This paper establishes theoretical and empirical linkages between union wage setting and the structure of the wage distribution. Theoretically, we identify conditions under which a right-to-manage model implies compression of the wage distribution in the union sector relative to the nonunion...

Applying the theory of yardstick competition to the schooling system, we show that it is optimal to have central tests of student achievement and to engage in benchmarking because it raises the quality of teaching. This is true even if teachers? pay (defined in monetary terms) is not performance...

At the age of ten German pupils are given a secondary school track recommendation which largely determines the actual track choice. Track choice has major effects on the life course, mainly through labor market outcomes. Using data from the German PISA extension study, we analyze the effect of...