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A Model of Job and Worker Flows

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  • Nobuhiro Kiyotaki
  • Ricardo Lagos

Abstract

We develop an equilibrium search model that incorporates job-to-job transitions, exhibits instances of replacement hiring, and conceptually distinguishes between job and worker flows. We propose a notion of competitive equilibrium for random-matching environments and study the extent to which it achieves an efficient allocation of resources. The model can be used to study how the permanent incomes and employment states of individual workers evolve over time, the amount of worker turnover in excess of job reallocation, the lengths of job tenures and unemployment durations, and the size and persistence of changes in workers' incomes following displacements or job-to-job transitions. (c) 2007 by The University of Chicago. All rights reserved..

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Article provided by University of Chicago Press in its journal Journal of Political Economy.

Volume (Year): 115 (2007)
Issue (Month): 5 (October)
Pages: 770-819

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Handle: RePEc:ucp:jpolec:v:115:y:2007:i:5:p:770-819

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Citations

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Cited by:
  1. Keisuke Kawata, 2013. "Work Hour Mismatch and On-the-job Search," IDEC DP2 Series 3-6, Hiroshima University, Graduate School for International Development and Cooperation (IDEC).
  2. Shintaro Yamaguchi, 2006. "Job Search, Bargaining, and Wage Dynamics," 2006 Meeting Papers 54, Society for Economic Dynamics.
  3. Ricardo Lagos & Guillaume Rocheteau, 2009. "Liquidity in Asset Markets With Search Frictions," Econometrica, Econometric Society, vol. 77(2), pages 403-426, 03.
  4. Giovanni L. Violante & Per Krusell & Andreas Hornstein, 2006. "Frictional wage dispersion in search models: a quantitative assessment," Working Paper 06-07, Federal Reserve Bank of Richmond.
  5. Davis, Steven J. & Faberman, R. Jason & Haltiwanger, John C., 2005. "The Flow Approach to Labor Markets: New Data Sources, Micro-Macro Links and the Recent Downturn," IZA Discussion Papers 1639, Institute for the Study of Labor (IZA).
  6. Nicolas L. Jacquet, 2007. "Inefficient Worker Turnover," Working Papers 17-2007, Singapore Management University, School of Economics.
  7. Spiros Bougheas & Carl Davidson & Richard Upward & Peter Wright, . "Structural Adjustment, Turnover and Career Mobility," Discussion Papers 08/23, University of Nottingham, GEP.

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