There are two divergent views on the role of public sector collective bargaining in American law. The first, and generally older, view is that public sector collective bargaining undermines democratic government, allowing organized employees to interfere with the administration of the law for...

We provide evidence that promotion incentives influence the effort of public employees by studying China's system of promotions for teachers. Predictions from a tournament model of promotion are tested using retrospective panel data on primary and middle school teachers. Consistent with theory,...

We model personnel policies in public agencies, examining how wages and promotion standards can partially offset a fundamental contracting problem: the inability of public sector workers to contract on performance, and the inability of political masters to contract on forbearance from meddling....

This paper examines the consequences of creating a fully competitive market in a sector previously dominated by a cost-minimizing public firm. Workers in the economy are heterogeneous in their intrinsic motivation to work in the sector. In line with empirical findings, our model implies that...

This paper investigates the public sector wage premium in the UK using a microfounded eco-nomic model and indirect inference. The neoclassical wage determination model is tested and estimated without introducing any gap between the theoretical and empirical models. To test if the model is true,...

We propose an assignment model in which positions along a hierarchy are attributed to individuals depending on their characteristics. Our theoretical framework can be used to study differences in assignment and outcomes across groups and we show how it can motivate decomposition and...

We provide evidence that promotion incentives influence the effort of public employees by studying China's system of promotions for teachers. Predictions from a tournament model of promotion are tested using retrospective panel data on primary and middle school teachers. Consistent with theory,...

We uncover the short- and long-run structural determinants of the existing cross-country heterogeneity in public-private pay differentials for a broad set of OECD countries. We explore micro data (EU-SILC, 2004–2012) and macro data (1970–2014). Three results stand out. First, when looking at...

This paper studies how wages respond to a sudden change in employer concentration. It exploits a reform that deregulated the Swedish pharmacy market, which until 2009 was a monopoly. The reform involved a substantial increase in the number of employers on the pharmacy labor market. However, the...

We propose an assignment model in which positions along a hierarchy are attributed to individuals depending on their characteristics. Our theoretical framework can be used to study differences in assignment and outcomes across groups and we show how it can motivate decomposition and...