We study the Lemons Problem when workers have private information on both their skills and their intrinsic motivation … adverse selection are mitigated. More interestingly, depending on the association between productivity and motivation, higher … two counterintuitive effects can only occur when a positive correlation exists between productivity and motivation. Our …

unexpected consequences. With a su¢ ciently strong and positive association between motivation and productivity, a wage increase …We study the Lemons Problem when workers have private information on both their skills and their intrinsic motivation …

/ Jos(c)♭ Luis Malo de Molina and Pilar Garc(c)Ưa Perea -- Wage structures, employment problems and economic policy in …