I study a labor market in which identical workers search on- and off-the-job heterogeneous firms employ using either an ex-ante posted wage or flexible contracts contingent on outside options. Firm level costs for generate segmented equilibrium less productive post wages. The model with can achieve dispersion, share, employment transitions, flow value of unemployment that are simultaneously con...

This paper analyzes the impact of indexed wage contracts on inflation and social welfare in a Barro–Gordon model with state contingent monetary policy. Wage indexation reduces the inflation bias but may raise the variance of inflation rates. In social optimum wages are fully indexed to the price level, but this requires optimal wage adjustments to productivity shocks. If wage adjustments to pro...

This paper presents the results of a policy oriented macroeconomic experiment involving an ‘international’ economy with a relatively small ‘home’ country and a large ‘foreign’ country. It compares the economic performance of two alternative tax systems as a means to finance unemployment benefits: a wage tax system versus a sales-tax-cum-labor-subsidy system. The two systems are applied to the s...

The impact of international trade on wages has received substantial attention in recent decades; but only recently have the specific effects of exporting on wage inequality been investigated in detail. This paper employs the unexpected 1999 Brazilian exchange rate devaluation to identify the effects of exporting on Brazilian manufacturing firm-level wages using employer-employee linked data. We...

Both human capital accumulation and Lazear contracts can explain the raising wage of salary/wage worker through job experience or tenure. To distinguish between these two effects, Lazear and Moore (1984) used self-employed workers’ wage growth to partial out the effect of human capital accumulation from salary/wage workers’ wage growth. When the human capital accumulation behavior is identical ...

This paper examines how closely the minimum wage has been set to the most popularly stated goals of minimum-wage policy. I first estimate these goals: the minimum-wage rate at which the relevant labor demand is unitary elastic—maximizing the total earnings of minimum-wage workers (about $5.35)—and the level that would lift a typical minimum-wage worker’s family out of poverty (about $5.17). I c...

This paper analyzes the gender wage disparities among rural-urban migrants in urban China using a nationally representative data set. On average, female migrants earn only 66% of their male counterparts’ average hourly wage. And the gender wage gap is not uniform across migrants’ wage distribution with differentials much higher at the top end than at the bottom and the middle. The mean decompos...

This paper examines the role of regional unemployment in wage determination. Recent empirical studies have found a negative relationship between local unemployment and the level of wages. The resulting downward sloping curve in the wage-unemployment space has become known as “the wage curve.” While the existence of the wage curve has been well established, little is known about what gives rise ...

BACKGROUND In Australia a persistent and sizable gender wage gap exists. In recent years this gap has been steadily widening. The negative impact of gender wage differentials is the disincentive to work more hours. This implies a substantial cost on the Australian health sector. This study aimed to identify the magnitude of gender wage differentials within the health sector. The investigation a...

When Congress or a state legislature passes a minimum wage increase, there is often a period of several months between the passage of the increase and its implementation. During this period, employers know the level of the current binding minimum wage, but they also know the level of the minimum wage at a defined future date. Although this “future wage,” as I call it, is not yet binding, employ...