Alex Heath and the RBA's Prices, Wages and Labour section, and participants at an RBA seminar for helpful comments and suggestions; the errors remaining are our own. The views expressed in this paper are those of the authors and should not be attributed to the Reserve Bank of Australia.

We show that worker wellbeing is determined not only by the amount of compensation workers receive but also by how compensation is determined. While previous theoretical and empirical work has often been preoccupied with individual performance-related pay, we find that the receipt of a range of group-performance schemes (profit shares, group bonuses and share ownership) is associated with highe...

"This paper presents a life-cycle model where migrants determine re-migration and consumption simultaneously in a stochastic environment. Whether precautionary savings of migrants are above or below those of natives is ambiguous in general--the sign depends on the risk in host- and home-country labor markets and on the correlation of labor market shocks. Furthermore, the effect of an uncertain ...

Although the Korean economy became severely depressed because of the financial crisis in November 1997, most foreign migrant workers in the country opted to stay rather than return to their home countries. This study examined the causes of their relative immobility at both the macro- and microlevel through the use of government statistics and survey data. The first section of this study explo...

The earnings gap between people with a college degree and those with no education beyond high school has been growing since the late 1970s. Since 2000, however, the gap has grown more for those who have earned a post-graduate degree as well. The divergence between workers with college degrees and those with graduate degrees may be one manifestation of rising labor market polarization, which ben...

This paper seeks to contribute to the ongoing controversy on the distributional effects of structural reforms in developing countries. To this end, we set up a small-scale macroeconomic model of a dual economy to capture the transmission mechanisms through which the deregulation of product and factor markets, the liberalization of the trade and FDI regime, and the privatization of public compan...

The aim of our study is to investigate the effect of immigrants on wages for natives with divergent skill level within one country. Skill level is measured as education level and the purpose is to focus on the level where it according to us is a lack in research, namely the effect on high skilled native-born worker wages. Further, our contribution to the already existing studies may be consider...

We evaluate the e¤ects of aging on productivity using data from piece-rates. Our data contains the population of Finnish blue collar metal industry workers from years 1996-2000. A unique feature of the data is that we can observe the exact hours worked on piece-rates and time rates as well as earnings from both performance schemes. Moreover, a subset of workers receive both piece-rates and time...

This study examines the differential effects of the unemployment rate at labor market entry, defined as the time of leaving school, on subsequent wages across gender and race using the National Longitudinal Survey of Youth 79. Results suggest that the negative effect of a recession at entry on wages is weaker for women. The differences between blacks and whites are not statistically significant...

This paper develops a model of career concerns. The worker’s skill is revealed through output, wage is based on expected output, and so on assessed ability. Specifically, effort increases the probability that a skilled worker achieves a one-time breakthrough. Effort levels at different times are strategic substitutes. Equilibrium effort (and, if marginal cost is convex, wage) is single-peaked w...