1. In Charles Baird's article "The Philosophical and Analytical Framework":

a. What is the difference between a legislated right and a natural right? An entitlement and voluntary exchange?

b. Why is the market process view of profit important to the study of labor economics?

c. Why does the bargaining power of workers depend on the competition between employers for their services? Why does the bargaining power of the employer depend on the competition between workers for positions in his firm?

a. Explain why Epstein argues that contracts at will are fair and that imposing for cause contracts on employers is basically unfair.

b. Why does contract at will work to the mutual benefit of both parties? Explain.

(1) How does the at-will contract contribute to reducing employee misbehavior (or opportunism)? (NOTE: Firms will monitor employees up to the point where $1 of additional monitoring will generate $1 of added benefits to the firm in employee productivity. Firms will not monitor employees more than that meaning that employees can impose some costs on the firm owners by not working as hard as they could, for example. As a result, the firm owners attempts to minimize the sum of monitoring plus lost worker productivity costs-these are called agency costs.) Is termination the least cost solution to employee misbehavior? Explain.

(2) How does the contract at-will benefit the worker? Explain both cases-where employers make increased demands on the worker and provision of severance pay.

(3) Explain what Epstein means by the asymmetry of reputational losses and why this is an important advantage for the worker in a contract at-will.

(4) Explain why risk diversification and minimization of administrative costs are important features of contracts at-will. (Hint: Why will informal methods of dealing with arbitrary firings be more efficient than formal court interventions? See especially p. 28 at the bottom of the first paragraph.)

(5) How does Epstein deal with the argument that the contract at-will has an inherent inequality of bargaining power imbedded in it? What price does an employer pay for exercising the right to fire? Who is more likely to appropriate most of the contract-specific surplus? Explain.

c. Should the contract at-will be abolished in order to accomplish some redistribution of wealth from rich to poor? Explain.

a. Why does the military use too few machines when it underprices military recruits?

b. Why are turnover times substantially longer in a volunteer army?

c. Why is the output of non-military goods lower and the cost of production higher when the army uses the method of the draft?

d. Why is the draft a regressive tax?

e. Is the volunteer army "too expensive"?

a. Why does the head tax result in the use of forced labor?

b. Is forced labor cheaper than using voluntary labor? Explain.

a. Be sure you can explain (1) who is getting the minimum wage, (2) who is stuck at the minimum wage, (3) how those receiving the minimum wage support families, and (4) who benefits from a minimum wage increase.

b. Do higher minimum wages lead to job losses? Explain using the evidence cited in the article.

c. In what form does the job loss occur? Explain.

d. Two economists (Card and Krueger) have recently published articles which claim to show that minimum wage increases do not lead to job losses but may have a small positive effect on employment. Is this a credible claim on a theoretical basis? Is their empirical work sound? Explain.

a. What offsetting strategies can employers use when the Congress mandates a minimum wage (or an increase in the minimum wage)?

b. Given your answer in part a, who are the gainers and who are the losers when a minimum wage is used to help low-wage workers? Explain carefully.

c. Explain some of the evidence that McKenzie cites in support of his position.

a. Why are freely moving prices the great equalizer?

b. Why are minimum wages the great unequalizer? Explain.

a. Will the minimum wage help poor low wage workers? Explain using some of the evidence that Forrest cites.

a. Why do some companies require new employees to pay back relocation costs if they quit shortly after they are hired?

b. What happens if companies cannot recover training costs (or the relocation costs) when workers leave before the companies can recoup their investment?

c. How might workers "exploit" companies in such cases?

d. In the American Airlines example: If a pilot quits within a year of taking the training course, the union argued that the company unfairly assumed that all such pilots intended to quit and should therefore pay back the training cost pro rated. Does intention to quit have anything to do with a payback requirement? (If I take the training course fully intending to stay with the company but change my mind later, should I have to pay the company back?)

e. What were the issues in the EDS and the Sheet Metal and Air-Conditioning Industry examples?

a. What price do women with careers pay when they take extended leave? Is this fair? Explain one or two examples from the article.

b. What is the economic explanation for employers' behavior?

c. What are some ways to solve this problem?

a. Distinguish between equality of rights or opportunity and equality of results. Which approach would seem the fairest? (Hint: Treating equals equally as under the rule of law.)

b. What is the residual fallacy? Explain.

c. What do the authors mean by the phrase "When a BA does not equal a BA"? Explain using the data in this section of the article.

d. How does marriage affect a woman's labor market earnings? Explain.

e. Are the Gender Wage Gap and Glass Ceiling meaningful concepts? Why or why not? Explain.

f. What alternative explanation do the authors offer in place of the above concepts? Explain.

g. Do women owe their increasing success in the labor market to preferential treatment through the political process? Explain.

a. Is there a glass ceiling for women engineers or women professionals in general? What determines the pay differential between professional men and women? Explain.