In this paper, we examine the general equilibrium implications of human capital accumulation in the presence of superstar markets, in which small differences in skill translate into huge differences in earnings. Previous research has concentrated on the microeconomic wage implications of...

In this paper we build on the Cunha, Heckman and Navarro (2005) and show that labor earnings risk has increased considerably over time and it has increased more for lower skill groups than higher skill groups

Competitive public and private institutions of higher education in the U.S. take race into consideration in admissions and decisions about financial aid when able to do so. In public universities in states that have proscribed use of race, substitute policies, intended to promote minority...

In many economic contexts, especially signaling and search models, agents care about the distribution of other agents around them. Because of this, firms arise which produce neither goods nor services, but local “ponds†of agents. Such firms derive their attractiveness through the...

In most democracies, the majority of education expenditures is financed by the government. In non-democracies, we observe a wide variation in the mix of public and private funding of education. In addition, countries with high inequality tend to rely more heavily on private schooling. We develop...

The transition from economic stagnation to sustained growth is often modelled with a "population-induced" technical progress which raised the return to human capital. In this literature the effect of population on productivity is assumed instead of being derived from more primary assumptions,...

We study the optimal long-term contract offered to workers when firms are financially constrained in their investment plans. To alleviate the tightness of the financial constraints, firms promise an increasing wage profile to workers, that is, they pay lower wages today in exchange of higher...

Recent empirical findings have emphasized post entry growth of survivors, as opposed to exit of inefficient and small firms, as the main source of growth over time in the average size of a cohort of entering firms. One proposed explanation for the post entry growth of survivors is financing...