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This document is an introduction to a special issue of the Journal of Labor Economics that honors the research contributions of David Card, a prominent labor economist. The document highlights Card's significant contributions to various topics, including minimum wages, immigration, education, training programs, unions, and wage inequality. It also acknowledges Card's role in graduate education and his dedication to mentoring PhD students. The special issue includes papers that showcase the diversity of Card's interests and the broad scope of his advising. The papers cover topics such as industry wage differentials, gentrification, teacher salaries, online education, student debt relief, caregiving and labor supply, cesarean sections, minimum wages, and the labor market integration of refugees. The document concludes by acknowledging the support and contributions of various institutions and individuals in making this tribute possible. [Extracted from the article]

Rebecca Diamond, a professor of economics at Stanford Graduate School of Business, has been awarded the Sherwin Rosen Prize by the Society of Labor Economists for her outstanding contributions to the field. Diamond has made significant contributions to labor economics, particularly in the areas of urban issues, housing, spatial sorting, and inequality. Her research on the economic implications of divergent location choices by workers of different skill levels has shown that geographic sorting has led to welfare changes that go beyond the growth in the college wage premium alone. Diamond has also studied the impact of rent control on housing supply and affordability, as well as the effects of high-skilled immigration, gender wage gaps, and nutritional inequality. The Society of Labor Economists is pleased to recognize Diamond's achievements with this prestigious award. [Extracted from the article]

Robert A. Moffitt, a professor at Johns Hopkins University, has been awarded the 2024 Edward P. Lazear Prize for his outstanding research, service to the field, and contributions to civil society. Moffitt has made significant contributions to the study of poverty, income inequality, social insurance, program evaluation, and health care. He has also served as the editor of several major journals and has been involved in numerous advisory committees and panels for the US government's statistical and scientific agencies. Moffitt's research and service demonstrate his dedication to advancing knowledge in the field of labor economics. [Extracted from the article]

Janet Currie, the Henry Putnam Professor of Economics and Public Affairs at Princeton University, has been awarded the 2024 Jacob Mincer Award for her lifetime contributions to the field of labor economics. She has received numerous other recognitions, including the Klaus J. Jacobs Research Award and honorary doctorates from the University of Zurich and l'Université Jean Moulin Lyon III. Currie's research focuses on the impact of education, family background, social transfer programs, access to healthcare, and environmental factors on the health and well-being of children and their outcomes as adults. She has made significant contributions to the economics of education, health economics, public economics, and environmental economics. Currie's work on early childhood education, social insurance, family characteristics, and environmental factors has had a major influence on the field. She is also known for her mentorship of junior scholars and her efforts to increase the presence of women in the economics profession. [Extracted from the article]

The utility of machine learning (ML) for regression-based causal inference is illustrated by using lasso to select control variables for estimates of college characteristics' wage effects. Post-double-selection lasso offers a path to data-driven sensitivity analysis. ML also seems useful for an instrumental variables (IV) first stage, since two-stage least squares (2SLS) bias reflects overfitting. While ML-based instrument selection can improve on 2SLS, split-sample IV and limited information maximum likelihood do better. Finally, we use ML to choose IV controls. Here, ML creates artificial exclusion restrictions, generating spurious findings. On balance, ML seems ill-suited to IV applications in labor economics. [ABSTRACT FROM AUTHOR]

John would also surely want to be remembered as a prolific writer of economic songs, including a musical tribute to Alan Manning's book I Monopsony in Motion i (Manning [33]).[2] Getting back to conventions, John is likely best known for his research on the sources of growing inequality in the United States. His early work on implicit contracts with Paul Beaudry (Beaudry and DiNardo [3], [4]) illustrates how workers' wages are often insulated from market shocks, a theme John later pursued in his work on unions. We are pleased to introduce this volume of papers, all of which were presented at a conference in honor of John DiNardo held in Ann Arbor, Michigan, in September 2018.[1] After battling leukemia for close to a decade, John left us on August 26, 2017, at the age of 56. Outside of labor economics, John also wrote some notable papers in political science (Brunell and DiNardo [5]; Walsh, Dolfin, and DiNardo [35]). [Extracted from the article]

The article presents a series of papers from a conference at Employment and Social Development Canada, that compares US and Canadian labor markets and social policy issues. Topics discussed include the paper covering the five broad themes of social programs, immigration, unemployement, local labor markets and human capital.

