The endowment and attachment effect are empirically well-documented in bilateral trade situations. Yet, the theoretical literature has so far failed to formally identify these effects. We ftll this gap by introducing expectations-based loss aversion, which can explain both effects, into the...

This paper examines the effect of imperfect labor market competition on the efficiency of compensation schemes in a setting with moral hazard and risk-averse agents, who have private information on their productivity. Two vertically differentiated firms compete for agents by offering contracts...

A growing wage gap between immigrant and native-born workers is well documented and is a fundamental policy issue in Canada. It is quite possible that wage differences, commonly attributed to the lower quality of foreign credentials or the deficiency in the accreditation of these credentials,...