Orley Ashenfelter

First name
Orley
Last name
Ashenfelter
Abstract

Based on hourly wage rates from nearly all McDonald’s restaurants, and prices of the Big Mac sandwich, we find an elasticity of the wage with respect to the minimum wage of 0.7. This elasticity does not differ between affected and unaffected restaurants because many restaurants maintain a constant wage ‘premium’ above the minimum wage. Higher minimum wages are not associated with faster adoption of touch-screen ordering, and there is near-full price pass-through of minimum wages. Minimum wages lead to higher real wages (expressed in Big Macs per hour) that are one fifth lower than the corresponding increases in nominal wages.

Year of Publication
2021
Number
646
Date Published
01/2021
Ashenfelter, O., & Jurajda, Š. (2021). Wages, Minimum Wages, and Price Pass-Through: The Case of McDonald’s Restaurants. Retrieved from http://arks.princeton.edu/ark:/88435/dsp01sb397c318 (Original work published 01/2021AD)
Working Papers
Abstract

Tradeoffs between monetary wealth and fatal safety risks are summarized in the value of a statistical life (VSL), a measure that is widely used for the evaluation of public policies in medicine, the environment, and transportation safety. This paper demonstrates the widespread use of this concept and summarizes the major issues, both theoretical and empirical, that must be confronted in order to provide a credible estimate of a VSL. The paper concludes with an application of these issues to a particular study of speed limits and highway safety.

Year of Publication
2005
Number
505
Date Published
12/2005
Publication Language
eng
Citation Key
7920
Ashenfelter, O. (2005). Measuring the Value of a Statistical Life: Problems and Prospects. Retrieved from http://arks.princeton.edu/ark:/88435/dsp01s1784k739 (Original work published 12/2005AD)
Working Papers
Year of Publication
1971
Number
29
Date Published
08/1971
Publication Language
eng
Citation Key
Econometrica, Vol. 42, No. 1, January 1974
Ashenfelter, O., & Heckman, J. (1971). The Estimation of Income and Substitution Effects in a Model of Family Labor Supply. Retrieved from http://arks.princeton.edu/ark:/88435/dsp01r781wg015 (Original work published 08/1971AD)
Working Papers
Year of Publication
1976
Number
93
Date Published
11/1976
Publication Language
eng
Citation Key
Review of Economics and Statistics, Vol. 60, No. 1, February 1978
Ashenfelter, O. (1976). Estimating the Effect of Training Programs on Earnings with Longitudinal Data. Retrieved from http://arks.princeton.edu/ark:/88435/dsp01d791sg182 (Original work published 11/1976AD)
Working Papers
Abstract

In this paper we report the results of randomized trials designed to measure whether stricter
enforcement and verification of work search behavior alone decreases unemployment insurance (Ul)
claims and benefits. These experiments were designed to explicitly test claims based on
nonexperimental data, that a prime cause of overpayment is the failure of claimants to actively seek
work. Our results provide no support for the view that the failure to actively search for work has been a
cause of overpayment in the UI system.

Year of Publication
1998
Number
412
Date Published
12/1998
Publication Language
eng
Citation Key
7926
Ashenfelter, O., Deschenes, O., & Ashmore, D. (1998). Do Unemployment Insurance Recipients Actively Seek Work? Randomized Trials in Four U.S. States. Retrieved from http://arks.princeton.edu/ark:/88435/dsp010k225b05v (Original work published 12/1998AD)
Working Papers
Abstract

In this paper we study the complete evolution of a final-offer arbitration system used in New
Jersey with data we have systematically collected over the 18-year life of the program. Covering
the wages of police officers and firefighters, this system provides virtually a laboratory setting for
the study of the evolution of strategic interaction. Our empirical analysis provides convincing
evidence that, left alone, the parties do not construct and present their offers as successfully as
when they retain expert agents to assist them. In principle, expert agents may be helpful to the
parties for two different reasons: (a) they may move the arbitrator to favor their position
independently of the facts, or (b) they may help eliminate inefficiencies in the conduct of strategic
behavior. In this paper we construct a model where the agent may influence outcomes
independent of the facts, but where the agent may also improve the outcomes of the process by
moderating any self-serving biases or over-confidence that may have led to impasse in the first
instance. Our data indicate that expert agents may well have had an important role in moderating
self-serving biases early in the history of the system, but that the parties have slowly evolved to a
non-cooperative equilibrium where the use of third-party agents has become nearly universal and
where agents are used primarily to move the fact finder’s decisions.

