IDEAS home Printed from https://ideas.repec.org/p/pri/indrel/180.html
   My bibliography  Save this paper

Efficient Contracts and Cost of Adjustment: Short-Run Employment Determination for Airline Mechanics

Author

Listed:
  • David E. Card

    (Princeton University)

Abstract

This paper presents an empirical analysis of short-run employment determination for mechanics employed at seven domestic airline firms during the period 1969-1976. The link between output, contractual wage rates, aggregate wage rates and employment is explored in the framework of a model that permits costly adjustment and potential discrepancies between contractual wage rates and the opportunity value of workers' time. The estimation results confirm that simple partial adjustment employment models provide a useful description of the output-employment relationship. These models are less successful, however, in describing the effects of wages on firm-specific employment outcomes. There is some evidence against both a standard labor demand curve characterization of employment, and a simple efficient contracts characterization that equates the marginal product of labor to the alternative wage rate available to employees.

Suggested Citation

  • David E. Card, 1984. "Efficient Contracts and Cost of Adjustment: Short-Run Employment Determination for Airline Mechanics," Working Papers 560, Princeton University, Department of Economics, Industrial Relations Section..
    • Handle: RePEc:pri:indrel:180
    as

    Download full text from publisher

    File URL: https://dataspace.princeton.edu/bitstream/88435/dsp015t34sj583/1/180.pdf
    Download Restriction: no
    ---><---

    More about this item

    JEL classification:

    • C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pri:indrel:180. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Bobray Bordelon (email available below). General contact details of provider: https://edirc.repec.org/data/irprius.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.