April 2006 (No. 14)
Editor: Terence K. Huwe
Contributors: Elizabeth del Rocío Camacho, Janice Kimball

IIR News & Events
IIR Hosts Immigration Conference
IIR Colloquium Series:   April Presenters
Working Paper Series:   Recent Additions
Industrial Relations Journal:   New Issue

IIR Unit News
Labor Center News
California Public Employee Relations News
Center for Culture, Organizations and Politics
Center for the Study of Child Care Employment News
Institute of Industrial Relations Library
Labor Project for Working Families

Campus Events
Bay Area Latin American Forum
Center for Chinese Studies
Center for Latin American Studies
Economics Department
Graduate School of Journalism
Haas School of Business
Sociology Department


IIR Hosts Immigration Conference

Irene Bloemraad and the Immigration Workshop are sponsoring the following event, which will be held at IIR.  Full information, please see the IIR Web in mid-April.

Conference Title:
Spotlight on Immigration: Interdisciplinary Perspectives on Newcomers and their Children
Friday April 21, 2006.

IIR Colloquium Series:   April Presenters

The seminars are held in the Directors Room, Light Lunch Provided
RSVP Myra Armstrong, 643-3012, zulu2@berkeley.edu

April 17, 2006
Professor of Sociology, UC Berkeley
Title To Be Announced

April 24, 2006
Visiting Scholar, Economics, M.I.T.
Reassessing the Efficacy of Workplace Safety Regulations: Evidence from Random OSHA Inspections

Working Paper Series:   Recent Additions
All Papers may be found at http://repositories.cdlib.org/iir

Kathy Baylis and Jeffrey M. Perloff
Trade Diversion from Tomato Suspension Agreements

Abstract: Trade barriers can cause trade to be diverted to other countries and into other products.  We study the voluntary price restraint (VPR) on Mexican tomato exports entering the United States. The diversion effects of the VPR were found to be significant – representing nearly three quarters of the direct effects of the trade barrier. When the VPR was binding, Mexico exported more tomatoes to Canada, while Canada and the Rest of the World increased their exports to the United States. The VPR also caused fresh tomatoes in Mexico to be diverted into paste production, which was exported to the United States.

Knut Gerlach, David Levine, Gesine Stephan, Olaf Struck
The Acceptability of Layoffs and Pay Cuts: Comparing North America with Germany

Abstract: Substantial evidence shows that North Americans are generally more accepting of the market than Europeans and attribute market outcomes to a larger degree to effort or skill. Thus, we expect North Americans to be more accepting of layoffs and pay cuts than Germans and that Germans will be more sensitive to the procedures and conditions under which pay cuts and layoffs occur. The empirical results from our quasi-experimental study are largely in line with our hypotheses.  These results may help explain and be explained by the different labour market institutions in the different regions.

Rui Huang, Jeffrey M. Perloff and Sofia B. Villas-Boas
Effect of Sales on Brand Loyalty

Abstract:   Although many theoretical industrial organization models are based on the existence of a critical mass of exogenously “brand loyal” consumers, we find little empirical evidence supporting these assumptions in the orange juice retail market. There are very few loyal consumers. More importantly, the frequency with which stores conduct sales affects the share of loyal types so that loyalty is endogenous rather than exogenous. Households’ demographics have statistically significant but economically minor effects on switching behavior. Switching across frozen and refrigerated states is very common, leading to more complicated substitution patterns and less loyalty than one observes looking at each state separately.

Larry Karp
Non-constant discounting in continuous time.

Abstract:   This note derives the dynamic programming equation (DPE) to a differentiable Markov Perfect equilibrium in a problem with non-constant discounting and general functional forms. Beginning with a discrete stage model and taking the limit as the length of the stage goes to 0 leads to the DPE corresponding to the continuous time problem. The note discusses the multiplicity of equilibria under non-constant discounting, calculates the bounds of the set of candidate steady states, and Pareto ranks the equilibria.

Larry Karp. and Thierry Paul
Friction and the Multiplicity of Equilibria

Abstract:   In familiar models, a decrease in the friction facing mobile factors (e.g., lowering their adjustment costs) increases a coordination problem, leading to more circumstances where there are multiple equilibria. We show that a decrease in friction can decrease coordination problems if, for example, a production externality arises from a changing stock of knowledge or a changing environmental stock. In general, the relation between the amount o friction that mobile factors face and the likelihood of multiple equilibria is non-monotonic.

