This paper investigates equilibria in a labor market where firms post wage/tenure contracts and risk-averse workers … endogenously over time through experience effects, tenure effects and quits to better paid employment. This equilibrium approach … suggests how to identify econometrically between experience and tenure effects on worker wages. …

We study the effect of tenure on earnings instability in Italy using two alternative estimation strategies. First we … earnings dynamics distinguishing permanent from transitory earnings, and exploit variation of tenure and instability over time … temporary contracts (short-tenure contracts). Our results indicate that each year of tenure on the job reduces earnings …