Year of Publication
2003
Number
478
Date Published
09/2003
Publication Language
eng
Citation Key
8097
Ashenfelter, O., & Dahl, G. (2003). Strategic Bargaining Behavior, Self-Serving Biases, and the Role of Expert Agents An Empirical Study of Final-Offer Arbitration. Retrieved from http://arks.princeton.edu/ark:/88435/dsp01ws859f663 (Original work published 09/2003AD)
Working Papers
Year of Publication
1979
Number
130
Date Published
11/1979
Publication Language
eng
Citation Key
Economica, 47, 1980
Ashenfelter, O., & Altonji, J. (1979). Wage Movements in the Labor Market Equilibrium Hypothesis. Retrieved from http://arks.princeton.edu/ark:/88435/dsp01w6634363w (Original work published 11/1979AD)
Working Papers
Year of Publication
1977
Number
98
Date Published
06/1977
Publication Language
eng
Citation Key
Journal of Political Economy, Vol. 87, No. 2, 1979
Ashenfelter, O., & Smith, R. (1977). Compliance with the Minimum Wage Law. Retrieved from http://arks.princeton.edu/ark:/88435/dsp013b591858q (Original work published 06/1977AD)
Working Papers
Abstract

Throughout the post—war period, U.S. and Canadian unemployment rates
moved in tandem, but this historical link apparently ended in 1982.
During the past three years, Canadian unemployment rates have been some
three percentage points higher than their U.S. analogues, and this gap
shows no sign of diminishing. This paper is an empirical evaluation of
a variety of explanations for this new unemployment gap.
We first show that the demographic and industrial composition of
the two countries is remarkably similar, so that no simple mechanical
hypothesis explain the basic puzzle. It is also evident that the
increase in Canadian unemployment relative to U.S. unemployment cannot
be fully attributed to output movements. We find that the gap between
actual and predicted Canadian output, based on U.S. output, has fallen
dramatically since 1982 while the unemployment gap has widened. We also
find that unemployment in Canada was 2 to 3 percentage points higher in
1983 and 1984 than predicted by Canadian output.
We have investigated a variety of hypotheses to explain the slow
growth of employment in Canada after 1982. These hypotheses attribute
the slow growth of employment to rigidities in the labor market that
raise employers’ costs and restrict the flow of workers between
sectors. The evidence does not support the notion that the growth in
relative unemployment in Canada is due to differences in the regulation
of the labor market in the two countries. Minimum wage laws and
unemployment benefits are fairly similar in Canada and the U.S., and
neither has changed relative to the other in the last decade.
Unionization rates have increased in Canada relative to U.S. since
1970. Most of this divergence occurred before 1980, however, and does
not seem to have created an unemployment gap prior to 1980. Finally,
the hypothesis that differential real wage rates are a major determinant
of relative employment in the U.S. and Canada is soundly rejected by the
data. Real wage rates have been essentially uncorrelated with employ-
ment movements within each country and between the two countries.

Year of Publication
1986
Number
204
Date Published
02/1986
Publication Language
eng
Citation Key
Economica, 53 Special Issue July 1986 S171 - S195
Ashenfelter, O., & Card, D. (1986). Why Have Unemployment Rates in Canada and the U.S. Diverged?. Retrieved from http://arks.princeton.edu/ark:/88435/dsp01bn999673s (Original work published 02/1986AD)
Working Papers