This paper studies the implications of labor taxation in determining the sensitivity of an economy to macroeconomic shocks. We construct a New Keynesian business cycle model with matching frictions of the labor market, where sluggish employment adjustment implies a key role for labor markets in...

I extend a two-skill group model by Katz andMurphy (1992) to estimate relative demand and supply for skills as well as wage rigidity in Germany. Using three data sets for Germany, two for Britain and one for the United States, I simulate the change in relative wage rigidity (wage compression) in...

This paper examines the relationship between wages and employment at the establishment level. It exploits a sample of Italian firms and workers. To correct for a potential labor composition effect, estimations use both the change in the firm's average wage and the mean of individual wage changes...

The impact of a Temporary Help Agency (THA) job placement on an employee’s future employment status and labor market income is examined using NLSY79 data for the late 1990s. Several matching estimators provide gender-specific estimates of the effects of temporary agency employment on future...

This paper presents a methodology to identify net demand shocks as well as wage rigidities in heterogeneous labor markets on the basis of nonparametric regression. We show how this approach can be used to make suggestions for immigration policy in economies with labor market rigidities. In an...

Almost 20% of all male employees in Germany who become unemployed return to their previous employers. Such temporary layoffs and the subsequent recalls are often used by firms to shift their labor costs onto society and the unemployment benefit system, which has led to various legislation aimed...

This paper presents a methodology to identify net demand shocks as well as wage rigidities in heterogeneous labor markets on the basis of nonparametric regression. We show how this approach can be used to make suggestions for immigration policy in economies with labor market rigidities. In an...

This paper estimates the impact of a more than 50 percent reduction in the minimum to average wage ratio in Mexico between 1970 and 1990 using panel data on minimum wages in thirty-two Mexican states. Minimum wages are found to have little effect on male employment but a negative employment...

The process of wage expectations formation in different regional labor markets is considered. We argue that when information is scarce or ambiguous, cognitive dissonance phenomena may play a relevant role in shaping expectations. The theoretical discussion is supplemented with an empirical...

The paper explores the determinants of internal migration in Albania, adopting the Harris-Todaro approach to migration: an internal migration function is estimated using district wage and unemployment rate differentials. The aggregate level wages and unemployment, included in the migration...