The general equilibrium analysis of many important labor market issues is very different in an economy that is open to international trade than an economy (like the US in the 1950s) in which trade is not very important. Despite the fact that individual national economies have become increasingly...

Barely a day goes by without some expert telling us how the continental European economies are about to disintegrate unless their labor markets become more flexible. Basically, we are told, Europe has the wrong sort of labor market institutions for the modern global economy. These outdated...

This chapter reviews recent developments in the study of individual employment contracts. It discusses three reasons for an employer and an employee to have a contract: (1) to allocate risk in a way different from a spot market; (2) to enhance the efficiency of investment decisions by protecting...

This chapter provides an overview of the literature linking health, health insurance and labor market outcomes such as wages, earnings, employment, hours, occupational choice, job turnover, retirement, and the structure of employment. The first part of the paper focuses on the relationship...

This chapter reviews the behavioral and redistributive effects of transfer programs targeted at working-age people with disabilities. While we primarily focus on the United States, we also include programs in the Federal Republic of Germany, The Netherlands, and Sweden. We look at how the...

The world's population is living longer but retiring earlier, and vast numbers of adults now spend as much as a third of their lifetimes relying on public and private retirement benefits. Consequently, labor economists are deeply interested in the forces driving retirement behavior, seeking to...

Econometric practice in labor economics has changed over the past 10 years as probit, logit, hazard methods, instrumental variables, and fixed effects models have grown in use and selection bias methods have declined in use. To a large degree these trends reflect an increasing preference for...

The chapter discusses the role played by labor market institutions in shaping the dynamics of wages, employment, and unemployment across European countries and the United States. The first part of the chapter uses simple, but formal models to show that the greater job security granted to...

We survey the theoretical literature on careers in organizations, focusing on models that address detailed evidence or stylized facts. We begin with what we call building-block models: human-capital acquisition, job assignment, incentive contracting, efficiency wages, and tournaments. We then...

Three central facts describe inter-firm worker mobility in modern labor markets: (1) long-term employment relationships are common; (2) most new jobs end early; and (3) the probability of a job ending declines with tenure. Models based on firm-specific capital provide a parsimonious explanation...