The prevailing labour market models assume that minimum wages do not affect the labour supply schedule. We challenge this view in this paper by showing experimentally that minimum wages have significant and lasting effects on subjects’ reservation wages. The temporary introduction of a minimum...

We examine the allocation of hours of work across industrial sectors in OECD countries. We find large disparities across three sector groups, one that produces goods without home substitutes, and two others that have home substitutes but treated differently by welfare policy. We attribute the...

We develop a two-sector model in which technological progress alternatively raises the productivity of one sector after another. We assume that goods are <MI>complements<D> for the final consumers. The sector which benefits from technical progress will see a resulting <MI>fall in its price<D>. In this model,...</d></mi></d></mi>

This paper has two aims. First, it provides simple theoretical models that highlight two channels whereby monetary shocks have permanent real effects and the interactions between these channels. Second, it presents an empirical dynamic model, covering a panel of EU countries, and derives the...

This paper estimates average and marginal returns to schooling in Indonesia using a non-parametric selection model. Identification of the model is given by exogenous geographic variation in access to upper secondary schools. We find that the return to upper secondary schooling varies widely...

Bargaining theory suggests that married women who experience a relative improvement in their labour market position should experience a comparative gain within their marriage. However, if renegotiation possibilities are limited by institutional mechanisms that achieve long-term commitment, the...

The increase in female employment and participation rates is one of the most dramatic economic changes to have taken place during the last century. However, while the employment rate of married women more than doubled during the last fifty years, that of unmarried women remained almost constant....

The paper explores the influence of job security provisions on employment and unemployment. We show that this influence depends on the persistence of the macroeconomic fluctuations to which the labour market is exposed, and on employees’ bargaining power in wage negotiations. Specifically,...

This paper criticizes the Alesina and Ichino (2007) proposal of taxing men more than women. First, the proposal is outright sex discrimination. Second, it cannot be Pareto-improving. Third, its virtues in terms of efficiency are better obtained by gender-neutral voluntary schemes for taxing...

This paper provides a brief, non-technical survey of the major theories about why people remain unemployed. The aim is to provide a macroeconomic perspective on the microeconomic problem of why people don't find work. The first section deals with market-clearing theories: the natural rate...