This paper develops a theoretical framework for analyzing contracting imperfections in long-term employment relationships. We focus chiefly on limited enforceability and limited worker liquidity. Inefficient severance of employment relationships, payment of efficiency wages, the relative...

This paper offers a legal and an economic analysis of collective dismissals procedures. First, it explains the economic rationale for having collective dismissal procedures in place, in light of the fact that labour markets are not perfect. Second, it overviews the international labour standards...

This paper considers a two-period optimal contracting model in which firms make new hires in the second period subject to the constraint that they cannot pay discriminate either against or in favour of the new hires. Under an assumption on the information available to workers, it is shown that...