This paper analyses how decentralised wage bargaining affects wage levels and the structure of wages as well as the impact on firm performance. By using unique employer-employee matched data for Sweden 2007 and 2010, the paper presents new evidence on the collective bargaining premium in Sweden...

Teacher contracts that condition pay and retention on demonstrated performance can improve selection into and out of teaching. I study alternative contracts in a simulated teacher labor market that incorporates dynamic self-selection and Bayesian learning. Bonus policies create only modest...

We implement a laboratory experiment in which a principal has to decide on monitoring intensity and pay to investigate whether they are complements or substitutes. Wage level, monitoring intensity, and consequently the desired enforceable effort level are jointly determined by the maximization...

This paper studies the adjusted gender wage gap in Colombia at different points of the distribution of wages and the effect of sample selection. We compare 1994 with 2010. A glass ceiling pattern is observed after controlling for observed characteristics in both years. In addition, the sample...

We construct and estimate an equilibrium search model with on–the–job–search. Firms make take–it–or–leave–it wage offers to workers conditional on their characteristics and they can respond to the outside job offers received by their employees. Unobserved worker productive...

Prof. Xiaogang Wu, an HKUST Faculty Associate and Professor of Social Science at HKUST, investigates the earnings disadvantages faced by rural Chinese migrants in urban cities as compared to their local urban counterparts, and uses empirical evidence to conclude that such disadvantages are...

We study all-pay auctions with multiple prizes. The players have the same value for all the certain prizes except for one uncertain prize for which each player has a private value. We characterize the equilibrium strategy and show that if the number of prizes is smaller than the number of...

Recent research in macroeconomics emphasizes the role of wage rigidity in accounting for the volatility of unemployment fluctuations. We use worker-level data from the CPS to measure the sensitivity of wages of newly hired workers to changes in aggregate labor market conditions. The wage of new...

This paper examines James Steuart’s explanation of the emergence of the exchange economy. An initial hypothesis holds the decisive influence of a plan designed and implemented by merchants. Our proposal evokes the importance, acknowledged by Steuart, of the construction of institutions,...

One of the long-standing puzzles in economics is why wages do not fall sufficiently in recessions so as to avoid increases in unemployment. Put differently, if the competitive market wage declines, why don't employers simply force their employees to accept lower wages as well? As an alternative...