterizes misallocation, factor shares, and gains from trade. Accounting for labor market power in markup estimation, w...Read more...

Blog

Economics Observatory:

What explains the gender division of labour and how can it be redressed?

Adam Smith's division of labour was about the efficiency gains from task specialisation in factories. But the gender division - gaps between men and women in pay, prestige, career progression and much more - can also be ...Read more...

Blog

LSE Business Review:

More education signals ability to employers, but does it really improve skills?

Better educated workers may earn higher wages for two possible reasons: because they acquire more skills or because more education signals their intellect and enthusiasm. Economists believe that signalling plays a role a...Read more...

Blog

LSE Impact of Social Sciences:

New approaches to economics research are reshaping how we understand and respond to gender stereotypes

New ways of analysing data from images and text are being used by economists to study discrimination in the labour market. A recent workshop, hosted by the Centre for Economic Performance and the Department of Social Pol...Read more...

CEP discussion paper

The measure of monopsony: the labour supply elasticity to the firm and its constituents

The estimation of labour supply elasticities is central to the measurement of monopsony power in the labor market. In this paper I provide new, firm-level estimates of the labour supply elasticity that distinguish betwee...Read more...

CentrePiece article

In brief... How citizens help expose environmental wrongdoing

Does enabling citizens to complain about public services provide an effective way of improving government services, or should we be concerned about the accuracy and reliability of such reports? Jonathan Colmer, Mary Evan...Read more...

CentrePiece article

Superstar firms: how the shift from manufacturing to services affects local concentration of sales and jobs

The leading US firms in many industries have increased their national market share substantially over the last four decades - making these industries more concentrated. But locally the picture is more complex. David Auto...Read more...

CEP discussion paper

VAT pass-through and competition: evidence from the Greek Islands

We examine how competition affects VAT pass-through in isolated oligopolistic markets as defined by the Greek islands. Using daily gasoline prices and a difference-in-differences methodology, we investigate how changes i...Read more...

Journal article

The Economic Journal:

Unraveling firms: demand, productivity and markups heterogeneity

We develop a novel framework that simultaneously allows recovering heterogeneity in demand, quantity TFP and markups across firms while leaving the correlation between the three dimensions unrestricted. We accomplish thi...Read more...

CEP discussion paper

Non-compete agreements in a rigid labour market: the case of Italy

Non-compete clauses (NCCs) limiting the mobility of workers have been found to be rather widespread in the US, a flexible labour market with large turnover rates and a limited coverage of collective bargaining. This pape...Read more...

Journal article

Journal of the European Economic Association:

City of dreams

Bigger cities offer more valuable experiences and opportunities in exchange for higher housing costs. While higher-ability workers benefit more from bigger cities, they are not more likely to move to one. Our model of ur...Read more...

Journal article

The Economic Journal:

Individual consequences of occupational decline

We assess the career earnings losses that individual Swedish workers suffered when their occupations' employment declined. High-quality data allow us to overcome sorting into declining occupations on various attributes, ...Read more...

Chapter

Families, labor markets, and policy

in Handbook of the Economics of the Family

Handbook of the Economics of the Family, Volume One includes comprehensive surveys of the current state of the economics literaure in the field, prepared by leading scholars, with a particular empahsis on the most recent...Read more...

CEP discussion paper

Environmental citizen complaints

Citizen complaints feature prominently in public oversight contexts. The nature and effects of complaints, however, are poorly understood. Here, we investigate attitudes about citizen complaints using a nationally repres...Read more...

CentrePiece article

The paradox of vocational education

Despite a UK labour market that is hungry for skills, academic education has triumphed over training, apprenticeships and preparation for specific occupations. Alison Wolf looks at why vocational education continues to l...Read more...

CentrePiece article

Commute and thrive

The advent of commuting in 1930s London opened up opportunities to working-class people. Andrew Seltzer and Jonathan Wadsworth show how public transport boosts the labour market....Read more...

Journal article

Journal of International Economics: Forthcoming

Sequentially exporting products across countries

Exploiting disaggregated data on French exporters, we show that firms expand their product scope and geographical presence sequentially. This process of internationalization is uneven over time, exhibiting more volatilit...Read more...

Blog

LSE Business Review:

Self-employment dwindles amid the cost-of-living crisis

As the Covid-19 crisis has made way for inflation and skyrocketing energy prices, the self-employed have not yet found their way out of the recent economic adversities. And many of them are now finding their way out of s...Read more...

CEP discussion paper

The indirect effect of the Russian-Ukrainian war through international linkages: early evidence from the stock market

This paper investigates how firms' international linkages to Russia and Ukraine affected investors' expectations following the escalation of the Russian-Ukrainian war. For this, we perform an event study around the Russi...Read more...

Blog

Vox EU:

The labour market in Ukraine: Rebuild better

Rebuilding Ukraine will require emergency measures that address the effects of war alongside structural reforms that address pre-existing political and economic issues. Giacomo Anastasia, Tito Boeri, Marianna Kudlyak and...Read more...

Journal article

Regional Science and Urban Economics :

Micro-geographic property price and rent indices

We develop a programming algorithm that predicts a balanced-panel mix-adjusted house price index for arbitrary spatial units from repeated cross-sections of geocoded micro data. The algorithm combines parametric and non-...Read more...

CEP discussion paper

The spillover effect of services offshoring on local labour markets

I provide new empirical evidence on the direct and indirect impact of services off-shoring on local employment and wages, using a unique dataset on firms in the UK for the period 2000-2015. Exploiting variation in firms'...Read more...

Journal article

Ecological Economics:

The environmental cost of the international job market for economists

We provide an estimate of the environmental impact of the recruitment system in the economics profession, known as the "international job market for economists". Each year, most graduating PhDs seeking jobs in academia, ...Read more...

CentrePiece article

Environmental costs of the global job market for economists

Each year, the international job market for economists involves more than 1,000 candidates and several hundred recruiters from around the world meeting for short pre-screening interviews at annual congresses in Europe an...Read more...

Journal article

Labour Economics:

The gender reveal: the effect of sons on young fathers' criminal behavior and labor market activities

Based on New Zealand's administrative court charges data, we document child gender-specific differences in future criminal behavior of young fathers. The deterrent impact of having a son on the future likelihood of recei...Read more...

CEP discussion paper

Acquisitions, management and efficiency in Rwanda's coffee industry

Well-functioning markets allocate assets to owners that improve firms' management and performance. We study the effects of ownership changes on coffee mills in Rwanda - an industry in which managing relationships with fa...Read more...

CEP discussion paper

Market size, markups and international price dispersion in the cement industry

Prices for several intermediate inputs, including cement, are higher in developing economies - particularly in Africa. Combining data from the International Comparison Program with a global directory of cement plants we ...Read more...

Journal article

Economica:

Information provision and postgraduate studies

This is the first paper to examine experimentally effects of information provision on beliefs about pecuniary and non-pecuniary returns of postgraduate education, enrolment intentions and realized enrolment. We find that...Read more...

CEP discussion paper

Accidents will happen: (de)regulation of health and safety legislation, workplace accidents and self employment

In 2015, the UK government exempted "low-risk" self-employed workers from legislation on workplace safety. This reversed a move two decades earlier that incorporated the self-employed more fully into the same regulatory ...Read more...

Blog

LSE Business Review:

Low pay and insecurity in the UK labour market

Minimum wage increases have driven down the incidence of low hourly pay, but there has been much less progress elsewhere for low earners. Low pay is widespread among the self-employed, who do not benefit from the minimum...Read more...

Journal article

Economics of Education Review:

Deregulating teacher labor markets

This paper examines how the removal of national pay scales, a common feature of public sector labor markets, affects productivity. We exploit a reform that compelled all schools in England to replace pay scales with scho...Read more...

Blog

The Sutton Trust:

Gloomy prospects for social mobility in the pandemic era

Lee Elliot Major and Andrew Eyles explain how a gap in missed education between richer and poorer children was exacerbated by stark home learning divides and the likely consequences for social mobility....Read more...

External publication

Social mobility: past, present and future

Andrew Eyles, Lee Elliot Major and Stephen Machin forecast that relative income mobility levels in the UK could fall by as much as 12%, driven by learning loss in schools....Read more...

Journal article

Labour Economics:

Slack and prices during Covid-19: accounting for labor market participation

Strong labor force participation cyclicality during the Covid-19 pandemic has put further into question the capacity of standard Phillips Curve (PC) models to fully capture labor market cyclical conditions. In this paper...Read more...

Journal article

Oxford Economic Papers: Forthcoming

Economic geography aspects of the Panama Canal

This paper studies how the opening of the Panama Canal in 1914 changed counties’ market potential and influenced the economic geography of the USA. We compute shipment effective distances with and without the canal from ...Read more...

Journal article

Management Science: Forthcoming

Vertical integration and foreclosure: evidence from production network data

This paper studies the prevalence of potential anticompetitive effects of vertical mergers using a novel data set on U.S. and international buyer-seller relationships and across a large range of industries. We find that ...Read more...

External publication

Monopsony in local labour markets

In this commentary, we propose a monopsony model of the labour market in which market power stems from idiosyncratic worker preferences over non-wage attributes of jobs. In this set-up, the relationship between wages and...Read more...

External publication

Labour market inequality

Wage and earnings inequality has been on the rise in the UK since the late 1970s / early 1980s, and with faster increases than comparator countries it is now one of the countries with the highest levels of wage and earni...Read more...

Journal article

Journal of International Economics:

Technology, market structure and the gains from trade

We study the gains from trade in a model with oligopolistic competition, heterogeneous firms and innovation. Our key finding is that a trade-induced increase in market concentration can be an important source of the gain...Read more...

Blog

VoxEU:

Inflation, market power, and price controls: views of leading economists

With sharply rising US inflation prompting debate about the potential role of powerful firms in driving up prices and whether antitrust interventions and/or price controls may be an effective policy response, the IGM For...Read more...

Blog

LSE Business Review:

Will the US child tax credit reduce poverty and improve outcomes for children and parents?

The American Rescue Plan Act of 2021 temporarily increased the value of the child tax credit from $2,000 to $3,000 for children aged 6-16 and to $3,600 for younger children. To date, the Biden administration has been una...Read more...

Blog

VoxEU:

Working from home and corporate real estate

As remote working became more common during Covid-19, Antonin Bergeaud, Jean Benoit Eymeoud, Thomas Garcia and Dorian Henricot examine how corporate real-estate market participants adjusted to the growth of teleworking i...Read more...

Blog

VoxEU:

The environmental burden of the international job market for economists

Each year, the 'international job market for economists' involves over 1,000 junior candidates and several hundred recruiters from all over the world meeting for short pre-screening interviews at annual congresses in Eur...Read more...

Blog

VoxEU:

The value of online gig economy platforms

The gig economy and online labour platforms often trade off increased flexibility for lower employment security. Christopher Stanton and Catherine Thomas show how traditional labour market regulations, such as minimum wa...Read more...

External publication

Changing jobs?

This report is about the nature and speed of change in the UK's labour market, about how past periods of rapid change have happened, and about workers' experiences as they have lived through these changes. It is written ...Read more...

CEP discussion paper

The environmental cost of the international job market for economists

We provide an estimate of the environmental impact of the recruitment system in the economics profession, known as the "international job market for economists". Each year, most graduating PhDs seeking jobs in academia, ...Read more...

