The decisions of firms on investment and hiring play a crucial role in business cycle fluctuations. This paper explores their dynamic behavior in the presence of frictions. It does so within a unified framework, stressing their mutual dependence and placing the emphasis on their joint,...

We develop a theory of firm scope in which integrating two firms into one facilitates the allocation of resources, but leads to weaker incentives for effort, compared with nonintegration. Our theory makes minimal assumptions about the underlying agency problem. Moreover, the benefits and costs...

Studies of public-private and foreign-domestic wage differentials face difficultiesdistinguishing ownership effects from correlated characteristics of workers and firms. Thispaper estimates these ownership differentials using linked employer-employee data (LEED)from Hungary containing 1.35mln...

This paper draws attention to an increase in the size of the union membership wage premiumin the UK public sector relative to the private sector. We find the public sector membershipwage premium is approximately double that in the private sector controlling for a full range ofindividual, job and...

I build a dynamic stochastic general equilibrium model with search and matching frictions and two sectors in order to study the labour market effects of public sector employment and wages. Public sector wages plays an important role in achieving the efficient allocation. High wages induce too...

We examine the interactions between public and private sector wages per employee in OECD countries. The growth of public sector wages and of public sector employment positively affects the growth of private sector wages. Moreover, total factor productivity, the unemployment rate and the degree...

This paper addresses the role played by Public Sector (PS) employment across different ECD labour markets in explaining: (i) gender differences regarding choices to work in either PS or private sector, and (ii) subsequent changes in female labour market outcomes. To do so, we provide some...

Recent controversy has surrounded the relative value of public and private sector remuneration. We define a comprehensive measure of Total Reward (TR) which includes not just pay, but pensions and other 'benefits in kind', evaluate it as the present value of the sum of all these payments over...

This paper addresses a lack of evidence on the impact of performance pay in the public sector by evaluating a pilot scheme of incentives in a major government agency. The incentive scheme was based on teams and covered quantity and quality targets, measured with varying degrees of precision. We...

With a sample of 700 future public sector primary teachers in India, a Discrete Choice Experiment is used to measure job preferences, particularly regarding location. General skills are also tested. Urban origin teachers and women are more averse to remote locations than rural origin teachers...