A displaced worker might rationally prefer to wait through a long spell of unemployment instead of seeking employment at a lower wage in a job he is not trained for. I evaluate this trade-off using micro data on displaced workers. To achieve identification, I exploit the fact that the more a worker has invested in occupation-specific human capital, the more costly it is for him to switch occupations and therefore the higher is his incentive to wait. I find that between 9% and 17% of total unemployment in the United States can be attributed to wait unemployment. [ABSTRACT FROM AUTHOR]

An introduction is presented in which the author discusses various reports within the issue on topics related to labor economics including the variation in relative upward mobility across commuting zones, labor market prospects for youth, and differences in the type of offense and arrest history.

Awarding Susan Houseman the 2023 SOLE Prize for Contributions to Data and Measurement is a fitting recognition of her many contributions to improving the nation's economic statistics. Susan is a labor economist whose research focuses on temporary and contract employment arrangements, domestic outsourcing, offshoring, manufacturing, and measurement issues in economic statistics. Susan Houseman is the 2023 recipient of the SOLE Prize for Contributions to Data and Measurement. [Extracted from the article]

Joseph Altonji is one of the pioneers of modern labor economics. Much of Joe's work focuses on the functioning of the labor market, with papers covering many areas, including the importance of downward nominal wage rigidity, vacation pay, and earnings dynamics. Some of Joe's most influential work on labor markets deals with the economics of discrimination. [Extracted from the article]

We study the relationship among productivity, management practices, and employee ability using German data combining management practices surveys with employees’ longitudinal earnings records. Including human capital reduces the association between productivity and management practices by 30%-50%. Only a small fraction is accounted for by the higher human capital of the average employee at better-managed firms. A larger share is attributable to the human capital of the highest-paid workers, that is, the managers. A similar share is mediated through the pay premiums offered by better-managed firms. We find that better-managed firms recruit and retain workers with higher average human capital. [ABSTRACT FROM AUTHOR]

Surveying employment-related newspaper advertisements over several centuries, we identify four eras (neither workers nor firms posted ads, mostly workers posted ads, mostly firms posted ads, and both parties regularly posted ads). These eras can be understood in the context of the equilibrium of a matching model that incorporates strategic interactions by both sides of the labor market. Potential explanations for transitions across eras include increasing literacy rates, expansion of social insurance programs, growth in the labor force and firm size, reduction in mobility costs and search frictions, and the internet. [ABSTRACT FROM AUTHOR]

The article discusses the core principles of labor economics at the University of Chicago. Topics discussed include the contributions of labor economists working in the Chicago tradition, the Chicago approach emphasizing the value of price theory in interpreting data and influence of economist Milton Friedman on economics at Chicago.

Using Norwegian population panel data with nearly career-longearnings histories, we provide a detailed picture of the causal relationship between schooling and earnings over the life cycle. To address selection bias, we apply three commonly used identification strategies. We find that additional schooling gives higher lifetime earnings and a steeper age-earnings profile, in line with predictions from human capital theory. Our preferred estimates imply an internal rate of return of around 11%, suggesting that it was highly profitable to acquire additional schooling. Our analysis reveals that Mincer regressions dramatically understate the returns to schooling because key assumptions are violated. [ABSTRACT FROM AUTHOR]

