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Estimating the Employer Switching Costs and Wage Responses of Forward-Looking Engineers

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  • Jeremy T. Fox

Abstract

This article estimates worker switching costs and how much the employer switching of experienced engineers responds to outside wage offers. I use data on engineers across Swedish private sector firms to estimate the relative importance of employer wage policies and switching costs in a dynamic programming, discrete choice model of employer choice. The differentiated firms are modeled in employer characteristic space, and each firm has its own age-wage profile. A majority of engineers have moderately high switching costs and a minority of experienced workers are responsive to outside wage offers. Younger workers are more sensitive to outside wage offers. (c) 2010 by The University of Chicago. All rights reserved..

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File URL: http://www.journals.uchicago.edu/doi/pdf/10.1086/651458
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Bibliographic Info

Article provided by University of Chicago Press in its journal Journal of Labor Economics.

Volume (Year): 28 (2010)
Issue (Month): 2 (04)
Pages: 357-412

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Handle: RePEc:ucp:jlabec:v:28:y:2010:i:2:p:357-412

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Web page: http://www.journals.uchicago.edu/JOLE/

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Cited by:
  1. Alan Manning, 2010. "Imperfect competition in the labour market," LSE Research Online Documents on Economics 28729, London School of Economics and Political Science, LSE Library.
  2. Alan Manning, 2010. "Imperfect Competition in the Labour Market," CEP Discussion Papers dp0981, Centre for Economic Performance, LSE.
  3. Orley C. Ashenfelter & Henry Farber & Michael R. Ransom, 2010. "Modern Models of Monopsony in Labor Markets: A Brief Survey," Working Papers 1223, Princeton University, Department of Economics, Industrial Relations Section..
  4. Ryan Monarch, 2014. ""It'S Not You, It'S Me": Breakups In U.S.-China Trade Relationships," Working Papers 14-08, Center for Economic Studies, U.S. Census Bureau.

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