Jeffrey M. Perloff, Valerie Y. Suslow, and Paul J. Seguin
Higher Prices from Entry:   Pricing of Brand-Name Drugs

Abstract:   When a new firm enters a market and starts selling a differentiated product, the prices of existing and new products may be higher than the first product’s original price due to a better match between consumers and products so that the average price rises. We find support for our theory–a rise in prices in response to entry–in the anti-ulcer drug market between 1977 and 1993, when brand-name entry occurred.

Marko Tervio
Career-Hopping:   Learning and Turnover in an Imperfect Labor Market

This paper studies a two-sector model of learning-by-doing that is partially transferable between sectors.  There is a potential efficiency gain from intersectoral turnover when the sectors have different complementary production costs or learning curves of different steepness.  If workers are liquidity restrained then there is a bias toward increased intersectroal turnover, resulting in socially inefficient career patterns.  Excess turnover can even result in lower average productivity of workers in both sectors.  If individual productivity is decreasing toward the end of the career, then a liquidity restraint on the young workers will also cause retirement to be delayed beyond the socially efficient retirement age.

Industrial Relations Journal:   April 2006 Issue
Volume 45 Issue 2

Metropolitan Wage Levels of Less-Educated Workers: 1986 to 1999


This work investigates determinants of metropolitan wage levels for workers with a high school education or less. It estimates their wage levels as a function of four factors: labor demand, industry mix, unionization, and the minimum wage. Labor demand and union strength influence wage levels most. The minimum wage and industry mix play smaller roles, although the minimum wage is the second most influential factor for men and women who did not complete high school. From 1990 to 1999, metropolitan wage levels exhibit considerable persistence, though persistence declines over this period.

The Wage Structure of Latino-Origin Groups across Generations


We analyzed in detail the wages of Latinos of Mexican origin, Central/South Americans, and Puerto Ricans. The wage structure facing second and third- and higher-generation Latinos is very similar to the wage structure of third- and higher-generation White workers. Unlike African American workers, more than half of the native Latino/White wage gap can be accounted for by the lower educational attainment and potential experience of native Latino workers.

A Note on the Changes in the Relative Wages of LEP Hispanic Men between 1980 and 2000

Using the Juhn-Murphy-Pierce (1993) wage decomposition technique, we analyzed changes in the earnings differential between Hispanic and non-Hispanic white men in the United States between 1980 and 2000. The empirical findings, based on decennial census data, indicate that limited-English-proficient (LEP) Hispanic men gained in their relative earnings position compared to English-fluent Hispanics during the 1990s. Our interpretation is that the relative demand for LEP Hispanic workers has risen in recent years.

Output Pay and Ethnic Wage Differentials: Canadian Evidence

Using the Workplace and Employee Survey, we are the first to examine the association between payment method and ethnic wage differentials in Canada. Following earlier theory, we hypothesize that output pay tying earnings to productivity makes it more difficult for employers to discriminate. The empirical estimations show that non-Europeans in Canada paid by time rates receive lower earnings than Europeans paid by time rates. Yet, non-Europeans paid by output pay receive virtually identical earnings to their European counterparts.

Minimum Wage Impacts from a Prespecified Research Design: Canada 1981–1997

Neumark (2001) used the novel methodology of a prespecified research design to estimate the employment effect of minimum wage changes. We conducted our analysis in the "spirit" of this methodology based on Canadian data from 1981 to 1997. Our minimum wage elasticities are substantial, typically in the range of −0.14 to −0.44, with −0.30 being a reasonable point estimate, and with the effects being larger after lagged adjustments.

Teams, Autonomy, and the Financial Performance of Firms

I estimate a structural model of teams, autonomy, and financial performance, using a cross section of British establishments. My findings suggest that team production improves financial performance for the typical establishment but that autonomous teams do no better than closely supervised or nonautonomous teams. I find that unobserved factors increasing the propensity to adopt teams are positively correlated with unobserved determinants of financial performance, and that unobserved factors increasing the propensity to grant teams autonomy are negatively correlated with unobserved determinants of financial performance when teams are adopted.

Revisiting General and Specific Union Beliefs: The Union-Voting Intentions of Professionals

We examine how general and specific beliefs about unions influence the union-voting intentions of professional employees. Previous research, mainly on nonprofessionals, has found that both beliefs are significant in predicting voting behavior, but that specific beliefs have the stronger effect. Using a structural equation model, we found a causal relationship between general and specific beliefs, and that the total effect of general beliefs is nearly three times as strong as that of specific beliefs.

IIR Unit News

Labor Center News

Evening with the All-Stars!

