A unifying theme in the literature on organizations such as public bureaucraciesand private nonprofits is the importance of mission, as opposed to profit, as anorganizational goal. Such mission-oriented organizations are frequently staffed bymotivated agents who subscribe to the mission. This...

To reduce the competition from farmers who self-produce seed, an inbred line seed producercan switch to nondurable hybrid seed. In a two-period model we investigate the impactof crop durability on self-production, pricing and switching decisions, and we examine theimpact of license fees paid by...

We provide evidence on the extent of ethnic segregation experienced bychildren across secondary schools and neighbourhoods (wards). Using 2001Schools Census and Population Census data we employ the indices ofdissimilarity and isolation and compare patterns of segregation across nineethnic...

In labor markets with worker and firm heterogeneity, the matching between firms and workersmay be assortative, meaning that the most productive workers and firms team up. Weinvestigate this with longitudinal population-wide matched employer-employee data fromPortugal...

Implementing performance pay requires that workers' output be measured. Whenmeasurement costs differ among firms, those with a measurement cost advantage choose toimplement performance pay. They attract the best workers, and both the level and variabilityof compensation are higher at these firms...

We show that the joint liability lending contracts derived in Ghatak (2000) violate an ex post incentive-compatibility constraint which says the amount of joint liability cannot exceed the amount of individual liability. We derive and characterize optimal separating joint liability contracts...

The Peter Principle states that, after a promotion, the observed output of promotedemployees tends to fall. Lazear (2004) models this principle as resulting from a regression tothe mean of the transitory component of ability...

We study how workers’ wages respond to TFP-driven innovations in firms’ labor productivity.Using unique data with highly reliable firm-level output prices and quantities in themanufacturing sector in Sweden, we are able to derive measures of physical (as opposed torevenue) TFP to instrument...