We study, theoretically and in a quantitative model, the determinants of lender profits in the cross-section of households. We argue that the empirical pattern of high profit margins for high risk contracts calls for a departure from constant markups or ex-post perfect competition models.We...

We use comprehensive data from Denmark that combine online job advertisements with a matched employer-employee dataset and a firm-level dataset with information on revenues and value added to study the relationship between vacancy-posting and various firm outcomes. Posting a vacancy is...

An equilibrium search model of the labor market is combined with a social network. The key features are that the workers' network transmits information about jobs and that wages and entry of firms are determined in equilibrium. When workers are homogeneous referrals mitigate search frictions....

Assortative matching between workers and firms provides evidence of the complementarities or substitutes in production. The presence of complementarities is important for policies that aim to achieve the optimal allocation of resources, e.g. unemployment insurance. We argue that using wage data...

Jan Eeckhout is a Professor of Economics at University College London and at Barcelona GSE/UPF. Eeckhout's research has been concerned with labor markets, matching and sorting. Philipp Kircher is a Reader of Economics at the London School of Economics. Kircher's research has been concerned with...

Eleven percent of the Malawian population is HIV infected. Eighteen percent of sexual encounters are casual. A condom is used one quarter of the time. A choice-theoretic general equilibrium search model is constructed to analyze the Malawian epidemic. In the developed framework, people select...

We develop and analyze a labor search model in which heterogeneous firms operate under decreasing returns and compete for labor by publicly posting long-term contracts. Firms achieve faster growth by offering higher lifetime wages that attract more workers which allows to fill vacancies with...

We develop a neoclassical trade model with heterogeneous factors of production. We consider a world with two factors, labor and .managers., each with a distribution of ability levels. Production combines a manager of some type with a group of workers. The output of a unit depends on the types of...