Levine, David K.; Weinschelbaum, Federico; Zurita, Felipe - In: International Economic Review 51 (2010) 2, pp. 497-507
When a firm is forced to pay abnormally high wages, hiring transfers rents. This effectively endows the employer with the ability to grant favors, and he may wish to do so even at some cost to efficient production. We refer to this as the "brother-in-law effect". This article analyzes its...