Public questioning about the role of finance has been fuelled by the perception that financial sector pay is an important factor behind high economic inequalities. This paper is the first to provide a comprehensive look at the level of earnings in finance and the implications for labour income...

We propose a labor market model in which financial firms compete for a scarce supply of workers who can either be employed as traders or as bankers. While hiring bankers allows to create a surplus that can be split between a firm and its trading counterparties, hiring traders helps to...

This paper investigates the relationship between financial development and income inequality by taking the role of individuals' talent into account. We measure talent using the direct observations of individuals’ achievements before entering the labor force by using the Program for...

We investigate wage differences between newly hired and incumbent employees. We show in a formal model that when employees care for wages as well as match-specific utility, incumbents earn less than new recruits if and only if firm-specific human capital is not too important. The existence and...

This paper examines the effect of financial development on educational quality in Sub-Saharan Africa. This paper also analyses the interaction effect of public education financing and measures of financial development on quality of education in Sub-Saharan Africa. The study adopts the two-step...

This paper studies the effect of financial booms and extreme asset valuations on the relative demand for skills and the wage structure. The substantial rise in wage inequality in the U.S. since the late 1970s has been accompanied by a major expansion of financial services, a series of asset...

This paper provides the kernel of the migration literature on remittances. It started from their three most debated features: stability, cyclicality and sustainability. Then moved to the motives driving remittances and, finally, their relationship with development. Both sustainability and...

The growing finance wage premium is related to a modest net reallocation of skilled workers from non-finance sectors into finance in a broad sample of 24 countries over 35 years. The reallocation is higher when the finance wage premium grows faster than the contribution of the financial sector...

This paper studies the effect of product market competition on the compensation packages that firms offer to their executives and in particular its impact on the sensitivity of pay to performance. To measure the effect of competition we use two different identification strategies on a panel of...