I use Swedish registry data to estimate lifetime earnings returns to college and how they vary with observed and unobserved characteristics. The richness of the data also allows me to examine heterogeneity with respect to cognitive and noncognitive ability and parental earnings. Local instrumental variable analysis is used to recover marginal and average treatment effects under selection on gains. The findings support the notion of self-selection, but mainly on observed characteristics. Returns vary little with parental earnings but substantially with respect to both cognitive and noncognitive ability, thus suggesting important complementarities between formal schooling and informal skills. [ABSTRACT FROM AUTHOR]

We model investment in entrepreneurial human capital (EHC)--the representative enterprise's share of production capacity allocated to investment in innovative industrial and commercial knowledge--as a distinct channel through which firmspecific human capital drives endogenous growth. Ourmodel suggests that institutional factors supporting free markets for goods and ideas and higher-educational attainments of entrepreneurs and workers enhance endogenous economic growth by augmenting the efficiency of investment in EHC rather than exclusively by themselves. We test these implications, using data from Global Entrepreneurship Monitor's Adult Population Survey of 63 countries over 2002-10, and find robust support for these hypotheses. [ABSTRACT FROM AUTHOR]

The high pace of reallocation across producers is pervasive in the US economy. Evidence shows that this high pace of reallocation is closely linked to productivity. While these patterns hold on average, the extent to which the reallocation dynamics in recessions are "cleansing" is an open question. We find that downturns prior to the Great Recession are periods of accelerated reallocation even more productivity enhancing than reallocation in normal times. In the Great Recession, we find that the intensity of reallocation fell rather than rose and that the reallocation that did occur was less productivity enhancing than in prior recessions. [ABSTRACT FROM AUTHOR]

We examine the impact of relative wages on labor supply in a laboratory experiment. We test the hypothesis that, ceteris paribus, making a given wage high (low) relative to other wage levels will lead to an increase (decrease) in labor supply. We find that labor supply does respond significantly to relative pay, and in the expected direction. However, when a strong enough reason for the relative low pay is given, this difference disappears. [ABSTRACT FROM AUTHOR]

Deming's most profound impact may come from his work on the labor market returns to skills. David Deming is the 2022 recipient of the Sherwin Rosen Prize for outstanding contributions to labor economics. Deming is the Isabelle and Scott Black Professor of Political Economy at the Harvard Kennedy School. [Extracted from the article]

Digital technologies tend to replace routine tasks performed by occupations in the middle of the wage distribution, where wages and employment fell noticeably from the 1990s, compared with both the top and the bottom of the earnings distribution. Lawrence F. Katz is the 2022 recipient of the Jacob Mincer Award for lifetime contributions to the field of labor economics. Katz's most influential research studies the evolution of wage inequality in advanced countries. [Extracted from the article]

John M. Abowd is the recipient of the 2022 Edward P. Lazear Prize for excellence in research, exemplary service to the field, and contributions to civil society. In addition, John has produced a large set of PhD students who are carrying his work forward in labor economics research and public goods provision of useful data. John received an AB in economics from Notre Dame and a PhD in economics from the University of Chicago. [Extracted from the article]

The international diversification puzzle is the fact that country portfolios are on average biased toward domestic assets, while one-good international macro models with nondiversifiable labor income risk predict the opposite pattern of diversification. This paper embeds a portfolio choice decision in a two-good international business cycle model and provides a closed-form solution for equilibrium country portfolios. Equilibrium portfolios are biased toward domestic assets because endogenous international relative price fluctuations make domestic assets a good hedge against labor income risk. Evidence from developed economies in recent years is qualitatively and quantitatively consistent with the mechanisms highlighted by the theory. [ABSTRACT FROM AUTHOR]

The expansion of available data for research has transformed empirical labor economics over the past generation. This paper briefly highlights some of the changes and describes a few examples of papers that illustrate the advances. It also documents the changing ways data have been used in the Journal of Labor Economics over the past 30 years, including a trend toward a higher fraction of papers using any data and, among those papers using any data, a higher fraction using nonpublic data, a higher fraction using international data, and more frequent use of multiple data sources. Finally, this paper describes work that carne out of the recent Princeton Data Improvement Initiative--a program that considers and furthers improved data collection. [ABSTRACT FROM AUTHOR]

