We study pricing and product diffusion in a dynamic general equilibrium framework with product market frictions. Ongoing R&D activity leads, with an endogenously determined probability, to continual improvements in product quality. We characterize the steady-state equilibrium with endogenous...

A model of learning in local labor markets is constructed in which the emphasis placed by employers on job applicants' employment histories induces workers to reject low nominal wages to avoid subsequently signalling a low ability. This 'wage censoring'behavior leads to inefficiently high levels...

Numerous studies document that criminal activity is positively related to unemployment and negatively related to educational attainment levels within given communities. We study this phenomenon in the context of a search-equilibrium model, in which agents choose between formal employment and...

This paper concentrates on the role of job matching frictions in influencing the interactions between fertility choice and wage offers and show that job market frictions are a crucial factor in wage differentials among female workers. The goals of this paper are to examine how the home-stay...

In this paper we use search theory to model the decision making process of boundedly rational agents. In the canonical (sequential) search approach, each decision maker is deemed to acquire new information, at random intervals of time, regarding the external environment. In the simplest of such...

The inability of employers to monitor perfectly the level of effort of their employees is a potentially serious impediment to labor market efficacy. Indeed, a number of recent studies have concluded that this may lead to involuntary unemployment, an inefficient sectoral allocation of workers,...