This paper analyses how job security policies, which in practice result in higher firing costs, affect long-run employment and investment in a two country model with free trade in goods and capital. The effects turn out to depend crucially on the preferences of trade unions, and in particular on...

A number of influential studies have documented a strong value premium for US stocks over the period 1963 to 1990 (Fama and French (1992), Lakonishok et al. (1994)). Stocks with low price-earnings multiples, price-book values and other measures of value are reported to have given a higher mean...

A model with trade union rivalry is used to derive wage reaction functions, which are then estimated for skilled and unskilled men in Denmark. The results show substantial differences in wage determination between the two groups of workers in the short term, but once the wage-wage spiral starts...

The role of devaluation in stimulating profitability, investment, and ec onomic activity is studied in a model characterized by forward-lookin g investment behavior and wage contracts that provide an element of s hort-term nominal wage rigidity. The analysis shows that, in the case where the...