Labour Economics

(EFIMM0041, MSc)

Dr. Patrick Arni

patrick.arni@bristol.ac.uk
Overview
• Course discusses a range of key issues in labour economics,
describing the interplay of workers, firms and institutions
• Labour is at the core of every economy: labour as input factor
accounts for about two thirds of total productivity
• Labour markets are imperfect, however: require institutions
(e.g., minimum wages, unemployment insurance, etc.)
• At core of the course: discussion of policy-relevant questions
related to the design and practice of such institutions
• To analyse the policy questions, we combine the use of formal
theoretical models with the application of empirical studies
Aimed at Students who…
• …are interested in the systematic economic analysis of topics
related to labour (institutions)
• …want to know how such highly relevant policy questions can
be assessed by modern empirical policy evaluation methods
• …want to gather analytical and methodological knowledge
which is applied in jobs such as
– Economic analysts in firms and non-profit organisations
– Policy analysts and designers in government & internat. organisations
– Academic pathways at universities and in private research institutions
– Etc.

• Course builds on concepts from Microeconomics

(ECONM1010) and Econometrics (ECONM1022)
Learning Outcomes

• Be able to understand and critically assess empirical findings

on the impact of labour market activities, labour market
institutions and related policies
• Develop knowledge to design empirical evaluations for the
assessment of policies relevant to the labour market
• Become familiar with theoretical models of labour economics
and related micro-econometric methods
• Understand and critically discuss current research papers in
the area of labour economics
Some Topics

• Labour Supply and Demand

• Human Capital and Education

• Job Search and Unemployment

• Minimum Wages and Wage Inequalities

• Migration of Workers
Examples of Related Policy Questions
• How will taxes and labour costs affect individual labour supply?

• How do people choose level and length of their education paths?

• How do different features of unemployment insurance affect the

way how individuals search for jobs?

• How do minimum wages influence employment of concerned

individuals – and wages of other workers?

• How did wage inequality develop in the last twenty years?

• How does immigration of labourers affect native workers?

Course details

Text books:
(1) P. Cahuc, S. Carcillo & A. Zylberberg (2014), Labor Economics,
(Second Edition), MIT Press
(2) T. Boeri & J. van Ours (2013), The Economics of Imperfect Labor Markets,
(Second Edition), Princeton University Press
(3) G. Borjas (2015), Labor Economics, (Seventh Edition), McGraw Hill

The course focuses on empirical studies, but covers as well some material on basic
concepts, theory and institutions as exposed in (1) to (3).

Course format:
16 hours of lectures
8 hours of exercise classes
Prepare answers to problems (theoretical, empirical, policy issues)
Present and discuss empirical studies
Feedback and Assessment

• Feedback and formative assessment: exercises, discussion and

presentation in classes

• Summative assessment: 2-hour written exam

• Exam questions will test different skills like:

– clearly explain relevant theoretical models (using equations, diagrams…)
– apply the theory to specific real-world cases or policy questions
– critical evaluation of results of empirical studies
– develop ideas and choose methods for empirical policy evaluations