{"id":{"repo_id":"uiuc","oai_identifier":"oai:www.ideals.illinois.edu:2142/23577"},"canonical_url":"https://search.dev.ndltd.org/etd/uiuc/oai:www.ideals.illinois.edu:2142/23577","repository":{"repo_id":"uiuc","name":"University of Illinois - Urbana-Champaign","base_url":"https://www.ideals.illinois.edu/oai-pmh"},"display":{"title":"The impact of firm failure rates on the development and nature of implicit long-term labor contracts","abstract":"\"Implicit long-term labor contracts provide a characterization of the employment relationship markedly different from that suggested by a \"\"spot\"\" labor market. Long-term implicit agreements are of considerable interest because their use is consistent with many stylized facts of the labor market, and they help to explain other observed micro- and macroeconomic phenomena not easily rationalized within the conventional neoclassical paradigm. This thesis addresses a gap in the current literature by rigorously examining the impact of various firm, worker, and industry characteristics on the development and nature of implicit long-term labor contracts.\"","abstract_html":""Implicit long-term labor contracts provide a characterization of the employment relationship markedly different from that suggested by a ""spot"" labor market. Long-term implicit agreements are of considerable interest because their use is consistent with many stylized facts of the labor market, and they help to explain other observed micro- and macroeconomic phenomena not easily rationalized within the conventional neoclassical paradigm. This thesis addresses a gap in the current literature by rigorously examining the impact of various firm, worker, and industry characteristics on the development and nature of implicit long-term labor contracts."","abstract_has_math":false,"creators":["Curme, Michael Allen"],"institution":"University of Illinois at Urbana-Champaign","degree_name":"Ph.D.","degree_level":"Dissertation","degree_discipline":"Economics, Labor","degree_department":null,"school":null,"contributors":["Kahn, Lawrence M."],"advisors":[],"committee_chairs":[],"committee_members":[],"year":2011,"date_issued":"2011-05-07T14:19:18Z","date_published":"2011-05-07T14:19:18Z","updated_at":"2026-07-22T22:25:22Z","subjects":["Economics, Labor"],"languages":["eng"],"rights":["Copyright 1989 Curme, Michael Allen"],"rights_urls":[],"identifier_entries":[{"key":"dc:identifier","label":"Identifier","values":["AAI8916233","(UMI)AAI8916233"],"render_values":[{"text":"AAI8916233","href":null,"code":true},{"text":"(UMI)AAI8916233","href":null,"code":true}]}]},"links":{"outbound_url":"http://hdl.handle.net/2142/23577","outbound_label":"Handle","outbound_source":"dc:identifier"},"metadata_groups":[{"id":"people","label":"People","entries":[{"key":"dc:contributor","label":"Contributor","values":["Kahn, Lawrence M."]},{"key":"dc:creator","label":"Author","values":["Curme, Michael Allen"]}]},{"id":"academic_context","label":"Academic Context","entries":[{"key":"dc:date","label":"Dc Date","values":["2011-05-07T14:19:18Z","10000-01-01","1989"]},{"key":"dc:type","label":"Dc Type","values":["text"]},{"key":"thesis:degree_discipline","label":"Discipline","values":["Economics, Labor"]},{"key":"thesis:degree_level","label":"Degree Level","values":["Dissertation"]},{"key":"thesis:degree_name","label":"Degree Name","values":["Ph.D."]},{"key":"thesis:institution_name","label":"Thesis Institution Name","values":["University of Illinois at Urbana-Champaign"]}]},{"id":"subjects_keywords","label":"Subjects and Keywords","entries":[{"key":"dc:subject","label":"Dc Subject","values":["Economics, Labor"]}]},{"id":"language_rights","label":"Language and Rights","entries":[{"key":"dc:language","label":"Dc Language","values":["eng"]},{"key":"dc:rights","label":"Dc Rights","values":["Copyright 1989 Curme, Michael Allen"]}]},{"id":"identifiers","label":"Identifiers","entries":[{"key":"dc:identifier","label":"Identifier","values":["AAI8916233","(UMI)AAI8916233","http://hdl.handle.net/2142/23577"]}]},{"id":"additional","label":"Additional Metadata","entries":[{"key":"dc:description","label":"Description","values":["\"Implicit long-term labor contracts provide a characterization of the employment relationship markedly different from that suggested by a \"\"spot\"\" labor market. Long-term implicit agreements are of considerable interest because their use is consistent with many stylized facts of the labor market, and they help to explain other observed micro- and macroeconomic phenomena not easily rationalized within the conventional neoclassical paradigm. This thesis addresses a gap in the current literature by rigorously examining the impact of various firm, worker, and industry characteristics on the development and nature of implicit long-term labor contracts.