We show that if agents are risk neutral, prizes outperform wages if and only if there is su¢ cient pride and envy relative to the noisiness of performance. If agents are risk averse, prizes are a necessary supplement to wages (as bonuses). Keywords: Envy, Pride, Wages, Prizes, Bonus JEL Classi…cation: C72, D01, D23, L14.

he links among trade, technological changes, and worker earnings have been the subject of intense research during the past few decades. The current literature on this subject shows that trade liberalization and technological changes are the main drivers of demand for skilled workers and a rise in the wage premium. In the present article, a panel of 134 Iranian manufacturing industries over the ...

We construct a stochastic overlapping generations model in which households of di¤erent ages are subject to aggregate shocks that a¤ect both wages and asset prices. We use a realistically calibrated version of the model to assess the distributional consequences of severe recessions. More speci…cally, within the context of this model we ask whether young people can be better o¤ if they become ec...

This paper examines whether men’s and women’s noncognitive skills influence their occupational attainment and, if so, whether this contributes to the disparity in their relative wages. We find that noncognitive skills have a substantial effect on the probability of employment in many, though not all, occupations in ways that differ by gender. Consequently, men and women with similar noncognitiv...

In this paper an effort is made in order to investigate the nexus of dynamic interrelations between the general macroeconomic environment of Greek economy with a special reference to the real wages determination. For the causality analysis among real wages, consumer price index, labour productivity, unemployment rate and gross domestic product a multivariate autoregressive VAR model was used, c...

In this paper, we use a multi-sector specific factors model with international capital mobility to examine the effects of globalization on the skill premium in U.S. manufacturing industries. This model allows us to identify two channels through which globalization affects relative wages: effects of international capital flows transmitted through changes in interest rates, and effects of international...