We use a mixture regression model to identify segmentation in the Israeli labor market, and propose a new method for assigning workers to simulated segments. We identified a lowwage segment and a high-wage segment, as well as a third segment with a large wage variability that we interpret as...

Knowledge spillover implies that the social value of knowledge is higher than its private value and leads to insufficient private investment in human capital. This paper examines implications for economic growth and offers a remedy. An incentive mechanism that implements the socially optimal...