I build a dynamic stochastic general equilibrium model with search and matching frictions and two sectors in order to study the labour market effects of public sector employment and wages. Public sector wages plays an important role in achieving the efficient allocation. High wages induce too...

This paper employs survey data on the reasons to quit of Dutch job changers who entered or left a public sector job in 2001. We show that workers' reasons to quit their public sector job influence their decision to stay in or leave their industry of employment. A bad experience with, for...

Military conscription implicitly taxes draftees. Those who would have volunteered at the market wage may be forced to serve for lower wages, and those with higher opportunity costs may be forced to serve regardless, yet little is known about the distribution of this burden. We exploit the Danish...

The paper investigates the short run responsiveness of National Health Service (NHS) nurses' labour supply to changes in wages of NHS nurses relative to wages in outside options available to nurses, utilising the panel data aspect of the Annual Survey of Hours and Earnings. We find the short run...

I build a dynamic stochastic general equilibrium model with search and matching frictions and two sectors in order to study the labour market effects of public sector employment and wages. Public sector wages plays an important role in achieving the efficient allocation. High wages induce too...

The role of teachers in achieving good quality education is universally acknowledged. What is less clear is what incentives are required to attract good teachers to teaching. Incentives, including teachers pay, need to be sufficient yet, in the light of fiscal resource constraints, not...

That immigrants in Canada on average earn lower wages than observationally equivalent Canadian-born individuals has been the subject of much research in recent years. The role of the public sector in this immigrant wage gap has been studied much less. We seek to add to the sparse literature on...

Military conscription implicitly taxes draftees. Those who would have volunteered at the market wage may be forced to serve for lower wages, and those with higher opportunity costs may be forced to serve regardless, yet little is known about the distribution of this burden. We exploit the Danish...

Research has clearly established that increasing teacher salaries reduces overall teacher attrition. A related question is whether higher salaries differentially retain high-ability teachers. Prior evidence suggests that the answer to this question is no. In this work, I revisit this question...

The public sector hires disproportionately more educated workers. To rationalize this finding, we propose a model with a perfectly competitive private sector, and non-Walrasian public sector. Our economy also features heterogeneity across individuals and jobs, and a simple sorting mechanism that...