Risk Sharing in Labor Markets
Empirical work in labor economics has focused on rent sharing as an explanation for the observed correlation between wages and profitability. The alternative explanation of risk sharing between workers and employers has not been tested. Using a uni...
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| Format: | Journal Article |
| Language: | English en_US |
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Washington, DC: World Bank
2014
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| Online Access: | http://documents.worldbank.org/curated/en/2003/09/17742612/risk-sharing-labor-markets http://hdl.handle.net/10986/17184 |
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okr-10986-171842021-04-23T14:03:29Z Risk Sharing in Labor Markets Bigsten, Arne Collier, Paul Dercon, Stefan Fafchamps, Marcel Gauthier, Bernard Gunning, Jan Willem Oduro, Abena Oostendorp, Remco Pattillo, Cathy Soderbom, Mans Teal, Francis Zeufack, Albert AVERAGE WAGE AVERAGE WAGES BARGAINING BARGAINING POWER BORROWING CAPITAL STOCK COBB-DOUGLAS PRODUCTION FUNCTION COMMERCIAL CONTRACTS COMPETITIVE MODEL CONTRACT ENFORCEMENT CONTRACTUAL RELATIONS CREDIT MARKET CREDIT MARKETS CREDIT RATIONING CRISES DEVELOPING COUNTRY DEVELOPMENT ECONOMICS DISPUTE ¨ RESOLUTION DUMMY VARIABLES ECONOMETRIC ANALYSIS ECONOMIC DEVELOPMENT ECONOMIC PERFORMANCE ECONOMIC RENTS EFFICIENCY WAGES ELASTICITY EMPLOYEE EMPLOYMENT EQUILIBRIUM UNEMPLOYMENT EXCHANGE RATE EXOGENOUS SHOCKS EXPECTED VALUE EXPORTS FINANCIAL MARKETS FIRM PERFORMANCE FIRM SIZE GOVERNMENT INTERVENTION HIGH WAGE HOLDING HUMAN CAPITAL IMPLICIT CONTRACT IMPLICIT CONTRACTS INCOME INEFFICIENCY INFORMAL CREDIT INSTRUMENT INSURANCE INSURANCE MARKET INSURANCE MARKETS INTERNATIONAL BANK INVENTORIES LABOR CONTRACTS LABOR ECONOMICS LABOR FORCE LABOR MARKET LABOR MARKETS LABOR SUPPLY LABOR TURNOVER LIQUID ASSETS LIQUIDITY LIQUIDITY CRISES MISSING MARKETS MONETARY FUND NEGATIVE SHOCK NEGATIVE SHOCKS OCCUPATION OPTIMAL CONTRACT PERMANENT SHOCK PERMANENT SHOCKS POLITICAL ECONOMY PRICE VOLATILITY PRIMARY EDUCATION PRODUCTION FUNCTION PRODUCTION WORKERS PRODUCTIVITY RATES OF RETURN RENTS RISK AVERSE RISK AVERSION RISK PREMIUM RISK SHARING STOCKS SUPPLIERS SUPPLY CURVE TOTAL OUTPUT TOTAL WAGE TRANSACTION TRANSACTION COSTS UNEMPLOYED UNEMPLOYMENT VALUE ADDED WAGE BARGAINING WAGE BILL WAGE DIFFERENTIALS WAGE EFFECT WAGE INCREASE WAGE LEVELS WAGE PREMIUM WAGE RATE WAGE RATES WAGE RIGIDITY WAGES WORK EXPERIENCE WORKER WORKER HETEROGENEITY WORKERS Empirical work in labor economics has focused on rent sharing as an explanation for the observed correlation between wages and profitability. The alternative explanation of risk sharing between workers and employers has not been tested. Using a unique panel data set for four African countries, Authors find strong evidence of risk sharing. Workers in effect offer insurance to employers: when firms are hit by temporary shocks, the effect on profits is cushioned by risk sharing with workers. Rent sharing is a symptom of an inefficient labor market. Risk sharing; by contrast, can be seen as an efficient response to missing markets. Authors evidence suggests that risk sharing accounts for a substantial part of the observed effect of shocks on wages. 