Report on the 3rd IZA European Summer School in Labor Economics, 2000


Daniel Hamermesh's lecture series on labor demand topics began with a static theory of labor demand, differentiating between homogeneous and heterogeneous labor, and moved to current methods of estimation and results of those estimates. In a second part, the course presented a dynamic theory of factor demand and discussed the estimation of dynamic models. Throughout his lecture, Daniel Hamermesh put special emphasis on the usefulness of the theory for evaluating labor-market policies. His traversal of the policy-oriented empirical literature focused on the impacts of minimum wages, including unemployment, employment and distribution effects, overtime policies and payroll taxes. The lecture also examined the relevance of labor demand for changing earnings inequality.


In his series of six lectures, Gerard van den Berg provided an overview of duration analysis in labor economics, with an emphasis on the specification and identification of (mixed) proportional hazard models, including models for multiple durations. As the results of duration analyses are often interpreted in terms of job search theory, the course furthermore dealt with various search models of the labor market, presenting stationary and non-stationary search models as well as partial and equilibrium search models. The lecture examined the relation of structural parameters of theoretical search models and popular reduced-form models. Special attention was paid to the analysis of treatment effects on duration variables, like the effect of training programs on unemployment duration. The theoretical considerations were illustrated with a number of empirical examples, including an analysis of the causes for long-term unemployment in Europe.