Monopsonistic Labour Markets and the Gender Pay Gap: Theory and Empirical Evidence

Cover......Page 1
Lecture Notes in Economics and Mathematical Systems 639......Page 2
Monopsonistic Labour Markets and the Gender Pay Gap: Theory and Empirical Evidence......Page 4
Copyright - ISBN: 3642104088......Page 5
Acknowledgements......Page 8
Contents......Page 10
List of Figures......Page 14
List of Tables......Page 18
List of Abbreviations......Page 20
List of Symbols......Page 22
1.1 Wage Setting vs. Wage Taking......Page 26
1.2 `Classic\' vs. `New\' Monopsony......Page 28
1.3 Plan of the Book......Page 31
Part I Spatial Monopsony......Page 34
2 Simple Static Monopsony......Page 36
3.1 The Basic Assumptions......Page 40
3.2 The Elasticity of the Firm\'s Aggregate Labour Supply......Page 44
3.3.1 Convexity Relative to an Exponential......Page 46
3.3.2 Spatial Implications of Individual Labour Supply\'s Convexity......Page 52
3.4 Spatial vs. Spaceless Monopsony......Page 53
3.5 Firms\' Interaction and Conjectural Variations......Page 56
3.6 The Short-Run Equilibrium......Page 60
3.7 Short-Run Comparative Statics......Page 63
3.8 Conclusions......Page 71
4 Long-Run Spatial Monopsony......Page 74
4.1 The Zero-Profit Locus......Page 75
4.2 The Wage-Setting Curve......Page 77
4.3 The Long-Run Equilibrium......Page 80
4.4 Long-Run Comparative Statics......Page 85
4.4.1 Changes in the Position of the Zero-Profit Locus and the Wage-Setting Curve......Page 86
4.4.2 Comparative Statics in the Fixed Costs and the Worker Density......Page 87
4.4.3 Comparative Statics in the Marginal Revenue Product of Labour......Page 90
4.4.4 Comparative Statics in the Travel Cost......Page 92
4.5 Long-Run Spatial Monopsony under Linear Individual Labour Supply......Page 95
4.5.1 The Löschian Equilibrium......Page 100
4.5.2 The Greenhut–Ohta Equilibrium......Page 103
4.5.3 The Hotelling–Smithies Equilibrium......Page 104
4.6 Long-Run Spatial Monopsony with Constant Individual Labour Supply......Page 107
4.6.1 The Hotelling–Smithies and the Greenhut–Ohta Equilibrium......Page 108
4.6.2 Allowing for Varying Participation......Page 112
4.6.3 The Löschian Equilibrium......Page 115
4.7 Conclusions......Page 117
5.1 The Gender Pay Gap and Beckerian vs. Robinsonian Discrimination......Page 120
5.2.1 The Basic Assumptions......Page 123
5.2.2 Firm-Level Labour Supply and Firms\' Wage-Setting Behaviour......Page 125
5.2.3 The Equilibrium and Its Properties......Page 128
5.3 Conclusions......Page 133
6 Spatial Monopsony and Regional Differences in the Gender Pay Gap......Page 138
6.1 Theoretical Considerations......Page 139
6.2 Empirical Specification......Page 141
6.3 Data......Page 144
6.4 Descriptive Evidence......Page 148
6.5 Multivariate Evidence......Page 150
6.6 Conclusions......Page 153
Part II Dynamic Monopsony......Page 156
7 Simple Dynamic Monopsony......Page 158
8.1 Some Introductory Remarks......Page 162
8.2.1 The Basic Assumptions......Page 164
8.2.2 Workers\' Reservation Wage......Page 166
8.2.3 Firms\' Steady-State Labour Supply......Page 168
8.2.4 The Steady-State Equilibrium and Its Properties......Page 169
8.3 Some Concluding Remarks......Page 173
9 Dynamic Monopsony and the Gender Pay Gap......Page 176
9.1 A Simple Measure of On-the-Job Search Frictions......Page 178
9.2.1 Combining Simple Dynamic Monopsony and the Burdett–Mortensen Model......Page 180
9.2.2 Introducing Stochastic Job-to-Job Transitions......Page 182
9.2.3 Introducing Elastic Transitions from and to Non-Employment......Page 183
9.2.5 Empirical Specification......Page 185
9.2.6 Related Empirical Literature......Page 188
9.3 Data......Page 189
9.4 Gender Differences in Search Frictions......Page 193
9.5 Estimates of the Gender Difference in Long-Run Firm-Level Labour Supply Elasticities......Page 198
9.5.1 Transition to Employment......Page 199
9.5.2 Transition to Non-Employment......Page 206
9.5.3 Hiring from Employment......Page 212
9.5.4 Estimates of the Long-Run Firm-Level Labour Supply Elasticities......Page 217
9.6 Conclusions......Page 224
10 Concluding Remarks......Page 226
A.1 Proof of Remark 3.2......Page 232
A.2 Proof of Example 3.5......Page 233
A.3 Proof of Proposition 3.3......Page 235
A.4 Proof of Proposition 3.5......Page 242
A.6 Proof of Lemma 4.1......Page 245
A.7 Proof of Lemma 4.3......Page 247
A.8 Comparative Statics under Linear Spatial Monopsony......Page 251
A.9 The Implicit Solution for the Long-Run Hotelling–Smithies Equilibrium Wage in the Linear Model......Page 252
A.10 Proof of Corollary 5.3......Page 253
A.11 Appendix to Chapter 6......Page 254
B.1 The Relation between the Firm\'s Short- and Long-Run Labour Supply Elasticity......Page 256
B.2 Workers\' Optimal Reservation Wage......Page 257
B.4 Proof of Equation (9.1)......Page 258
B.5 Proof of Equation (9.12)......Page 260
B.7 Appendix to Chapter 9......Page 261
References......Page 270
Index......Page 282