2014-02-26T20:34:41Z 2014-02-26T20:34:41Z 2003-09 Journal Article http://documents.worldbank.org/curated/en/2003/09/17742612/risk-sharing-labor-markets World Bank Economic Review http://hdl.handle.net/10986/17184 English en_US CC BY-NC-ND 3.0 IGO http://creativecommons.org/licenses/by-nc-nd/3.0/igo World Bank Washington, DC: World Bank Publications & Research :: Journal Article Publications & Research Africa Sub-Saharan Africa Cameroon Ghana Kenya Zimbabwe |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English en_US |
| topic |
AVERAGE WAGE AVERAGE WAGES BARGAINING BARGAINING POWER BORROWING CAPITAL STOCK COBB-DOUGLAS PRODUCTION FUNCTION COMMERCIAL CONTRACTS COMPETITIVE MODEL CONTRACT ENFORCEMENT CONTRACTUAL RELATIONS CREDIT MARKET CREDIT MARKETS CREDIT RATIONING CRISES DEVELOPING COUNTRY DEVELOPMENT ECONOMICS DISPUTE ¨ RESOLUTION DUMMY VARIABLES ECONOMETRIC ANALYSIS ECONOMIC DEVELOPMENT ECONOMIC PERFORMANCE ECONOMIC RENTS EFFICIENCY WAGES ELASTICITY EMPLOYEE EMPLOYMENT EQUILIBRIUM UNEMPLOYMENT EXCHANGE RATE EXOGENOUS SHOCKS EXPECTED VALUE EXPORTS FINANCIAL MARKETS FIRM PERFORMANCE FIRM SIZE GOVERNMENT INTERVENTION HIGH WAGE HOLDING HUMAN CAPITAL IMPLICIT CONTRACT IMPLICIT CONTRACTS INCOME INEFFICIENCY INFORMAL CREDIT INSTRUMENT INSURANCE INSURANCE MARKET INSURANCE MARKETS INTERNATIONAL BANK INVENTORIES LABOR CONTRACTS LABOR ECONOMICS LABOR FORCE LABOR MARKET LABOR MARKETS LABOR SUPPLY LABOR TURNOVER LIQUID ASSETS LIQUIDITY LIQUIDITY CRISES MISSING MARKETS MONETARY FUND NEGATIVE SHOCK NEGATIVE SHOCKS OCCUPATION OPTIMAL CONTRACT PERMANENT SHOCK PERMANENT SHOCKS POLITICAL ECONOMY PRICE VOLATILITY PRIMARY EDUCATION PRODUCTION FUNCTION PRODUCTION WORKERS PRODUCTIVITY RATES OF RETURN RENTS RISK AVERSE RISK AVERSION RISK PREMIUM RISK SHARING STOCKS SUPPLIERS SUPPLY CURVE TOTAL OUTPUT TOTAL WAGE TRANSACTION TRANSACTION COSTS UNEMPLOYED UNEMPLOYMENT VALUE ADDED WAGE BARGAINING WAGE BILL WAGE DIFFERENTIALS WAGE EFFECT WAGE INCREASE WAGE LEVELS WAGE PREMIUM WAGE RATE WAGE RATES WAGE RIGIDITY WAGES WORK EXPERIENCE WORKER WORKER HETEROGENEITY WORKERS |
| spellingShingle |
AVERAGE WAGE AVERAGE WAGES BARGAINING BARGAINING POWER BORROWING CAPITAL STOCK COBB-DOUGLAS PRODUCTION FUNCTION COMMERCIAL CONTRACTS COMPETITIVE MODEL CONTRACT ENFORCEMENT CONTRACTUAL RELATIONS CREDIT MARKET CREDIT MARKETS CREDIT RATIONING CRISES DEVELOPING COUNTRY DEVELOPMENT ECONOMICS DISPUTE ¨ RESOLUTION DUMMY VARIABLES ECONOMETRIC ANALYSIS ECONOMIC DEVELOPMENT ECONOMIC PERFORMANCE ECONOMIC RENTS EFFICIENCY WAGES ELASTICITY EMPLOYEE EMPLOYMENT EQUILIBRIUM UNEMPLOYMENT EXCHANGE RATE EXOGENOUS SHOCKS EXPECTED VALUE EXPORTS FINANCIAL MARKETS FIRM PERFORMANCE FIRM SIZE GOVERNMENT INTERVENTION HIGH WAGE HOLDING