One of the major requirements for this course is the term paper. This term paper is described in the syllabus as a 14+ (typed, double spaced, 12 point font, 1 inch margins, numbered pages) paper reporting on a small-scale empirical study. Note that the syllabus also states that 'Care should be taken on organization, grammar, and spelling as poor presentation detracts from any paper and will be reflected in the grade.' Communication skills are crucial, not just here at the university but out there in the real world. If you need help, seek it out in advance. Address the paper to an audience with a background in economics (at the Econ 210/211 level) but no particular knowledge of labor economics. In other words, do not ask me to read your mind or assume you know labor economics. I need to see how well you understand labor economics to assign a grade. Convince me you do! The following includes (a) an overall discussion of the paper with a focus on the aspects that are most likely to cause a problem, (b) a description and grading rubric for the prospectus, (c) a brief outline/format that you might find useful to follow for the term paper, and (d) the rubric by which the final paper will be graded.
The most difficult decision you face is your choice of topic. Any labor-related topic is acceptable, but you must have a hypothesis that is defensible (usually from a theoretical perspective) and testable using publicly available data. I am here to serve as a sounding board and to help you determine the feasibility of a proposal. Please, however, pick a topic that interests you since you will be working on this paper for a while. In the past students have:
1) examined men's labor force participation rates by marital status and hypothesized that marriage might increase their labor force participation because marriage tends to increase the need for income.
2) examined labor legislation and hypothesized that Senators from states where unions are more powerful are more likely to vote in favor of pro-labor legislation.
3) examined salaries of major league baseball pitchers as a function of ERA stats..., years in league, and city size using labor demand theory as the motivation.
4) examined the labor force participation rate of women across different countries as a function of education, number of children ... . The hypothesis could be that women are more likely to seek employment when they have better market wage opportunities (ie. higher education) and lower opportunity costs.
5) examined how the unemployment rate differs from state to state (or country to country) as a function of various characteristics of the state such as education levels, industrial mix, ... . One possible hypothesis is that states with a historical emphasis on heavy manufacturing will have higher unemployment rates because that sector of the economy has been shrinking and retraining/moving costs are significant.
6) examined how the minimum wage affects youth employment rates by taking advantage of state differences in the minimum wage. Hypothesis: states with higher minimum wages will have lower youth employment rates.
7) examined the impact of immigrants on resident earnings. Hypothesis: an influx of immigrants will drive wages down because it constitutes an increase in labor supply.
8) examined employment demand in a particular industry as a function of output price in that industry, wage in that industry, and the price of other inputs in that industry. Labor demand theory has clear predictions for a model of this sort.
Upon identifying a topic that interests you, there are two important steps to take. First, you must clearly formulate a defensible hypothesis. An example of a hypothesis is: an increase in X will cause an increase in Y. Such a statement is only defensible if you can explain why such a connection exists. Theory is typically critical at this stage. The text and I can help you here. Reading how others have approached this topic will help you formulate your thoughts. Third, you must be able to collect data on X and Y that will allow you to conduct an empirical study to test your hypothesis. I have posted links to numerous on-line data sources. There are many more not listed here. Ask me and/or a librarian for help. Think also about what other variables might have an important effect on Y and gather data on these variables as well. SEE ME! I may be able to help you to focus your ideas, identify potential problems with data access, and find relevant journal articles. Data are not that difficult to obtain now in Excel format. The more observations you have, the more likely you are to obtain statistically significant coefficients.
Suggested Outline for the Paper
There are many ways to organize a paper. What follows is a sample outline containing questions you need to address somewhere in the paper. Be organized! Many journal articles follow a format similar to that shown below. Look at the articles we have discussed in class and the article for which you wrote a literature review.
What is the issue you wish to address? Why is this an interesting/important issue? What is your hypothesis? Do not begin you paper by saying “I decided to write on XXX because I think it is interesting. …” Indeed writing in the first person and using conjunctions is discouraged in a formal term paper. Motivate your readers!
II. Literature Review
What have other researchers (and possibly the popular press) had to say about this issue? What sort of analysis have they done? How will your work be different? I expect you to have several relevant economic citations! Check with me if in doubt. See the handout on Blackboard for the appropriate footnote and bibliographic format.
Justify/Defend your hypothesis. Refer back to basic economic theory like profit maximization or utility maximization. Or use the principle of marginal cost/marginal benefit analysis. Or think about production functions, demand equations, supply equations. What is it that you are trying to explain? What factors/variables are you going to use to explain this phenomenon? What effect do you expect they have (ie. what is/are your hypothesis(es))? Why? What specific equation are you going to estimate?
What data are you using to test your hypothesis(es)? Were you able to find exactly the information your model called for or did you have to settle for second best? If you had to settle, why did you choose the measures you chose (what were your alternatives, if any) and what effect do you think using these approximations will have upon the results? You should present sample statistics for your data at this time (usually done in a table) and carefully define the variables you are using. Briefly identify where you obtained your data. (An electronic copy of the data must be submitted to me along with the paper. E-mail is fine. I must be able to replicate your analysis.)
Present the empirical results of your study. Was your hypothesis correct, incorrect, ...? Did the effect of any of the variables surprise you? What might explain any anomalies? - NOTE: The grade on this final paper is not a function of whether you find evidence for or against your hypothesis, but rather of how well you explain yourself.
Briefly restate your hypothesis and arguments, highlight your results, perhaps suggest further work/analysis that would shed more light on this issue.
You are required to provide me with an electronic (not paper) copy of all your data. Specifically I need the Excel spreadsheet containing the data you use for your regression. I need to be able to replicate your analysis. Please label the file with your name (for example, Smith.xlsx).
Sample papers (courtesy of Jigar Patel and Adrianna Sheer-Cook) are posted on Blackboard for your perusal.
Grading Rubric for the term paper:
10% Content: Introduction, statement of hypothesis, motivation. 15% Background: Theoretical justification, literature review. 15% Data: Appropriateness of data and data description/citation. 30% Analysis: Discussion of empirical model, analysis, discussion of results, conclusion. 15% Organization and Structure: Does the paper flow clearly from topic to topic? Are sections and paragraphs reasonably well organized in thesis form? 15% Mechanics: Punctuation, grammar, spelling.
Students coauthoring a term paper may be asked to complete a survey regarding their own and their coauthors’ contributions to the project. Grades may be adjusted accordingly.
EXCEPTION: If you fail to turn in the data used in your analysis, I reserve the right to give you a zero on the paper.