Henry Farber

First name
Henry
Last name
Farber

Year of Publication
2021
Abstract

This paper summarizes the results of nearly a dozen new papers presented at the Sundance Conference on Monopsony in Labor Markets held in October 2018.  These papers, to be published as a special issue of the Journal of Human Resources, study various aspects of monopsony and failures of competition in labor markets. It also reports on the new developments in public policies associated with widespread concerns about labor market competition and efforts to ameliorate competitive failures. The conference papers range from studies of the labor supply elasticity individual firms face to studies of local labor market concentration to studies of explicit covenants suppressing labor market competition. New policies range from private and public antitrust litigation to concerns about the effect of mergers and inter-firm agreements on labor market competition. We provide a detailed discussion of the mechanics of the Silicon Valley High Tech Worker conspiracy to suppress competition based on Court documents in the case. Non-compete agreements, which are not enforceable in three states already, have also come under scrutiny.  

Number
652
Date Published
10/2021
Ashenfelter, O., Card, D., Farber, H., & Ransom, M. R. (2021). Monopsony in the Labor Market New Empirical Results and New Public Policies. Retrieved from http://arks.princeton.edu/ark:/88435/dsp016m311s43b (Original work published 10/2021AD)
Working Papers

Author
Year of Publication
2007
Abstract

The increasing globalization of production and trade in the last 25 years has
required substantial adjustment of employment relationships in the United States
and Japan. Worker attachment to firms has always been lower in the U.S. than
in Japan, and this is reflected in a difference in institutions. As both the U.S.
and Japan have been faced with similar global competitive pressures, firms in
the two countries have responded in ways that are consistent with their histories,
institutions, and demographics. Firms in the United States have laid off workers,
even those in long-term primary jobs. Firms in Japan have taken the approach
of reassigning workers to other, perhaps lesser, jobs, seconding workers to other
firms, and making more use of part-time and secondary jobs. The result of
this difference in strategies is that the Japanese-U.S. gap in worker attachment
to firms has widened, particularly for males. Interestingly, the Japanese labor
market has made increased use of part-time and other non-standard workers,
particularly for females, to an extent not seen in the United States

Number
519
Date Published
09/2007
Publication Language
eng
Citation Key
8028
Farber, H. (2007). Labor Market Adjustment to Globalization: Long-Term Employment in the United States and Japan. Retrieved from http://arks.princeton.edu/ark:/88435/dsp01tb09j566t (Original work published 09/2007AD)
Working Papers

Author
Year of Publication
1975
Number
72
Date Published
07/1975
Publication Language
eng
Citation Key
8193
Farber, H. (1975). Testing a Naive Theory of Bargaining. Retrieved from http://arks.princeton.edu/ark:/88435/dsp01h415p9553 (Original work published 07/1975AD)
Working Papers

Year of Publication
1992
Abstract

We use a demand/supply framework to analyze 1) the decline in union
membership since 1977 in the United States and 2) the difference in
unionization rates between the United States and Canada. We extend earlier
work on these problems by analyzing new data for 1991 from the General Social
Survey and for 1992 from our own household survey on worker preferences for
union representation. When combined with earlier data for 1977 from the
Quality of Employment Survey and for 1984 from a survey conducted for the
AFl-CIO, we are able to decompose changes in unionization into changes in
demand and changes in supply. We also analyze data for 1990 from a survey
conducted for the Canadian Federation of Labor on the preferences of Canadian
workers for union representation.
We find that virtually all of the decline in union membership in the
United States between 1977 and 1991 is due to a decline in worker demand for
union representation. There was almost no change over this period in the
relative supply of union jobs. Additionally, very little of the decline in
unionization in the U.S. can be accounted for by structural shifts in the
composition of the labor force. Next, we find that all of the higher
unionization rate in the U.S. public sector in 1984 can be accounted for by
higher demand for unionization and that there is actually more frustrated
demand for union representation in the public sector. Finally, we
tentatively conclude that the difference in unionization rates between the
U.S. and Canada is accounted for roughly in equal measure by differences in
demand and in supply.