Journal article

Management Science:

Building a Productive Workforce: The Role of Structured Management Practices

In an influential study, Bender et al. [Bender S, Bloom N, Card D, Van Reenen J, Wolter S (2018) Management practices, workforce selection, and productivity. J. Labor Econom. 36(S1):S371-S409] document consistent relatio...Read more...

Journal article

Journal of the European Economic Association:

Marshall Lecture 2020 The Measure of Monopsony

There has been increasing interest in recent years in monopsony in the labour market. This paper discusses how we can measure monopsony power by combining insights from models based on both frictions and idiosyncrasies. ...Read more...

CEP discussion paper

Population growth, immigration and labour market dynamics

This paper examines the role of population flows on labour market dynamics across immigrant and native-born populations in the United Kingdom. Population flows are large, and cyclical, driven first by the maturation of b...Read more...

Journal article

Journal of Urban Economics:

The amplifying effect of capitalization rates on housing supply

We provide empirical evidence that increases in housing rental income lead to a larger supply response than price increases of the same percentage value. We rationalize this differential in supply responsiveness with an ...Read more...

CEP discussion paper

Minimum wages and the China syndrome: causal evidence from US local labor markets

Exposure to Chinese import competition led to significant manufacturing job losses in the United States. Local labor markets, however, differ significantly in how they fared with respect to manufacturing employment. An i...Read more...

Journal article

International Journal of Manpower:

Eastern European immigrants in the UK

The paper aims at examining wage developments among Eastern European immigrants vs UK natives before and after the 2004 enlargement by measuring the extent to which inter-group wage differentials are explainable by these...Read more...

Journal article

American Economic Journal: Applied Economics:

Temperature, Labor Reallocation, and Industrial Production: Evidence from India

To what degree can labor reallocation mitigate the economic consequences of weather-driven agricultural productivity shocks? I estimate that temperature-driven reductions in the demand for agricultural labor in India are...Read more...

CEP discussion paper

The diffusion of disruptive technologies

We identify novel technologies using textual analysis of patents, job postings, and earnings calls. Our approach enables us to identify and document the diffusion of 29 disruptive technologies across firms and labor mark...Read more...

Blog

LSE Business Review:

UK labour shortages and immigration: looking at the evidence

Can the shortages of workers reported by the food and drink sector be solved by making it easier to hire migrants? How will wages in these sectors change? Is there a conflict between short- and long-term fixes? Alan Mann...Read more...

Blog

VoxEU:

Labour market reallocation in the wake of Covid-19

As economies bounce back from Covid-19, our economists question whether the recovery will re-employ all of the workers made redundant during the downturn, and whether they will go back to similar jobs....Read more...

CEP discussion paper

Technological change and domestic outsourcing

Domestic outsourcing has grown substantially in developed countries over the past two decades. This paper addresses the question of the technological drivers of this phenomenon by studying the impact of the staggered dif...Read more...

CEP discussion paper

Firm export responses to tariff hikes

We study how firms react to unexpected increases in import tariffs. We identify our results from a sudden removal of American preferential tariffs applied on Argentine imports under the Generalized System of Preferences,...Read more...

Blog

VoxEU:

Let me work from home, or I will find another job

Jose Maria Barrero, Nicholas Bloom, Steven Davis examine survey data from American employees currently working from home, and find 40% say they would seek another job if employers require a full return to business premis...Read more...

Journal article

Journal of Political Economy:

Are bigger banks better? Firm-level evidence from Germany

The effects of large banks on the real economy are theoretically ambiguous and politically controversial. I identify quasi-exogenous increases in bank size in postwar Germany. I show that firms did not grow faster after ...Read more...

Journal article

Journal of Common Market Studies:

The Effect on Foreign Direct Investment of Membership in the European Union

This article explores the impact of EU membership on foreign direct investment (FDI). It analyses empirically how the effects of such deep integration differ from other forms and investigates what drives these effects. U...Read more...

CEP discussion paper

The measure of monopsony

There has been increasing interest in recent years in monopsony in labour market. This paper discusses how we can measure monopsony power combining insights from models based on both frictions and idiosyncrasies. It pres...Read more...

CentrePiece article

The impact of regulation on innovation

It is widely feared that private sector innovation is constrained by 'red tape'. Philippe Aghion and colleagues test that view on data from France, where firms of more than 50 employees face far heavier regulatory obliga...Read more...

CEP discussion paper

Sequential exporting across countries and products

How do exporters expand their product scope and geographical presence? We argue that new exporters are uncertain about their profitability in different countries and products, but learn it as they start to export. As a c...Read more...

Blog

Economics Observatory:

What is the future of commuting to work?

Around half the UK labour force is currently working from home. Paul Mizen, Nick Bloom, Shivani Taneja analyse survey data suggesting that spending two to three days a week at home is the most common expected working pat...Read more...

Journal article

AEA Papers & Proceedings:

The Family Origin of the Math Gender Gap is a White Affluent Phenomenon

Previous research has shown that norms around the role of women in society could help explain the gender gap in mathematics and that these norms could be transmitted within the family. Using data from the Florida Departm...Read more...

Journal article

Journal of Economic Geography:

Local economic conditions and the nature of new housing supply

We explore the effects of local economic conditions on the type and size of newly constructed housing units in a city. Exploiting the 1984–2004 metro area samples of the American Housing Survey and US Census building per...Read more...

Journal article

Journal of the European Economic Association:

Parents, Schools and Human Capital Differences Across Countries

This paper studies the contribution of parental influence in accounting for cross-country gaps in human capital achievements. We argue that the cross-country variation in unobserved parental characteristics is at least a...Read more...

Blog

Economics Observatory:

A year in the UK labour market: what's happened over the coronavirus pandemic?

Jonathan Wadsworth explains how the performance of the UK labour market during Covid-19 shows that the most notable effects of a downturn caused by restrictions on mobility are the more dynamic aspects: falls in hours, h...Read more...

Blog

LSE Covid-19:

Why central London has seen the biggest rises in house prices, despite Covid

As many predicted, the pandemic led to a demand for bigger homes and gardens. But with supply limited by Britain's strict planning regulations, and the market propped up by a stamp duty waiver and the furlough scheme, pr...Read more...

CEP discussion paper

Globalization, trade imbalances and labor market adjustment

We study the role of global trade imbalances in shaping the adjustment dynamics in response to trade shocks. We build and estimate a general equilibrium, multi-country, multi-sector model of trade with two key ingredient...Read more...

Blog

UK in a Changing Europe:

Trade after Brexit: the initial numbers

Thomas Sampson argues that, although the full effects of Brexit won't be known for many years, regulatory divergence is likely to further reduce trade, as firms face the challenge of satisfying different regulations in t...Read more...

Journal article

Real Estate Economics: Forthcoming

Offices scarce but housing scarcer: Estimating the premium for London office conversions

British planning is among the most restrictive in the world and has been restrictive for longer than elsewhere. Restrictive regulation substantially increases the costs of office space and, especially in London, increase...Read more...

CEP discussion paper

Non-compete agreements, wages and efficiency: theory and evidence from Brazilian football

We propose a model to study non-compete agreements and evaluate their quantitative effects. We explore an exogenous policy change that removed non-compete clauses in the market for Brazilian footballers, the Pele Act of ...Read more...

CEP discussion paper

Unequal learning and labour market losses in the crisis: consequences for social mobility

The unequal learning and labour market losses arising in the UK due to the Covid-19 pandemic are used to assess the consequences for social mobility. Labour market and learning losses have been more pronounced for people...Read more...

Blog

VoxEU:

Regulation chills minor (but not radical) technological innovations

While there is suggestive evidence that regulations may have a stifling effect on innovation, there is as yet no rigorous economic framework to quantify the magnitude of such regulatory effects on innovation and the aggr...Read more...

CEP discussion paper

The impact of regulation on innovation

We present a framework that can be used to assess the equilibrium impact of regulation on endogenous innovation with heterogeneous firms. We implement this model using French firm-level panel data where there is a sharp ...Read more...

Blog

LSE Business Review:

New incentives for businesses to train their employees are needed for economic recovery from Covid-19

The need to retrain or upskill the workforce has become ever more urgent due to sharp changes in skills demand induced by the pandemic, write Jiaqi Li, Guglielmo Ventura and Anna Valero....Read more...

CEP discussion paper

Why have house prices risen so much more than rents in superstar cities?

In most countries – particularly in supply constrained superstar cities – house prices have risen much more strongly than rents over the last two decades. We provide an explanation that does not rely on falling interest ...Read more...

Journal article

Quarterly Journal of Economics:

Competition and relational contracts in the Rwanda coffee chain

How does competition affect market outcomes when formal contracts are not enforceable and parties resort to relational contracts? Difficulties with measuring relational contracts and dealing with the endogeneity of compe...Read more...

Journal article

American Journal of Agricultural Economics:

Rainfall Variability, Child Labor, and Human Capital Accumulation in Rural Ethiopia

How does income uncertainty affect human capital investments in agrarian economies? Using child-level panel data, I exploit a medium-run change in mean-preserving rainfall variability to identify the effects of income un...Read more...

Journal article

ILR Review:

Monopsony in Labor Markets: A Review

Researchers’ interest in monopsony has increased in recent years. This article reviews the accumulating evidence that employers have considerable monopsony power. It summarizes the application of this idea to explaining ...Read more...

Journal article

The Economic Journal:

Adjustment Costs and Factor Demand: New Evidence from Firms’ Real Estate

We study corporate real estate frictions and their effect on firm dynamics and labour demand. We build and simulate a general equilibrium model with heterogeneous firms that predicts the response of firms to a productivi...Read more...

Journal article

The Economic Journal:

Trapped Factors and China’s Impact on Global Growth

After a recent increase in Chinese import competition, European firms increased innovation. We present and rationalise these patterns using ‘trapped factors’ at the micro level within a stylised equilibrium model of prod...Read more...

CEP discussion paper

Are bigger banks better? Firm-level evidence from Germany

The effects of large banks on the real economy are theoretically ambiguous and politically controversial. I identify quasi-exogenous increases in bank size in post-war Germany. I show that firms did not grow faster after...Read more...

CEP discussion paper

The grandkids aren't alright: the intergenerational effects of prenatal pollution exposure

Using newly linked survey and administrative data, providing more than 150 million parent-child links, we show that regulation-induced improvements in early life air quality have intergenerational effects on human capita...Read more...

Blog

The State of Working Britain:

Long-term unemployment and the Covid downturn

With the first signs of rising unemployment under the crisis are beginning to ripple through the labour market, Jonathan Wadsworth examines trends in employment against unemployment, the chances of finding work among tho...Read more...

Blog

VoxEU:

Work, care, and gender across UK lockdowns

A growing body of research is making clear the unequal impact of the COVID-19 pandemic across gender. This column explores what the likely implications of a second lockdown in the UK are for gender equality at work and i...Read more...

CEP discussion paper

Pandemics, global supply chains and local labor demand: evidence from 100 million posted jobs in China

This paper studies how the COVID-19 pandemic has affected labor demand, using over 100 million posted jobs on one of the largest online platforms in China. Our data reveal that the number of newly posted jobs within the ...Read more...

CEP discussion paper

Does pricing carbon mitigate climate change? Firm-level evidence from the European Union emissions trading scheme

In theory, market-based regulatory instruments correct market failures at least cost. However, evidence on their efficacy remains scarce. Using administrative data, we estimate that, on average, the EU ETS - the world's ...Read more...

Blog

State of Working Britain Blog:

1 million missing immigrants (and 1.2 million more UK-born)

Jonathan Wadsworth examines the Labour Force Survey, highlighting the strange case of a rapid fall of around 750,000 in the immigrant population of working age over the last year contained in the latest ONS labour market...Read more...

