Costas Cavounidis

Department of Economics
Warwick University
Coventry, CV4 7AL
Tel: +44 2476528420
United Kingdom

E-Mail: EmailAddress: hidden: you can email any NBER-related person as first underscore last at nber dot org
Institutional Affiliation: University of Warwick

NBER Working Papers and Publications

September 2019The Boss is Watching: How Monitoring Decisions Hurt Black Workers
with Kevin Lang, Russell Weinstein: w26319
African Americans face shorter employment durations than apparently similar whites. We hypothesize that employers discriminate in either acquiring or acting on ability-relevant information. We construct a model in which firms may "monitor" workers. Monitoring black but not white workers is self-sustaining: new black hires are more likely to have been screened by a previous employer, causing firms to discriminate in monitoring. We confirm the model's prediction that the unemployment hazard is initially higher for blacks but converges to that for whites. Two additional predictions, lower lifetime incomes and longer unemployment durations for blacks, are known to be strongly empirically supported.
April 2017Ben-Porath meets Lazear: Lifetime Skill Investment and Occupation Choice with Multiple Skills
with Kevin Lang: w23367
We develop a fairly general and tractable model of investment when workers can invest in multiple skills and different jobs put different weights on those skills. In addition to expected findings such as that younger workers are more likely than older workers to respond to a demand shock by investing in skills whose value unexpectedly increases, we derive some less obvious results. Credit constraints may affect investment even when they do not bind it equilibrium. If there are mobility costs, firms will generally have an incentive to invest in some of their workers' skills even when there are a large number of similar competitors, and, in equilibrium, there can be overinvestment in all skills. Worker skill accumulation resembles learning by doing even in its absence. We demonstrate how the...
October 2015Discrimination and Worker Evaluation
with Kevin Lang: w21612
We develop a model of self-sustaining discrimination in wages, coupled with higher unemployment and shorter employment duration among blacks. While white workers are hired and retained indefinitely without monitoring, black workers are monitored and fired if a negative signal is received. The fired workers, who return to the pool of job-seekers, lower the average productivity of black job-seekers, perpetuating the cycle of lower wages and discriminatory monitoring. Under suitable parameter values the model has two steady states, one corresponding to each population group. Discrimination can persist even if the productivity of blacks exceeds that of whites.
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