Fixed-Wages, Wage Differentials and Workers Heterogeneities

We study incentive-compatible labour contracts in the case where individual productivity, preference for leisure and time preference rate are unobservable by the principal in a two-period model. We first reduce this three-dimensional problem to a standard one-dimensional screening problem. Features of second-best labour contracts provide a rationale for both fixed-wages and wage differentials.

MoreLess

Year of publication:	2008
Authors:	Carlier, Guillaume ; Gaumont, Damien
Institutions:	Université Paris-Dauphine (Paris IX)
Subject:	Adverse selection \| labor contracts \| multi-dimensional heterogeneity

More details

Extent:	application/pdf
Series:	Economics Papers from University Paris Dauphine.
Type of publication:	Book / Working Paper
Notes:	Published in Australian Economic Papers, 2008, Vol. 47, no. 4. pp. 320-333.Length: 13 pages
Classification:	D82 - Asymmetric and Private Information ; J31 - Wage Level and Structure; Wage Differentials by Skill, Training, Occupation, etc
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10010752107