This paper shows that the existence and persistence of `overeducation' can be explained by an extension of the efficiency wage model. When calibrated to fit the amounts of overeducation found in most empirical studies, the model implies that both the relative wage and the relative employment of...

Nicholas Kaldor's Mattioli Lectures analyze a two-sector model with increasing returns to scale (IRS) in industry and diminishing returns in agriculture (DR). This review article shows that (1) with IRS in industry, a long-run equilibrium growth path with strictly positive growth rates may exist...

Using a simple model with two levels of skill, we assume that high-skill workers who fail to get high-skill jobs may accept low-skill positions; low-skill workers do not have the analogous option of filling high-skill positions. This asymmetry implies that a slowdown in Hicks-neutral technical...

This paper shows that the existence and persistence of `overeducation' can be explained by a simple extension of the efficiency wage model. When calibrated to fit the amounts of overeducation found in most empirical studies, the model implies that both the relative wage and the relative...

Stylized models of the policy game between monetary policymakers and the private sector have suggested that disciplinary policy regimes suffer from an inherent inflationary bias and that precommitment to a target rate of inflation may be desirable. This paper shows that, in the presence of labor...

We propose an explanation for the growth of executive pay since the 1980s. New information and communication technologies (ICTs) appear to favor winner-take-all markets and to accentuate firm-level volatility of profits. We show, using an efficiency wage model, that these changes lead to higher...

Following an analysis of the relation between a standard Steindlian model of stagnation and Steindl's own analysis, we modify the standard model by introducing endogenous changes in the mark-up and a reformulation of the investment function. These extensions, which address significant weaknesses...

This paper analyses the influence of norms of fairness on wage formation. Fairness is defined by `real-wage' and `relative-wage' norms that relate wage offers to workers' own current wage and to the wages of other groups of workers, and, to avoid shirking, firms pay fair wages. The wage norms...