IDEAS home Printed from https://ideas.repec.org/p/nbr/nberwo/2040.html
   My bibliography  Save this paper

The Importance of Local Fiscal Conditions in Analyzing Local Labor Markets

Author

Listed:
  • Joseph Gyourko
  • Joseph S. Tracy

Abstract

A new test of the compensating wage differential model is proposed. The logic behind Roback's model showing how differences in nonproduced amenities may be reflected in intercity wage differentials is extended to the case of differences in local fiscal conditions, represented by tax rates and publicly produced services. Results show that differences in local tax rates and services provisions do generate compensating wage differentials across cities. The effects of a particularly large set of taxes and effective services output measures are examined.

Suggested Citation

  • Joseph Gyourko & Joseph S. Tracy, 1986. "The Importance of Local Fiscal Conditions in Analyzing Local Labor Markets," NBER Working Papers 2040, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:2040
    Note: LS
    as

    Download full text from publisher

    File URL: http://www.nber.org/papers/w2040.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. John M. Abowd & Orley C. Ashenfelter, 1981. "Anticipated Unemployment, Temporary Layoffs, and Compensating Wage Differentials," NBER Chapters, in: Studies in Labor Markets, pages 141-170, National Bureau of Economic Research, Inc.
    2. Greg J. Duncan, 1976. "Earnings Functions and Nonpecuniary Benefits," Journal of Human Resources, University of Wisconsin Press, vol. 11(4), pages 462-483.
    3. Rosen, Sherwin, 2007. "Studies in Labor Markets," National Bureau of Economic Research Books, University of Chicago Press, number 9780226726304, December.
    4. Charles Brown, 1980. "Equalizing Differences in the Labor Market," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 94(1), pages 113-134.
    5. Duncan, Greg J & Holmlund, Bertil, 1983. "Was Adam Smith Right after All? Another Test of the Theory of Compensating Wage Differentials," Journal of Labor Economics, University of Chicago Press, vol. 1(4), pages 366-379, October.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. repec:eee:labchp:v:1:y:1986:i:c:p:641-692 is not listed on IDEAS
    2. repec:eee:labchp:v:1:y:1986:i:c:p:387-423 is not listed on IDEAS
    3. Joseph G. Altonji & Emiko Usui, 2007. "Work Hours, Wages, and Vacation Leave," ILR Review, Cornell University, ILR School, vol. 60(3), pages 408-428, April.
    4. Elliott, Robert F. & Sandy, Robert, 1998. "Adam Smith may have been right after all: A new approach to the analysis of compensating differentials," Economics Letters, Elsevier, vol. 59(1), pages 127-131, April.
    5. Pinheiro, Roberto & Visschers, Ludo, 2015. "Unemployment risk and wage differentials," Journal of Economic Theory, Elsevier, vol. 157(C), pages 397-424.
    6. Nicole Maestas & Kathleen J. Mullen & David Powell & Till von Wachter & Jeffrey B. Wenger, 2023. "The Value of Working Conditions in the United States and the Implications for the Structure of Wages," American Economic Review, American Economic Association, vol. 113(7), pages 2007-2047, July.
    7. Patricia M. Anderson & Bruce D. Meyer, "undated". "The Incidence of a Firm-Varying Payroll Tax: The Case of Unemployment Insurance," IPR working papers 95-23, Institute for Policy Resarch at Northwestern University.
    8. Michael P. Keane, 1993. "Individual Heterogeneity and Interindustry Wage Differentials," Journal of Human Resources, University of Wisconsin Press, vol. 28(1), pages 134-161.
    9. Egidio Farina & Colin Green & Duncan McVicar, 2021. "Are Estimates of Non‐Standard Employment Wage Penalties Robust to Different Wage Measures? The Case of Zero‐hour Contracts in the UK," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 60(3), pages 370-399, July.
    10. Marios Michaelides, 2010. "A New Test of Compensating Differences: Evidence on the Importance of Unobserved Heterogeneity," Journal of Sports Economics, , vol. 11(5), pages 475-495, October.
    11. Patricia M. Anderson & Bruce D. Meyer, 1994. "The Effects of Unemployment Insurance Taxes and Benefits on Layoffs Using Firm and Individual Data," NBER Working Papers 4960, National Bureau of Economic Research, Inc.
    12. Rosen, Sherwin, 1985. "Implicit Contracts: A Survey," Journal of Economic Literature, American Economic Association, vol. 23(3), pages 1144-1175, September.
    13. Tadashi Sakai & Naomi Miyazato, 2014. "Who values the family-friendly aspects of a job? Evidence from the Japanese labour market," The Japanese Economic Review, Japanese Economic Association, vol. 65(3), pages 397-413, September.
    14. Joseph G. Altonji & Christina H. Paxson, 1992. "Labor Supply, Hours Constraints, and Job Mobility," Journal of Human Resources, University of Wisconsin Press, vol. 27(2), pages 256-278.
    15. Florian S. Peters & Alexander F. Wagner, 2014. "The Executive Turnover Risk Premium," Journal of Finance, American Finance Association, vol. 69(4), pages 1529-1563, August.
    16. Han, Seungjin & Yamaguchi, Shintaro, 2015. "Compensating wage differentials in stable job matching equilibrium," Journal of Economic Behavior & Organization, Elsevier, vol. 114(C), pages 36-45.
    17. Shaw, Kathryn L, 1996. "An Empirical Analysis of Risk Aversion and Income Growth," Journal of Labor Economics, University of Chicago Press, vol. 14(4), pages 626-653, October.
    18. StÈphane Bonhomme & GrÈgory Jolivet, 2009. "The pervasive absence of compensating differentials," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 24(5), pages 763-795.
    19. Petri Böckerman & Pekka Ilmakunnas, 2006. "Do job disamenities raise wages or ruin job satisfaction?," International Journal of Manpower, Emerald Group Publishing Limited, vol. 27(3), pages 290-302, April.
    20. Wei, Chunyan & Hu, Shiyang & Chen, Feng, 2020. "Do political connection disruptions increase labor costs in a government-dominated market? Evidence from publicly listed companies in China," Journal of Corporate Finance, Elsevier, vol. 62(C).
    21. Josefa Ramoni Perazzi, 2007. "The compensating differential principle in the public and private sector: A multivariate statistical analysis approach," Economía, Instituto de Investigaciones Económicas y Sociales (IIES). Facultad de Ciencias Económicas y Sociales. Universidad de Los Andes. Mérida, Venezuela, vol. 32(24), pages 95-112, july-dece.
    22. repec:eee:labchp:v:2:y:1986:i:c:p:789-848 is not listed on IDEAS
    23. Margarita Katsimi, 2008. "Training, Job Security And Incentive Wages," Scottish Journal of Political Economy, Scottish Economic Society, vol. 55(1), pages 67-78, February.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:2040. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/nberrus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.