Are you looking for read ebook online? Search for your book and save it on your Kindle device, PC, phones or tablets. Download Essays on Frictional Labor Market PDF full book. Access full book title Essays on Frictional Labor Market by Eunbi Ko. Download full books in PDF and EPUB format.
Author: Eunbi Ko Publisher: ISBN: Category : Languages : en Pages :
Book Description
This dissertation develops two models of frictional labor market which provide tools to understand some important phenomena of the US labor market.The first chapter models labor market choices of workers depending primarily on his/her marital status and the partner's labor market outcome if the worker is married. In the household of a married couple, an increase in the husband's wage leads to a rise in the number of days his wife remains out of the labor force. If only one of the couple is employed, a wage increase for the employed partner lengthens the spouse's unemployment duration. Moreover, if both are employed, their wages move in the same direction. To explain these stylized facts, I construct an equilibrium model of the labor market in which a married couple jointly chooses market participation and search for and separation from a job. Calibration shows that the model can correctly account for the facts. The unified framework with endogenous market participation and frictional search is necessary to correctly predict the correlations in spouses' labor market outcomes. Using the benchmark model, I do the policy experiments of unemployment insurance (UI) and the earned income tax credit (EITC). I show that generous UI can increase the employment-population ratio by mitigating married females' disincentive to participate in the market. I also show that the EITC increases the employment of single parents but it decreases the employment of workers who belong to other types of households. In the sense of welfare, the EITC enhances welfare for all single parents, but it reduces welfare of some married parents by reducing the value of working wives.In the second chapter, I construct a directed search model of the labor market with two types of workers and two types of firms to show that an asymmetric positive productivity shock could cause a recent upward shift of the US Beveridge curve. The model possesses an equilibrium in which unskilled workers apply to both high-tech and low-tech firms and skilled workers apply only to high-tech firms. The productivity difference between sectors affects unskilled workers' application strategy: the larger the productivity gap is, the more unskilled workers apply to high-tech firms. The calibration suggests that the productivity difference between sectors has become greater after the recession than before. This makes unskilled workers apply to a high-tech firm with a greater probability than before, which results in the lower average job-finding rate and an upward shift of the Beveridge curve.
Author: Eunbi Ko Publisher: ISBN: Category : Languages : en Pages :
Book Description
This dissertation develops two models of frictional labor market which provide tools to understand some important phenomena of the US labor market.The first chapter models labor market choices of workers depending primarily on his/her marital status and the partner's labor market outcome if the worker is married. In the household of a married couple, an increase in the husband's wage leads to a rise in the number of days his wife remains out of the labor force. If only one of the couple is employed, a wage increase for the employed partner lengthens the spouse's unemployment duration. Moreover, if both are employed, their wages move in the same direction. To explain these stylized facts, I construct an equilibrium model of the labor market in which a married couple jointly chooses market participation and search for and separation from a job. Calibration shows that the model can correctly account for the facts. The unified framework with endogenous market participation and frictional search is necessary to correctly predict the correlations in spouses' labor market outcomes. Using the benchmark model, I do the policy experiments of unemployment insurance (UI) and the earned income tax credit (EITC). I show that generous UI can increase the employment-population ratio by mitigating married females' disincentive to participate in the market. I also show that the EITC increases the employment of single parents but it decreases the employment of workers who belong to other types of households. In the sense of welfare, the EITC enhances welfare for all single parents, but it reduces welfare of some married parents by reducing the value of working wives.In the second chapter, I construct a directed search model of the labor market with two types of workers and two types of firms to show that an asymmetric positive productivity shock could cause a recent upward shift of the US Beveridge curve. The model possesses an equilibrium in which unskilled workers apply to both high-tech and low-tech firms and skilled workers apply only to high-tech firms. The productivity difference between sectors affects unskilled workers' application strategy: the larger the productivity gap is, the more unskilled workers apply to high-tech firms. The calibration suggests that the productivity difference between sectors has become greater after the recession than before. This makes unskilled workers apply to a high-tech firm with a greater probability than before, which results in the lower average job-finding rate and an upward shift of the Beveridge curve.
