This paper examines the development of wage inequality in the context of a Burdett- Mortensen (1998) model that is extended to incorporate worker heterogeneity through skill requirements in the production process. In this environment, wage dispersion is a natural consequence of firms pursuing...

This paper examines the development of wage inequality in the context of a Burdett-Mortensen (1998) model that is extended to incorporate worker heterogeneity through skill requirements in the production process. In this environment, wage dispersion is a natural consequence of firms pursuing...

This paper integrates a frictional labour market into a general equilibrium model with incomplete markets. Workers are subject to employment shocks and are able to insure themselves by trading a risk free asset. Firms seek to maximise profits by hiring workers in a frictional labour market. In...

We build a general equilibrium overlapping generations model with heterogeneous agents to study the welfare implications of housing investment tax concessions in the Australian housing market . Comparing stationary equilibria, we find that removing these concessions significantly reduces housing...

Property transaction taxes - also known as stamp duty - are widely viewed as an inefficient form of taxation. In this paper, we examine the welfare implications of removing stamp duty in a general equilibrium overlapping generation model with heterogeneous agents. Our model features an...

We examine the implications of worker heterogeneity on the equilibrium matching process, using a directed search model. Worker abilities are selected from a general distribution, subject to some weak regularity requirements, and the firms direct their job offers to workers. We identify...

We use a standard New Keynesian model of a small open economy, extended to include a government sector, to investigate the Great Depression in Australia. A calibrated model with a fixed exchange rate regime, similar to the gold standard, does well in replicating the dynamics of output during the...