Job Search and Migration in a System of Cities

58 Pages Posted: 17 Jan 2015

Date Written: January 9, 2015

Abstract

We build an equilibrium job search model, where workers engage in both off- and on-the-job search over a set of cities, to quantify the impact of spatial matching frictions and mobility costs on the job search process. Migration decisions, based on a dynamic utility trade-off between locations, can rationalize diverse wage dynamics as part of forward-looking spatial strategies. Our estimation results allow us to characterize each of the largest 200 French cities by a set of city-specific matching and amenity parameters and to measure the impact of distance on spatial constraints. We find that after controlling for frictions, mobility cost parameters are significantly lower than previously reported in the literature. Additional results include a robust positive correlation between on-the-job arrival rates and local wage dispersion, which provides new empirical support to the wage-posting framework and suggests an alternative explanation for the city size wage gap.

Keywords: local labor market; frictions; on-the-job search; migration

JEL Classification: J2, J3, J6

Suggested Citation

Schmutz, Benoît and Sidibe, Modibo, Job Search and Migration in a System of Cities (January 9, 2015). Economic Research Initiatives at Duke (ERID) Working Paper No. 181, Available at SSRN: https://ssrn.com/abstract=2550235 or http://dx.doi.org/10.2139/ssrn.2550235

Benoît Schmutz

Howard University ( email )

2400 Sixth Street, NW
Washington, DC 20059
United States

Modibo Sidibe (Contact Author)

Duke University ( email )

100 Fuqua Drive
Durham, NC 27708-0204
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
189
Abstract Views
925
rank
207,405
PlumX Metrics