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NBER Working Papers and Publications
|March 2017||The Influence of Licensing Engineers on their Labor Market|
with Yoon Sun Hur, Morris M. Kleiner
in U.S. Engineering in a Global Economy, Richard B. Freeman and Hal Salzman, editors
Our paper presents an analysis of the role of occupational licensing requirements on the labor market for civil, electrical, and industrial engineers. These groups of engineers represent the largest number of engineers that are covered by occupational licensing statutes in the United States. We initially trace the historical evolution of licensing for engineers. Second, we present a theoretical rationale for the role of government in the labor market for the occupation. In the model, the government’s ability to control supply through licensing restrictions and the pass rate could limit the number of engineers, which may drive up wages. We then estimate a panel data model for the engineers in our sample using the American Community Survey and regulatory statutes. Our estimates show a small ...
|November 2010||Analyzing Compensation Methods in Manufacturing: Piece Rates, Time Rates, or Gain-Sharing?|
with Susan Helper, Morris M. Kleiner: w16540
Economists have often argued that "pay for performance" is the optimal compensation scheme. However, use of the simplest form of pay for performance, the piece rate, has been in decline in manufacturing in recent decades. We show both theoretically and empirically that these changes are due to adoption of "modern manufacturing" in which firms produce a greater variety of products to a more demanding quality and delivery standard.
We further develop a theory of the type of compensation system appropriate for this kind of production, in which there is a high return to "multi-tasking", where the same workers perform both easy-to-observe and hard-to-observe tasks and to "just-in-time" production, which entails a high cost of holding inventory.
We test these predictions using detailed monthly...