Course Meeting Times
Lectures: 2 sessions / week, 1.5 hours / session
Recitations: 1 session / week, 1.5 hours / session
Course Overview
The aim of this course is to acquaint students with traditional topics in labor economics and to encourage the development of independent research interests. We will cover a systematic development of the theory of labor supply, labor demand, and human capital. Topics include wage and employment determination, turnover, search, immigration, unemployment, equalizing differences, and institutions in the labor market. There will be particular emphasis on the interaction between theoretical and empirical modeling. Prerequisites are intermediate microeconomics and a course in econometrics.
Class Requirements
| ACTIVITIES | PERCENTAGES |
|---|---|
| 3 problem sets | 30% |
| Empirical project | 30% |
| Final exam | 40% |
Calendar
| LEC # | TOPICS | KEY DATES |
|---|---|---|
| I. Labor market facts and trends | ||
| 1 | Labor markets | |
| II. Neoclassical labor supply | ||
| 2 | Basics; review of duality | |
| 3-4 | Tax and transfer programs; theoretical and empirical analysis of negative income tax (NIT) programs | |
| 5 | The life-cycle model; theory; the Institute of Statistics and Econometrics; basic panel econometrics | Problem set 1 due |
| 6 | Cab drivers, stadium vendors, and bicycle messengers | |
| 7 | Household family models; theory of time allocation; IV/Wald estimators | |
| 8 | Quantity/quality trade-offs | |
| III. Labor demand, immigration, minimum wages, unions | ||
| 9 | Neoclassical demand theory; review of Hicks-Marshall formulas | |
| 10 | Empirical studies of immigration effects | |
| 11 | Minimum wages; review of monopsony | |
| 12 | Differences-in-differences methods; the M&M controversy | Problem set 2 due |
| 13-14 | Union relative wage effects; bargaining and efficient contracts | |
| IV. Human capital | ||
| 15 | Schooling experience and earnings; basic theory; ability bias | |
| 16-17 | Signaling; returns to schooling econometrics | |
| 18 | Returns to experience and on-the-job training (OJT) | |
| 19 | Education production: school inputs, school quality, student and teacher incentives | |
| 20 | Competition and regulation | |
| 21 | Human capital policy; higher education | |
| 22-23 | Evaluation of government training programs | |
| 24 | Externalities and peer effects | Problem set 3 due |
| V. Discrimination | ||
| 25 | Theory; wage gaps | |
| 26 | Anti-discrimination policy | |
| Final exam | ||