The Economics of Non-Compete Agreements

This episode breaks down what non-compete agreements are and why they’ve become such a hot topic in labor economics. Matt and Jadrian explore when these contracts make sense and when they might go too far. They weigh the trade-offs between protecting company investments and limiting worker mobility, while also digging into recent policy debates and what non-competes mean for innovation and entrepreneurship.

In this episode, we talk about:

* What non-compete agreements are and why companies use them

* Whether it’s reasonable to restrict employees from working for competitors

* The fairness (or unfairness) of non-competes after leaving a job

* The role of non-competes in limiting job mobility and career growth

* State-level bans and the brief FTC attempt to outlaw non-competes nationally

* Whether non-competes function similarly to patents in protecting investments

If you liked this conversation, you might also enjoy:

This Week’s Drinks 🍻

This week featured a couple of solid, no-nonsense beer picks. Jadrian went with a Sam Adams Cold Snap White Ale, a citrusy, spiced brew with clementine and orange peel that paired perfectly with chips and homemade salsa. Matt opted for a Founders Centennial IPA, a go-to choice that balances quality with value. Nothing says economist like getting a 15-pack for the price of a 12. Classic Matt.

Name That Stat 📊