Flexicurity is a new way of looking at flexibility and security on the labor market. It sets out from the awareness that globalization and technological progress are rapidly changing the needs of workers and enterprises. Companies are under increasing pressure to adapt and develop their products...

Academic research is a public good whose production is supported by the tuition-paying students that a faculty's research accomplishments attract. A professor's spot contribution to the university's revenues thus depends not on her spot research production, but rather on her cumulative research...

This study derives a reduced-form equation for the aggregate supply curve from a model in which firms pay efficiency wages and workers have imperfect information about average wages at other firms. If specific assumptions are made about workers’ expectations of average wages and about...

This study investigates the effects of short-term employment contracts on employment fluctuations and economic fluctuations using a dynamic model with long-term and short-term employment contracts. Numerical experiments show that an increase in the short-term employment ratio amplifies the...

In 1990 a reform in Italy has modified the employment protection legislation for employees of small firms (with fewer than 16 employees) making much more costly for firms to dismiss workers, while leaving unchanged the employment protection in large firms. Using a sample of administrative data...

In Italy employees are fully insured against earning losses due to illness. Since worker’s health is not easily verifiable, absenteeism due to illness is considered an empirical proxy for employee shirking. The Bank of Italy Household Survey (SHIW) provides individual data on days of absence....

This paper studies a dynamic model with efficiency wages and adjustment costs associated with hiring and firing decisions. With linear adjustment costs, the optimal efficiency wage and employment are affected by the real interest rate and adjustment costs. When lumpy costs or convex adjustment...

This paper provides a socio-psychological theory of efficiency wage growth. The model blends agency theory with the Forced Savings hypothesis by assuming that firms set an increasing wage profile to minimize shirking costs, and that workers’ effort is positively related to the variation of...

An optimizing representative firm pays efficiency wages to skilled workers to produce technological innovations, which are assumed to be of labor saving type, affecting negatively the hiring rate of unskilled workers. The results are: i) The efficiency wage of skilled workers is determined by...

This paper provides a socio-psychological theory of efficiency wage growth. The model blends agency theory with the Forced Savings hypothesis by assuming that firms set an increasing wage profile to minimize shirking costs, and that workers’ effort is positively related to the variation of...