This paper addresses the applicability of the theory of equalizing differences (Rosen, 1987) ina market in which temporary and permanent workers co-exist. The assumption of perfectcompetition in the labour market is directly questioned and a model is developed in which thelabour market is...

We measure labor market frictions using a strategy that bridges design-based and structuralapproaches: estimating an equilibrium search model using reduced-form minimum wageelasticities identified from border discontinuities and fitted with Bayesian and LIML methods.We begin by providing the...

In this paper we estimate the elasticity of the labour supply to a firm, using data from theHousehold, Income and Labour Dynamics in Australia (HILDA) Survey. Estimation of thiselasticity is of particular interest not only in its own right but also because of its relevance tothe debate about the...

The minimum wage rate has been introduced in many countries as a means of alleviating thepoverty of the working poor. This paper shows, however, that an imperfectly enforcedminimum wage rate causes small firms to face an upward-sloping labor supply schedule.Since this turns these firms into...

This paper uses British panel data to investigate single women´s labour supply changes inresponse to three tax and benefit policy reforms that occurred in the 1990s. These reformschanged individuals´ work incentives and we use them to identify changes in labour supply.We find evidence of small...

We analyze optimal taxation in an economy with monopsonistic labor markets. Theindividuals, whose only decisions are whether to work, or not, have heterogeneousproductivities and opportunity costs of work. Given its preferences for redistribution, thegovernment, which does not observe the...