On the job search in a matching model with heterogeneous jobs and workers (original) (raw)

A Matching Model of Crowding-Out and On-the-Job Search

2002

This paper considers a matching model of heterogenous and jobs which includes on-the-job search. High-educated workers transitorily accept unskilled jobs and continue to search for skilled jobs. We study the implications of this model for the unemployment rates of high and low-educated workers, for the share of mismatched workers and wage nequality both within and between skill groups. The model is used to shed light on the Spanish experience following a large educational upgrading since the mid-eighties.

On-the-Job Search in a Matching Model with Heterogenous Jobs and Workers

2003

This Discussion Paper is issued within the framework of IZA's research area Mobility and Flexibility of Labor. Any opinions expressed here are those of the author(s) and not those of the institute. Research disseminated by IZA may include views on policy, but the institute itself takes no institutional policy positions.

A Matching Model of Crowding-Out and On-the-Job Search (with an Application to Spain)

SSRN Electronic Journal, 2002

On-the-Job Search in a Matching Model with Heterogeneous Jobs and Workers &ast

Economic Journal, 2009

Unemployment and search externalities in a model with heterogeneous jobs and workers

2002

This paper presents a matching model with low-and high-skilled workers and simple and complex jobs. I show that the degree to which low-skilled workers are harmed by high-skilled workers who are willing to temporarily accept simple jobs depends on the relative productivity of high-and low-skilled workers on simple jobs and on the quit rate of high-skilled workers. Under certain conditions, low-skilled workers can benefit from job competition with highskilled workers. Within this framework, some explanations for the high and persistent unemployment rates of lower educated workers in the 1990s are evaluated.

The Employed, the Unemployed, and the Unemployable: Directed Search with Worker Heterogeneity

SSRN Electronic Journal, 2000

We examine the implications of worker heterogeneity on the equilibrium matching process, using a directed search model. Worker abilities are selected from a general distribution, subject to some weak regularity requirements, and the firms direct their job offers to workers. We identify conditions under which some fraction of the workforce will be "unemployable": no firm will approach them even though they offer positive surplus. For large markets we derive a simple closed form expression for the equilibrum matching function. This function has constant returns to scale and two new terms, which are functions of the underlying distribution of worker productivities: the percentage of unemployable workers, and a measure of heterogeneity (κ).The equilibrium unemployment rate is increasing in κ and, under certain circumstances, is increasing in the productivity of highly skilled workers, despite endogenous entry. A key empirical prediction of the theory is that κ ≥ 1. We examine this prediction, using data from several countries.

Search, mismatch and unemployment

European Economic Review, 2008

This paper explores the efficiency of the equilibrium allocation in a matching model with heterogeneous workers and jobs. In the basic setup the labor force is divided in two groups. The high-skill workers are qualified for all jobs, while low-skill workers can perform unskilled jobs but not the more attractive skilled jobs. We demonstrate that the equilibrium with random search and ex post bargaining is never efficient. Under Hosios' condition the average wage is correct, but bargaining compresses the wage distribution relative to workers' shadow values. The wage compression distorts the relative profits of jobs making it too attractive to create skilled jobs. Furthermore, the low skill premium may prevent that the two types of workers efficiently sort in different jobs. In the first case we show that the market offers too few job opportunities for low-skill workers. On the contrary, when mismatch is socially wasteful, we find that low-skill workers experience shorter unemployment spells than in the efficient allocation. Finally, we show that our results generalize to environments with many types of agents and less stringent restrictions on the production technology.

Two-Sided Search, Heterogeneous Skills and Labor Market Performance

2005

A quantitative model of two-sided search with ex-ante heterogeneity in both worker and entrepreneurial skills is proposed. It is possible to characterize both the competitive equilibrium and the optimal solution numerically. The competitive equilibrium is shown to be suboptimal. Less-skilled workers and firms are too selective, not matching with their comparable counterparts. High-types, on the other hand, are not selective enough. The model shows promise as a tool for evaluating the effects of labor policies (and other changes in the economy) on the composition of unemployment and on unemployment duration, as well as on wage distributions. The effect of introducing a simple unemployment insurance scheme is then twofold. First, it increases unemployment by allowing a greater proportion of low types not to match, which decreases output. Second, it decreases mismatch, which has a positive effect on output. It is possible to have a positive effect of unemployment insurance on productivity and find the optimal level of unemployment insurance. Finally, it is shown that assuming risk-neutral workers in this model is not innocuous.

Worker flows, job flows and unemployment in a matching model

European Economic Review, 2010

Standard matching models of unemployment assume that workers and job ßows are identical. This is in stark contrast to empirical evidence that job ßows in fact only account for a fraction of worker ßows, that unemployment exits only account for a fraction of hires and that these fractions vary over the cycle. In this paper, we develop and calibrate a model based on the Mortensen and Pissarides approach but that emphasises this issue.

On the job search in a matching model with heterogeneous jobs and workers (original) (raw)

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