Blog

LSE British Politics and Policy:

How lockdowns have reversed traditional gender roles in some UK households and further entrenched them in others

Claudia Hupkau and Barbara Petrongolo discuss what the likely implications of a second lockdown are for gender equality at work and in the home....Read more...

Journal article

Quarterly Journal of Economics:

Quantifying the gap between equilibrium and optimum under monopolistic competition

Equilibria and optima generally differ in imperfectly competitive markets. Although this is well understood theoretically, it is unclear how large the welfare distortions are in the aggregate economy. Do they matter quan...Read more...

Journal article

The Economic Journal:

The impact of terrorism on individual well-being: Evidence from the boston marathon bombing

A growing literature has concluded that terrorism affects the economy, yet less is known about its impact on individual welfare. This article estimates the impact of the 2013 Boston marathon bombing on well-being, exploi...Read more...

Journal article

Journal of Economic Perspectives:

Solo self-employment and alternative work arrangements: a cross-country perspective on the changing composition of jobs

The nature of self-employment is changing in most OECD countries. Solo self-employment is increasing relative to self-employment with dependent employees, often being associated with the development of gig economy work a...Read more...

CEP discussion paper

Trade and geography

This paper reviews recent research on geography and trade. One of the key empirical findings over the last decade has been the role of geography in shaping the distributional consequences of trade. One of the major theor...Read more...

Blog

The State of Working Britain:

UK labour market under Covid part 3: layoffs, hiring & wages

Recessions, usually signify a rise in layoffs. Even the last recession, which was accompanied by much more wage moderation than previous ones, generated a significant rise in redundancies. This time it is a little differ...Read more...

Blog

The State of Working Britain:

What's happening to the labour market under Covid-19? Part 2

So if unemployment, employment or more marginal types of working appear little changed under COVID, things are different from normal if we look elsewhere. Figure 1 shows the percentage of workers who say they had a job b...Read more...

Blog

The State of Working Britain:

What's happening to the UK labour market under Covid-19? Looking for signs of excess and what it shows (so far). Part 1

Six months into the worst pandemic of the modern era, the worst recession of the modern era and yet and yet .... the labour market is proving to be remarkably resilient (so far) – at least along the dimensions normally ...Read more...

Journal article

Economica:

'Trophy architects' and design as rent-seeking: quantifying deadweight losses in a tightly regulated office market

Britain tightly restricts the supply of office space, creating substantial economic rents, but its development restrictions are politically administered and therefore gameable, inducing rent-seeking activity. We find tha...Read more...

CEP discussion paper

Generalized linear competition: from pass-through to policy

Economic policy and shifts in input market prices often have significant effects on the marginal costs of firms and can prompt strategic responses that make their impact hard to predict. We introduce "generalized linear ...Read more...

CentrePiece article

Covid-19 and the work patterns of men and women

Claudia Hupkau and Barbara Petrongolo explore the impact of the pandemic on women's labour market prospects and ‘home production' responsibilities...Read more...

Blog

LSE Business Review:

Dream jobs: managers in internationally active firms have higher lifetime wages

People at managerial level in international companies accumulate strong experience that is useful also in other firms, write Giordano Mion, Luca David Opromolla, and Gianmarco Ottaviano....Read more...

CEP occasional paper

Labour markets in the time of Coronavirus: measuring excess

Recessions are usually accompanied by some combination of job loss, hiring freezes, wage cuts or hours reductions. In a rapidly evolving economic crisis there is a need for timely information to assess labour market perf...Read more...

Journal article

European Journal of Finance:

Is firm-level clean or dirty innovation valued more?

We examine how Tobin's Q is linked to 'clean' and 'dirty' innovation and innovation efficiency at the firm level. Clean innovation relates to patented technologies in areas such as renewable energy generation and electri...Read more...

CEP occasional paper

Preserving job matches during the Covid-19 pandemic: firm-level evidence on the role of government aid

We analyze the impact of the COVID-19 pandemic and government policies on firms’ aid takeup, layoff and furlough decisions. We collect new survey data for 10,642 small, medium and large Danish firms, and match to governm...Read more...

CEP discussion paper

Offices scarce but housing scarcer: estimating the premium for London office conversions

The British system of land use planning is one of the most restrictive in the world. It substantially increases the costs of office space (Cheshire & Hilber, 2008; Cheshire & Dericks, 2020) and, especially in London, inc...Read more...

Journal article

Labour Economics:

Gender gaps and the structure of local labor markets

In this paper we discuss some strands of the recent literature on the evolution of gender gaps and their driving forces. We will revisit key stylized facts about gender gaps in employment and wages in a few high-income c...Read more...

Journal article

Journal of Economic Perspectives:

Place-based policies and spatial disparities across European cities

Spatial disparities in income and worklessness across areas of the European Union are profound and persistent. Concerns about these disparities and the appropriate policy response are longstanding. Two trends have re-ene...Read more...

Journal article

Journal of Economic Dynamics and Control:

Comments on "labor market trends and the changing value of time"

The last century was characterized by a well-documented marked increase in income inequality in the US (see Alvaredo et al., 2018, among many others), which fostered a vast debate among academics and policy makers about ...Read more...

Blog

LSE Covid-19 blog:

How a job guarantee scheme can avoid the slide into long-term unemployment

Even if COVID-19 infection rates dwindle, it is now clear that the economy is unlikely to bounce back quickly. This raises the spectre of long-term unemployment. Richard Layard (LSE) explains how the government could dra...Read more...

CEP discussion paper

A survey of gender gaps through the lens of the industry structure and local labor markets

In this paper we discuss some strands of the recent literature on the evolution of gender gaps and their driving forces. We will revisit key stylized facts about gender gaps in employment and wages in a few high-income c...Read more...

Blog

VoxEU:

Covid-19 and gender gaps: Latest evidence and lessons from the UK

The social distancing and lockdowns associated with the COVID-19 crisis has hit service sectors with frequent interactions between consumers and providers which cannot be done from home. At the same time, it has added ed...Read more...

Blog

VoxEU:

Prepare for large wage cuts if you are younger and work in a small firm

The COVID-19 pandemic is turning into a global recession - probably the biggest drop in economic activity since the Great Depression of the 1930s. This column uses over 3 million earnings observations drawn from more tha...Read more...

CEP discussion paper

Environmental preferences and technological choices: is market competition clean or dirty?

We investigate the effects of consumers' environmental concerns and market competition on firms' decisions to innovate in 'clean' technologies. Agents care about their consumption and environmental footprint; firms pursu...Read more...

CEP discussion paper

Labor demand in the past, present and future

Since the beginning of the Industrial Revolution, technological change has led to the automation of existing tasks and the creation of new ones, as well as the reallocation of labor across occupations and industries. The...Read more...

CEP discussion paper

On the economic impacts of mortgage credit expansion policies: evidence from help to buy

Mortgage credit expansion policies – such as UK’s Help to Buy (HtB) – aim to increase access to and affordability of owner-occupied housing and are widespread around the world. We take advantage of spatial discontinuitie...Read more...

Blog

LSE Business Review:

Technology can benefit a few superstar workers, at the expense of everyone else

The rollout of television provides a natural experiment, creating an opportunity to isolate the impact of a technical disruption on the labour market, writes Felix Koenig....Read more...

CEP discussion paper

The contribution of immigration to local labor market adjustment

The US suffers from persistent local disparities in employment rates, which should in principle be eliminated by population mobility. Can immigration accelerate this process? Remarkably, on average since 1960, new immigr...Read more...

CEP discussion paper

The rise of agribusiness and the distributional consequences of policies on intermediated trade

Policies to encourage agribusinesses-led development of crop markets are high on the agenda of many policy-makers. Since the 1980s, several countries have moved to a model in which agribusinesses provide market access to...Read more...

Journal article

The Economic Journal:

Merger Policy in a Quantitative Model of International Trade

In a two-country international trade model with oligopolistic competition, we study the conditions on market structure and trade costs under which a merger policy designed to benefit domestic consumers is either too toug...Read more...

CEP discussion paper

Immigration, local crowd-out and undercoverage bias

Using decadal census data since 1960, I cannot reject the hypothesis that new immigrants crowd out existing residents from US commuting zones and states one-for-one. My estimate accounts explicitly for dynamic local adju...Read more...

Journal article

Oxford Review of Economic Policy:

Gender diversity in firms

This paper explores the recent efforts by the corporate world and public policy to increase the number of women in leadership positions in the workplace. We review and empirically evaluate the ‘business case’ for gender ...Read more...

CEP election analysis

#GE2019Economists: the research evidence on key issues for voters in the 2019 UK General Election

The general election of 2019 was called after negotiations over how the UK should leave the European Union became increasingly tortuous. While Brexit may have been the trigger for the election, it was far from being the ...Read more...

CEP discussion paper

Measuring the gains from labor specialization

We estimate the productivity effects of labor specialization using a judicial environment that offers a quasi-experimental setting well suited to this purpose. Judges in this environment are randomly assigned many differ...Read more...

Journal article

Journal of Urban Economics:

The energy costs of historic preservation

We explore the impact of historic preservation policies on domestic energy consumption. Using panel data for England from 2006 to 2013 and employing a fixed effects strategy, we document that (i) rising national energy p...Read more...

CEP discussion paper

When income effects are large: labor supply responses and the value of welfare transfers

I estimate the long-run income effect of welfare transfers on individual labor supply. Using Italian administrative data on the universe of survivor insurance recipients, I implement a regression discontinuity design aro...Read more...

Journal article

Journal of International Economics:

Geography, competition, and optimal multilateral trade policy

How should multilateral trade policy be designed in a world in which countries differ in terms of market access and technology, and firms with market power differ in terms of productivity? We answer this question in a mo...Read more...

CEP discussion paper

The best versus the rest: divergence across firms during the global productivity slowdown

We document that labor productivity of the globally most productive firms – the “frontier” – has diverged from all other firms – the “rest” – throughout the 2000s. This divergence remains after controlling for capital in...Read more...

CEP discussion paper

Building a productive workforce: the role of structured management practices

Firms’ hiring and firing decisions affect the entire labor market. Managers often make these decisions, yet the effects of management on labor allocation remains largely unexplored. To study the relationship between a fi...Read more...

CEP discussion paper

Vertical integration and foreclosure: evidence from production network data

This paper studies the prevalence of vertical market foreclosure using a novel dataset on U.S. and international buyer-seller relationships, and across a large range of industries. We find that relationships are more lik...Read more...

Blog

LSE Business Review:

Can economic incentives promote a more equal gender division of house chores?

Gender identity norms such as the male bread-winner model are possible drivers of persistent gender inequalities in the labour market. However, the extent to which they restrict the behaviour of couples is debated. While...Read more...

CEP discussion paper

Competition and pass-through: evidence from isolated markets

We measure how pass-through varies with competition in isolated oligopolistic markets with captive consumers. Using daily pricing data from gas stations on small Greek islands, we study how unanticipated and exogenous ch...Read more...

CEP discussion paper

Economic geography aspects of the Panama Canal

This paper studies how the opening of the Panama Canal in 1914 changed market access and influenced the economic geography of the United States. We compute shipment distances with and without the canal from each US count...Read more...

Journal article

Economic Policy:

Zero Hours Contracts and Labour Market Policy

The evolving nature of atypical work arrangements is studied. A particular focus is placed on one such form of work relation: zero hour contracts (ZHCs). The paper uses existing secondary data and new survey data collect...Read more...

