I develop a matching model with heterogeneous workers, firms, and worker-firm matches, and apply it to longitudinal linked data on employers and employees. Workers vary in their marginal product when employed and their value of leisure when unemployed. Firms vary in their marginal product and...

The paper studies a learning model in which information about a worker's ability can be acquired symmetrically by the worker and a firm in any period by observing the worker's performance on a given task. Productivity at different tasks is assumed to be differentially sensitive to a worker's...

People care not only about how much they are paid, but also about what they do. The aim of this paper is to investigate the interplay between an individual's personal motivation and the structure of dynamic incentive schemes. The optimal long-term contract involves not only transfers at each...

The purpose of this paper is to study the relationship between job mobility and wage mobility. One of the main points of this paper is that job mobility is not necessarily bad. Job mobility might be the quickest way in which workers can advance in their careers and move up in the wage structure....

We analyze the importance of information about individual skills for understanding economic growth and income inequality. The paper uses the framework of an OLG economy with endogenous investment in human capital. Agents in each generation differ by random individual ability, or talent, which...

We analyze the importance of information about individual skills for understanding economic growth and income inequality. The paper uses the framework of an OLG economy with endogenous investment in human capital. Agents in each generation differ by random individual ability, or talent, which...

A large portion of the rise in the education premium can be explained by a signaling theory of education which predicts that in the future, increases in the education level of the workforce will actually cause the education premium to rise, simply because different workers are being labeled as...

This paper develops a tractable, heterogeneous agents general equilibrium model where agents face different costs of access to the educational system. The paper explores the relation between inequality of opportunities (in the form of differential costs of access to the educational process) and...

In this paper, we match firm data to individual work history files in order to simultaneously estimate the wage and employment duration processes of a longitudinal sample of two million French workers employed in roughly one million firms and followed over twenty years. The particular structure...

We analyze a search model of the labor market in which firms and workers meet bilaterally and negotiate over wages in the presence of private information. We show that a fall in labor market frictions induces more aggressive wage bargaining behavior which in turn leads to a costly increase in...