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Specialization and wages when jobs generate utility




The paper presents a model where both income and hours of work are allowed to have a positive effect on individual utility. Increasing returns to specialization and the concavity of the utility function leads some workers to choose lower wages in return for a more interesting job. Such interest in ones'work means that not all possible gains from specialization are achieved and that the correlation between income and talent (opportunities) is weakened. If letting workers do many tasks is costly for the firms, there may be few jobs where the workers can choose to be a generalist.

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  • Andreassen Leif, 2010. "Specialization and wages when jobs generate utility," Department of Economics and Statistics Cognetti de Martiis. Working Papers 201009, University of Turin.
  • Handle: RePEc:uto:dipeco:201009

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