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Large firms and within firm occupational reallocation

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  • Papageorgiou, Theodore

Abstract

This paper considers the equilibrium interaction between within firm and across firm reallocation in the presence of labor market frictions. While a sizable literature has investigated frictional labor markets, it has ignored within firm mobility. Nonetheless, every year a sizable fraction of workers switch occupations without changing firms. Employees in large firms can sample from a larger selection and across firm mobility is replaced by within firm mobility. Bringing together within and across firm reallocation along with labor market frictions, naturally accounts for the observed differences in worker flows and wages across firms of different sizes.

Suggested Citation

  • Papageorgiou, Theodore, 2018. "Large firms and within firm occupational reallocation," Journal of Economic Theory, Elsevier, vol. 174(C), pages 184-223.
    • Handle: RePEc:eee:jetheo:v:174:y:2018:i:c:p:184-223
    DOI: 10.1016/j.jet.2017.12.004
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    2. Giuseppe Moscarini, 2023. "Comment on "An Anatomy of Monopsony: Search Frictions, Amenities and Bargaining in Concentrated Markets"," NBER Chapters, in: NBER Macroeconomics Annual 2023, volume 38, National Bureau of Economic Research, Inc.
    3. Gueorgui Kambourov & Iourii Manovskii & Miana Plesca, 2020. "Occupational mobility and the returns to training," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 53(1), pages 174-211, February.
    4. Chatt, Robert & Gustafson, Matthew & Welker, Adam, 2021. "Firing frictions and the U.S. mergers and acquisitions market," Journal of Banking & Finance, Elsevier, vol. 128(C).
    5. Cici, Gjergji & Hendriock, Mario & Kempf, Alexander, 2018. "The impact of labor mobility restrictions on managerial actions: Evidence from the mutual fund industry," CFR Working Papers 18-01, University of Cologne, Centre for Financial Research (CFR).
    6. Karin Mayr-Dorn, 2019. "Does digitalization increase labor market efficiency? Job search and effort on the job with asymmetric information and firm learning," Economics working papers 2019-06, Department of Economics, Johannes Kepler University Linz, Austria.
    7. Cici, Gjergji & Hendriock, Mario & Kempf, Alexander, 2022. "Finding your calling: Matching skills with jobs in the mutual fund industry," CFR Working Papers 19-05, University of Cologne, Centre for Financial Research (CFR), revised 2022.
    8. Karin Mayr‐Dorn, 2023. "Adverse Selection, Learning, And Competitive Search," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 64(1), pages 129-153, February.

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    More about this item

    Keywords

    Frictional labor markets; Occupational mobility; Within firm occupational reallocation; Firm size–wage premium; Separation rates;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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