\"","Specifically, it is demonstrated that under certain conditions, the use of long-term implicit labor contracts is inversely related to the failure probability of firms. This result follows naturally from the shirk-deterring, end-weighted compensation scheme associated with incentives based extended contracts, coupled with worker risk aversion. Moreover, it is shown that the earnings profile under implicit contracts may also be influenced by the probability of unintentional firm default.","The theoretical predictions are uniformly supported by appropriately designed empirical tests. Based on previous research in the area, pension coverage is used as a proxy for implicit long-term contract coverage. It is demonstrated that for workers most likely to be faced with the long-term/spot market dichotomy, industry failure rates exert a significant negative influence on the probability of implicit contract coverage. Furthermore, the evidence supports several related hypotheses concerning the impact of failure rates on the earnings profile under long-term agreements; for workers taken to be covered by implicit contracts, a compensating differential related to the probability of failure was found, as is a return to tenure that is positively related to firm failure rates.","Made available in DSpace on 2011-05-07T14:19:18Z (GMT). No. of bitstreams: 2 license.txt: 4922 bytes, checksum: 910b249b4beec47e7ab768910c8f966f (MD5) 8916233.pdf: 10429406 bytes, checksum: dc166428406217c8483a457d7021a9bf (MD5) Previous issue date: 1989","Item marked as restricted to the 'UIUC Users [automated]' Group (id=2) by Howard Ding (hding2@illinois.edu) on 2011-05-07T15:05:25Z Item is restricted indefinitely.","Restriction data tranferred 2014-07-01T11:31:20-05:00 Original Data Group with Access UIUC Users [automated] Release Date: none Reason: ETDs are only available to UIUC Users without author permission","ETDs are only available to UIUC Users without author permission","U of I Only"]},{"key":"dc:title","label":"Title","values":["The impact of firm failure rates on the development and nature of implicit long-term labor contracts"]}]}],"canonical_facts":{"dc:contributor":["Kahn, Lawrence M."],"dc:creator":["Curme, Michael Allen"],"dc:date":["2011-05-07T14:19:18Z","10000-01-01","1989"],"dc:description":["\"Implicit long-term labor contracts provide a characterization of the employment relationship markedly different from that suggested by a \"\"spot\"\" labor market. Long-term implicit agreements are of considerable interest because their use is consistent with many stylized facts of the labor market, and they help to explain other observed micro- and macroeconomic phenomena not easily rationalized within the conventional neoclassical paradigm. This thesis addresses a gap in the current literature by rigorously examining the impact of various firm, worker, and industry characteristics on the development and nature of implicit long-term labor contracts.\"","Specifically, it is demonstrated that under certain conditions, the use of long-term implicit labor contracts is inversely related to the failure probability of firms. This result follows naturally from the shirk-deterring, end-weighted compensation scheme associated with incentives based extended contracts, coupled with worker risk aversion. Moreover, it is shown that the earnings profile under implicit contracts may also be influenced by the probability of unintentional firm default.","The theoretical predictions are uniformly supported by appropriately designed empirical tests. Based on previous research in the area, pension coverage is used as a proxy for implicit long-term contract coverage. It is demonstrated that for workers most likely to be faced with the long-term/spot market dichotomy, industry failure rates exert a significant negative influence on the probability of implicit contract coverage. Furthermore, the evidence supports several related hypotheses concerning the impact of failure rates on the earnings profile under long-term agreements; for workers taken to be covered by implicit contracts, a compensating differential related to the probability of failure was found, as is a return to tenure that is positively related to firm failure rates.","Made available in DSpace on 2011-05-07T14:19:18Z (GMT). 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