A flat tax rate on income has gained popularity in European countries. This paper assesses the attractiveness of such a flat tax in achieving redistributive objectives with the least cost to labour market performance. We do so by using a detailed applied general equilibrium model for the...

A flat tax rate on income has gained popularity in European countries. This paper assesses the attractiveness of such a flat tax in achieving redistributive objectives with the least cost to labour market performance. We do so by using a detailed applied general equilibrium model for the...

This paper examines the consequences of creating a fully competitive market in a sector previously dominated by a cost-minimizing public firm. Workers in the economy are heterogeneous in their intrinsic motivation to work in the sector. In line with empirical findings, our model implies that...

The risk of investment in schooling has largely been ignored. We assess the variance in the rate of return by surveying the international empirical literature from this fresh perspective and by simulating risky earnings profiles in alternative options. choosing parameters on basis of the very...

This paper explores the meaning and implications of the desire by workers for impact. We find that this impact motive can make a firm in a competitive labor market face an upward-sloping supply curve of labor, lead workers with the same characteristics but at different firms to earn different...

Many street-level bureaucrats (such as caseworkers) have the dual task of helping some clients, while sanctioning others. We develop a model of such a street-level bureaucracy and study the implications of its personnel policy on the self-selection and allocation decisions of agents who differ...

The quality of public management is a recurrent concern in many countries. Calls to attract the economy's best and brightest managers to the public sector abound. This paper studies self-selection into managerial and non-managerial positions in the public and private sector, using a model of a...

Civil servants have a reputation for being lazy. However, people's personal experiences with civil servants frequently run counter to this stereotype. We develop a model of an economy in which workers differ in laziness and in public service motivation, and characterise optimal incentive...

We introduce and apply a method for estimating workers' marginal willingness to pay for job attributes employing data on job search activity. Worker's willingness to pay for the remaining duration of the employment contract is derived. We provide evidence that workers attach substantial value to...

Using data from the Current Population Survey from 1980 through 2010 we examine what drives variation and cyclicality in the growth rate of real wages over time. We employ a novel decomposition technique that allows us to divide the time series for median weekly earnings growth into the part...