The Value of Leisure or Disutility of Work: Wage Dispersion in a Model of Search with Endogenous Effort

33 Pages Posted: 26 Apr 2012  

Adrian Masters

State University of New York at Albany - College of Arts and Sciences, Economics

Date Written: January 3, 2012

Abstract

Wage dispersion is generated in a sequential search environment through heterogeneity in firm productivity along with an individual wage-effort trade-off. For a given degree of TFP dispersion, the framework can generate any amount of wage dispersion. Calibrated to generate realistic gains from trade, it is able to generate the kind of wage dispersion observed in data.

Keywords: Wage dispersion, search

JEL Classification: E24, J64

Suggested Citation

Masters, Adrian, The Value of Leisure or Disutility of Work: Wage Dispersion in a Model of Search with Endogenous Effort (January 3, 2012). Available at SSRN: https://ssrn.com/abstract=2046732 or http://dx.doi.org/10.2139/ssrn.2046732

Adrian Masters (Contact Author)

State University of New York at Albany - College of Arts and Sciences, Economics ( email )

1400 Washington Avenue
Albany, NY 12222
United States

Paper statistics

Downloads
27
Abstract Views
259