Journal article

The Quarterly Journal of Economics:

Protests as strategic games: Experimental evidence from Hong Kong's antiauthoritarian movement

Social scientists have long viewed the decision to protest as strategic, with an individual's participation a function of their beliefs about others' turnout. We conduct a framed field experiment that recalibrates indivi...Read more...

Journal article

Journal of Urban Economics:

Relocation of public sector workers: Evaluating a place-based policy ,

This paper investigates the local labor market impact of a UK relocation initiative – the 2004 Lyons Review. The review resulted in the dispersal of about 25,000 civil service jobs out of London and the South East toward...Read more...

CEP discussion paper

A tale of comprehensive labor market reforms: evidence from the Italian jobs act

The Italian Jobs Act introduced a subsidy for new hirings as well as a new open ended labor contract based on graded security, with severance payments increasing with tenure, while phasing out the compulsory reinstatemen...Read more...

CEP discussion paper

Geography, competition and optimal multilateral trade policy

How should multilateral trade policy be designed in a world in which countries differ in terms of market access and technology, and firms with market power differ in terms of productivity? We answer this question in a mo...Read more...

Journal article

Journal of Economic Geography:

The preservation of historic districts - Is it worth it?

Read more...

Journal article

The Quarterly Journal of Economics:

Firming up inequality

We use a massive,matched employer-employee database for the United States to analyze the contribution of firms to the rise in earnings inequality from 1978 to 2013. We find that one-third of the rise in the variance of (...Read more...

CEP discussion paper

The public sector and the misallocation of labor: evidence from a policy experiment in India

State-owned enterprises are often thought to represent a distortion in the labor market, but the implied efficiency losses have not been carefully estimated. This paper presents the first rigorous quantification of the a...Read more...

CEP discussion paper

Technology, market structure and the gains from trade

We study the gains from trade in a new model with oligopolistic competition, firm heterogeneity, and innovation. Lowering trade costs reduces markups on domestic sales but increases markups on export sales, as firms do n...Read more...

Journal article

Journal of Housing Economics:

Institutional settings and urban sprawl: Evidence from Europe

This article explores the role of institutional settings in determining spatial variation in urban sprawl across Europe. We first synthesize the emerging literature that links land use policies and local fiscal incentive...Read more...

Journal article

Journal of Housing Economics:

Housing in Europe: A different continent – A continent of differences

This article provides the introduction to the special issue on ‘Housing in Europe: a different continent – a continent of differences’ in the Journal of Housing Economics in 2018. Europe is a large continent with a long ...Read more...

Journal article

Fiscal Studies:

The Economic Effects of Brexit: Evidence from the Stock Market

We study stock market reactions to the Brexit referendum on 23 June 2016 in order to assess investors� expectations about the effects of leaving theEuropean Union on the UK economy. Our results suggest that initial sto...Read more...

CEP discussion paper

The contribution of foreign migration to local labor market adjustment

The US suffers from large regional disparities in employment rates which have persisted for many decades. It has been argued that foreign migration offers a remedy: it “greases the wheels” of the labor market by accelera...Read more...

CentrePiece article

Apprenticeships in England: what do we know?

Increasing the quantity and quality of apprenticeships is high on the policy agenda in England. Research on this issue is a central focus of the Centre for Vocational Education Research (CVER). Sandra McNally summarises ...Read more...

CEP discussion paper

Labor specialization as a source of market frictions

This paper investigates why labor specialization brings additional frictions to the labor market. The intuition is that labor specialized firms rely on complementarity and firm-specific human capital, assigning high valu...Read more...

Journal article

Journal of Public Economics:

Does competition from private surgical centres improve public hospitals’ performance? Evidence from the English National Health Service

This paper examines the impact of a government programme which facilitated the entry of for-profit surgical centres to compete against incumbent National Health Service hospitals in England. We examine the impact of comp...Read more...

CEP discussion paper

Increasing differences between firms: market power and the macro-economy

A rich understanding of macro-economic outcomes requires taking into account the large (and increasing) differences between firms. These differences stem in large part from heterogeneous productivity rooted in managerial...Read more...

CEP discussion paper

The economic effects of Brexit - evidence from the stock market

We study stock market reactions to the Brexit referendum on 23 June 2016 in order to assess investors’ expectations about the effects of leaving the European Union on the UK economy. Our results suggest that initial stoc...Read more...

Journal article

The Economic Journal:

Location, Search Costs and Youth Unemployment: Experimental Evidence from Transport Subsidies

Do high search costs affect the labour market outcomes of jobseekers living far away from jobs? I randomly assign transport subsidies to unemployed youth in urban Ethiopia. Treated respondents increase job search intensi...Read more...

Journal article

Journal of International Economics:

Market Potential and Global Growth over the Long Twentieth Century

We examine the evolution of market potential and its role in driving economic growth over the long twentieth century. Theoretically, we exploit a structural gravity model to derive a closed-form solution for a widely-use...Read more...

CEP discussion paper

History dependence in the housing market

Using data on the universe of housing transactions in England and Wales over a twenty-year period, we document a robust pattern of history dependence in housing markets. Sale prices and selling propensities are affected ...Read more...

Journal article

The Economic Journal:

The Time Value of Housing: Historical Evidence on Discount Rates

Most London housing transactions involve trading long leases of varying lengths. We exploit this to estimate the time value of housing – the relationship between the price of a property and the term of ownership – over a...Read more...

Journal article

Small Business Economics:

The evolution and adoption of equity crowdfunding: entrepreneur and investor entry into a new market

Equity crowdfunding (ECF) offers entrepreneurs an online social media marketplace where they can access numerous potential investors who, in exchange for an ownership stake, may supply them with finance. In this paper, w...Read more...

Journal article

ILR Review:

The Impact of Acquiring Unrestricted Work Authorization on Romanian and Bulgarian Migrants in the United Kingdom

When Romania and Bulgaria (the so-called A2 countries) joined the European Union in 2007, the United Kingdom imposed temporary restrictions on the employment and welfare entitlements of A2 citizens that lasted until Janu...Read more...

Journal article

National Institute Economic Review:

Broken Market or Broken Policy? The Unintended Consequences of Restrictive Planning

This paper summarises the evidence from recent research relating to the British Planning system's impact on the supply of development. Planning serves important economic and social purposes but it is essential to disting...Read more...

CEP discussion paper

Market potential and global growth over the long twentieth century

We examine the evolution of market potential and its role in driving economic growth over the long twentieth century. Theoretically, we exploit a structural gravity model to derive a closed-form solution for a widely-use...Read more...

CEP industrial strategy paper

Apprenticeships in England: what does research tell us?

Read more...

CVER Briefing Note

Apprenticeships in England: what does research tell us?

Read more...

CEP discussion paper

The economic impacts of constraining home investments

We investigate how political backlash against wealthy investors in high-amenity places affects local residents. We exploit a quasi-natural experiment: the ‘Swiss Second Home Initiative’, which banned the construction of ...Read more...

Journal article

American Economic Review:

The persistence of local joblessness

Differences in employment-population ratios across US commuting zones have persisted for many decades. We claim these disparities represent real gaps in economic opportunity for individuals of fixed characteristics. Thes...Read more...

Journal article

Journal of Economic Geography:

Intended versus unintended consequences of migration restriction policies: Evidence from a natural experiment in Indonesia

This article studies the consequences of restrictions to migration at the origin on labor market outcomes and school enrolment in origin communities. Our difference-indifferences specification exploits the differential i...Read more...

CEP discussion paper

Medical marijuana laws and mental health in the United States

The consequences of legal access to medical marijuana for individual welfare are a matter of controversy. We contribute to the ongoing discussion by evaluating the impact of the staggered introduction and extension of me...Read more...

CEP discussion paper

Specialization matters in the firm size-wage gap

This study applies the O-ring theory to explain the firm-size wage premium. It focuses on the joint role of the division of labor and employee characteristics. Including the firm heterogeneity of occupations in a standar...Read more...

CEP discussion paper

Temperature, labor reallocation and industrial production: evidence from India

To what degree can labor reallocation mitigate the economic consequences of weather-driven agricultural productivity shocks? I estimate that temperature-driven reductions in the demand for agricultural labor in India are...Read more...

Journal article

Journal of Economic Geography:

From periphery to core: Measuring agglomeration effects using high-speed rail

We analyze the economic impact of the German high-speed rail (HSR) connecting Cologne and Frankfurt, which provides plausibly exogenous variation in access to surrounding economic mass. We find a causal effect of about 8...Read more...

CentrePiece article

In brief... Empty homes, longer commutes

In areas of Britain where there are empty houses, planners typically allocate less land for development and make it more difficult to build or adapt houses. Research by Paul Cheshire, Christian Hilber and Hans Koster exp...Read more...

CEP discussion paper

The effect of minimum wages on low-wage jobs: evidence from the United States using a bunching estimator

We propose a novel method that infers the employment effect of a minimum wage increase by comparing the number of excess jobs paying at or slightly above the new minimum wage to the missing jobs paying below it. Using st...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Interaction of Public and Private Employment: Evidence from a German Government Move

We use the German government move from Bonn to Berlin in 1999 to test competing views about the impact of public employment on private sector activity in a local labor market. A relocated public sector job might create n...Read more...

CVER Research Paper

Skills, Signals, and Employability: An Experimental Investigation

As skills of labor-market entrants are usually not directly observed by employers, individuals acquire skill signals. To study which signals are valued by employers, we simultaneously and independently randomize a broad ...Read more...

Journal article

Journal of Public Economics:

Empty homes, longer commutes: The unintended consequences of more restrictive local planning

We investigate the impact of land use regulation on housing vacancy rates. Using a 30-year panel dataset on land use regulation for 350 English Local Authorities (LAs) and addressing potential reverse causation and other...Read more...

Journal article

Research in Economics:

Efficiency in large markets with firm heterogeneity

Empirical work has drawn attention to the high degree of productivity differences within industries, and its role in resource allocation. In a benchmark monopolistically competitive economy, productivity differences intr...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Highways, Market Access and Spatial Sorting

We design a spatial model featuring workers embodied with heterogeneous skills. In equilibrium, locations with improved market access become relatively more attractive to the high-skilled, high-income earners. We then em...Read more...

CEP discussion paper

The productivity slowdown and the declining labor share: a neoclassical exploration

We explore the possibility that a global productivity slowdown is responsible for the widespread decline in the labor share of national income. In a neoclassical growth model with endogenous human capital accumulation a ...Read more...

CEP discussion paper

Efficiency in large markets with firm heterogeneity

Abstract Empirical work has drawn attention to the high degree of productivity differences within industries, and its role in resource allocation. In a benchmark monopolistically competitive economy, productivity differe...Read more...

Journal article

American Economic Review:

How Local Are Labor Markets? Evidence from a Spatial Job Search Model

This paper models the optimal search strategies of the unemployed across space to characterize local labor markets. Our methodology allows for linkages between numerous areas, while preserving tractability. We estimate t...Read more...

CEP discussion paper

Equity crowdfunding and early stage entrepreneurial finance: damaging or disruptive?

Equity crowdfunding (ECF) offers founders of new ventures an online social media marketplace where they can access a large number of investors who, in exchange for an ownership stake, provide finance for business opportu...Read more...

CEP discussion paper

Goods and factor market integration: a quantitative assessment of the EU enlargement

The economic effects from labor market integration are crucially affected by the extent to which countries are open to trade. In this paper we build a multi-country dynamic general equilibrium model with trade in goods a...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Energy Costs of Historic Preservation

We explore the impact of historical preservation policies on domestic energy consumption. Using panel data for England from 2006 to 2013 and employing a fixed effects-strategy, we document that (i) rising national energy...Read more...

