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The size of the public sector in terms of employment and compensation has a strong life-cycle dimension. We establish a … important forms of compensation to public-sector workers. Harmonizing the characteristics of public employment with those of the … private sector would lower the unemployment rate and reduce government costs. …
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We set up a search and matching model with a private and a public sector to understand the effects of employment and … wage policies in the public sector on unemployment and education decisions. The effects on the educational composition of … small positive impact on educational composition and larger negative impact on the private employment of skilled workers, if …
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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...
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Government wage, benefit, and employment decisions are not taken on a profit-maximizing basis, and have a substantial … impact on aggregate labour market performance and unemployment. In a two-sector labour market model with free mobility of … labour, an increase in government wages or benefits reduces private sector employment, and government employment is not an …
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for immigrants than for natives: a one percentage point increase in the unemployment rate is associated with a 0.61 and 0 …
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