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Author: Cornwell, Christopher
Resulting in 2 citations.
1. Cornwell, Christopher
Dorsey, Stuart
Mehrzad, Nasser
Opportunistic Behavior by Firms in Implicit Pension Contracts
Journal of Human Resources 26,4 (Fall 1991): 704-725.
Cohort(s): Older Men
Publisher: University of Wisconsin Press
Keyword(s): Behavior; Inflation; Pensions; Retirement/Retirement Planning

Several studies have established that under the most common form of pension coverage, benefits accrue disproportionately near the end of a worker's career. Such backloading establishes a penalty for early quitting but many also create an incentive for opportunistic behavior. Because benefits generally are a function of highest earnings, when nominal earnings are expected to rise, an employer can reduce pension liabilities by discharging workers prior to retirement. This paper uses the NLS of Older Men to test whether such actions by employers are systematic. It is estimated that pension-covered workers with mean losses are less likely to be discharged. Unexpected increases in pension losses due to increases in inflation, however, raise the risk of discharge. No evidence was found that the minimum vesting standards of the Employees' Retirement Income Security Act reduces the likelihood of discharge for older workers who previously were not vested. These results are consistent with an implicit pension contract under which employer compliance is enforced by reputation. [MGMT CONTENTS]
Bibliography Citation
Cornwell, Christopher, Stuart Dorsey and Nasser Mehrzad. "Opportunistic Behavior by Firms in Implicit Pension Contracts." Journal of Human Resources 26,4 (Fall 1991): 704-725.
2. Cornwell, Christopher
Rupert, Peter
Unobservable Individual Effects, Marriage and the Earnings of Young Men
Economic Inquiry 35,2 (April 1997): 285-294.
Cohort(s): Young Men
Publisher: Western Economic Association International
Keyword(s): Earnings; Marital Status; Marriage; Wage Effects; Wages; Wages, Young Men

While there is compelling evidence that married men earn more than unmarried men, the source of this premium remains unsettled. Using panel data from the National Longitudinal Survey of Young Men, we show that much of the premium normally attributed to marriage is associated with unobservable individual effects that are correlated with marital status and wages. To the extent there is a gain, it is purely an intercept shift and no more than 5% to 7%. Our findings cast doubt on the interpretation that marriage enhances productivity through specialization. (Copyright Western Economic Association International.)
Bibliography Citation
Cornwell, Christopher and Peter Rupert. "Unobservable Individual Effects, Marriage and the Earnings of Young Men." Economic Inquiry 35,2 (April 1997): 285-294.