I argue for increased reliance on non-U.S. data and policy evaluations to understand basic labor- market parameters and to predict the effects of changes in U.S. labor-market policies. Foreign experiences generate exogenous shocks to labor costs that create unusual opportunities to measure...

This essay sets out a framework for evaluating empirical work in terms of the ability of the data to provide adequate parameter estimates and hypothesis tests about the true underlying structure. Problems of aggregation, representativeness and structural change are discussed in detail. These...

This paper measures excess labor supply in equilibrium. We examine hiring shocks--which employ 24% of the labor force in external month-long jobs--in Indian local labor markets. In peak months, wages increase instantaneously and local aggregate employment declines. In lean months, consistent...

We study the labor markets in China and the United States, the two largest economies in the world, by examining the evolution of their cross-sectional age-earnings profiles during the past thirty years. We find that, first, the peak age in the cross-sectional age-earnings profiles, which we...

This paper makes three primary contributions. First, we demonstrate the usefulness of general equilibrium models as tools with which to draw policy implications for policies implemented in practice only as small-scale social experiments. Second, we illustrate the usefulness of social experiments...

For an economic system not to exhibit debt neutrality it must be true that changes in the time profile of lump-sum taxes redistributes resources between heterogeneous consumers. OLD models have age heterogeneity because of a positive birth rate. Unless a bequest motive or child-to-parent gift...

Economists disagree about the factors driving the substantial increase in residual wage inequality in the U.S. over the past few decades. We identify and estimate a general model of log wage residuals that incorporates: (i) changing returns to unobserved skills, (ii) a changing distribution of...

I generalize the canonical model--in which relative supply and demand for worker skills shape the skill premium--incorporating monopsony power, minimum wages, and unemployment. I estimate the extended canonical model using national data and, separately, state-level data. I show that...

Labor market institutions, via their effect on the wage structure, affect the investment decisions of firms in labor markets with frictions. This observation helps explain rising wage inequality in the US, but a relatively stable wage structure in Europe in the 1980s. These different trends are...