This research advances the hypothesis and establishes empirically that interpersonal population diversity, rather than fractionalization or polarization across ethnic groups, has been pivotal to the emergence, prevalence, recurrence, and severity of intrasocietal conflicts. Exploiting an...

This paper studies the forces which determine how diversity at a firm evolves over time. We consider a dynamic model o a single firm with two levels of employees, the entry level and the upper level. In each period, the firm selects a subset of the entry-level workers for promotion to the upper...

We argue that earnings management and fraudulent accounting have important economic consequences. In a model where the costs of earnings management are endogenous, we show that in equilibrium, bad managers hire and invest too much in order to pool with the good managers. This behavior distorts...

In this review of the personnel economics literature, we introduce key topics of personnel economics, focus on some relatively new findings that have emerged since prior reviews of some or all of the personnel economics literature, and suggest open questions in personnel economics where future...

We model personnel policies in public agencies, examining how wages and promotion standards can partially offset a fundamental contracting problem: the inability of public sector workers to contract on performance, and the inability of political masters to contract on forbearance from meddling....

We develop a dynamic equilibrium model of labor demand with adverse selection. Firms learn the quality of newly hired workers after a period of employment. Adverse selection makes it costly to hire new workers and to release productive workers. As a result, firms hoard labor and under-react to...

Consider a labor market in which firms want to insure existing employees against income fluctuations and, simultaneously, want to recruit new employees to fill vacant jobs. Firms can commit to a wage policy, i.e. a policy that specifies the wage paid to their employees as a function of tenure,...

Increasingly, firms are considering the adoption of new work practices, such as problem-solving teams, enhanced communication with workers, employment security, flexibility in job assignments, training workers for multiple jobs, and greater reliance on incentive pay. This paper provides...

Firms rarely cut compensation, so little is known about the after-effects when compensation reductions do occur. We use commission reductions at a sales firm to estimate how work effort and turnover change. In response to an 18% decline in sales commissions, corresponding to a 7% decline in...

While businesses require funding to start and grow, they also rely on human capital, which affects how they raise funds. Labor market frictions make financing labor different than financing capital. Unlike capital, labor cannot be owned and can act strategically. Workers face unemployment costs,...