This paper develops a matching model of the labour market under wage rigidity when hiring decisions are irreversible. There are two types of workers, the skilled and the unskilled. The model is used to analyse whether technological advances may have increased unemployment, and shows that this is...

In this paper, we present a summary of recent microeconometric results on the evaluation of the effects of active labour market policies on youth employment in France. We focus our discussion on three types of policies: (1) youth employment schemes for out-of-employment and low-skilled young...

This paper develops a model to analyse the implications of firing costs on incentives for R&D and international specialization. The key idea is that, to avoid paying firing costs, the country with a rigid labour market will tend to produce relatively secure goods, at late stages in their product...

This paper considers an economy where skilled and unskilled workers use different technologies. The rate of improvement of each technology is determined by a profit-maximizing R&D sector. When there is a high proportion of skilled workers in the labour-force, the market for skill-complementary...

In the standard model of human capital with perfect labor markets, workers pay for general training. When labor market frictions compress the structure of wages, firms may invest in the general skills of their employees. The reason is that the distortion in the wage structure turns...

This paper shows that search in the labour market has important effects on accumulation decisions. In a labour market characterized by search, employment contracts are naturally incomplete and this creates a wedge between the rates of return and marginal products of both human and physical...

Becker's theory of human capital predicts that minimum wages should reduce training investments for affected workers, because they prevent these workers from taking wage cuts necessary to finance training. We show that when the assumption of perfectly competitive labour markets underlying this...

We use longitudinal individual wage and employment data in France and the United States to investigate the effect of intertemporal changes in an individual's status vis-à-vis the real minimum wage on employment transition rates. We find that movements in both French and American real minimum...

This paper offers a model of the interaction between composition of jobs and labour market regulation. Ex-post rent-sharing due to search frictions implies that ‘good’ jobs which have higher creation costs must pay higher wages. This wage differential distorts the composition of jobs, and in...

This Paper uses US Census data from 1990 and 2000 to provide evidence on the labour market characteristics of European-born workers living in the US. It is found that there is a positive wage premium associated with these workers, and that the highly skilled are over-represented compared with...