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Concentrating on the Fall of the Labor Share

By David Autor, David Dorn, Lawrence F. Katz, Christina Patterson, and John Van Reenen

American Economic Review, May 2017

The recent fall of labor's share of GDP in numerous countries is well-documented, but its causes are poorly understood. We sketch a "superstar firm" model where industries are increasingly characterized by "winner take most" competition, leading a small n...

Matching and Price Competition

By Jeremy Bulow and Jonathan Levin

American Economic Review, June 2006

We develop a model in which firms set impersonal salary levels before matching with workers. Wages fall relative to any competitive equilibrium while profits rise almost as much, implying little inefficiency. Furthermore, the best firms gain the most f...