Number
306
Date Published
08/1992
Publication Language
eng
Citation Key
In Employee Representation: Alternatives and Future Directions, Bruce Kaufman and Morris Kleiner, editor s. Industrial Relations Research Association, 1993
Krueger, A., & Farber, H. (1992). Union Membership in the United States: The Decline Continues. Retrieved from http://arks.princeton.edu/ark:/88435/dsp01m039k4906 (Original work published 08/1992AD)
Working Papers

Year of Publication
1996
Abstract

A central feature of the litigation process that affects case outcomes is the selection of
cases for litigation. In this study, we present a theoretical framework for understanding the
operation of this suit selection process and its relationship to the underlying distribution
of potential claims and claimants. We implement the model empirically by assuming that
individuals vary more in their litigiousness (inverse costs of litigation) than do corporations.
This assumption, coupled with the case selection process we present, yields clear predictions
on trial rates as a function of whether the plaintiff and defendant were individuals or
corporations. The model also yields a prediction on the plaintiff ’s win rate in lawsuits as
a function of the plaintiff ’s identity. Our empirical analysis, using data on over 200,000
federal civil litigations, yields results that are generally consistent with the theory. Lawsuits
where the plaintiff is an individual are found to have higher trial rates and lower plaintiff
win rates.

Number
364
Date Published
06/1996
Publication Language
eng
Citation Key
Rand Journal of Economics, 28, 1997
Farber, H., & Eisenberg, T. (1996). The Litigious Plaintiff Hypothesis: Case Selection and Resolution. Retrieved from http://arks.princeton.edu/ark:/88435/dsp01f4752g733 (Original work published 06/1996AD)
Working Papers

Year of Publication
1993
Abstract

In this study we examine the experience of a single large hospital with an
informal pre-litigation “complaint” process that resolves some cases outside of the legal
system. The empirical results are generally consistent with an information structure where
patients are poorly informed about the quality of medical care and the hospital does not
know whether particular patients are litigious or not. The complaint process seems to
resolve many complaints in a less costly manner than filing lawsuits. Almost half of all
complaints are resolved before a lawsuit is filed. The large majority of these are dropped,
and they are cases that would likely have been dropped even if they had been initiated as
lawsuits. Very few cases are settled with a cash payment to patients before a lawsuit is
filed, suggesting that patients must file lawsuits in order to convince the hospital that they
are litigious enough to justify a settlement. Cases initiated through the complaint process
are not resolved (dropped, settled, tried to a verdict) significantly differently from cases
initiated as lawsuits, controlling for observable case characteristics. When settlements
of lawsuits occur, the amounts paid do not vary depending on how the case originated,
but settlements of complaints are much higher for cases settled after a lawsuit is filed.
We conclude that the complaint process is a cost-effective “front-end” for the litigation
process that provides information to patients regarding the quality of their medical care
and, hence, the likelihood of negligence.

Number
314
Date Published
03/1993
Publication Language
eng
Citation Key
Journal of Legal Studies, Vol. 23, No. 2, June 1994
White, M., & Farber, H. (1993). A Comparison of Formal and Informal Dispute Resolution in Medical Malpractice. Retrieved from http://arks.princeton.edu/ark:/88435/dsp01g732d898w (Original work published 03/1993AD)
Working Papers

