Kathryn Ierulli

kierulli@uchicago.edu
TA Howard Riady
howardriady@gmail.com
Economics 244
Winter 2015
Pay and Performance
MW 12-1.20pm, SHFE 146
This is an elective course in personnel economics, a subset of applied labor economics. We model methods of compensation and their corresponding incentives, the firms profit-maximizing choice of labor inputs, and how characteristics of workers and of jobs affect level and form of pay. The class will generally consist of an introductory lecture on
each topic, followed by more applied models, evidence from the empirical personnel literature, and discussion.
Prerequisites:
Economics 200 and 201. All students should have completed a multivariate calculus course.
Texts:
Required textbooks:
Lazear, Edward P., and Michael Gibbs, Personnel Economics in Practice. 3rd ed. John Wiley & Sons, available at : www.wiley.com/college/lazear
To access the appendices:
www.wiley.com/college/lazear. Next, click on Visit the Companion Site, and then the Student Companion site.
Next, click on Browse by Resources and you will see a drop down menu for each chapter appendix. This is not
password protected.
1.

2. Lazear, Edward P. Personnel Economics. MIT Press, 2009, available at:

http://mitpress.mit.edu/books/personnel-economics
Supplemental readings as assigned. Handouts in class are always required reading.
Web Resources:
http://chalk.uchicago.edu. All registered students will automatically be added to this web interface.
Problem Session:
Monday, 6-7pm Rosenwald 301. Attendance is required. Problem sets are to be turned in to Howard at the beginning
of the session. They will not be accepted at any other time.
Assessment:
Your grade for the course will depend upon 5 problem sets, a midterm exam in class, and a final exam. The weights
on these for your letter grade are 10%, 40%, and 50%. Exams are given only at assigned times. The sole exceptions
are for documented medical emergencies and early final exams for graduating fourth year students.
Exam on Thursday, December 10th, 4:00-6:00
Communication:
Mobile: 312-731-6107
Office Hours: TBA, but will be on Friday.
Class website: http://chalk.uchicago.edu
You are required to read email at your uchicago.edu account regularly since I can only send out class email to that
domain via the chalk website. Although email may be less compelling than instant messaging, it is the only method
available to me that reaches all registered students.

Course Syllabus: Pay and Performance

Weeks 1-10:
1.

Salaries and Piece Rates, Hiring and Recruitment L and G Ch 1, 2, L Ch 2

2.

Skills, Human Capital L and G Ch 3

3.

Turnover and Efficient Separation L and G Ch 4

4.

Decision Making L and G Ch 5

5.

Hierarchies L and G Ch 6. Midterm in class on Thursday.

6.

Performance Evaluation L and G Ch 9.

7.

Paying for Performance L and G Ch 10.

8.

Careers, Incentives, Pensions L and G Ch 11.

9.

Stock, Options, and Executive Pay L and G Ch 12.

10.

Selected Topics.