This paper challenges the conventional wisdom that income inequality in Poland increased substantially following the economic transition in 1989–90. The results, based on micro data from the 1985–92 Household Budget Surveys, indicate that overall income inequality increased during the...

Intra-firm trade in intermediates between U.S. multinational parents (MNCs) and their Canadian manufacturing affiliates increased dramatically in the 1984-1995 period (i.e., it roughly doubled). Tariff and transport cost declines were far too small to explain this phenomenon. But we show that...

The response of aggregate labor supply to various changes in the economic environment is central to many economic issues, especially the optimal design of tax policies. This paper surveys recent work that uses structural models and micro data to evaluate the size of this response. Whereas the...

We evaluate the effect of child care versus maternal time inputs on child cognitive development using single mothers from the NLSY79. To deal with nonrandom selection of children into child care, we exploit the exogenous variation in welfare policy rules facing single mothers. In particular, the...

I survey the male and female labor supply literatures, focusing on implications for effects of wages and taxes. For males, I describe and contrast results from three basic types of model: static models (especially those that account for nonlinear taxes), life-cycle models with savings, and...

Using confidential firm-level panel data from the Bureau of Economic Analysis, we examine how the bilateral trade flows of U.S. multinational corporations (MNCs) and their Canadian affiliates responded to U.S.-Canadian tariff reductions from 1983 to 1992. We find that Canadian affiliate sales to...

This paper generalizes the normal probit model of dichotomous choice by introducing mixtures of normals distributions for the disturbance term. By mixing on both the mean and variance parameters and by increasing the number of distributions in the mixture these models effectively remove the...

This paper develops a simulation estimation algorithm that is particularly useful for estimating dynamic panel data models with unobserved endogenous state variables. The new approach can easily deal with the commonly encountered and widely discussed "initial conditions problem," as well as the...

We solve and estimate a dynamic model that allows agents to optimally choose their labor hours and consumption and that allows for both human capital accumulation and savings. Estimation results and simulation exercises indicate that the intertemporal elasticity of substitution is much higher...