Author: Sayoudh Roy Publisher: ISBN: Category : Frictional unemployment Languages : en Pages : 0
Book Description
This thesis is a collection of three chapters that study various aspects of the labor force. The first two chapters study how labor markets respond to aggregate influences, when labor market frictions interact with other market features, and a third chapter that evaluates the impact of heterogeneity in households on interest rates. In the first two chapters, I focus on how the post-recession recovery of labor market variables is affected by imperfections in the market. The first chapter investigates the role of on-the-job search in the recovery process of employment, and how labor market power can suppress wages and incentivize against on-the-job search. Labor Market power allows a small number of firms to influence wages and employment in the market, and the suppression of wages persuades workers against expending costly search effort. The second chapter focuses on how the presence of financial frictions can affect the response of labor market variables in a frictional labor market. When bank liquidity is constrained in the event of a downturn, affecting the amount of loans available to firms, firms are unable to purchase the capital input they require to complement labor. This results in firms posting fewer vacancies, and a lower matching rate for workers, which hinders the recovery of employment. The third chapter introduces discount rate heterogeneity in Huggett (1993) and Aiyagari (1994) and evaluates the impact on interest rates.
Author: Jong-Seok Oh Publisher: ISBN: Category : Languages : en Pages :
Book Description
This dissertation examines the macroeconomic impact of reduced labor market friction on the U.S. business cycle after the mid-1980s. The first two essays investigate the relationship between labor market flexibility and macroeconomic stability from a post-Keynesian perspective. In the third essay which reviews the relationship between labor market flexibility and patterns of U.S. business cycle, I test the argument that after 1985 Okun's coefficient became larger due to the flexible labor market. In essay 1, considering two aspects of labor market flexibility, employment flexibility and real wage flexibility, I adopt the flex-output model (Skott, 2015) to first discuss employment flexibility and then extend it by incorporating real wage dynamics induced from a wage-price Phillips curve (Flaschel and Krolzig, 2006) to address real wage flexibility. The simulation of model explains that employment flexibility increases instability of an economy whereas real wage flexibility reduces it. Empirical results of this paper suggest that during the Great Moderation, real wage flexibility played a major role in stabilizing the U.S. economy. On the other hand, employment flexibility has contributed to destabilizing the economy during the Great Recession. In essay 2, using structural VAR analysis, I provide more rigorous empirical evidence to support the hypothesis in essay 1 - real wage flexibility played a major role in stabilizing U.S. economy during the Great Moderation, and employment flexibility has contributed to destabilizing the economy during the Great Recession. I found that during the Great Moderation (1) Employment and real wage flexibilities were operating simultaneously; (2) The employment flexibility was not so severe; (3) Flexible real wages functioned as an autonomic stabilizer; (4) Therefore, stabilized goods market during the Great Moderation can be explained by dominating effect of the real wage flexibility over the employment flexibility. For the Great Recession, however, severe asymmetry in the business cycle and the lack of observations obstructs reliable empirical work. In essay 3, I discuss the observations of increased cyclicality in aggregate hours and increased responsiveness of the (un)employment rate to output changes after 1985, which have contributed to recent debate about the validity of Okun's law. To investigate this, I measure Okun's coefficients in three phases of the business cycle - recessions, early expansions and late expansions. Related findings include: (1) The main determining factor for an increased coefficient for aggregate hours is the increased responsiveness of the employment rate during late expansions. (2) The increased responsiveness of hours per employee in early expansion is another main determining factor for more reactive aggregate hours. These findings conflict with the flexible labor market hypothesis that focuses mainly on firms' firing behaviors during recessions when they incur less costs than previously.
