We study equilibrium wage contracts in a labour market with adverse selection and moral hazard. Firms offer incentive contracts to their employees to motivate them to exert effort. Providing incentives comes, however, at a cost, as it leads to misallocation of effort across tasks. With ex ante...

Housing transactions by existing homeowners take two steps, a purchase of a new property and sale of the old housing unit. These two decisions are not independent, and their sequence may depend on the state of the housing market. This paper shows how the sequence of buyer-seller decisions...

Housing transactions by owner-occupiers take two steps, purchase of a new property and sale of the old housing unit. This paper shows how the transaction sequence decision of owner-occupiers depends on, and in turn, affects housing market conditions in an equilibrium search-and-matching model of...

In search theory, an important distinction can be drawn between models with competitive search and with random search; empirical work on job search models overwhelmingly assume random search. This paper uses linked register data on workers and rms to explore patterns of wages at job to job...

Do firms have the right incentives to innovate in the presence of spillovers? This paper proposes an explicit channel of spillovers through labor flows within a framework of competitive search. Firms can choose to innovate or to imitate by hiring a worker from a firm that has already innovated....

Housing transactions by existing homeowners take two steps, a purchase of a new property and sale of the old housing unit. These two decisions are not independent, and their sequence may depend on the state of the housing market. This paper shows how the sequence of buyer-seller decisions...

We consider a model economy populated by risk-neutral firms with multiple vacancies and risk-averse workers. Following the implicit contract literature, we assume that workers have limited access to the intertemporal trade markets. Following the directed search literature, we assume that...

We consider a frictional labor market in which firms want to insure their senior employees against income fluctuations and, at the same time, want to recruit new employees to fill their vacant positions. Firms can commit to a wage schedule, i.e. a schedule that specifies the wage paid by the...