Worker Flows and Job Flows: A Quantitative Investigation
43 Pages Posted: 1 Oct 2009 Last revised: 27 Nov 2009
There are 4 versions of this paper
Worker Flows and Job Flows: A Quantitative Investigation
Worker Flows and Job Flows: A Quantitative Investigation
Worker Flows and Job Flows: A Quantitative Investigation
Worker Flows and Job Flows: A Quantitative Investigation
Date Written: November 25, 2009
Abstract
Worker flows and job flows behave differently over the business cycle. We investigate the sources of the differences by studying quantitative properties of a multiple-worker version of the search/matching model that features endogenous job separation and intra-firm wage bargaining. Our calibration incorporates micro- and macro-level evidence on worker and job flows. We show that the dynamic stochastic equilibrium of the model replicates important cyclical features of worker flows and job flows simultaneously. In particular, the model correctly predicts that hires from unemployment move countercyclically while the job creation rate moves procyclically. The key to this result is to allow for a large hiring flow that does not go through unemployment but is part of job creation, for which procyclicality of the job finding rate dominates its cyclicality. We also show that the model generates large volatilities of unemployment and vacancies when a worker's outside option is at 83% of aggregate labor productivity.
Keywords: Job flows, worker flows, search and matching, business cycles, unemployment, vacancies
JEL Classification: E24, E32, J63, J64
Suggested Citation: Suggested Citation
Do you have a job opening that you would like to promote on SSRN?
Recommended Papers
-
Incentives in Competitive Search Equilibrium
By Espen R. Moen and Asa Rosen
-
The Cyclical Behavior of Equilibrium Unemployment and Vacancies Revisited
By Marcus Hagedorn and Iourii Manovskii
-
The Cyclical Behavior of Equilibrium Unemployment and Vacancies: Evidence and Theory
-
Incentives in Competitive Search Equilibrium and Wage Rigidity
By Espen R. Moen and Asa Rosen
-
Incentives in Competitive Search Equilibrium and Wage Rigidity
By Espen R. Moen and Asa Rosen
-
Search-Theoretic Models of the Labor Market: A Survey
By Richard Rogerson and Randall Wright
-
Search-Theoretic Models of the Labor Market-A Survey
By Richard Rogerson, Robert Shimer, ...
-
Unemployment Fluctuations with Staggered Nash Wage Bargaining
By Mark Gertler and Antonella Trigari
-
Employer-to-Employer Flows in the U.S. Labor Market: The Complete Picture of Gross Worker Flows
