This paper develops the theory of statistical discrimination in the form of unequal employment criteria and interviews. Workers differ by imperfectly observed 'quit rate.' Profit maximization leads firms to set stricter employment criteria or interview fewer workers from the group with a greater...

This paper has resulted in a publication in <I>Labour Economics</I> (2013), 23, 50-56.<P> The paper provides a theoretical foundation for the empirical regularities observed in estimations of wage consequences of overeducation and undereducation. Workers with more education than required for their jobs...</p></i>

The paper provides a new model of consumption behavior under uncertainty as the solution to a continuous-time dynamic control problem in which an individual moves between employment and unemployment according to a Markov process. Behavior at low asset levels and at break-even points is analyzed....

The paper provides a theoretical foundation for the empirical regularities observed in estimations of wage consequences of overeducation and undereducation. Workers with more education than required for their jobs are observed to suffer wage penalties relative to workers with the same education...

Price dispersion is analyzed in the context of a queuing market where customers enter queues to acquire a good or service and may experience delays. With menu costs, price dispersion arises and can persist in the medium and long run. The queuing market rations goods in the same way whether firm...

This paper considers the decisions of workers to search in different labor markets, in analogy to Roy¡¯s model of sectoral selection. In the basic model, a worker can search in one labor market or another but not both. With non-pecuniary benefits, a worker chooses the labor market offering the...