We study the impact of trade on wage inequality and welfare when labor market is monopsonistic. Firm heterogeneity in productivity along with workers’ idiosyncratic preferences for different firms generate between-firm workers identical skills. The model features a novel channel “love firm variety.” Trade liberalization provides additional gains through firm-variety monopsony power high but det...

We use data at the Census ward level to investigate the extent to which labor markets are ‘local’. We present some non-structural estimates in which the probability of filling a vacancy is influenced by unemployment and vacancies in the surrounding areas, but we argue that these estimates cannot adequately estimate the true cost of distance. We then present a simple model of job-search across s...

The research on teacher labor markets is quite large and expanding; yet, as in most areas of education research, our knowledge is full of holes and only gets us a little ways towards identifying productive policy directions. As such, there is plenty of room for new research – describing labor market dynamics, developing and substantiating theories about the mechanisms driving the trends and rel...

China’s emergence as a great economic power has induced an epochal shift in patterns of world trade. Simultaneously, it has toppled much of the received empirical wisdom about how labor markets adjust to trade shocks. Alongside its heralded consumer benefits, trade has both significant distributional costs, which theory has long recognized, and substantial adjustment costs, which the literature...

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How Important Are Labor Market Institutions for Labor Market Performance in Transition Countries? This paper offers a first comprehensive study of the relationship between labor market institutions and policies and labor market performance in the countries of Eastern Europe and Central Asia, which in the last two decades experienced radical economic and institutional transformations. Based on a...

Using data from the Fragile Families and Child Wellbeing study and the Current Population Survey, we find that labor market conditions play a large role in explaining the positive relationship between educational attainment and marriage. Our results suggest that if loweducated parents enjoyed the same, stronger labor market conditions as their more-educated counterparts, then differences in mar...

Even though labor income represents about two thirds of disposal income to household, its role has largely been neglected by asset pricing models. In this paper, we solve a general equilibrium model which can both rationalize important feature of labor markets as well as financial markets. To this end, we embed labor market search frictions into a business cycle model where the representative h...