In economies with competitive labour markets social policies harm employment and output. In Europe, in particular, non-competitive labour markets with trade unions, efficiency wages and/or costly search and mismatch seem more realistic. Social policies such as progressive taxation or...

This paper analyses optimal contracts in a principal-agent model where the agent is intrinsically motivated at the outset and there is an endogenous relationship between the structure of incentive payments and intrinsic motivation (crowding effects). The analysis shows that crowding effects have...

A main reason for our present climate problems are not the basic economical requirements of man but the exponential increasing world population and their ever growing demand for luxury far beyond the necessary basic economical needs. It is suggested to put the world's attention on the basic...

This article describes, within a microeconomic intergenerational bargaining framework incorporating two discrete periods and binary states of risks, some new aspects regarding the mixture of intergenerational risk sharing and social security. Here, state-dependent utility under mortality risk...

This paper summarizes additional evidence indicating that much on-the-job training appears to be "specific" in that workers do not pay for such training in the form of lower starting wages. The paper then considers reasons why workers and firms might limit the portability of training. One...

Cyclical fluctuations in unemployment vary widely across cities in the United States. It is puzzling that after controlling for the industry composition effect, people can still find significant cyclical heterogeneity. This paper demonstrates how market friction, combined with idiosyncratic...

This paper presents a two-period “nutshell” model that explains the composition of labour demand when the labour market is dualistic and workers may be hired via permanent (P) or temporary (T) contracts. The model does not explain the level of labor demand, nor the wage of permanent workers,...

In the United States, religious attendance rises sharply with education across individuals, but religious attendance declines sharply with education across denominations. This puzzle is explained if education both increases the returns to social connection and reduces the extent of religious...

Recently, Constant, Gataullina, and Zimmermann (2009) established a new method to measure ethnic identity which they called the "ethnosizer". Using information on an individual's language, culture, social interactions, history of migration, and ethnic self-identification, the method classifies...

Income inequality and income intergenerational immobility are positively associated across countries. Here we provide an explanation for this association and show it is mechanically driven by the definition of the intergenerational earnings elasticity. This may hint that higher intergenerational...