14.661
Labor Economics I
A systematic development of the theory of labor supply, labor demand, and human capital. Topics include wage and employment determination, turnover, search, immigration, unemployment, equalizing differences, and institutions in the labor market. Particular emphasis on the interaction between theoretical and empirical modeling. No listeners.
Fall 2024
This course provides a systematic development of the theory of labor supply, labor demand, and human capital. Topics include wage and employment determination, turnover, search, immigration, unemployment, equalizing differences, and institutions in the labor market. Particular emphasis is placed on the interaction between theoretical and empirical modeling.
Readings
- G. Borjas, Labor Economics, 8 th edition. McGraw-Hill, 2020.
- J. Rothstein. “Unemployment and Job Search in the Great Recession.” Brookings Papers on Economic Activity 43 (Fall 2011), 143–213.
- C. Goldin and L. F. Katz. The Race Between Education and Technology . Harvard University Press, 2010.
- A. Deaton and J. Muellbauer. Economics and Consumer Behavior. Cambridge University Press, 1980, especially chapter 4.
- ‘Metrics: MHE Chapter 4; MM Chapter 3 (Instrumental variables).
- G. S. Becker. A Treatise on the Family. Harvard University Press, 1981.
- ‘Metrics: MHE Sections 4.1 and 5.1; MM Chapter 3 (IV and grouped data)
- G. Becker and G. Ghez. The Allocation of Time and Goods Over the Life-Cycle. Columbia University Press, 1975.
- ‘Metrics: MHE Chapter 5; MM Chapter 5 (Diffs-in-diffs).
- A. Manning. Monopsony in Motion: Imperfect Competition in Labor Markets. Princeton University Press, 2003.
- J. Mincer. Schooling, Experience, and Earnings. NBER, 1974.
- G. Becker. Human Capital , 3 rd edition. University of Chicago Press, 1993.
- ‘Metrics: MM Chapter 6; AK99 Section 2.
- ‘Metrics: MHE Chapter 6; MM Chapter 4 (Regression Discontinuity Designs).
- H. Gregg Lewis. Union Relative Wage Effects: A Survey. University of Chicago Press, 1986.
Fall 2017
Topics
- Labor Market Facts and Trends
- Basics
- Tax and Transfer Programs
- The Life-Cycle Model
- Household and Family Models
- Labor Demand
- Market Structure and the Min
- Immigration and Migration
- Unions
- Schooling, Experience, and Earnings
- Empirical Earnings Functions
- Non-Pecuniary and Pecuniary Externalities in the Labor Market
- Signaling
- Social Mobility
- Peer Effects
- Multitasking
- Career Concerns in the Private and the Public Sector
- Efficiency Wages
- Holdups and Investments
- Investment in General Skills
- Specific Skills, Investments, and Learning
- Unemployment, Non-Employment, and Labor Market Flows
- The Partial Equilibrium Search Model
- The Basic Equilibrium Search Framework
- Assignment Models
- The Composition of Jobs
- Real Wage Rigidity, Unemployment, and Unemployment Persistence
- Nominal Wage Rigidity and Unemployment
Readings
- [MHE] J. Angrist and J-S Pischke, Mostly Harmless Econometrics: An Empiricist’s Companion, Princeton University Press, 2008. ISBN: 9780691120355.
- [MM] — — —, Mastering ‘Metrics: The Path from Cause to Effect, Princeton University, 2014. ISBN: 9780691152844.
- [HOLE] O. Ashenfelter and R. Layard, Handbook of Labor Economics, Volume 1 , 1987. ISBN: 9780444878564.
- [HOLE 3A] O. Ashenfelter and D. Card, Handbook of Labor Economics, Volume 3A, 2010. ISBN: 9780444501875.
- L. Katz and C. Goldin, The Race Between Education and Technology , Harvard University Press, 2010. ISBN: 9780674035300.
- A. Deaton and J. Muellbauer, Economics and Consumer Behavior , Cambridge University Press, 1980, especially Chapter 4. ISBN: 9780521296762.
