Dwight W. Adamson and Scott W. Fausti
An alternative theoretical explanation for the existence of wage differentials between minority and majority groups is proposed. It is demonstrated that wage differentials that arise from uncertainty about minority group abilities relative to those of the majority group are not exclusively the result of statistical discrimination. It is proposed here that wage differentials are made up of two elements: a statistical discrimination component and a wage disparity component. Wage disparity differentials are a consequence of uncertainty over the flow of labor factor services affecting the production technology of the firm. Wage disparity is demonstrated to be a competitive outcome resulting from the minority group's higher variance associated with the flow of factor services relative to the majority group. Consequently, in response to lower expected average and marginal productivity, this group of workers receives a lower wage or employment level. It is established that nondiscriminatory wage differentials can persist in a competitive risk neutral market environment in the long run. ( J700, D800)
Jannett Highfill and William V. Weber
Suppose consumers demand a composite good called "baseball experience" that incorporates the value received from both attending the game in person and purchasing concessions at the stadium. It is shown that when the firm maximizes the total profit from tickets and concessions, the ticket price is between the competitive and simple monopoly prices. Further, the paper considers uncertain demand and a capacity constraint, which are shown to raise the firm's marginal cost and make the ticket price higher and "stickier" than in the certainty model. The paper provides some insights into two open questions from the empirical sports literature (JEL D4, D81)
Diane Primont, Bruce Domazlicky, Sarah Berkbigler, and Joshua Campbell
The No Child Left Behind initiative places pressure on school districts to be accountable for the performance of their students. Though an imperfect measure, student performance is most frequently measured through the use of standardized test scores. Research has shown that a value added approach, such as employed in this paper, is a more accurate measure of a school district's performance. Our research implies that test scores alone may not capture the true status of a district's performance level. Some districts with low test scores may actually be outperforming other districts with much higher scores, as measured by efficiency levels. That is, some low-scoring districts may actually be providing education services as effectively as they can, given their resources and student characteristics. (JEL I21)
Timothy O. Bisping
The growth of the service sector's share of total employment has obvious consequences for labor force participants. The issue has long been discussed, though little analysis has been done using vector autoregressive techniques, especially in determining the regional differences in the impact of this trend. Here I examine the potentially disparate impact of the growth in the service sector's share of total employment across gender and region. At the national level I find that this growth lowers labor force participation rates, though men and women experience a similar impact. I also find substantial variation in the impact of service sector growth across regions, with the South and West being isolated from such changes, and men and women experiencing different reactions in the Midwest and the Northeast. (J21)