Market wages reflect expected productivity by using signals of past performance and past experience. These signals are generated at least partially on the job and create incentives for agents to choose high-profile and highly visible tasks. If agents have private information about the...

I explore the efficiency properties of a decentralized labor market for scientists. I use a model where firms produce science by building labs and hiring researchers in a competitive market. Firms may invest in science to produce new scientific knowledge or to increase their absorptive capacity:...

I explore the effect of skill-biased technological change on long-run inequality using a theoretical model where the supply of skilled and unskilled workers, the cost of education, and credit rationing are endogenous. I show that the existence of unequal steady states does not depend on the...

This paper analyzes the effects of intrafirm bargaining on the formation of firms in an economy with imperfect capital markets and contracting constraints. In equilibrium wealth inequality induces a heterogenous distribution of firm sizes allowing for firms both too small and too large in terms...

Institutions determine prospects for economic growth and development. This paper collapses potentially complex interactions of different institutions into a simple condition on the primitives that determines whether a society supports spot markets or not. In a dynamic model of an agrarian...

We study the aggregate economic effects of diversity policies such as affirmative action in college admission. If agents are constrained in the side payments they can make, the free market allocation displays excessive segregation relative to the first-best. Affirmative action policies can...

This paper examines possible effects of college admission policy on general equilibrium outcomes at the high school stage. Specifically, we investigate whether a policy that bases college admission on relative performance at high school could modify in the aggregate the degree of segregation in...

Does a competitive equilibrium in a matching market provide adequate incentives for investments made before the market when utility is not perfectly transferable? This paper derives a necessary and sufficient condition for equilibrium investments to maximize surplus conditional on the matching...