- M. Killingsworth, Labor Supply , Cambridge University Press, 1983; Chapters 1, 2, and 7. ISBN:9780521299169.
- R. Blundell and T. MaCurdy, “Labor Supply: a Review of Alternative Approaches.” In [HOLE 3A], chapter 27, 1999.
- R. Moffitt, “Welfare Programs and Labor Supply,” Handbook of Public Economics: Volume 4 . eds. A. Aurbach and M. Feldstein, September 2002. ISBN: 9781493302499.
- G. Becker and G. Ghez, The Allocation of Time and Goods Over the Life-Cycle , Columbia University Press, 1975. ISBN: 9780870145148.
- [MHE] Section 4.1 (especially 4.1.2 and 4.1.3), and [MM] Chapter 3.
- Cab drivers, et al.
- G. Becker, 1981, A Treatise on the Family , Cambridge: Harvard University Press. ISBN: 9780674906990.
- [MHE] Chapter 4 (Instrumental Variables), and [MM] Chapter 3.
- D. Hamermesh, Labor Demand , Princeton, NJ: Princeton University Press, Chapters 2-3, 18-136. ISBN:9780691025872.
- D. Hamermesh, “The Demand for Labor in the Long Run,” Chapter 8 in [HOLE].
- S. Nickell, “Dynamic Models of Labour Demand,” Chapter 9 in [HOLE].
- C. Brown, “Minimum Wages, Employment, and the Distribution of Income”, Chapter 32 in [HOLE 3A].
- D. Card and A. Krueger, Myth and Measurement: The New Economics of the Minimum Wage , Princeton: Princeton University Press, 1995. ISBN:9780691169125.
- A. Manning, Monopsony in Motion: Imperfect Competition in Labor Markets , Princeton University Press, 2003. ISBN: 0691113122.
- [MHE] Chapter 5 and [MM] Chapter 5.
- G. Borjas, Labor Economics, 5th Ed ., McGraw-Hill, 2010 (Chapter 10). ISBN: 9780078021886.
- R. Freeman and J. Medoff, What Do Unions Do? , Basic Books, 1985. ISBN: 9780465091324.
- H. Gregg Lewis, Union Relative Wage Effects: A Survey , Chicago, University of Chicago Press, 1986. ISBN: 9780226477213.
- [MHE] Chapters 5 (Panel Data) and 6 and [MM] Chapter 4.
- G. Becker, Human Capital, 3rd Edition , Chicago: University of Chicago Press, 1993. ISBN: 9780226041223.
- R.J. Willis, “Wage Determinants,” Chapter 10 in [HOLE].
- R. Freeman, “Demand for Education,” Chapter 6 in [HOLE].
- Returns-to-schooling econometrics
- D. Card, “The Causal Effect of Education on Earnings,” chapter in [HOLE 3A].
- [MM] Chapter 6.
- Returns to experience and OJT
- Mulligan Casey, Parental Priorities and Economic Inequality , (1997) University of Chicago Press. ISBN: 9780226548401.
- * Bewley, Truman (1999), Why Wages Don’t Fall During a Recession , Harvard University Press. ISBN: 9780674009431.
Prerequisites & course information
Subject meets with 14.661A Prereq: 14.32 and ( 14.03 or 14.04 ) G (Fall) 5-0-7 units
Sources
- Course catalogue ↗2026–2027
- MIT OpenCourseWare ↗Fall 2024
- MIT OCW readings ↗
- MIT OCW schedule ↗
- MIT OCW syllabus ↗
- MIT OpenCourseWare ↗Fall 2017
- MIT OCW calendar ↗
- MIT OCW syllabus ↗
- MIT OCW readings ↗
- Historical MIT OpenCourseWare offering. Named reading entries and schedule topics are automatically extracted from the linked source pages.
- Historical MIT OpenCourseWare offering. Named reading entries and schedule topics are automatically extracted from the linked source pages.