We present a wage-hours contract designed to minimize costly turnover given investments in specific training combined with firm and worker information asymmetries. It may be optimal for the parties to work ‘long hours’ remunerated at premium rates for guaranteed overtime hours. Based on...

This paper extends a standard labor demand model in order to study the microeconomic effects of marginal employment subsidies. The analysis emphasizes the distinction between workers and hours per worker, and investigates subsidies with respect to both quasi-fixed and variable labor costs. The...

Against the background of firm-specific human capital theory, this paper investigates empirically the relative propensity of manufacturing industries in Japan, Germany, the United Kingdom, and the United States to hold excess labor over the business cycle. Both stock and utilization dimensions...