A Theory of Labor Markets with Inefficient Turnover
We develop a theory of labor markets with four features: search frictions, worker productivity shocks, wage rigidity, and two-sided lack of commitment. Inefficient job separations occur in the form of endogenous quits and layoffs that are unilaterally initiated whenever a worker’s wage-to-productivity ratio moves outside an inaction region. We derive sufficient statistics for the labor market response to aggregate shocks based on the distribution of workers’ wage-to-productivity ratios. These statistics crucially depend on the incidence of inefficient job separations, which we show how to identify using readily available microdata on wage changes and worker flows between jobs.
Date:
13 May 2024, 13:15 (Monday, 4th week, Trinity 2024)
Venue:
Manor Road Building, Manor Road OX1 3UQ
Venue Details:
Seminar Room A or https://zoom.us/j/99960790792?pwd=eVFyRGRQc1RRS3l1U1U2UnlKTHBqUT09
Speaker:
Christian Moser (Columbia University)
Organising department:
Department of Economics
Part of:
Seminar in Macroeconomics
Booking required?:
Not required
Audience:
Members of the University only
Editor:
Edward Clark
