This dissertation is a collection of three empirical essays on Albania andIran. In December of 1990, the communist system in Albania came to an abruptend. The collapse of communism led to a number of macroeconomic reforms that,among other things, brought dramatic changes in the Albanian labor market. Thisstudy uses data from the first nationally representative household survey toexamine one outcome of a decade-long transition in Albania, the earnings gapbetween men and women. The average gender earnings gap is calculated at 31percent, but it is found to be as high as 50 percent in the upper parts of thedistribution. The traditional Oaxaca-Blinder method and a recent method thatcombines quantile regression with the bootstrap are applied to decompose thegender gap into a portion attributable to differences in characteristics and aportion explained by returns to characteristics. Results show that differencesin human capital characteristics do not explain any of the existing gap.Furthermore, a large proportion of the gap can be attributed to segregation inoccupations and industries. Simulations of female counterfactual wages showthat the gender gap is significantly reduced for the entire distribution, anddisappears in the higher quantiles of the distribution when occupation andindustry are controlled for.
The next two essays analyze welfare and female labor force participation inpost-Revolution Iran. The Islamic Revolution of 1979 and a number of subsequentmacro shocks dealt a huge blow to Iran's economy. In this paper we ask thequestion of how families and individuals have fared through these tumultustimes. Conventional measures of change in welfare, such as averageconsumption or GDP per capita, do not accurately reflect the experience ofindividual cohorts. We utilize annual surveys of expenditures and incomeconducted between 1984 and 2004 and decompose changes in average earnings andexpenditures into cohort, age, and period effects. The estimated period effectsaccurately reflect the fluctuations in the economy noticeable in the macrodata, and the life cycle earnings and expenditures profiles show a typicalinverted U-shape. The cohort effects, which compare the position of life cycleprofiles of different cohorts, and are of most interest to us, show a risingtrend for cohorts born before the 1950s (about 30 years or older at the time ofthe Revolution). They also indicate that younger cohorts, those born after 1965and therefore entered adult life after the Revolution, seem to have lost out.We discuss possible reasons for the asymmetrical lifetime experience of the twosets of cohorts. We believe that the disruptions caused by the Revolutionitself and the subsequent eight year war with Iraq (1980-88) may have causedlifetime losses for the cohorts who came of age in the early 1980s.
The purpose of the third essay is to understand changes in the labor forceparticipation rate of women in Iran after the Islamic Revolution of 1979.Studies consistently show that like other countries in the Middle East andNorth Africa, Iran has experienced only a modest improvement in female laborforce participation rates, despite having gone through the fertility transitionand significant improvements in education of women. Utilizing 21 consecutivehousehold surveys from 1984-2004, we decompose changes in the participationrate into age, cohort, and period effects. We find some evidence that theIslamic Revolution of 1979 did indeed have a negative impact on the cohortsthat were in their teens or early 20s at that time. However, viewed from acohort perspective, the evidence shows that women born after 1965 havecontinuously increased their participation. This is in contrast to the evidencethat has been observed by others who have compared cross-section averages overtime.
