Using data from the European Community Household Panel (ECHP), we identify workers who report having skills or qualifications for a more demanding job than the one they hold at the time of the interview. These overeducated workers are distinguished from non-overeducated workers. We further...

This paper considers a dynamic matching model with imperfectly observable worker effort. In equilibrium, the wage distribution is truncated from below by a no-shirking condition. This downward wage rigidity induces the same type of inefficient churning and contractual fragility as in Ramey and...

This paper studies the cyclical dynamics of Mortensen and Pissarides' (1994) model of job creation and destruction when workers' effort is not perfectly observable, as in Shapiro and Stiglitz (1984). An occasionally-binding no-shirking constraint truncates the real wage distribution from below,...