Author: Hajime Takizawa Publisher: ISBN: Category : Languages : en Pages :
Book Description
The first essay explores an environment characterized by search friction and the accumulation of non-firm specific skill. In this environment, a competitive search equilibrium has the following properties: Investment in skill is below the socially efficient level; there will not emerge separate markets catering to skilled and non-skilled workers. An alternative equilibrium concept that incorporates up-front payments from workers to firms does not resolve the problem of under-investment. However, it does eliminate the possibility of socially inefficient search and turnover that would result from the incentive for workers to look for better paying jobs in the absence of payments. In some economies but not all, a system of taxes and transfers is shown to resolve the under-investment problem.
Author: David Zentler-Munro Publisher: ISBN: Category : Languages : en Pages : 0
Book Description
The first paper of this thesis considers the impact of minimum wages when search frictions are present and firms can substitute away from low skilled workers to both higher skilled workers and to capital. This represents a contribution to the search literature, which typically assumes labour is the only input of production and perfect substitution between labour inputs. I examine whether the model I develop features significant nonlinearities in the impact of the minimum wage on unemployment. I find that the theoretical contribution of this paper, i.e. allowing for search frictions and imperfect substitutability of factor inputs, is quantitatively significant. Specifically, the nonlinear unemployment response in my model does not occur if I use the typical assumptions of the search literature. In my second paper, I develop a structural model that can help to quantify the relative importance of institutions, labour market frictions and technology in explaining wage inequality. This contribution is a complement to the empirical literature on wage inequality, which tends to emphasise either technological explanations or institutional ones but rarely considers the two jointly. I take my model to the data to test whether estimates of capital skill complementarity in \citet{krusellohanianriosrull} are robust to the inclusion of search frictions. I find this is indeed the case: parameter estimates change very little when allowing for search frictions. My final paper returns to the minimum wage model of my first paper and considers how allowing for asset accumulation by workers changes the model's predictions regarding the relationship between the minimum wage and consumption inequality. I find that allowing for asset accumulation by workers suggests the minimum wage is more successful at reducing consumption inequality than models without asset accumulation would indicate.
Author: David Pothier Publisher: ISBN: Category : Labor economics Languages : en Pages : 116
Book Description
This thesis contributes to the understanding of how socio-economic factors affect the functioning of modern labour markets. It belongs to the strand of academic literature that departs from the standard Walrasian model of the labour market, and considers matching and information frictions to be important determinants of observed labour market phenomena. Within this general framework, this thesis analyses how different forms of agent heterogeneity / socio-demographic identity, productivity, and wealth - affect wage rates and the level of employment in competitive labour markets. The first chapter studies how occupational segregation - the sorting of workers across occupations based on their demographic characteristics - affects the allocation of talent in the labour market. When job vacancy information is transmitted via workers' group-biased social contacts, occupational segregation is found to be a robust equilibrium outcome. The chapter shows that while occupational segregation implies benefits in terms of the job-finding probability of individual workers, it may also engender significant allocative inefficiencies when workers differ in terms of their productivity across occupations. The second chapter examines how heterogeneous workers and firms sort across formal (market-based) and informal (network-based) recruitment channels. When worker and firm productivity are unobservable the two recruitment channels effectively compete in terms of their screening capability. Matching frictions are shown to generate a sorting externality that leads to a multiplicity of equilibrium outcomes, depending on the skill-bias within social networks and the productivity dispersion among workers and firms. The third chapter, co-authored with Damien Puy, examines to what extent variations in wages and employment over the business-cycle can explain the counter-cyclical properties of the income distribution. We show that demand composition effects are an important channel through which aggregate supply shocks are propagated through the economy, and that these have important distributional consequences. In particular, we find income inequality (as measured by the Gini coefficient) to be counter-cyclical. Consistent with empirical evidence, this is shown to be largely due to changes in the level of employment and to a lesser degree to variations in relative factor prices.
Author: Eunbi Ko
Author: Eunbi Ko
Author: Georg Duernecker
Author: Sumon Majumdar
Author: Sayoudh Roy
Author: Tamás K. Papp
Author: Jong-Seok Oh
Author: Hajime Takizawa
Author: David Zentler-Munro
Author: Antonio Parlavecchio
Author: David Pothier