This article develops and tests a simple dynamic model of statistical discrimination. The model improves on earlier static models both by allowing ex ante uncertainty about worker productivity to be resolved as on-the-job performance is observed and by generating several testable empirical implications. These predictions are tested using a sample of young men from the National Longitudinal Survey of Youth, producing mixed evidence for the model. The main empirical result is that no black-white wage gap exists at labor force entry but that one develops as experience accumulates, mainly because blacks reap smaller gains from job mobility.

This paper analyzes both theoretically and empirically how an absolute grading standard that allows only a small number of distinct grades affects student course performance outcomes. The clearest prediction of the model is that course performance of “grade-motivated” students will tend to be clustered slightly above the boundaries that separate grades, as long as the variance of the random component of performance is not too large. A more tenuous prediction is that the proximity of a grade-motivated student to a grade boundary going into the final exam should influence final exam performance, after controlling for prefinal exam performance. An empirical investigation of the course performance of university students who were enrolled in introductory economics classes that used an absolute grading standard finds evidence in favor of both of these predictions. The results suggest that student effort decisions respond to the incentives created by the grading system.

This paper analyzes the daily labor supply behavior of food and beverage vendors at a single stadium over an entire baseball season. This labor market is attractive for the study of labor supply both because the vendors unilaterally decide whether to participate on each game date and because changes in product demand conditions across days are large and highly predictable, generating exogenous game‐to‐game variation in the vendor “Wage.” I exploit the observable shifts in product demand conditions across games to estimate the labor supply (participation) elasticity of stadium vendors. Estimates that recognize that demand conditions and vendor labor supply decisions simultaneously determine the vendor wage always find substantial labor supply elasticities, typically in the .55–.65 range. In contrast, estimates that ignore the endogeneity of the vendor wage yield severely downward-biased labor supply elasticities. These results highlight the importance of using demand shift instruments to identify labor supply elasticities in specific labor markets.

This paper empirically examines the relationship between enrollment is sex education and subsequent sexual behavior for U.S. teenagers during the 1970's. The estimates indicate that enrollment in sex education was associated with earlier sexual activity for females in this cohart. Sex education also was associated with earlier pregnancy for some group of females, but these effects are smaller and not always statistically significant. For both types of transitions, the effect of sex education appears to have been larger for women with fewer alternative sources of sexual information. In contrast, sex education had much less impact on male transitions into sexual activity. Within‐family analyses using sibling data reveal qualitatively similar patterns. Overall, the evidence suggests that sex education in the 1970's had some causal impact on teen sexual behavior, probably in significant part by providing information that enabled teens to alter the risks of sexual activity.