Two - Year Master Degree in Economics

LABOR ECONOMICS II

Labor Economics II

Academic year 2015/2016

Sommario del corso

• Course objectives
• Results of learning outcomes
• Course delivery
• Learning assessment methods
• Support activities
• Program
• Suggested textbooks and readings
• Teaching tools

Course objectives

The course will present modern methods for conducting empirical research in labor economics. The focus will be on the identification strategies of causal relationships of interest to economists and other social scientists. The course will provide students with the most widely used econometric techniques in empirical labor economics and industrial organization, and will also cover practical issues of data collection, manipulation and econometric analyses using standard statistical software. It will illustrate how to handle real individual-level (firm and worker) microdata in a couple of laboratory, hands-on lessons. These are mainly intended to teach the students how to use standard statistical software (STATA) to perform a convincing empirical analysis. This course is particularly suitable to those students intending to carry out some empirical analyses as part of their final dissertation.

Students are expected to have good knowledge of the intermediates quantitative and econometric methods in economics. 

Results of learning outcomes

1) Knowledge and understanding ability.

The objective of the course is to develop graduate students' abilities in acquiring a better understanding of the functioning of labour markets on the basis of the recent literature of the profession, with particular emphasis on the empirical literature.

2) Capability to apply knowledge and understanding

The literature in the profession is usually formulated in terms of formal mathematical and econometric models . The lectures aim at fostering the students' understanding of the methodological issues involved when going from the theoretical analysis to the empirical testing of hypotheses formulated by theory.

3) Capability to approach the subject in a critical manner

By the end of the course, students are expected to have increased their ability to critically assess the results of empirical analyses, for example whether or not the effect of labor market reforms or other policy interventions are evaluated using sound, transparent and convincing identification strategies. 

4) Communication abilities

Students will be required to communicate sophisticated theorethical or econometric analyses in both formal and intuitive/verbal formats.

5) Learning ability

Ability to collect and process cross-sectional and logitudinal economic data and to use standard statistical techinques and software to (i) document and explain current labor market issues and problems, (ii) test the empirical validity of theories, and (iii) make economic predictions and provide policy recomendations.

Course delivery

A combination of classroom lectures and hands-on, practical sessions in the computer lab using simulated or real datasets, and the most commonly used statistical softwares, to replicate existing empirial studies and start conducting original emprical research. 

Learning assessment methods

Examination

3 hours Written exam at the end of the course. 
Students are also expected to submit a short empirical report summarizing the results of their empirical analysis conducted under the supervision of the instructors.

Support activities

Further information will be provided during the course.

Program

Syllabus and Reading Material

Program:

1. Empirical Strategies in Labor Economics. Introduction and Motivation.  Identification strategies for causal relationships.

2. Potential outcome approach. Social experiments. Non-experimental methods. Selection bias.

3. Controlling strategies. Regression and matching estimators.

4. IV methods.

5. Panel data. Diff-in-diff strategies.

6. Regression discontinuity design. Quantile regressions. 

7. Data collection strategies and measurement issues 
- Types of microdata (survey data, administrative data, ...) 
- Example I: Analysis of one (real) firm-level dataset 
- Example II: Analysis of one (real) worker-level dataset

8. Laboratory session: How to conduct empirical research using STATA 
- Laboratory session: Introduction to STATA 
- Laboratory session: Examples using real datasets

9. Presenting the results of the empirical analysis and writing-up a research report or an empirical scientific paper (lecture 11) 
- Laboratory session: The effect of unions on firm investment: the hold-up problem.

References: 

Main: 

Notes from the instructors.

J. Angrist and J. Pischke (2009) “Mostly Harmless Econometrics”, Princeton University Press.

Other useful resources: 

J. Angrist and A. Krueger (1999) “Empirical Strategies in Labor Economics”, in Handbook of Labor Economics, vol. 3, chap. 23, edited by O. Ashenfelter and D. Card. 

Cahuc and Zylberberg, Labor Economics, Chapter 7. 

G. Borjas “Labor Economics”, ch. 10, MacGraw Hill, 6th edition.

STATA Manuals. 

Addison et. Al. (2007) “Do Works Councils Inhibit Investments?”, Industrial and Labor Relation Review, 60,2.

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