Should capital and labor be taxed, and if so how when individuals’labor and capital income are subject to uninsurable idiosyncratic risks? In a two period general equilibrium model with production, we first show that reducing investment is welfare improving if households are homogeneous enough ex ante. On the other hand, when the degree of heterogeneity is suffi ciently high a welfare improveme...

China presents several macroeconomic patterns that appear inconsistent with standard stylized facts about economic development and hence inconsistent with the standard neoclassical growth model. We show that Chinese macroeconomic patterns instead appear consistent with an environment where state control of factor markets can promote aggressive output goals. We consider the micro-institutional f...

How Do Layoff Costs Affect Employment? General equilibrium analyses of layoff costs have had mixed messages on the implications for employment. This paper brings out the economic forces at work and explains the disparate results. Specifically, we show that positive employment effects of layoff costs come through reducing labor reallocation, whereas negative effects come through reducing the pri...

Attempting to explain why biological sex remains the primary predictor of household labor allocation, gender theorists have suggested that husbands and wives perform family work in ways that facilitate culturally appropriate constructions of gender. To date, however, researchers have yet to consider the theoretical and empirical significance of emotion work in their studies of the gendered divi...

This paper studies the effects of terms of trade volatility on growth. First, we present a simple two-sector model where it is costly to initiate tradable goods production and terms of trade volatility decreases the labor force share of the tradables sector and GDP. Second, we show that the authorities can use international liquidity (reserves) to stabilize the real exchange rate, restore the e...

This paper proposes a one-sector multigroup growth model with endogenous labor supply in discrete time. Proposing an alternative approach to behavior of households, we examine the dynamics of wealth and income distribution in a competitive economy with capital accumulation as the main engine of economic growth. We show how human capital levels, preferences, and labor force of heterogeneous hous...

In many West African countries, large rural multigenerational households farm common household plots as well as allocate individual plots to different family members. Multiple studies have found that women plot managers achieve lower yields than men. This work uses a unique 17-year panel dataset from southern Mali to investigate this gender production differential. The long-span and specificity...

How Do Layoff Costs Affect Employment? General equilibrium analyses of layoff costs have had mixed messages on the implications for employment. This paper brings out the economic forces at work and explains the disparate results. Specifically, we show that positive employment effects of layoff costs come through reducing labor reallocation, whereas negative effects come through reducing the pri...

This paper studies the labor market in Vietnam during the transition towards market economy (1993-2006): we show that the public-private sector wage gap markedly increased, but that wage inequality decreased overall. Our aim is to assess how much of this evolution can be explained by workers’ productive skills and their allocation between sectors. We use a simple, yet innovative, method that al...

Although there is growing recognition of the contribution of teachers to students’ educational outcomes, there are large gaps in our understanding of how teacher labor markets function. Lowincome, low-achieving and non-white students, particularly those in urban areas, often are taught by the least skilled teachers. This sorting of teachers to jobs likely contributes to the substantial gaps in ...