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AN NBER PUBLICATION ISSUE: No. 4, April 1998

The Digest

A free monthly publication featuring non-technical summaries of research on topics of broad public interest
In the early 1960s, the labor force participation rates of men 60 to 64 were above 70 percent in all but one of the countries and above 80 percent in several countries. By the mid-1990s, the rate had fallen to below 20 percent in Belgium, Italy, France, and the Netherlands and to about 35 percent in Germany and 40 percent in Spain. The U.S. decline from 82 percent to 53 percent was modest in comparison to the much more precipitous decline in these European countries....

Research Summaries

Article
To check for an effect of the minimum wage, the authors tracked the employment of workers whose wage, just prior to the increase, was above the previous minimum wage but below the new higher minimum wage. For French men aged 25 to 30 who were in this marginal category, an increase of 1 percent in the minimum wage reduced their probability of keeping their job by 4.6 percent. Economists have long believed that minimum wages destroy jobs for low-wage workers....
Article
Participation in boycotts is related inversely to the magnitude of U.S. tax penalties. The Arab League boycott of Israel has been in effect since 1945, making it one of the longest lasting in modern history. American firms receive approximately 10,000 requests each year to participate in that boycott, the most visible of all on the international scene. The U.S. government requires companies to report all requests to participate in such boycotts. U.S. anti-boycott...
Article
Inflation targeting appears to have been successful in increasing the transparency of monetary policymaking and in lowering significantly the rate of inflation in these countries, without any negative consequences for output. The key issue facing central banks as we approach the end of the twentieth century is what strategy they should pursue in the conduct of monetary policy. One choice of monetary strategy that has become increasingly popular in recent years...

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