Labor Comp January 2013
Answer question 1.
1) Discuss the problem of missing information faced by the researcher evaluating the impact of any
policy. List empirical solutions to the problem. Discuss specific assumptions and appropriate context
of the method application.
Answer question 2 or 3.
2) List at least four examples of labor policies targeting the reduction of unemployment. Describe the
literature on one of these examples. Enrich your discussion by 1) citing empirical works you are
familiar with and emphasizing the originality of empirical approach ,and 2) citing statistical tests
allowing eventually to check/prove some specific assumption.
OR
3) You studied the methods of measuring the impact of policies targeting reduction of unemployment
extensively, but know that the methodology is useful to answer other types of research questions.
List at least three examples of these other types of research questions. Describe the literature on
one of these examples. Enrich your discussion by 1) citing empirical works you are familiar with and
emphasizing the originality of empirical approach, and 2) citing statistical tests allowing eventually
to check/prove some specific assumption.
Answer question 4 or 5.
4) Derive the labor demand curve for a firm with typically shaped isoquants. Define (that is, distinguish
between in words, use equations, and draw a graph to illustrate) the following: wage elasticity of
labor demand, elasticity of substitution, cross price elasticity of labor demand (with respect to the
price of capital).
OR
5) Summarize the theoretical and empirical treatments of individual’s decision to supply labor. Discuss
a) the theoretical effect(s) of changing wages on hours worked,
b) the effects of redistribution schemes such as Aid to Families with Dependent Children,
Temporary Assistance to Needy Families and the Earned Income Tax Credit, and
c) the labor supply questions that require treatment within a life-cycle approach?