Learning in Labour Markets

Edited by Michael Waldman, Charles H. Dyson Professor in Management and Professor of Economics, Johnson Graduate School of Management, Cornell University, US

‘Any scholar interested in career patterns of employees in organizations should consult this collection. It combines in one volume a comprehensive collection of seminal articles in economics that analyze the processes of learning about employees‘ talents and its implications for educational choices, promotion decisions and salary structures in firms. It demonstrates how powerful microeconomic analysis has become to help us develop a precise understanding of careers within and across organizations.’

• Contents:Introduction Michael WaldmanPART I CLASSICS1. Michael Spence (1973), ‘Job Market Signaling’, 87 (3), Quarterly Journal of Economics, August, 355–742. Boyan Jovanovic (1979), ‘Job Matching and the Theory of Turnover’, Journal of Political Economy, 87 (5), Part 1, October, 972–903. Eugene F. Fama (1980), ‘Agency Problems and the Theory of the Firm’, Journal of Political Economy, 88 (2), April, 288–3074. Michael Waldman (1984), ‘Job Assignments, Signaling and Efficiency’, Rand Journal of Economics, 15 (2), Summer, 255-675. Bruce C. Greenwald (1986), ‘Adverse Selection in the Labour Market’, Review of Economic Studies, 53 (3), July, 325-476. Bengt Holmstrom (1999), ‘Managerial Incentive Problems: A Dynamic Perspective’, Review of Economic Studies, 66 (1), January, 169-82PART II EDUCATION 7. John G. Riley (1979), ‘Testing the Educational Screening Hypothesis,’ Journal of Political Economy, 87 (5), Part 2: Education and Income, October, S227–S2528. Kevin Lang and David Kropp (1986), ‘Human Capital Versus Sorting: The Effects of Compulsory Attendance Laws’, Quarterly Journal of Economics, 101 (3), August, 609–24 9. Thomas Hungerford and Gary Solon (1987), ‘Sheepskin Effects in the Returns to Education’, Review of Economics and Statistics, 69 (1), February, 175–710. Kelly Bedard (2001),’Human Capital versus Signaling Models: University Access and High School Dropouts’, Journal of Political Economy, 109 (4), 749–7511. Fabian Lange (2007), ‘The Speed of Employer Learning’, Journal of Labor Economics, 25 (1), 1–3512. Peter Arcidiacono, Patrick Bayer and Aurel Hizmo (2010), ‘Beyond Signaling and Human Capital: Education and the Revelation of Ability,’ American Economic Journal: Applied Economics, 2 (4), October, 76–104PART III THEORY OF SYMMETRIC LEARNING 13. Milton Harris and Bengt Holmstrom (1982), ‘A Theory of Wage Dynamics’, Review of Economic Studies, 49 (3), July, 315–3314. Robert Gibbons and Michael Waldman (1999), ‘A Theory of Wage and Promotion Dynamics Inside Firms’, Quarterly Journal of Economics, 114 (4), November, 1321–35815. Jaime Ortega (2001), ‘Job Rotation as a Learning Mechanism’, Management Science, 47 (10), October, 1361–7016. Edward P. Lazear (2004), ‘The Peter Principle: A Theory of Decline’, Journal of Political Economy, 112 (1) Part 2, S141–S163PART IV EVIDENCE ON SYMMETRIC LEARNING 17. Robert Gibbons and Kevin J. Murphy (1992), ‘Optimal Incentive Contracts in the Presence of Career Concerns: Theory and Evidence’, Journal of Political Economy, 100 (3), June, 468–505 18. Curtis J. Simon and John T. Warner (1992), ‘Matchmaker, Matchmaker: The Effect of Old Boy Networks on Job Match Quality, Earnings and Tenure’, Journal of Labor Economics, 10 (3), July, 306–3019. Henry S. Farber and Robert Gibbons (1996), ‘Learning and Wage Dynamics’, Quarterly Journal of Economics, 111 (4), November, 1007–4720. Joseph G. Altonji and Charles R. Pierret (2001), ‘Employer Learning and Statistical Discrimination’, Quarterly Journal of Economics, 116 (1), February, 313–5021. Lisa B. Kahn and Fabian Lange (2014) ‘Employer Learning, Productivity, and the Earnings Distribution: Evidence from Performance Measures’, Review of Economic Studies, 81, 1575–61322. Amanda Pallais (2014), ‘Inefficient Hiring in Entry-Level Labor Markets’, American Economic Review, 104 (11), 3565–9923. Jeanine Miklós-Thal and Hannes Ullrich (2016), ‘Career Prospects and Effort Incentives: Evidence from Professional Soccer’, Management Science, 62 (6), 1645–67PART V THEORY OF ASYMMETRIC LEARNING 24. Paul Milgrom and Sharon Oster (1987), ‘Job Discrimination, Market Forces, and the Invisibility Hypothesis’, Quarterly Journal of Economics, CII (3), August, 453–7625. James D. Montgomery (1991), ‘Social Networks and Labor-Market Outcomes: Toward an Economic Analysis’, American Economic Review, 81, (5), December, 1408–41826. Dan Bernhardt (1995) ‘Strategic Promotion and Compensation’, Review of Economic Studies, 62 (2), April, 315–3927. Chun Chang and Yijiang Wang (1996), ‘Human Capital Investment under Asymmetric Information: The Pigovian Conjecture Revisited ’, Journal of Labor Economics, 14 (3), July, 505–1928. Ján Zábojník and Dan Bernhardt (2001), ‘Corporate Tournaments, Human Capital Acquisition, and the Firm Size-Wage Relation’, Review of Economic Studies, 68 (3), 693–71629. Hideo Owan (2004), ‘Promotion, Turnover, Earnings, and Firm-Sponsored Training’, Journal of Labor Economics, 22 (4), October, 955–78PART VI EVIDENCE FROM ASYMMETRIC LEARNING 30. Robert Gibbons and Lawrence F. Katz (1991), ‘Layoffs and Lemons’, Journal of Labor Economics, 9 (4), October, 351–8031. Daron Acemoglu and Jorn -Steffen Pischke (1998) ‘Why do Firms Train? Theory and Evidence’, Quarterly Journal of Economics, 113 (1), February, 79–11932. Uta Schönberg (2007), ‘Testing for Asymmetric Employer Learning’, Journal of Labor Economics, 25 (4), October, 651–9133. Joshua C. Pinkston (2009), ‘A Model of Asymmetric Employer Learning with Testable Implications’, Review of Economic Studies, 76 (1), January, 367–9434. Jed DeVaro and Michael Waldman (2012), ‘The Signaling Role of Promotions: Further Theory and Empirical Evidence’, Journal of Labor Economics, 30 (1), January, 91–14735. Lisa B. Kahn (2013), ‘Asymmetric Information Between Employers’, American Economic Journal: Applied Economics, 5 (4), October, 165–205Index