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In a world of uncertainty in which a worker's performance is variable over time and average performance is unknown when hiring, how will employers determine compensation? We develop a monitoring and signaling model where information is symmetric and parties are risk neutral. Monitoring costs...
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One of the most stylized facts in labor economics is the finding that wages tend to rise with job duration but what is … performance and wages in the National Basketball Association (NBA) is used to test the superiority of one model over others in … wages are solely determined on the basis of their productivity. Findings are rather in accordance with shirking and matching …
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