Using original, representative survey data, we document that analytical, routine, and manual job tasks can be measured with high validity, vary substantially within and between occupations, are significantly related to workers' characteristics, and are robustly predictive of wage differences between occupations and among workers in the same occupation. We offer a conceptual framework that makes explicit the causal links between human capital endowments, occupational assignment, job tasks, and wages, which motivate a Roy model of the allocation of workers to occupations. We offer two simple tests of the model's gross predictions for the relationship between tasks and wages, both of which receive qualified empirical support. [ABSTRACT FROM AUTHOR]

Liberalized markets promoted by the Washington Consensus under globalization have resulted in a global class structure in which new groups have emerged, including a precariat consisting of millions of people subject to flexible, insecure labor relations. The precariat is a class-in-the-making, in that the global market system wants most workers to be flexible and insecure, even if it is not yet a class-for-itself, having a clear vision of what type of society it wishes to see emerge. It is not an underclass. This article traces the factors explaining its growth and considers which demographic groups have the highest probability of being in it. The essay then considers two possible political scenarios-a politics of inferno, if current negative trends are allowed to continue, and a politics of paradise, a set of policies that would be essential to arrest those negative trends. [ABSTRACT FROM AUTHOR]

This article explores the consequences of sabotage for the design of incentive contracts. The possibility of sabotage gives rise to a dynamic concern, similar to the Ratchet effect, which distorts the agents' incentives. We first show that the mere possibility of sabotage may make it impossible to implement the first-best effort, and we then offer two distinct incentive schemes, fast track and late selection, to circumvent this problem. The present model offers a mechanism through which these two schemes arise in a unified framework. [ABSTRACT FROM AUTHOR]

The employment to population rate of high school-aged youth has fallen by about 20 percentage points since the late 1980s. One potential explanation is increased competition from substitutable labor, such as immigrants. I demonstrate that the increase in the population of less educated immigrants has had a considerably more negative effect on employment outcomes for native youth than for native adults. At least two factors are at work: there is greater overlap between the jobs that youth and less educated adult immigrants traditionally do, and youth labor supply appears more responsive to immigration-induced wage changes. [ABSTRACT FROM AUTHOR]

Promotions play an important role for the provision of incentives in firms. We analyze incentives in multistage elimination tournaments with controlled laboratory experiments. In our two main treatments, we compare a two-stage tournament to a one-stage tournament. Subjects in the two-stage treatment provide excess effort in the first stage, both with respect to Nash predictions and compared to the strategically equivalent one-stage tournament. Additional control treatments confirm that excess effort in early stages is a robust finding and suggest that above-equilibrium effort might be driven by limited degrees of forward-looking behavior and subjects deriving nonmonetary value from competing. [ABSTRACT FROM AUTHOR]

This article proposes a new approach to modeling heterogeneous human capital using task data from the Dictionary of Occupational Titles. The key feature of the model is that it departs from the Roy model, which treats occupations as distinct categories and conceives of occupations as bundles of tasks. The advantages of this approach are that it can accommodate many occupations without computational burden and provide a clear interpretation as to how and why skills are differently rewarded across occupations. The model is structurally estimated by the Kalman filter using the National Longitudinal Survey of Youth 1979. [ABSTRACT FROM AUTHOR]

A positive relation between parents' schooling and child's schooling does not necessarily reflect a causal relation. This article uses a new approach to identify intergenerational schooling effects: a nonparametric bounds analysis. By relying on relatively weak and in part testable assumptions, this article obtains informative bounds on the average causal impact of parents' schooling. The tightest bounds, using monotone instrumental variables, show that increasing mother's or father's schooling to a college degree has a positive effect on child's schooling that is significantly different from zero but substantially lower than the ordinary least squares estimates. [ABSTRACT FROM AUTHOR]