CentrePiece article

In brief... Career opportunities

Students’ decisions about their education can be improved by providing them with more information, according to a report by Sandra McNally, which surveys the latest evidence on what advice is on offer and what works. She...Read more...

CentrePiece article

Towards a new UK industrial strategy

The regulation of business has been a rollercoaster ride for the UK over the past 20 years. Drawing on their work with the LSE Growth Commission, Anna Valero and Richard Davies outline an opportunity to build a new syste...Read more...

CEP discussion paper

Evaluating market consolidation in mobile communications

We study the dual relationship between market structure and prices and between market structure and investment in mobile telecommunications. Using a uniquely constructed panel of mobile operators’ prices and accounting i...Read more...

CEP election analysis

Brexit and the UK Economy

This general election is pitched as the ‘Brexit Election’, one that will give the incoming government a mandate to negotiate the terms of the UK’s exit from the European Union (EU). The Conservatives and Labour have both...Read more...

CEP discussion paper

The hospital as a multi-product firm: the effect of hospital competition on value-added indicators of clinical quality

There is increasing international interest in using Patient Reported Outcome Measures (PROMs) to assess health care provider performance. PROMs are a fundamental advance on existing indicators of health care quality in t...Read more...

CEP election analysis

Real Wages and Living Standards in the UK

Since the global financial crisis of 2007/08, workers’ real wages and family living standards in the UK have suffered to an extent unprecedented in modern history. Real wages of the typical (median) worker have fallen by...Read more...

Journal article

American Economic Review:

Is modern technology responsible for jobless recoveries?

Since the early 1990s, recoveries from recessions in the US have been plagued by weak employment growth. We investigate whether a similar problem afflicts other developed economies, and whether technology is a culprit. W...Read more...

CEP discussion paper

International expansion and riskiness of banks

We exploit an original dataset on European G-SIBs to assess how banks’ internationalization affects risk in the banking sector. We find a robust negative correlation between foreign expansion and banking risk as captured...Read more...

Journal article

Economica:

Gender Inequality and Economic Development: Fertility, Education and Norms

We document the evolution of gender inequality in labour market outcomes—earnings, labour supply and wage rates—over the path of economic development, and present evidence on the potential reasons for this evolution. To ...Read more...

Journal article

Journal of Urban Economics:

Political favoritism in China's capital markets and its effect on city sizes

This paper examines political favoritism of cites in national capital markets and the effect of that favoritism on city sizes. The paper estimates the city-by-city variation in the prices of capital across cities in Chin...Read more...

CEP discussion paper

Fertility and mothers' labor supply: new evidence using time-to-conception

We analyze the impact of children on their mothers' labor market outcomes in the UK. We use time-to-conception of the first child as an exogenous variation in the probability of having more children. We find that having ...Read more...

Journal article

The Economic Journal:

Unemployment and Domestic Violence: Theory and Evidence

Does rising unemployment really increase domestic violence as many commentators expect? The contribution of this article is to examine how changes in unemployment affect the incidence of domestic abuse. Theory predicts t...Read more...

CVER Research Paper

Labour Market Returns to Vocational Qualifications in the Labour Force Survey

This report uses data from the Labour Force Survey covering the period 1997-2015, to estimate wage premiums, or returns, to acquiring vocational qualifications. Different specifications of the wage equations are estimate...Read more...

CentrePiece article

Brexit and the UK labour market

Following the referendum vote to leave the European Union, the UK faces a trade-off between retaining access to the Single Market and restricting free movement of labour. Barbara Petrongolo considers the likely impact of...Read more...

Journal article

Journal of Social Policy:

Educational inequality, educational expansion and intergenerational mobility

The distribution of education by social background and the mobility prospects of society are intimately connected. To begin to predict future trends in mobility in the UK we bring together evidence on educational inequal...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Housing Market Impacts of Constraining Second Home Investments

We investigate how political backlash against wealthy second home investors in high-amenity places – tourist areas or superstar cities – affects local residents. We develop a general equilibrium model and exploit a quasi...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Preservation of Historic Districts - Is it Worth it?

I investigate the welfare effect of conservation areas that preserve historic districts by regulating development. Such regulation may improve quality of life but does so by reducing housing productivity – the efficiency...Read more...

CEP discussion paper

Does competition from private surgical centres improve public hospitals' performance? Evidence from the English National Health Service

This paper examines the impact of competition from government-facilitated entry of private, specialty surgical centres on the efficiency and case mix of incumbent public hospitals within the English NHS. We exploit the f...Read more...

Journal article

Journal of Economic Theory:

Assignment reversals: Trade, skill allocation and wage inequality

The allocation of skilled labor across industries shapes inter-industry wage differences and wage inequality. This paper shows the ranking of industries by workforce skill differs between developed and developing countri...Read more...

CEP Brexit analysis

The impact of Brexit on foreign investment in the UK

The third in a series of Brexit reports from the Centre for Economic Performance (CEP), examines how leaving the EU would affect UK incomes through changes in foreign investment in the UK. Leaving the European Union (EU)...Read more...

Journal article

The Review of Economic Studies:

Landing the first job: The value of intermediaries in online hiring

Online markets for remote labour services allow workers and firms to contract with each other directly. Despite this, intermediaries-called outsourcing agencies-have emerged in these markets. This article shows that agen...Read more...

Journal article

Economica:

The Rising Postgraduate Wage Premium

Despite post-college degree holders now making up nearly 15% of the US adult workforce, studies of their labour market performance remain sparse. This is surprising given that they are the most educated group in the labo...Read more...

CentrePiece article

Online hiring of offshore workers: the value of intermediaries

‘Old boy networks’ have not been rendered obsolete by modern communications technology. That is one of the conclusions of a study of global online labour markets by Christopher Stanton and Catherine Thomas. Their researc...Read more...

CEP real wages update

Slowing UK Wage Growth

We have previously examined the path of nominal and real wages in the UK (Blanchflower and Machin, 2014a, 2014b, 2014c). In that work, we expressed the view that in recent years there has been sufficient slack in the lab...Read more...

CEP discussion paper

The effect of trade liberalization on firm-level profits: an event-study approach

I use an event study approach to present novel evidence on the impact of trade liberalization on firm-level profits. Using the uncertainty surrounding the negotiation and ratification process of the Canada-United States ...Read more...

CEP discussion paper

The price ain't right? Hospital prices and health spending on the privately insured

We use insurance claims data covering 28 percent of individuals with employer-sponsored health insurance in the US to study the variation in health spending on the privately insured, examine the structure of insurer-hosp...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Trade and Frictional Unemployment in the Global Economy

We develop a multi-country, multi-sector trade model with labor market frictions and equilibrium unemployment. Trade opening leads to a reduction in unemployment if it raises real wages and reallocates labor towards sect...Read more...

CentrePiece article

Regulatory reform in Greece: the benefits of removing maximum mark-ups

Regulations that impose maximum mark-ups are intended to protect consumers from firms exercising market power. But a study by Christos Genakos and colleagues suggests that they can have the opposite effect: when Greece l...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Regulating Housing Vacancies Away? The Paradoxical Effects of Mismatch

Policy makers agree that vacant houses are undesirable. Moreover the existence of empty houses is used as an argument for allocating less land for new construction. So higher vacancy rates tend to trigger tighter restric...Read more...

Journal article

The Economic Journal:

Immigration, Housing Discrimination and Employment

We use a new data set on Italy and a novel identification strategy to analyse the relationship between migrants' employment status and the percentage of non-Italians living nearby. Our data contain information at the ver...Read more...

CEP discussion paper

The persistence of local joblessness

Local differences in US employment-population ratios and unemployment rates have persisted over many decades. Using decennial census data from 1950-2010, we investigate the reasons for this. The persistence cannot be exp...Read more...

CEP discussion paper

The future of the German industrial relations model

The paper examines recent evidence on the erosion of the German industrial relations model. Although its coverage has declined, much of this has occurred in smaller and newer establishments, and compared with Britain, it...Read more...

CEP election analysis

Health: How Will the NHS Fare in a Cold Climate?

With the NHS a central issue of the 2015 general election, the parties are debating funding, the form of provision, quality and productivity. This paper looks at the NHS record under the coalition government and consider...Read more...

CEP election analysis

The Economic Performance of UK Cities: Can Urban and Regional Policy Make a Difference to the North-South Divide

There are large variations in economic performance across UK cities and on some measures, they have widened since the global financial crisis. All main parties promise action to reduce them, but there is little differenc...Read more...

SERC/Urban and Spatial Programme Discussion Paper

From Periphery to Core: Measuring Agglomeration Effects Using High-Speed Rail

We analyze the economic impact of the German high-speed rail (HSR) connecting Cologne and Frankfurt, which provides plausibly exogenous variation in access to surrounding economic mass. We find a causal effect of about 8...Read more...

CEP discussion paper

Evaluating the impact of Sunday trading deregulation

During the past few decades a number of European countries lifted the regulations that restricted the opening hours of shops on Sunday. In this paper we examine the impact of Sunday trade deregulation on employment, expe...Read more...

CEP election analysis

Immigration and the UK Labour Market

During periods of strong economic growth, migration is and has always been important for filling gaps in the labour market. Perceptions do not seem to line up with the existing academic evidence. On balance, the evidence...Read more...

CEP discussion paper

Teachers and performance pay in 2014: first results of a survey

From the autumn of 2014, a new performance pay scheme was introduced for school teachers in England and Wales. It makes pay progression for all teachers dependent upon their performance as evaluated by their line manager...Read more...

CEP discussion paper

Landing the first job: the value of intermediaries in online hiring

Online markets for remote labor services allow workers and firms to contract with each other directly. Despite this, intermediaries - called outsourcing agencies - have emerged in these markets. This paper shows that age...Read more...

CEP discussion paper

The impact of maximum markup regulation on prices

Markup regulation is a common yet understudied type of regulation. We analyze the repeal of maximum wholesale and retail markup regulation in an oligopolistic and vertically non-integrated market. By comparing the prices...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Employment and Technological Change: On the Geography of Labour Market Adjustments

This paper investigates the impact of technological change on local labour market outcomes in Britain. Using a newly assembled panel database for the period 2000-2007 and a directly observed measure of technological chan...Read more...

CentrePiece article

Trophy architects and the ‘dark matter' of London’s planning system

A quarter of London’s skyscrapers are designed by architects who have already won a lifetime achievement award and whose work thus has the imprimatur of ‘iconic design’; this compares with just 3% in Chicago. According t...Read more...

CEP discussion paper

Patents and the global diffusion of new drugs

This paper studies how patent rights and price regulation affect how fast new drugs are launched in different countries, using newly constructed data on launches of 642 new drugs in 76 countries for the period 1983-2002,...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Local Economic Conditions and the Nature of New Housing Supply

We present a modified open monocentric city model that assumes that land is available for conversion into new housing throughout the city. The model predicts that positive local income shocks (i) increase the city’s shar...Read more...

CEP discussion paper

What happens when employers are free to discriminate? Evidence from the English Barclays Premier Fantasy Football League

Research on employers’ hiring discrimination is limited by the unlawfulness of such activity. Consequently, researchers have focused on the intention to hire. Instead, we rely on a virtual labour market, the Fantasy Foot...Read more...