Author
Year of Publication
1998
Abstract

Three central facts describe inter-firm worker mobility in modern labor mar-
kets: 1) long-term employment relationships are common, 2) most new jobs end early,
and 3) the probability of a job ending declines with tenure. Models based on firm-specific
capital provide a parsimonious explanation for these facts, but it also appears that worker
heterogeneity in mobility rates can account for much of what we observe in these data. I
investigate tests of the specific capital model and consider whether these tests are success-
ful in distinguishing the specific capital model from a model based on heterogeneity. One
approach uses longitudinal data with detailed mobility histories of workers. These analyses
suggest that both heterogeneity and specific capital (implying true duration dependence
in the hazard of job ending) appear to be significant factors in accounting for mobil-
ity patterns. A second approach is through estimation of the return to tenure in earnings
functions. This is found to have several weaknesses including endogeneity of tenure and the
lack of tight theoretical links between tenure and accumulated specific capital and between
productivity and wages. A third approach is to use of data on the earnings experience of
displaced workers. Several tests are derived based on these data, but there is generally an
alternative heterogeneity-based explanation that makes interpretation difficult. Nonethe-
less, firms appear willing to pay to encourage long-term employment relationships, and
they may do so because it is efficient to invest in their workforce. On this basis, I conclude
that, while deriving convincing direct evidence for the specific capital model of mobility
is difficult, it appears that specific capital is a useful construct for understanding worker
mobility and wage dynamics.

Number
400
Date Published
06/1998
Publication Language
eng
Citation Key
8379
Farber, H. (1998). Mobility and Stability: The Dynamics of Job Change in Labor Markets. Retrieved from http://arks.princeton.edu/ark:/88435/dsp01g732d899j (Original work published 06/1998AD)
Working Papers

Year of Publication
1992
Abstract

We test for the presence of an addictive effect of arbitration
(positive state dependence) using data both from a laboratory bargaining
experiment and from the field. We find no evidence of state dependence in
the experimental data, and we find weak evidence of positive state dependence
in the field data on teachers in British Columbia. Hence, we reject the view
that use of arbitration per se leads to state dependence either through
reducing uncertainty about the arbitral process or through changing the
bargaining parties perceptions about their opponents. The results further
suggest that an explanation for any positive state dependence we find in the
British Columbia field data must lie in an aspect of the arbitration process
which is not captured by our simple experimental design.

Number
295
Date Published
01/1992
Publication Language
eng
Citation Key
Proceeding of the Forty-Fourth Annual Meeting of the Industrial Relations Research Association, 1992
Currie, J., & Farber, H. (1992). Is Arbitration Addictive? Evidence From the Laboratory and the Field. Retrieved from http://arks.princeton.edu/ark:/88435/dsp01rf55z7705 (Original work published 01/1992AD)
Working Papers

Year of Publication
2001
Number
460
Date Published
12/2001
Publication Language
eng
Citation Key
British Journal of Industrial Relations, September 2002, pp. 385-401
Western, B., & Farber, H. (2001). Ronald Reagan and the Politics of Declining Union Organization. Retrieved from http://arks.princeton.edu/ark:/88435/dsp01j098zb111 (Original work published 12/2001AD)
Working Papers

Year of Publication
1995
Abstract

The central claim of a rapidly growing literature in international relations is that members
of pairs of democratic states are much less likely to engage each other in war or in serious
disputes short of war than are members of other pairs of states.
Our analysis does not support this claim. Instead, we find that the dispute rate between
democracies is lower than is that of other country pairs only after World War H. Before 1914
and between the World Wars, there is no difference between the war rates of members of
democratic pairs of states and those of members of other pairs of states. We also find that there
is a higher incidence of serious disputes short of war between democracies than between
nondemocracies before 1914.
We attribute this cross-temporal variation in dispute rates to changes in patterns of
common and conflicting interests across time. We use alliances as an indicator of common
interests to show that cross-temporal variation in dispute rates conforms to variations in interest
patterns for two of the three time periods in our sample.

Number
342
Date Published
01/1995
Publication Language
eng
Citation Key
Journal of Politics, 59, May, 1997
Gowa, J., & Farber, H. (1995). Common Interests or Common Polities? Reinterpreting the Democratic Peace. Retrieved from http://arks.princeton.edu/ark:/88435/dsp01cc08hf63j (Original work published 01/1995AD)
Working Papers