HUMAN CAPITAL IMPLICIT CONTRACT IMPLICIT CONTRACTS INCOME INEFFICIENCY INFORMAL CREDIT INSTRUMENT INSURANCE INSURANCE MARKET INSURANCE MARKETS INTERNATIONAL BANK INVENTORIES LABOR CONTRACTS LABOR ECONOMICS LABOR FORCE LABOR MARKET LABOR MARKETS LABOR SUPPLY LABOR TURNOVER LIQUID ASSETS LIQUIDITY LIQUIDITY CRISES MISSING MARKETS MONETARY FUND NEGATIVE SHOCK NEGATIVE SHOCKS OCCUPATION OPTIMAL CONTRACT PERMANENT SHOCK PERMANENT SHOCKS POLITICAL ECONOMY PRICE VOLATILITY PRIMARY EDUCATION PRODUCTION FUNCTION PRODUCTION WORKERS PRODUCTIVITY RATES OF RETURN RENTS RISK AVERSE RISK AVERSION RISK PREMIUM RISK SHARING STOCKS SUPPLIERS SUPPLY CURVE TOTAL OUTPUT TOTAL WAGE TRANSACTION TRANSACTION COSTS UNEMPLOYED UNEMPLOYMENT VALUE ADDED WAGE BARGAINING WAGE BILL WAGE DIFFERENTIALS WAGE EFFECT WAGE INCREASE WAGE LEVELS WAGE PREMIUM WAGE RATE WAGE RATES WAGE RIGIDITY WAGES WORK EXPERIENCE WORKER WORKER HETEROGENEITY WORKERS Bigsten, Arne Collier, Paul Dercon, Stefan Fafchamps, Marcel Gauthier, Bernard Gunning, Jan Willem Oduro, Abena Oostendorp, Remco Pattillo, Cathy Soderbom, Mans Teal, Francis Zeufack, Albert Risk Sharing in Labor Markets |
| geographic_facet |
Africa Sub-Saharan Africa Cameroon Ghana Kenya Zimbabwe |
| description |
Empirical work in labor economics has
focused on rent sharing as an explanation for the observed
correlation between wages and profitability. The alternative
explanation of risk sharing between workers and employers
has not been tested. Using a unique panel data set for four
African countries, Authors find strong evidence of risk
sharing. Workers in effect offer insurance to employers:
when firms are hit by temporary shocks, the effect on
profits is cushioned by risk sharing with workers. Rent
sharing is a symptom of an inefficient labor market. Risk
sharing; by contrast, can be seen as an efficient response
to missing markets. Authors evidence suggests that risk
sharing accounts for a substantial part of the observed
effect of shocks on wages. |
| format |
Journal Article |
| author |
Bigsten, Arne Collier, Paul Dercon, Stefan Fafchamps, Marcel Gauthier, Bernard Gunning, Jan Willem Oduro, Abena Oostendorp, Remco Pattillo, Cathy Soderbom, Mans Teal, Francis Zeufack, Albert |
| author_facet |
Bigsten, Arne Collier, Paul Dercon, Stefan Fafchamps, Marcel Gauthier, Bernard Gunning, Jan Willem Oduro, Abena Oostendorp, Remco Pattillo, Cathy Soderbom, Mans Teal, Francis Zeufack, Albert |
| author_sort |
Bigsten, Arne |
| title |
Risk Sharing in Labor Markets |
| title_short |
Risk Sharing in Labor Markets |
| title_full |
Risk Sharing in Labor Markets |
| title_fullStr |
Risk Sharing in Labor Markets |
| title_full_unstemmed |
Risk Sharing in Labor Markets |
| title_sort |
risk sharing in labor markets |
| publisher |
Washington, DC: World Bank |
| publishDate |
2014 |
| url |
http://documents.worldbank.org/curated/en/2003/09/17742612/risk-sharing-labor-markets http://hdl.handle.net/10986/17184 |
| _version_ |
1764433248505561088 |