We specify and implement a test for the presence and importance of labor market networks based on residential proximity, in determining the establishments at which people work. Using matched employer-employee data at the establishment level, we measure the importance of these network effects for groups broken out by race, ethnicity, and measures of skill. The evidence indicates that these types of labor market networks do exist and play an important role in determining the establishments where workers work; that they are more important for minorities and the less skilled, especially among Hispanics; and that they appear to be race based. [ABSTRACT FROM AUTHOR]

The Appalachian region has experienced persistently higher poverty and lower earnings than the rest of the United States. We examine whether skill differentials or differences in the returns to those skills lie at the root of the Appalachian wage gap. Using census data, we decompose the Appalachian wage gap using both mean and full distribution methods. Our findings suggest that significant upgrading of skills within the region has prevented the gap from widening over the last 20 years. Additionally we find that urban areas within Appalachia have not experienced the rise in returns to skills as in non-Appalachian urban areas. [ABSTRACT FROM AUTHOR]

This article establishes the cyclical properties of a novel measure of worker reallocation: long-distance migration rates within the United States. Combining evidence from a number of data sets spanning the entire postwar era, we find that internal migration within the United States is procyclical. This result cannot be explained by cyclical variation in relative local economic conditions, suggesting that the net benefit of moving rises during booms. Migration is most procyclical for younger labor-force participants. Therefore, cyclical fluctuations in the net benefit of moving appear to be related to conditions in the labor market and the spatial reallocation of labor. [ABSTRACT FROM AUTHOR]

In this article, I present structural estimates of a search model that flexibly incorporates general human capital accumulation along with career and firm choice, where a career is empirically identified as a combination of industry and occupation. I use these estimates to empirically distinguish between the relative importance of various factors for generating wage growth over the life cycle. Evidence presented in the article highlights the importance of considering the two-stage search process that originates from the model. In particular, I demonstrate that previous instrumental variables methods dramatically underestimate the importance of firm-specific matches for wage growth. [ABSTRACT FROM AUTHOR]

This paper studies whether labor scarcity encourages technological advances, that is, technology adoption or innovation, for example, as claimed by Habakkuk in the context of nineteenth-century United States. I define technology as strongly labor saving if technological advances reduce the marginal product of labor and as strongly labor complementary if they increase it. I show that labor scarcity encourages technological advances if technology is strongly labor saving and will discourage them if technology is strongly labor complementary. I also show that technology can be strongly labor saving in plausible environments but not in many canonical macroeconomic models. [ABSTRACT FROM AUTHOR]

What explains the variance in how authoritarian regimes treat labor? We advance a theory of why and how some dictatorships coopt workers using nominally democratic institutions, such as legislatures and political parties. When dictatorships need cooperation from society and face a potentially strong opposition, they attempt to coopt workers to reinforce their bases of support. As instruments of cooptation, legislatures and parties are useful in facilitating a political exchange between regimes and labor: dictatorships provide material benefits to workers in exchange for labor's quiescence. As a result, institutionalized dictatorships provide more benefits to workers and experience lower levels of labor protest than their noninstitutionalized counterparts. We find empirical support for these hypotheses from a sample of all dictatorships from the 1946-96 period. [ABSTRACT FROM AUTHOR]

We quantify agglomeration spillovers by comparing changes in total factor productivity (TFP) among incumbent plants in "winning" counties that attracted a large manufacturing plant and "losing" counties that were the new plant's runner-up choice. Winning and losing counties have similar trends in TFP prior to the new plant opening. Five years after the opening, incumbent plants' TFP is 12 percent higher in winning counties. This productivity spillover is larger for plants sharing similar labor and technology pools with the new plant. Consistent with spatial equilibrium models, labor costs increase in winning [ABSTRACT FROM AUTHOR]

