We explore an hitherto unused approach to testing marginal productivity theory. Our method rests on the simple idea that, under the assumption of a linear homogeneous production function, residual profits are informative about the discrepancies between factor payments and marginal products. Our...

This note presents a general way to decompose differences over time or between objects into the <italic>ceteris paribus</italic> effects and the interaction effects of an arbitrary number of factors. The decomposition addresses the issue of interaction effects between factors which have been neglected in the...

This article revisits the effectiveness of public-sponsored training programs for Germany accounting for dynamic selection into heterogeneous programs. We carefully assess to what extent various aspects of our empirical strategy, such as conditioning flexibly on employment and benefit histories,...

We explore the idea that a negative relationship between individual unemployment persistence and the business cycle can be interpreted as evidence for stigma effects. Our results suggest that there is weak evidence for stigma effects.

This paper develops a discrete variant of the semiparametric methodology of DiNardo, Fortin, and Lemieux (1996) (DFL) to measure the effects of socio-economic variables on the income distribution. Although the proposed method is also based on the calculation of hypothetical income distributions...

From 2000 to 2005, Germany experienced an unprecedented rise in net equivalized income inequality and poverty. At the same time, unemployment rose to record levels and overall employment stagnated, suggesting that changes in households’ conditional employment outcomes were partly responsible...