It’s not too late to sponsor or to purchase tickets for the Labor Center’s “Evening with the All-Stars - Celebrating the Spirit and Strength of Working People” on Thursday, April 27 at the Oakland Museum of California. This gala event will honor activist stars from the ranks of the labor movement who have made outstanding contributions to improving the lives of working people. Awards include Best Dramatic Performance, Best Adapted Screenplay, Best Courtroom Drama, and Best Choreography. Help us honor some extraordinary people and concurrently support the Labor Center!  Please contact event coordinator Lisa Wong at 415-355-9988 for information on sponsorship or tickets.

New Grants
Rockefeller Foundation: Public Cost of Low-Wage Work
Labor Market Impact of Wal-Mart Growth

California Public Employee Relations News

CPER currently is working on Issue No. 178 (June 2006). BART Labor Relations Manager Darrell Murray will discuss the difficult task of recording liability of accumulated future unfunded retirement health benefits. Attorney Peter Saltzman (Leonard Carder) will provide the union's perspective on the subject. Also in the next issue: "Preparing the Next Generation of Leaders," by Bob Lavigna. Lavigna is senior manager for client services for CPS Human Resources, a self-supporting public agency that provides consulting services to federal, state, and local government. He writes, "Many public organizations are facing leadership turnover of 50 percent or higher in the next few years. Unless we develop talented replacements, our organizations face the very real risk of failing to achieve our missions and our potential."

CPER currently is working on a fourth edition of the Pocket Guide to Unfair Practices: California Public Sector, due this summer. This publication is a comprehensive guide to the unfair practices created by state laws covering public school, state, higher education, and local government employees. We recently published the seventh edition of the Pocket Guide to the Educational Employment Relations Act. This edition is the 20th anniversary publication since CPER wrote its first edition in 1986. The EERA Guide is designed for day-to-day use by labor and management in California public schools and community colleges. It provides a description of the basic rights and obligations conferred by the statue, as well as a guide to the decisions of the Public Employment Relations Board and the courts. All CPER's pocket guides can be ordered on the CPER page of the IIR website.

On Friday April 28th, CPER Director Carol Vendrillo will serve as the moderator of a panel discussion entitled "Practical Arbitration Advice" at the 12th Annual Labor and Employment Public Sector Program presented by the Labor and Employment Section of the State Bar of California in Pasadena. And looking ahead, CPER will be cosponsor a conference on September 14 with the Public Employment Relations Board.

Center for Culture, Organizations and Politics

New Working Papers Available

The following working papers have been published on the CCOP Web site, and can be downloaded from http://www.irle.berkeley.edu/culture/papers.html.

Noy, Darren (#2006-01)
Stable Conflict in the San Francisco Homeless Policy Field

Eidlin, Barry (#2006-02)
State Coercion and the Rise of U.S. Business Unionism: The Counterfactual Case of Minneapolis Teamsters, 1934-1941

Berman, Elizabeth Popp (#2006-03)
Why Do Universities Patent? The Role of the Federal Government in Creating Modern Technology Transfer Practice

Short, Jodi (#2006-04)
Turning Themselves In: Why Companies Disclose Regulatory Violations

Fairbrother, Malcolm (#2006-05)
Economic Experts and Neoliberal Policy Changes: A Case Study of North American Free Trade 

CCOP Seminars
IIR Seminars are in the Director's Room. SRC Seminars are in the Conference Room at the Survey Research Center, 2538 Channing Way. Lunch begins at 11:45.

April 7
12-1:30 - IIR
Ben Moodie

April 21
12-1:30 - SRC
Nydia MacGregor

Center for the Study of Child Care Employment

For a full listing of CSCCE news and events, check, the Center’s Web site at

Institute of Industrial Relations Library News

Library Launches Immigration Workshop Wiki

The Library has created a members-only Web resource for the Immigration Workshop.  Wikis are similar to Blogs, but allow for multiple users to share files and communication more easily. The Immigration Workshop Wiki will host bibliographies, full text articles, presentations and other materials with long-term value.  This new Wiki service is available to other IIR units, and more news about it will follow later this spring.

Recent Library Presentations

IIR Librarian Terry Huwe presented a paper titled “Digital Preservation and the Open Web:  A Curatorial Perspective” at Computers in Libraries (CIL) in Washington, DC.  CIL is one of the longest running conferences with a focus on technology and libraries.

Janice Kimball gave a presentation on how to use Web resources for labor research at Laney College.  The class included a wide cross-section of working adults, some of whom did not have extensive experience with (or access to) the Internet.