CEP discussion paper

Wealth shocks and health outcomes: evidence from stock market fluctuations

Do wealth shocks affect the health of the elderly in developed countries? The economic literature is skeptical about such effects which have so far only been found for poor retirees in poor countries. In this paper I sho...Read more...

CEP discussion paper

Fueling the gender gap? Oil and women's labor and marriage market outcomes

This paper analyzes the effect of resource-based economic specialization on women's labor market outcomes. Using information on the location and discovery of major oil fields in the Southern United States coupled with a ...Read more...

CEP discussion paper

Biomarkers and long-term market outcomes: the case of creatine

Using the Young Finns Study (YFS) combined with the Finnish Linked Employer-Employee Data (FLEED) we show that quantities of creatine measured in 1980 prior to labour market entry affect labour market outcomes over the p...Read more...

CEP discussion paper

Transportation costs and the spatial organization of economic activity

This paper surveys the theoretical and empirical literature on the relationship between the spatial distribution of economic activity and transportation costs. We develop a multi-region model of economic geography that w...Read more...

CEP policy analysis

Immigration, the European Union and the UK Labour Market

During periods of strong economic growth, migration is and has always been important for filling gaps in the labour market. On balance, the evidence for the UK labour market suggests that fears about adverse consequences...Read more...

CEP discussion paper

The impact of mandatory entitlement to paid leave on employment in the UK

I evaluate the impact of the UK Working Time Regulations 1998, which introduced mandatory paid holiday entitlement. The regulation gave (nearly) all workers the right to a minimum of 4 weeks of paid holiday per a year. W...Read more...

CEP discussion paper

Home computers and married women's labor supply

I consider how the availability of a personal computer at home changed employment for married women. I develop a theoretical model that motivates the empirical specifications. Using data from the U.S. CPS from 1984 to 20...Read more...

SERC/Urban and Spatial Programme Discussion Paper

'Iconic Design' as Deadweight Loss: Rent Acquisition by Design in the Constrained London Office Market

Britain’s land use regulation (planning) system imposes very tight restrictions on the supply of office space so creating substantial rents. An unmeasured part of the costs associated with these restrictions likely comes...Read more...

Blog

LSE European Politics and Policy Blog:

The state of the UK economy: Diagnosis, prognosis and recommended treatment

The UK economy has experienced a prolonged period of weakness over the last five years. John Van Reenen writes that the real problems for the UK are inadequate long-run investment in infrastructure, innovation and human ...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Land Use Regulation and Productivity - Land Matters: Evidence from a UK Supermarket Chain

We use store-specific data for a UK supermarket chain to estimate the impact of planning on store output. Exploiting the variation in policies between England and other UK countries, we isolate the impact of Town Centre ...Read more...

CEP discussion paper

A general method for valuing non-market goods using wellbeing data: three-stage wellbeing valuation

Subjective wellbeing data is becoming increasingly popular in economics research. The wellbeing valuation approach uses wellbeing data instead of data gleaned from preferences to attach monetary values to non-market good...Read more...

Blog

LSE European Politics and Policy Blog:

UK Spending Review 2013: A triumph of politics over reason?

The UK’s Spending Review has been forced on the British Chancellor because weak economic growth has blown a hole in the deficit reduction programme. John Van Reenen welcomes the partial reversal of the hugely damaging cu...Read more...

CEP report

The UK productivity and jobs puzzle: does the answer lie in labour market flexibility?

GDP per worker fell for the five years after 2008 which is unprecedented in post war UK history. In this paper we argue that “capital shallowing” (i.e. the fall in the capital-labour ratio) could be the main reason for t...Read more...

Blog

LSE European Politics and Policy Blog:

Small isn’t always beautiful: The cost of regulation on French firms

France has a raft of labour-market regulations that kick in for firms with 50 workers or more. Luis Garicano and John Van Reenen use this threshold to identify the economic effects of size-contingent regulations. Such po...Read more...

Blog

LSE European Politics and Policy Blog:

No Triple Dip does not mean a good recovery for the UK

John Van Reenen reacts to the news this week that the UK has avoided economic contraction in the last quarter. Whilst Osborne may see this as cause to celebrate, there is nothing commendable about an economy that continu...Read more...

CEP discussion paper

The Great Stagnation: What Can Policymakers Do?

Although the economic recovery in the UK has been disappointing, it is inappropriate to either assert that Japan’s two lost decades illustrate the ineffectiveness of stimulative monetary policy or that the UK is predesti...Read more...

CEP occasional paper

Social policies and labor market outcomes in Latin America and the Caribbean: a review of the existing evidence

Latin America and the Caribbean have become in the last decade or so a formidable laboratory for the design and implementation of innovative social policies. In the face of an unprecedented surge in the number of non-con...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Impact of Supply Constraints on House Prices in England

i) This discussion paper, originally published September 2012, is a completely revised version from April 2014. ...Read more...

CEP discussion paper

Female Employment and Fertility - The Effects of Rising Female Wages

Increases in female employment and falling fertility rates have often been linked to rising female wages. However, over the last 30 years the US total fertility rate has been fairly stable while female wages have continu...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Trade Liberalisation Does Not Always Raise Wage Premia: Evidence from Ugandan Districts

The process of economic integration over the past two decades has been accompanied by an expanding income wedge between skilled and unskilled workers in many developing countries. This was also the case for Ugandan wage ...Read more...

CEP policy analysis

Immigration and the UK Labour Market: The latest evidence from economic research

During periods of strong economic growth, migration is and has always been important for filling gaps in the labour market. On balance, the evidence for the UK labour market suggests that fears about the consequences of ...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Ambition, Human Capital Acquisition and the Metropolitan Escalator

This paper examines the relation between ambition, as a form of dynamic human capital, and the escalator role of high order metropolitan regions, as originally identified by Fielding (1989). It argues that occupational p...Read more...

CEP discussion paper

Firm Size Distortions and the Productivity Distribution: Evidence from France

We show how size-contingent laws can be used to identify the equilibrium and welfare effects of labor regulation. Our framework incorporates such regulations into the Lucas (1978) model and applies it to France where man...Read more...

CEP discussion paper

Does Competition Improve Public Hospitals' Efficiency? Evidence from a Quasi-Experiment in the English National Health Service

This paper uses a difference-in-difference style estimation strategy to test separately the impact of competition from public sector and private sector hospitals on the efficiency of public hospitals. Our identification ...Read more...

CEP discussion paper

Market Leadership Through Technology - Backward Compatibility in the U.S. Handheld Video Game Industry

The introduction of a new product generation forces incumbents in network industries to rebuild their installed base to maintain an advantage over potential entrants. We study if backward compatibility moderates this pro...Read more...

CEP discussion paper

The Household Effects of Government Spending

This paper provides new evidence on the effects of fiscal policy by studying, using household-level data, how households respond to shifts in government spending. Our identification strategy allows us to control for time...Read more...

CEP discussion paper

Preferential Trade Agreements and the Labor Market

Labor market consequences are at the forefront of most debates on the merits of trade liberalization. Preferential trade agreements (PTAs) have become the primary form of trade liberalization in most countries, and sever...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Flexible Employment and Cross-Regional Adjustment

Employment flexibility is commonly associated to greater labour mobility and thus faster cross-regional adjustments. The literature however offers very little hard evidence on this and quite limited theoretical guidance....Read more...

CEP discussion paper

Assignment Reversals: Trade, Skill Allocation and Wage Inequality

Understanding the allocation of skilled labor across industries is necessary to explain inter-industry wage differences and the effect of trade on wages. This paper develops a multi-sector assignment model with both hete...Read more...

CEP discussion paper

Worktime Regulations and Spousal Labor Supply

We investigate cross-hour effects in spousal labor supply exploiting independent variation in hours worked generated by the introduction of the short workweek in France in the late 1990s. We find that female and male emp...Read more...

CEP discussion paper

Measuring the (Income) Effect of Disability Insurance Generosity on Labour Market Participation

We analyze the employment effect of a law that provides for a 36 percent increase in the generosity of disability insurance (DI) for claimants who are, as a result of their lack of skills and of the labour market conditi...Read more...

CEP discussion paper

Heterogeneous Firm-Level Responses to Trade Liberalisation: A Test Using Stock Price Reactions

This paper presents novel empirical evidence on key predictions of heterogeneous firm models by examining stock market reactions to the Canada-United States Free Trade Agreement of 1989 (CUSFTA). Using the uncertainty su...Read more...

CentrePiece article

Unequal Britain: how real are regional disparities?

Average earnings vary widely across the regions of Britain, a fact that has prompted many decades of policies aimed at reducing regional disparities. But as Henry Overman and Steve Gibbons demonstrate, such variation rev...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Economics Implications of House Price Capitalization: A Synthesis

In this article I argue that the extent to which fiscal variables are capitalized into house prices has important economic implications. I synthesize an emerging literature that explores the conditions under which public...Read more...

SERC/Urban and Spatial Programme Discussion Paper

From Russia with Love: The Impact of Relocated Firms on Incumbent Survival

We identify the impact of local firm concentration on incumbent performance with a quasi natural experiment. When Germany was divided after World War II, many firms in the machine tool industry fled the Soviet occupied z...Read more...

CEP discussion paper

Trading and Enforcing Patent Rights

We study how the market for innovation affects enforcement of patent rights. Conventional wisdom associates the gains from trade with comparative advantage in manufacturing or marketing. We show that these gains imply th...Read more...

CEP discussion paper

Individual Voice in Employment Relationships: A Comparison Under Different Forms of Workplace Representation

This article considers the role of individual employee voice in regulating the ‘zone of acceptance’ within the employment relationship, and examines the extent to which different models of collective voice inhibit or fos...Read more...

CEP discussion paper

Racial Discrimination and Competition

We provide the first assessment of whether an intensification of product market competition reduces the racial wage gap exactly where taste-based theories predict that competition will reduce labor market discrimination....Read more...

CEP discussion paper

A Step towards Valuing Utility the Marginal and Cardinal Way

Income has a direct impact on our utility as well as an indirect impact through the goods, services and life events it allows us to purchase. The indirect effect of income is not properly accounted for in existing resear...Read more...

CEP discussion paper

The Role of Worker Flows in the Dynamics and Distribution of UK Unemployment

Unemployment varies substantially over time and across subgroups of the labour market. Worker flows among labour market states act as key determinants of this variation. We examine how the structure of unemployment acros...Read more...

CentrePiece article

Land use planning: the impact on retail productivity

The restrictions that planning policies impose on retail development have significantly reduced the productivity of supermarkets, according to Paul Cheshire and colleagues....Read more...

CentrePiece article

In brief... Chernobyl: the long-term health and economic consequences

Hartmut Lehmann and Jonathan Wadsworth assess the long-lasting effects of radiation exposure from the Chernobyl disaster on the people of Ukraine....Read more...

CentrePiece article

In brief... Competition in the public sector: good for the goose, good for the gander?

Zack Cooper outlines evidence on the benefits of competition in healthcare - and the implications for the coalition government's NHS reform plans....Read more...

CEP discussion paper

The Impact of Chernobyl on Health and Labour Market Performance

Using longitudinal data from Ukraine we examine the extent of any long-lasting effects of radiation exposure from the Chernobyl disaster on the health and labour market performance of the adult workforce. The variation i...Read more...

CEP discussion paper

Seesaw in the Air: Interconnection Regulation and the Structure of Mobile Tariffs

Interconnection rates are a key variable in telecommunications markets. Every call that is placed must be terminated by the network of the receiving party, thus the termination end has the characteristic of an economic b...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Evaluating the Effects of Planning Policies on the Retail Sector: Or do Town Centre First Policies Deliver the Goods?

