to explain any of the existing puzzles.

During the last three decades, the U.S. labor market was characterized by its employment polarization. As jobs in the middle of the skill distribution disappeared, employment expanded for the high and low-skill occupations. Real wages did not follow the same pattern. While earnings for the...

During the last thirty years, labor markets in advanced economies where characterized by their remarkable polarization. As job opportunities in middle-skill occupations disappeared, employment opportunities concentrated in the highest- and lowest wage occupations. I develop a two-country...

Parents socialize their children about many things, including sex. Socialization is costly. It uses scare resources, such as time and effort. Parents weigh the marginal gains from socialization against its costs. Parents at the lower end of the social-economic scale indoctrinate their daughters...

and a notable change in the current account of the economy.

We show how to formulate and solve the new Keynesian model in continuous time. In our economy, monopolistic firms engage in infrequent price setting á la Calvo. We introduce shocks for preferences, total factor productivity and government expenditure, and then show how the equilibrium system...