Renovation News

IIR is currently evaluating three bids for the remodeling work on the Library, which should commence soon.  A visual rendering of the design and narrative describing the project have been added to the Library Web.  Take a lot at

Labor Project for Working Families News

New Work Family Curriculum Available from Labor Project for Working Families

MAKING IT WORK BETTER, A Work Family Educational Program, a step-by-step curriculum.
Available for download at no charge from www.laborproject.org

MAKING IT WORK BETTER is a step-by-step facilitator’s curricula designed to educate and mobilize union members and leaders on work family issues. This free 3 ½ hour curriculum has short modules which can be used in existing union trainings. It contains everything needed - group exercises on organizing, bargaining and advancing a public policy agenda on work/family issues, a power point presentation, background material and handouts - and can be customized by industry, union, size of the group or leadership level of the participants.

Spread the word about the new Work Family Curriculum:

1. Forward this email to your email lists 
2. Put a link to MAKING IT WORK BETTER, A Work Family Educational Program on your website: www.laborproject.org
3. Place our press release in your publication, available at: http://www.laborproject.org/press/press_release_1.doc
4. Email your feedback to lpwf@berkeley.edu.

You may also order the companion Work Family Union Guide:

A Job and a Life, Organizing and Bargaining for Work and Family Issues.

This 90 + page guide includes ways to get started – starting a committee, a fund, work and family bill of rights; sample contract language on child care, family leave, flexible hours, elder care and more, family friendly state laws, sample work family surveys, resources and more.
$10.00, available at www.laborproject.org or send check to: Labor Project for Working Families, 2521 Channing Way, #5555, Berkeley, CA 94720.

For more information, contact us at lpwf@berkeley.edu or (510)643-7088.

Campus Events

Bay Area Latin American Forum

April 17, 2006
12 – 1:15pm
Location TBA

The Way Things Work: Multinational Corporations in Latin America
Lowell Bergman

Center for Chinese Studies

April 19, 2006
3401 Dwinelle Hall

Building Ladders out of Chains: The Political Economy of China's Technological Development under Globalization
Douglas Fuller, Postdoctoral Fellow, SPRIE/APARC, Stanford

Center for Latin American Studies

Cine Documental

April 5, 2006
Location TBA

Looking Back at You 1995
Andrew Snell
This documentary focuses on Sebastião Salgado’s photo essay “Workers” which records the displacement of manual labor by technological advances in countries ranging from Cuba to Italy to Bangladesh. The film also includes archival footage of Salgado’s life and commentary by artists, photographers, critics and writers such as Jorge Armado, Robert Delpire, Jimmy Fox and Arthur Miller.

Economics Department

April 20, 2006
Thursday, 2 – 3:30pm, 608-7 Evans Hall
(Joint Seminar with Labor Economics)

Do Temporary Help Jobs Improve Labor Market Outcomes for Low-Skilled Workers? Evidence from Random Assignments

David Autor, MIT

Economics 242. Econometrics Seminar
639 Evans Hall

April 13, 2006
Marc Henry, Columbia University

April 20, 2006
Richard Smith, Cambridge University

April 27, 2006
(Joint Seminar with Labor Economics)
608-7 Evans Hall
Guido Kuerstiener, Boston University

Economics 251, Labor Economics Seminar
608-7 Evans Hall

April 13, 2006
Michael Greenstone, MIT

Graduate School of Journalism

April 6, 2006
4 – 5:pm
IGS Library
109 Moses Hall

California: America's High-Stakes Experiment - A panel discussion with Peter Schrag's on his new book.
Peter Schrag

Haas School of Business

Organizational Behavior and Industrial Relations Spring 2006 Colloquium
Haas room C-330, Wednesdays 4 - 5:30 pm
Professor Barry Staw

April 5, 2006
Nydia MacGregor, Erika Henik

April 12, 2006
Andrew Hargadon, University of California, Davis

April 19, 2006
Chris Rider, Margaret Ormiston

April 26, 2006
Connson Locke, Carmit Tadmor

Sociology Department Colloquium Series

Blumer Room
402 Barrows Hall
Thursdays, 4:00 - 5:30 pm

April 13, 2005
Racial Conflict and the Origins of Affirmative Action at Elite Universities
]erome Karabel, UC Berkeley

April 20, 2006
Inheriting the City: Immigrant origins and Americans Dreams in Contemporary New York Co-sponsored by the Immigration Workshop

Philip Kasinitz, CUNY