Few studies conceive of land as a productive factor but British land use policies may lower total factor productivity (TFP) in the retailing industry by (i) restricting the total availability of land for retail, thereby ...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Real Earnings Disparities in Britain

This report estimates housing-cost-earnings differentials across labour market areas in Britain. We show that quality-adjusted housing costs rise on average, one for one with the skill-adjusted earnings of the average wo...Read more...

CEP discussion paper

School Proximity and Child Labor Evidence from Rurul Tanzania

Is improved school accessibility an effective policy tool for reducing child labor in developing countries? We address this question using micro data from rural Tanzania and a regression strategy that attempts to control...Read more...

CEP discussion paper

Trade and Labor Market Outcomes

This paper reviews a new framework for analyzing the interrelationship between inequality, unemployment, labor market frictions, and foreign trade. This framework emphasizes firm heterogeneity and search and matching fri...Read more...

CEP discussion paper

Explaining Job Polarization in Europe: The Roles of Technology, Globalization and Institutions

This paper shows the employment structure of 16 European countries has been polarizing in recent years with the employment shares of managers, professionals and low-paid personal services workers increasing at the expens...Read more...

SERC/Urban and Spatial Programme Discussion Paper

The Mortgage Interest Deduction and its Impact on Homeownership Decisions

This paper examines the impact of the combined U.S. state and federal mortgage interest deduction (MID) on homeownership attainment, using data from 1984 to 2007 and exploiting variation in the subsidy across states, ove...Read more...

CEP discussion paper

The Effect of Market Entry on Innovation: Evidence from UK University Incubators

This paper investigates the effect of market entry of new firms on incumbent firms' innovative activity measured as patent applications. The basic assumption is that the effect of entry varies by geographical distance be...Read more...

CEP discussion paper

The End of National Models in Employment Relations?

The erosion of a number of national systems of employment relations, and the evidence from large scale workplace surveys has brought attention to the considerable diversity of employment systems within major economies. T...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Modelling and Forecasting UK Mortgage Arrears and Possessions

This paper presents new models for aggregate UK data on mortgage possessions (foreclosures) and mortgage arrears (payment delinquencies). The innovations include the treatment of difficult to observe variations in loan q...Read more...

CentrePiece article

Jobs in the recession

The recession of 2008-09 inflicted a larger cumulative loss of UK output than any of the previous post-war recessions, yet there has been a relatively low loss of employment, at least so far. Paul Gregg and Jonathan Wads...Read more...

CEP occasional paper

The UK labour market and the 2008 - 2009 recession

The recession of 2008-2009 inflicted a larger cumulative loss of UK output than any of the other post-war recessions. Nevertheless, employment rates remained higher than might have been expected given the experience of p...Read more...

CEP discussion paper

The Growth of Extended 'Entry Tournaments' and the Decline of Institutionalised Occupational Labour Markets in Britain

In recent years, British labour markets have been characterised by a decline of institutional regulation of entry routes into many occupations and internal labour markets. This paper examines this change by comparing occ...Read more...

CEP discussion paper

Does Hospital Competition Improve Efficiency? An Analysis of the Recent Market-Based Reforms to the English NHS

This paper uses a difference-in-difference estimator to test whether the introduction of patient choice and hospital competition in the English NHS in January 2006 has prompted hospitals to become more efficient. Efficie...Read more...

Journal article

Journal of Political Economy:

Can pay regulation kill? Panel data evidence on the effect of labor markets on hospital performance

In many sectors, pay is regulated to be equal across heterogeneous geographical labor markets. When the competitive outside wage is higher than the regulated wage, there are likely to be falls in quality. We exploit pane...Read more...

CEP election analysis

Financial Regulation: Can We Avoid Another Great Recession?

Read more...

CEP election analysis

Immigration and the UK Labour Market: The Evidence from Economic Research

Read more...

Journal article

Economica:

The wage impact of trade unions in the UK public and private sectors

There is a growing gap in the union membership wage premium between public and private-sector workers in the United Kingdom. Using the Labour Force Surveys of 1993-2006, the gap between the membership premium in the publ...Read more...

CEP discussion paper

Can Family-Support Policies Help Explain Differences in Working Hours Across Countries?

It has been suggested in the literature that taxes and subsidies play an important role in explaining the differences in working hours across countries. In this paper I test whether public programmes for family support p...Read more...

CEP discussion paper

Participation in Organisations: Economic Approaches

Under the auspices of the debate about high performance work systems, it has been suggested that the evidence of positive results is disappointing and that one reason is that there has been a lack of theory. This paper a...Read more...

CEP discussion paper

What if Congress Doubled R&D Spending on the Physical Sciences?

Many business, academic, and scientific groups have recommended that the Congress substantially increase R&D spending in the near future. President Bush’s American Competitiveness Initiative calls for a doubling of spend...Read more...

CEP discussion paper

The Empirics of New Economic Geography

Although a rich and extensive body of theoretical research on new economic geography has emerged, empirical research remains comparatively less well developed. This paper reviews the existing empirical literature on the ...Read more...

CEP discussion paper

Employee Voice and Private Sector Workplace Outcomes in Britain, 1980-2004

Non-union direct voice has replaced union representative voice as the primary avenue for employee voice in the British private sector. This paper provides a framework for examining the relationship between employee voice...Read more...

CEP discussion paper

Hot and Cold Seasons in the Housing Market

Every year during the second and thirdquarters (the “hot season”) housing markets in the UK and the US experience systematic above-trend increases in both prices and transactions. During the fourth and first quarters (th...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Long-Term Effects of Forced Migration

We study the long-term effects of human displacement using individual level panel data on forced migrants and comparable non-migrants. After World War II, Finland ceded a tenth of its territory to the Soviet Union and re...Read more...

CEP discussion paper

The Margins of US Trade

Recent research in international trade emphasizes the importance of firms’ extensive margins for understanding overall patterns of trade as well as how firms respond to specific events such as trade liberalization. In th...Read more...

CEP discussion paper

Economic Geography: A Review of the Theoretical and Empirical Literature

This paper reviews the new economic geography literature, which accounts for the uneven distribution of economic activity across space in terms of a combination of love of variety preferences, increasing returns to scale...Read more...

CEE/Education and skills discussion paper

Education and Mobility

We show that the length of compulsory education has a causal impact on regional labour mobility. The analysis is based on a quasi-exogenous staged Norwegian school reform, and register data on the whole population. Based...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Family Types and the Persistence of Regional Disparities in Europe

This paper examines the association between one of the most basic institutional forms, the family, and a series of demographic, educational, social, and economic indicators across regions in Europe. Using Emmanuel Todd’s...Read more...

CEP occasional paper

The impact of policy change on job retention and advancement

This paper examines the impact of the Working Families Tax Credit (WFTC) on employment retention and advancement. The WFTC, which replaced Family Credit in October 1999, supplemented earnings of low paid workers living i...Read more...

CEP occasional paper

Changes in earnings inequality and mobility in Great Britain 1978/9-2005/6

This paper examines changes in earnings inequality and mobility between 1978/9 and 2005/6 using a unique dataset that includes both those with secure patterns of employment and a wider group who experience periods withou...Read more...

SERC/Urban and Spatial Programme Discussion Paper

Labour Pooling as a Source of Agglomeration: An Empirical Investigation

We provide empirical evidence on the role of labour market pooling in determining the spatial concentration of UK manufacturing establishments. This role arises because large concentrations of employment iron out idiosyn...Read more...

CEP discussion paper

Does Planning Regulation Protect Independent Retailers?

Entry regulations against big-box retailers have been introduced in many countries to protect smaller independent stores. Using a new dataset from the UK, I show that in fact these entry regulations have been associated ...Read more...

CEP discussion paper

Product Market Deregulation and the U.S. Employment Miracle

We consider the dynamic relationship between product market entry regulation and equilibrium unemployment. The main theoretical contribution is combining a job matching model with monopolistic competition in the goods ma...Read more...

CEP discussion paper

Resurrecting the Participation Margin

This paper considers a real business cycle model with search frictions in the labor market and labor supply which is elastic along the participation margin. Previous authors have found that such models generate counterfa...Read more...

CEP discussion paper

Labor Market Reforms, Job Instability, and the Flexibility of the Employment Relationship

We endogenize separation in a search model of the labor market and allow for bargaining over the continuation of employment relationships following productivity shocks to take place under asymmetric information. In such ...Read more...

CEP discussion paper

Labor Market Institutions Around the World

This paper documents the large cross-country differences in labor institutions that make them a candidate explanatory factor for the divergent economic performance of countries and reviews what economists have learned ab...Read more...

CEP discussion paper

Can Pay Regulation Kill? Panel Data Evidence on the Effect of Labor Markets on Hospital Performance

Labor market regulation can have harmful unintended consequences. In many markets, especially for public sector workers, pay is regulated to be the same for individuals across heterogeneous geographical labor markets. We...Read more...

CEP discussion paper

Lags and Leads in Life Satisfaction: A Test of the Baseline Hypothesis

We look for evidence of habituation in twenty waves of German panel data: do individuals, after life and labour market events, tend to return to some baseline level of well-being? Although the strongest life satisfaction...Read more...

CEP discussion paper

U.S. Labor Market Dynamics Revisited

The picture of U.S. labor market dynamics is opaque. Empirical studies have yielded contradictory findings and debates have emerged regarding their implications. This paper aims at clarifying the picture, which is import...Read more...

CEP discussion paper

Conflict-Induced Displacement and Labour Market Outcomes: Evidence from Post-War Bosnia and Herzegovina

This study uses a longitudinal data source to study the effects of conflict-induced displacement on labour market outcomes for Bosnians in post-war Bosnia and Herzegovina. To account for endogeneity in the displacement s...Read more...

CEP discussion paper

Testing the 'Waterbed' Effect in Mobile Telephony

This paper examines the impact of regulatory intervention to cut termination rates of calls from fixed lines to mobile phones. Under quite general conditions of competition, theory suggests that lower termination charges...Read more...

CEP discussion paper

The Shimer Puzzle and the Correct Identification of Productivity Shocks

Shimer (2005a) claims that the Mortensen-Pissarides search model of unemployment lacks an ampiflication mechanism because it cannot generate the observed business cycle fluctuations in unemployment given labor productivi...Read more...

CEP discussion paper

Productivity, Aggregate Demand and Unemployment Fluctuations

This paper presents new empirical evidence on the cyclical behavior of US unemployment that poses a challenge to standard search and matching models. The correlation between cyclical unemployment and the cyclical compone...Read more...

CEP discussion paper

The Division of Labor, Coordination, and the Demand for Information Processing

Since Adam Smith’s time, the division of labor in production has increased significantly, while information processing has become an important part of work. This paper examines whether the need to coordinate an increasin...Read more...

CEP discussion paper

Privatization, Entry Regulation and the Decline of Labor's Share of GDP: A Cross-Country Analysis of the Network Industries

Labor’s share of GDP in most OECD countries has declined over the last two decades. Some authors have suggested that these changes are linked to deregulation of product and labor markets. To examine this we focus on a la...Read more...

CEE/Education and skills discussion paper

The Value of Basic Skills in the British Labour Market

In this paper we evaluate the labour market value of basic skills in the UK, focusing on the wage and employment returns to having better literacy and numeracy skills. We draw on literacy and numeracy assessments underta...Read more...