This paper provides a human capital theory-based explanation for the presence of a permanent component in earnings levels as well as individual heterogeneity in earnings slopes. We incorporate uncertainty about the future rental rates of human capital into a life-cycle human capital investment model and obtain an earnings equation implied by the solution to the worker's optimal investment decision. While heterogeneous growth stems from individual heterogeneity in the ability of human capital production, permanent errors are induced by the response of optimal investments to transitory rental rate shocks. We empirically show that both components are present. [ABSTRACT FROM AUTHOR]

Spousal education is correlated with earnings for two reasons: cross-productivity between couples and assortative mating. This article empirically disentangles the two effects by using Chinese twins data. We have two innovations: using twins data to control for the unobserved mating effect in our estimations and estimating both current and wedding-time earnings equations. We find that both cross-productivity and mating are important in explaining the current earnings. Although the mating effect exists for both husbands and wives, the cross-productivity effect mainly runs from Chinese husbands to wives. Our findings shed light on the theories of human capital, marriage, and the family. [ABSTRACT FROM AUTHOR]

We estimate short-run, medium-run, and long-run individual labor market effects of training programs for the unemployed by following program participation on a monthly basis over a 10-year period. Since analyzing the effectiveness of training over such a long period is impossible with experimental data, we use an administrative database compiled for evaluating German training programs. Based on matching estimation adapted to address the various issues that arise in this particular context, we find a clear positive relation between the effectiveness of the programs and the unemployment rate over time. [ABSTRACT FROM AUTHOR]

The theory of human capital is agnostic on what constitutes firms-specific skills. The theory specifies that specific skills contribute to productivity only at the current firm. A broader approach lets all skills be general, but firms use them with different weights attached. For example, computer programming, economics, and accounting are general skills, but there may be only one firm that wants workers trained in all three. One implication is that wage profiles and the split of human capital costs depend on thickness of the market. Another is that firms pay for what appears to be general training. [ABSTRACT FROM AUTHOR]

This paper presents an equilibrium labor search model in which workers can simultaneously apply to multiple firms to increase their search intensity. They observe firms' wage postings before choosing where to apply. Owing to coordination frictions, a firm may not receive any applications; otherwise it is able to hire unless all its applicants have better offers. It is shown that the equilibrium converges to the efficient Walrasian outcome as application costs vanish. Even for nonnegligible application costs, the entry of firms, the search intensity, and the number of ?lled vacancies are constrained efficient. Wage dispersion is essential for constrained efficiency. [ABSTRACT FROM AUTHOR]

This paper investigates the impact on labor supply of changes in the Social Security earnings test in 1996 and 2000. We highlight how inertia in labor supply choices influences responses to policy changes. We do this in two ways. First, we show that taking account of last year's employment status is important in estimating responses to current earnings test changes, a step that has not always been taken in the literature. Second, we test the effect of not only actual but also anticipated earnings test parameters that cohorts faced at earlier ages. This approach demonstrates that past and anticipated future rules influence current employment and earnings. Thus we identify an impact of earnings test changes on employment at ages that are younger than those directly affected and in years that follow the direct change. Finally, we show that earnings test changes that were initiated in 1996 had an effect, in addition to the changes in 2000 that have been recently studied by others. Overall, we predict that the elimination of the earnings test in 2000 raised employment among Health and Retirement Study respondents by around 2 percentage points at ages 66-69 and 3.5 points at age 65, with gains persisting as exposed cohorts aged and also arising at younger ages due to the shock to anticipated earnings test rules. [ABSTRACT FROM PUBLISHER]

Economists generally assume, implicitly, that "the return to schooling" is invariant across local labor markets. We demonstrate that this outcome pertains if and only if preferences are homothetic--a special case that seems unlikely. Our theory predicts that returns to education will instead be relatively low in expensive high-amenity locations. Our analysis of U.S. data provides support for this contention; returns to college are especially low in such cities as San Francisco and Seattle. Our findings call into question standard empirical exercises in labor economics that treat the returns to education as a single parameter. [ABSTRACT FROM AUTHOR]