We analyze the importance of information about individual skills for understanding economic growth and income inequality. The paper uses the framework of an OLG economy with endogenous investment in human capital. Agents in each generation differ by random individual ability, or talent, which...

We consider an OLG economy with endogenous investment in human capital. Heterogeneity in individual human capital levels is generated by random innate ability. The production of human capital depends on each individual s investment in education. This investment decision is taken only after...

We consider an OLG economy with endogenous investment in human capital. Heterogeneity in individual human capital levels is generated by random innate ability. The production of human capital depends on each individual's investment in education. This investment decision is taken only after...

We develop a dynamic general equilibrium model with two-sided limited commitment to study how barriers to competition, such as restrictions to business start-up, affect the incentive to accumulate human capital. We show that a lack of contract enforceability amplifies the effect of barriers to...

This paper provides quasi-experimental evidence on the effects of income taxes on gross hourly wages by utilizing administrative data and a tax reform in Denmark. The reform introduced joint taxation to a middle tax bracket, bringing large changes to the tax system facing married couples. Using...

This paper provides quasi-experimental evidence on the effects of income taxes on gross hourly wages by utilizing administrative data and a tax reform in Denmark. The reform introduced joint taxation to a middle tax bracket, bringing large changes to the tax system facing married couples. Using...

Two recent novels portray the substantively unhappy and morally unfulfilling lives of young associates who work long hours in large, elite law firms. As it turns out, their search for love, happiness, and moral purpose is largely in vain. In the rarefied atmosphere of both fictitious firms, the...

Traditionelle Wohlfahrtsanalysen, die sich alleine auf monetäre Einkommensangaben stützen, bedürfen der Erweiterung um die zeitliche Dimension, zumal auch in den vergangenen Jahren der Vollzeitarbeitstag anderen, flexibleren Arbeitszeitformen gewichen ist. Mit unserem Fokus auf die Frage, wer...

Traditional welfare analyses based on money income needs to be broadened by its time dimension. In the course of time the traditional full-time work is diminishing and new labour arrangements are discussed (keyword: flexible labour markets). Our study is contributing to economic well-being by...

Rich democracies have experienced a large increase in income inequality starting around 1980, coinciding with a rise in international trade and information technology. The leading theories used to explain changes in the income distribution — skill-biased technological change and globalization...