Journal article

Review of Economics and Statistics:

Lousy and lovely jobs: the rising polarization of work in Britain

This paper shows that the United Kingdom since 1975 has exhibited a pattern of job polarization with rises in employment shares in the highest- and lowest-wage occupations. This is not entirely consistent with the idea o...Read more...

CEE/Education and skills discussion paper

The Long Term Impacts of Compulsory Schooling: Evidence from a Natural Experiment in School Leaving Dates

This paper investigates a unique feature of the English educational system to estimate the causal effect of compulsory schooling on labour market outcomes. We examine school leaving rules that allow for discrete variatio...Read more...

CEP discussion paper

The Impact of Central Bank Announcements on Asset Prices in Real Time: Testing the Efficiency of the Euribor Futures Market

This paper examines the effect of European Central Bank communication on the price discovery process in the Euribor futures market using a new tick-by-tick dataset. First, we show that two pieces of news systematically h...Read more...

CEP discussion paper

Unemployment and Hours of Work: The North Atlantic Divide Revisited

I examine the dynamic evolutions of unemployment, hours of work and the service share since the war in the United States and Europe. The theoretical model brings together all three and emphasizes technological growth. Co...Read more...

CEP discussion paper

Gross Worker Flows in the Presence of Informal Labor Markets. The Mexican Experience 1987-2002

This paper applies recent advances in the study of labor market dynamics to a representative developing country with a large unregulated of “informal” sector, Mexico. It finds, first, that the formal salaried sector show...Read more...

CEP discussion paper

Strategic Patenting and Software Innovation

Strategic patenting is widely believed to raise the costs of innovating, especially in industries characterised by cumulative innovation. This paper studies the effects of strategic patenting on R&D, patenting and market...Read more...

CEP discussion paper

Multi-Product Firms and Product Switching

This paper examines the frequency, pervasiveness and determinants of product switching among U.S. manufacturing firms. We find that two-thirds of firms alter their mix of five-digit SIC products every five years, that on...Read more...

CEE/Education and skills discussion paper

Which Skills Matter?

Read more...

CEP discussion paper

The Unequal Effects of Liberalization: Evidence from Dismantling the License Raj in India

This paper investigates whether the effects, on registered manufacturing out- put, employment, entry and investment, of dismantling the .license raja system of central controls regulating entry and production activity in...Read more...

CEP discussion paper

Knowledge Flow and Sequential Innovation: Implications for Technology Diffusion, R&D and Market Value

It is shown that spillovers can enhance private returns to innovation if they feed back into the dynamic research of the original inventor (Internalized spillovers), but will always reduce private returns, if the origina...Read more...

CEP discussion paper

What Do Unions Do to Executive Compensation?

We estimate the relation between union presence and executive compensation using a unique panel of executives in publicly listed US firms during the period 1992-2001. We find evidence that union presence is associated wi...Read more...

CEE/Education and skills discussion paper

From the Cradle to the Labor Market? The Effect of Birth Weight on Adult Outcomes

Lower birth weight babies have worse outcomes, both short-run in terms of one year mortality rates and longer run in terms of educational attainment and earnings. However, recent research has called into question whether...Read more...

CEP discussion paper

The Impact of Uncertainty Shocks: Firm Level Estimation and a 9/11 Simulation

Uncertainty appears to vary strongly over time, temporarily rising by up to 200% around major shocks like the Cuban Missile crisis, the assassination of JFK and 9/11. This paper offers the first structural framework to a...Read more...

CEP discussion paper

Superstars and Renaissance Men: Specialization, Market Size and the Income Distribution

A general equilibrium model of individual specialization is presented in which agents trade off the productivity and price implications of producing a narrower range of goods. Agents with highly specific skills turn out ...Read more...

Book

Unemployment: Macroeconomic Performance and the Labour Market

This book aims to provide a basis for better unemployment policy: showing how the lessons learned from experience and theory can be applied to greatly reduce the waste and misery of high unemployment. The book surveys th...Read more...

CEP discussion paper

Factor Price Equality and the Economies of the United States

We develop a methodology for identifying departures from relative factor price equality across regions that is valid under general assumptions about production, markets and factors. Application of this methodology to the...Read more...

CEP discussion paper

Labor and the Market Value of the Firm

What role does labor play in a firm’s market value? We explore this question using a production-based asset pricing model with frictions in the adjustment of both capital and labor. We posit that hiring of labor is akin ...Read more...

CEP discussion paper

The Costs of Remoteness: Evidence from German Division and Reunification

This paper exploits the division of Germany after the Second World War and the reunification of East and West Germany in 1990 as a natural experiment to provide evidence of the importance of market access for economic de...Read more...

CEP discussion paper

How Does Product Market Competition Shape Incentive Contracts?

This paper studies the effect of product market competition on the explicit compensation packages that firms offer to their CEOs, executives and workers. We use a large sample of both traded and non-traded UK firms and e...Read more...

CEP discussion paper

Product Market Competition Returns to Skill and Wage Inequality

This paper shows that increasing product market competition can have a direct impact on the employment relationship and on wage inequality. I develop a simple model in which an increase in product market competition incr...Read more...

CEP discussion paper

Evaluating the Performance of the Search and Matching Model

Does the search and matching model fit aggregate U.S. labor market data? While the model has become an important tool of macroeconomic analysis, recent literature pointed to some failures in accounting for the data. This...Read more...

CEP discussion paper

Identifying Technology Spillovers and Product Market Rivalry

The impact of R&D on growth through spillovers has been a major topic of economic research over the last thirty years. A central problem in the literature is that firm performance is affected by two countervailing “spill...Read more...

CEP discussion paper

Is Poland the Next Spain?

We revisit Western Europe’s record with labor-productivity convergence, and tentatively extrapolate its implications for the future path of Eastern Europe. The poorer Western European countries caught up with the richer ...Read more...

CEP discussion paper

Sinking the Blues: the Impact of Shop Closing Hours on Labor and Product Markets

There is a growing consensus among economists that extending shop opening hours creates jobs. While this is probably true in deregulating industries, this paper argues there are some deficiencies in the existing hypothes...Read more...

Journal article

Journal of Human Resources:

Crime and economic incentives

We explore the role that economic incentives, particularly changes in wages at the bottom end of the wage distribution, play in determining crime rates. We use data on the police force areas of England and Wales between ...Read more...

CEP discussion paper

Labor Market Institutions, Wages and Investment

Labor market institutions, via their effect on the wage structure, affect the investment decisions of firms in labor markets with frictions. This observation helps explain rising wage inequality in the US, but a relative...Read more...

CEP discussion paper

Are European Labor Markets As Awful As All That?

“The standard explanation of why advanced Europe has generated less work per adult than the US is that something is seriously amiss with EU labor markets. The theme of this piece is simple. Compared to an ideal competiti...Read more...

Journal article

Journal of the European Economic Association:

Evaluating the employment impact of a mandatory job search program

This paper exploits area-based piloting and age-related eligibility rules to identify treatment effects of a labor market program-the New Deal for Young People in the U.K. A central focus is on substitution/displacement ...Read more...

CEP discussion paper

We Can Work It Out: the Impact of Technological Change on the Demand for Low Skill Workers

There is little doubt that technology has had the most profound effect on altering the tasks that we humans do in our jobs. Economists have long speculated on how technical change affects both the absolute demand for lab...Read more...

CEP discussion paper

Short Job Tenures and Firing Taxes in the Search Theory of Unemployment

This paper studies the effects of firing taxes on the job destruction rate, when probation period - or temporary contract - policies are implemented in an otherwise exogenous job separation search model. It is shown that...Read more...

CEP discussion paper

The 'Network Economy' and Models of the Employment Contract: Psychological, Economic and Legal

The emergence of the so-called ¿network economy¿ and the development of project-based work pose a fundamental challenge to established methods of regulating the employment relationship. There appears to be an unsatisfied...Read more...

CEP discussion paper

Is the Medical Brain Drain Beneficial? Evidence from Overseas Doctors in the UK

The ¿beneficial brain drain¿ hypothesis suggests that skilled migration can be good for a sending country because the incentives it creates for training increase that country¿s supply of skilled labour. To work, this hyp...Read more...

CEP discussion paper

Executive Compensation and Product Market Competition

The aim of this paper is to study the effects of product market competition on the explicit compensation packages that firms offer to their executives. In order to measure the net effect of competition we use two differe...Read more...

CEP discussion paper

Endowments, Market Potential, and Industrial Location: Evidence from Interwar Poland (1918-1939)

The paper explores the determinants of industry location across interwar Poland. After more than 120 years of political and economic separation, Poland was reunified at the end of 1918. In consequence, its industry faced...Read more...

CEP discussion paper

Lousy and Lovely Jobs: the Rising Polarization of Work in Britain

This paper argues that skill-biased technical change has some deficiencies as a hypothesis about the impact of technology on the labor market and that a more nuanced view recently proposed by Autor, Levy and Murnane (200...Read more...

CEP discussion paper

Child Labor and the Labor Supply of Other Household Members: Evidence from 1920 America

This paper analyses the effect of child labor on household labor supply using 1920 US Census micro data. The aim of the analysis is to understand who in the household benefits from child labor. In order to identify a sou...Read more...

CEP discussion paper

Aggregate Growth and the Efficiency of Labour Reallocation

We consider the potential importance of labour market efficiency for aggregate growth. The idea is that efficient labour markets move workers more quickly from low to high productivity sites, thereby raising aggregate pr...Read more...

CEP discussion paper

The Impact of the Labour Market on the Timing of Marriage and Births in Spain.

The main purpose of this paper is to show how the labour market affects Spanish individual fertility decisions. Spain is an interesting case due to its huge fertility decline. Our hypothesis is that precarious Spanish la...Read more...

CEP discussion paper

Educational Attainment, Labour Market Institutions, and the Structure of Production

A key feature of OECD economic growth since the early 1970s has been the secular decline in manufacturing's share of GDP and the secular rise of service sectors. This paper examines the role played by relative prices, t...Read more...

CEP discussion paper

Minimum Wages and On-the-Job Training

Becker's theory of human capital predicts that minimum wages should reduce training investments for affected workers because they prevent these workers from taking wage cuts necessary to finance training. In contrast, i...Read more...

CEP discussion paper

Company Start-Up Costs and Employment

I study the role of company start-up costs for employment performance. The model is search equilibrium with a new concept for firms. Agents have an innate managerial ability and make a career choice to become either mana...Read more...

CEP discussion paper

Monopsony and the Efficiency of Labour Market Interventions

Implicit in many discussions of labour market policy is the assumption that, in the absence of interventions, the operation of the labour market is well-approximated by the perfectly competitive model. The merits or deme...Read more...

CEP discussion paper

Labor Pooling, Labor Poaching and Spatial Clustering

When firms cluster in the same local labor market, they face a trade-off between the benefits of labor pooling (i.e., access to workers whose knowledge help reduce costs) and the costs of labor poaching (i.e., loss of so...Read more...

CEP discussion paper

The Beveridge Curve, Unemployment and Wages in the OECD from the 1960s to the 1990s - Preliminary Version

This paper is an empirical analysis of unemployment patterns in the OECD countries from the 1960s to the 1990s, looking at the Beveridge Curves, real wages as well as unemployment directly. Our results indicate the follo...Read more...

CEP discussion paper

The Multi-Dimensional Nature of Labour Demmand and Skill Biased Technical Change

Investigating the robustness of the skill-biased technological change hypothesis, this analysis incorporates two novel features. First, effective labor is modeled as the product of a quantity measure û number of employee...Read more...