This paper develops a theoretical framework to study the impact of bonus caps on banks' risk taking. In the model, labor market price adjustments can offset the direct effects of bonus caps. The calibrated model suggests that bonus caps are only effective when bank executives' mobility is...

We compile a novel database on average public and private sector wages and public-private wage differentials, which we use to analyze how average public-private wage differentials vary according to gender and skill level as well as over time. We further examine the dynamic relationship between...

This paper uses a life-cycle framework to document new stylized facts about the nexus between job polarization and earnings inequality. Using quarterly labor force data for the UK over the period 2000-2018, we find clear life-cycle profiles in the probability of being employed within each...

It is obvious that holding city population constant, differences in cities across the world areenormous. Urban giants in poor countries are not large using measures such as land area,interior space or value of output. These differences are easily reconciled mathematically aspopulation is the...

We study the costs of hospitalizations on patients' earnings and labor supply, using the universe of hospital admissions in Denmark and full-population tax data. We evaluate the quality of treatment based on its ability to mitigate the labor market consequences of a given diagnosis and propose a...

Wage rises have remained stubbornly low in advanced Europe in recent years, but, at the same time, newer EU members are experiencing rapid wage acceleration. This paper investigates the drivers of this wage divergence. Econometric analysis using error correction models suggests that wage growth...

The consumer price index (CPI) is a key economic indicator used to gauge inflation, adjust wages, pensions, and social benefits. The producer prices index (PPI) is used for forecasting and deflating GDP estimates. Both indexes are used by the Fund, policymakers, and researchers for global,...

This paper documents recent labor market performance in the Latin American region. The paper shows that unemployment, informality, and inequality have been falling over the past two decades, though still remain high. By contrast, productivity has remained stubbornly low. The paper, then, turns...

Tourism has become the main driver of economic growth and employment and the most important source of income in the ECCU. Preserving and, possibly, enhancing the competitiveness of the tourism product is key for these countries. Unfortunately, the evidence shows that tourism arrivals to the ECCU...

The recovery of private investment in Italy has lagged its euro area peers over the past decade. This paper examines the role of elevated labor costs in hindering the recovery. Specifically, labor costs rose faster than labor productivity prior to the global financial crisis and have remained...