Three essays in labor economics

The first chapter studies the use of signing bonuses, a common form of compensation in the high-skill, high-wage labor market. I consider three explanations for signing bonuses: the firm's comparative advantage in lending, an ability to exploit ex-post monopsony power and the desire for internal wage equity. Using survey data on MBA graduates, I find that signing bonuses are more cyclical than base salaries provides strong evidence for the wage compression component. Supporting evidence for the lending motive and firms' ex-post monopsony power is weaker and not robust. I find that signing bonuses are higher for younger workers who are likely to be credit constrained and that smaller firms and pre-IPO firms offer smaller signing bonuses. Non-U.S. residents, whose job mobility is limited due to U.S. immigration and visa policies, tend to get larger signing bonuses, suggesting that ex-post monopsony power may be operating.; The second chapter investigates the extent to which low-skilled female immigrants increase the labor supply of skilled native women. Less-educated female immigrants, who often lack labor market skills and language proficiency, have a comparative advantage in occupations closely related to home production. An increase in the supply of domestic service workers enables native-born women to take up market work. Empirical analyses show that a one-percentage point increase in the proportion of low-skilled female immigrants in a metropolitan area raises the proportion of private household workers by 6 percentage points and lowers their wages by 3%. Moreover, the labor supply of college-graduate married women is higher in metropolitan areas with a high proportion of private household workers. The magnitude of the change in supply of private household services due to immigration, however, seems too small to have a significant impact on labor supply of skilled native women.; The last chapter examines the role of language enclaves in promoting self-employment. Literature on networks suggests that social interactions in an enclave may influence an individual's propensity to become self-employed by sharing information on how to run a business, imposing social norms, or providing role models. Using language spoken at home to define networks, I find strong evidence that enclave networks play an important role in determining the likelihood of self-employment. I also explore three other hypotheses of the beneficial effect of enclaves on self-employment: (1) Enclaves supply potential entrepreneurs with low-paid immigrant labor, (2) Enclaves provide access to informal credit, and (3) Enclaves provide a market opportunity for ethnic entrepreneurs to serve special needs of their co-ethnics. Suggestive evidence does not seem to support any of the three hypotheses.