Showing 1 - 4 of 4 Items

Date: 2022-01-01

Creator: Levi McAtee

Access: Open access

Do minimum wage increases serve as stepping-stones to higher-paying jobs for low-pay workers? This paper analyzes the impact of state minimum wage policy on the one-year wage growth rates of individuals across the wage distribution and whether that impact changes for individuals in highly monopsonistic industries. I review the recent literature on the disemployment effect, the impact of the minimum wage on wage growth rates, the nature of monopsonistic industries, and the relationship between the minimum wage and monopsony power. I offer theoretical reasons why the minimum wage may impact the wage growth rates of individuals in monopsonistic industries differently than it impacts those of individuals in competitive industries. I then re-estimate Lopresti’s and Mumford’s (2016) panel fixed effects model to determine how the effect of a minimum wage increase depends nonlinearly on the size of the increase. Using data from 2005-2008, Lopresti and Mumford found that small minimum wage increases have a significant negative impact on wage growth rates, while large minimum wage increases have a significant positive impact. Using data from 2016-2019, I find similar results. As my primary empirical contribution, I test whether individuals in highly monopsonistic industries experience minimum wage changes differently than individuals in more competitive industries. I find monopsony power in the form of high labor immobility primarily impacts the wage growth rates of high-pay workers and does not influence how low-pay workers experience minimum wage changes. Finally, I recommend policymakers impose larger minimum wage increases to avoid impeding the wage-growth of low-pay workers.

Date: 2022-01-01

Creator: Maynor Alberto Loaisiga Bojorge

Access: Open access

For most of their histories, Costa Rica and Honduras were primarily agricultural societies with little economic diversification. However, around 1990, after the implementation of Washington Consensus reforms, the economies of both nations began to diverge. Costa Rica’s economy rapidly expanded for the following 30 years, while Honduras remained stagnant. Through a New Institutional Economics approach, I argue that institutional differences between Costa Rica and Honduras are responsible for the impressive economic growth Costa Rica has been able to achieve in the past few decades. Specifically, early political developments in Costa Rica have deeply imbedded relatively egalitarian values into the population, helping shape formal and informal inclusive political institutions. Meanwhile, Honduras experienced the development of extractive political institutions, as political and economic power was heavily concentrated in the hands of a select few. These political institutions were crucial during the implementation stages of Washington Consensus reforms, as strong and inclusive political institutions attracted Foreign Direct Investment that helped propel the Costa Rican economy and materialize its position as an outlier in the region. In contrast, lack of institutional guarantees discouraged foreign investors from investing money into the Honduran economy. Through a deep dive into the political histories of both nations, from European discovery to modernity, I conclude that the political institutions of these Central American nations have determined their economic growth paths.

Date: 2017-05-01

Creator: Xuanming Guo

Access: Open access

This study uses an event study framework to find the relationship between ownership concentration and project value. I find that project value first increases with ownership concentration when block size, the percentage ownership of the largest blockholder, is smaller than 10%, then declines with ownership concentration when block size gets larger, and finally rises again when block size exceeds 30%. However, my research only suggests an ambiguous relationship between ownership concentration and firm value. Additionally, ownership concentration seems to affect both the timing of market responses and the market’s interpretation of large investment projects.

Date: 2013-05-01

Creator: Joseph S Durgin

Access: Open access

This paper explores the effects of patient travel distance on hospital profit margins, with consideration to the effects of travel subsidies on hospital pricing. We develop a model in which hospital agglomeration leads to a negative relationship between profit margins and patient travel distance, challenging the standard IO theory that profit margins are higher for firms with greater distances of customer travel. Using data on patient visits and hospital finances from the California Office of Statewide Health Planning and Development (OSHPD), we test our theory and confirm that a hospital tends to have less pricing power if it draws patients from beyond its local cluster. We then consider how our results might justify the subsidizing of patient travel by insurers and government payers. Lastly, we present an argument for why the ubiquitous Hirschman-Herfindahl index of market concentration can be robust to owner and system-level hospital cooperation.