One of the long-standing puzzles in economics is why wages do not fall sufficiently in recessions so as to avoid increases in unemployment. Put differently, if the competitive market wage declines, why don't employers simply force their employees to accept lower wages as well? As an alternative...

This paper develops a two-country two-sector endogenous growth model with a dual labour market based on efficiency wages. Growth is driven by Research done in the (high-tech) tradeable sector. The follower country tends to grow faster the greater the productivity gap from the leader country, but...

This paper investigates the impact of individual asset holdings on the probability of leaving unemployment. According to the theory, higher levels of financial wealth will result in higher reservation wages and longer unemployment durations. I estimate the impact of beginning of period financial...

Employment protection is often related to costs incurred by the firms when they hire a worker.The stability of the employment relationship, enhanced by employment protection, is also favorable to the productivity of the job.We analyze employment protection focusing on this trade-off between...

Numerous laboratory experiments show that workers reciprocate to high wages with high effort, when there is perfect information on the surplus created. Recent field experiments, however, suggest that trust and reciprocity may be lower or absent when the information is incomplete.We report a...

We present a theoretical explanation of the gender wage gap which turns on the interaction between men and women in households.In equilibria where men are over-represented in full-time work, we show that firms rationally choose to hire women only at strictly lower wages than men.The model...

Much of the literature on the usefulness of company financial statement information focuses on the United States and the United Kingdom. But, these two countries are characterized by similar and rigid regulatory and enforcement regime. This study provides direct evidence from the Netherlands –...

The paper deals with the issue of budget setting to the divisions of a company. The approach is quantitative in nature both in the formulation of the requirements for the set-budgets, as related to different general managerial objectives of interest, and in the modelling of the inherent...

Royal Ahold (Koninklijke Ahold NV) was one of the major success stories in the 1990s and is one of the major failures, suffering a complete meltdown, in 2003.We investigate the strategy, accounting transparency and corporate governance of Ahold; elements which jointly drive the firm s performance...