Efficient Contracts with Costly Adjustment: Short-RUn Employment Determination for Airline Mechanics
AbstractThis paper presents an empirical analysis of firm-specific employment and wage outcomes for mechanics in the domestic airline industry. A dynamic contracting model is presented that incorporates both costly employment adjustment and potential gaps between contract wage rates and the opportunity value of workers' time. The model gives a useful description of the employment-output linkage in the data, but is less successful in capturing the dynamic relation between employment, contract wage rates, and wage rates outside the airline industry.
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Bibliographic InfoPaper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 1931.
Date of creation: May 1986
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- Card, David, 1986. "Efficient Contracts with Costly Adjustment: Short-run Employment Determination for Airline Mechanics," American Economic Review, American Economic Association, vol. 76(5), pages 1045-71, December.
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