This paper examines the market for teachers in the UK from 1960 to the mid 1990s using graduate cohort data from 5 separate cohorts. The use of this data allows us to simulate the effect of possible teacher pay rises over time. We find that relative wages in teaching compared to alternative professions have a significant impact on the likelihood of graduates choosing to teach, although the impa...

We study unemployment insurance (UI) in a general equilibrium environment in which unemployed workers only receive benefits for a finite length of time. Although all workers have identical productivity and leisure value, the random arrival of job offers creates ex-post differences with respect to their time remaining until benefit expiration. Firms, which are also homogenous, can exploit these ...

ainstream macroeconomics is in disarray. Perusal of commonly used textbooks in macroeconomics will confirm that impression without much difficulty. Unfortunately, the same statement could have been made, and often was made, fifteen years ago. While in this sense little has changed in recent years, the disarray is now more fundamental and severe than a t any time since the 1930s. Amidst this dis...

Do reported reservation wages correspond to the concept of reservation wages that economists have? Using panel data on British unemployed I calculate reservation wages from a search model and compare these with reported reservation wages. It is shown that men’s reported reservation wages are greater than what the model predicts, and that for women there is hardly a relation between the two vari...

Ever since H. G. Lewis’s classic (1963) study of union relative wages, the empirical study of the economic effects of trade unions has been a thriving industry in the U.S. Since that time, the empirical analysis of unions’ effects has spread to encompass outcomes other than wages --including profits, productivity and employment—and to consider unionism in other countries, including the U.K. and...

This paper introduces and tests for the endogeneity of job tenure and number of jobs in the wage equation using panel data uniquely suited for that purpose – the National Longitudinal Survey of Youth (NLSY). The model is multi-level in that there is wage dynamics – random intercept, random growth path and autocorrelated transitory variation – at the person-career level and at the job-specific l...

We present a generalization of the standard random-search model of unemployment in which firms hire multiple workers and in which the hiring process is time-consuming as well as costly. We follow Stole and Zwiebel (1996a,b) and assume that wages are determined by continuous bargaining between the firm and its employees. This generates a non-trivial dispersion of firm sizes; when firms’ producti...