We exploit policy discontinuity at U.S. state borders to identify the effects of unemployment insurance policies on unemployment. We find large effects of unemployment benefit extensions on unemployment. In fact, the estimates imply that most of the persistent increase in unemployment during the...

Does the market allocate the right workers to the right jobs? Since observable (to economists) variables account for only a small fraction of the wage variance in the data, to answer this question it is essential to study assortative matching between employers and employees based on their...

We show theoretically how to identify, using wage data alone, whether assortative matching between workers and firms is positive or negative. The results of a Monte Carlo study of calibrated models featuring positive and negative sorting illustrate that the method performs well given the...

We develop a quantitative equilibrium model that features tax deductibility of employer-provided coverage, non-discrimination restrictions, fixed costs of coverage and firms that hire discrete numbers of workers in frictional labor markets. We use the calibrated model to understand what drives...

We develop a quantitative equilibrium model that features tax deductibility of employer-provided coverage, non-discrimination restrictions, fixed costs of coverage and employers that hire discrete numbers of workers in frictional labor markets. We use the calibrated model to understand what...

It has been recently documented that the estimates of income processes using the moments for log-incomes in levels and differences deviate substantially. This has important quantitative implications for calibrated macro models. We propose a specification of the income process consistent with the...

In this paper we document substantial returns to occupational tenure. Everything else being constant, ten years of occupational tenure are likely to increase wages by at least $19\%$. Moreover, we show that when occupational experience is taken into account, tenure with an industry or an...

Two salient changes in the US wage structure have occurred over the past three decades: first, a sharp increase in the wage premium to schooling despite a continual increase in the supply of schooling, and second, a rise and then fall of the wage premium to work experience. Capital-skill...