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Author: Petrongolo, Barbara
Resulting in 3 citations.
1. Eckstein, Zvi
Ge, Suqin
Petrongolo, Barbara
Job and Wage Mobility in a Search Model with Non-Compliance (Exemptions) with the Minimum Wage
IZA Discussion Paper No. 2076, Institute for the Study of Labor (IZA), April 2006.
Also: http://ftp.iza.org/dp2076.pdf
Cohort(s): NLSY79
Publisher: Institute for the Study of Labor (IZA)
Keyword(s): Job Search; Mobility, Job; Modeling; Wage Growth; Wages

Permission to reprint the abstract has not been received from the publisher.

How well does a simple search on-the-job model fit the eighteen years of job and wage mobility of high school graduates? To answer this question we are confronted from the data with a prevalent non-compliance and exemptions from the minimum wage. We incorporate this observation in a job search model with three main ingredients: (i) search on-the-job; (ii) minimum wages, with potentially imperfect compliance or exemptions; and, (iii) exogenous wage growth on-the-job. We use panel data drawn from the NLSY79, US youth panel starting in 1979, to estimate the parameters of our simple job search model and, in particular, the extent of non-compliance/exemptions to the minimum wage. The model is solved numerically and we use simulated moments to estimate the parameters. The estimated parameters are consistent with the model and they provide a good fit for the observed levels and trends of the main job and wage mobility data. Furthermore, the estimated model indicates that the non-compliance and exemption rate with the federal minimum wage translates into a roughly 10% of jobs paying less than the minimum wage. Counterfactual experiment of increase of the compliance/non-exemption rate or the minimum wage shows a small effect on mean accepted wages but a significant negative effect on the non-employment rate.
Bibliography Citation
Eckstein, Zvi, Suqin Ge and Barbara Petrongolo. "Job and Wage Mobility in a Search Model with Non-Compliance (Exemptions) with the Minimum Wage." IZA Discussion Paper No. 2076, Institute for the Study of Labor (IZA), April 2006.
2. Eckstein, Zvi
Ge, Suqin
Petrongolo, Barbara
Job and Wage Mobility with Minimum Wages and Imperfect Compliance
Journal of Applied Econometrics 26,4 (June-July 2011): 580.
Also: http://www.econ.queensu.ca/jae/forthcoming/eckstein-ge-petrongolo/
Cohort(s): NLSY79
Publisher: Wiley Online
Keyword(s): Job Search; Labor Force Participation; Life Cycle Research; Mobility, Job; Modeling; Wage Dynamics; Wage Growth

Permission to reprint the abstract has not been received from the publisher.

We propose a job search model with minimum wage regulations and imperfect compliance to explain the doubling of the mean and variance of hourly earnings of white males during the first eighteen years of labor market experience. The model encompasses job mobility and on-the-job wage growth as sources of wage dynamics, and is estimated by simulated GMM using data from the NLSY79. Our estimates provide a good fit for the observed levels and trends of the main job and wage mobility data, and for the increase in the mean and variance of wages over the life cycle, as well as for the fall in the fraction of workers paid below the minimum wage. Job mobility explains 40% to 50% of the observed wage growth. Increases in the minimum wage and/or compliance deliver small effects on the wage distribution and the nonemployment rate.

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Bibliography Citation
Eckstein, Zvi, Suqin Ge and Barbara Petrongolo. "Job and Wage Mobility with Minimum Wages and Imperfect Compliance." Journal of Applied Econometrics 26,4 (June-July 2011): 580.
3. Eckstein, Zvi
Ge, Suqin
Petrongolo, Barbara
Minimum Wage and Compliance in a Model of Search on-the-Job
Presented: Sonderborg, Denmark, Conference of Labor Market Models and Matched Employer-Employee Data, August 2004.
Also: http://repec.org/sed2005/up.25119.1104042882.pdf
Cohort(s): NLSY79
Publisher: Center for Labour Market and Social Research
Keyword(s): Job Search; Minimum Wage; Modeling

Permission to reprint the abstract has not been received from the publisher.

We estimate a job search model with three main ingredients: (i) search on-the-job; (ii) wage growth on-the-job; and (iii) minimum wages, with potentially imperfect compliance. We use data drawn from the NLSY79 to estimate the parameters of our job search model and, in particular, the extent of compliance to the minimum wage. The model is solved numerically and we use simulated moments to estimate the parameters. The estimated parameters are consistent with the model and they provide a good fit for the observed level and trend of main labor market moments. Furthermore, the arrival rate of job offers below the minimum wage is 40% lower than the arrival rate of job offers above the minimum wage.
Bibliography Citation
Eckstein, Zvi, Suqin Ge and Barbara Petrongolo. "Minimum Wage and Compliance in a Model of Search on-the-Job." Presented: Sonderborg, Denmark, Conference of Labor Market Models and Matched Employer-Employee Data, August 2004.