Frictional Labor Mobility

61 Pages Posted: 3 Nov 2016  

Benoît Schmutz

Howard University

Modibo Sidibe

Duke University

Date Written: May 3, 2016

Abstract

We build a dynamic model of migration where, in addition to classical mobility costs, workers face informational frictions that decrease their ability to compete for distant job opportunities. We structurally estimate the model on a matched employer-employee panel dataset describing labor market transitions within and between the 100 largest French cities. Our identification strategy is based on the premise that frictions affect the frequency of job transitions, while mobility costs impact the distribution of accepted wages. We find that after controlling for frictions, mobility costs are one order of magnitude lower than previously reported in the literature and their effect on labor mobility and unemployment is significantly lower than the effect of informational frictions.

Keywords: Mobility Costs, Informational Frictions, Local Labor Markets

JEL Classification: J61, J64, R12, R23

Suggested Citation

Schmutz, Benoît and Sidibe, Modibo, Frictional Labor Mobility (May 3, 2016). Economic Research Initiatives at Duke (ERID) Working Paper No. 234. Available at SSRN: https://ssrn.com/abstract=2863311

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

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