I argue that household specialization and investment in firm-specific human capital explain the male marriage premium. First I develop a model of human capital in which to-be-married men invest in human capital over two rounds. The promise of high returns to the second round of investment encourages firms to offer high wages before the first round, so that wages do not change upon marriage. The...

Building upon a continuous-time model of search with Nash bargaining in a stationary environment, we analyze the effect of changes in minimum wages on labor market outcomes and welfare. While minimum wage increases may or may not lead to increases in unemployment in our model, they can be welfare-improving to labor market participants on both the supply and demand sides of the labor market. We ...

The reservation wage is an integral part of most theories of involuntary unemployment. We use panel data to examine the empirical determinants of the reservation wage — in particular the inßuence of previous wages — and consider what this implies for the evolution of the natural rate of unemployment. We Þnd that previous wages have a signiÞcant but relatively small effect on reservation wages (...

The prevailing labor market models assume that minimum wages do not affect the labor supply schedule. We challenge this view in this paper by showing experimentally that minimum wages have significant and lasting effects on subjects’ reservation wages. The temporary introduction of a minimum wage leads to a rise in subjects’ reservation wages which persists even after the minimum wage has been ...

Recent work on the economic effects of minimum wages has stressed that the standard economic model, where increases in minimum wages depress employment, is not supported by empirical work in some labor markets. We present a general theoretical model whereby employers have some degree of monopsony power, which allows minimum wages to have the conventional negative impact on employment but which ...

This study uses data from the British Household Panel Study (BHPS) and employs all basic traits from the Five Factor Personality Inventory – openness to experience, conscientiousness, extraversion, agreeableness and neuroticism – to examine the relationship between individuals’ personality and wages in the UK. The results indicate a negative linear relationship between wages and agreeableness a...

The wages time series are in fact stochastic in which successive observations are dependent and can be represented by a linear combination of independent random variables , , 1 − t t ε ε ... . If the successive observations are highly dependent, we should use in model past values of the time series variable and (or) current and past values of the error terms { t ε }. There are available techniq...

Psychology is a very popular undergraduate major. Examining wage data from a range of degree holders reveals much about the expected career trajectories of those with psychology degrees. First, regarding baccalaureates, psychology and other liberal arts graduates-compared with those from certain preprofessional and technical undergraduate programs-generally fall in relatively low tiers of salar...

Multidimensional Human Capital, Wages and Endogenous Employment Status in Ghana Previous studies of labor market outcomes such as employment and wages have mostly been limited to investigating the impact of formal schooling only and, as a consequence, have seldom considered skills or alternative routes to acquiring skills, such as adult literacy programs, or other types of education. This paper...