Michelacci, Claudio; Quadrini, Vincenzo - In: Journal of the European Economic Association 3 (2005) 2-3, pp. 360-369
We analyze how the financial conditions of the firm affect the compensation structure of workers, the size of the firm, and its dynamics. Firms that are financially constrained offer long-term wage contracts characterized by an increasing wage profile, that is, they pay lower wages today in...
