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Repeated Job Quits: Stepping stones or learning about quality?

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Author Info
Gielen Anne C. (ROA rm)

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Abstract

Despite the fact that worker quits are often associated with wage gains and higheroverall job satisfaction, many workers quit once again within one or two years afterchanging jobs initially. Such repeated job quit behavior may arise as a steppingstone to better quality jobs (Burdett, 1978) or as a response to unexpectedly lowjob quality (Jovanovic, 1979).This paper tests the validity of both explanations using data from the UK labormarket in order to improve our understanding of job search behavior. Results frompanel estimations of job quits and job satisfaction illustrate that the labor market ischaracterized by elements of both explanations. More specifically, a variancedecomposition shows that the stepping stone model explains 80 percent ofrepeated job quit behavior; the remaining 20 percent is the result of learning aboutjob quality. Hence, workers appear to need several job quits to find their mostpreferred job and multiple job quits serve as a stepping stone to more satisfaction atwork.

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Paper provided by Maastricht : ROA, Research Centre for Education and the Labour Market in its series Research Memoranda with number 010.

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Date of creation: 2008
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Handle: RePEc:dgr:umaror:2008010

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Keywords: education; training and the labour market;

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  1. Böckerman, Petri & Ilmakunnas, Pekka, 2007. "Job disamenities, job satisfaction, quit intentions, and actual separations: putting the pieces together," MPRA Paper 3245, University Library of Munich, Germany. [Downloadable!]
  2. Joseph G. Altonji & Christina H. Paxson, 1986. "Job Characteristics and Hours of Work," NBER Working Papers 1895, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  3. Ada Ferrer-i-Carbonell & Paul Frijters, 2004. "How Important is Methodology for the estimates of the determinants of Happiness?," Economic Journal, Royal Economic Society, vol. 114(497), pages 641-659, 07. [Downloadable!] (restricted)
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  4. Freeman, Richard B, 1978. "Job Satisfaction as an Economic Variable," American Economic Review, American Economic Association, vol. 68(2), pages 135-41, May. [Downloadable!] (restricted)
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  5. Levy-Garboua, Louis & Montmarquette, Claude & Simonnet, Veronique, 2007. "Job satisfaction and quits," Labour Economics, Elsevier, vol. 14(2), pages 251-268, April. [Downloadable!] (restricted)
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  6. Neal, Derek, 1999. "The Complexity of Job Mobility among Young Men," Journal of Labor Economics, University of Chicago Press, vol. 17(2), pages 237-61, April. [Downloadable!] (restricted)
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  7. Gueorgui Kambourov & Iourii Manovskii, 2008. "Rising Occupational And Industry Mobility In The United States: 1968-97," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 49(1), pages 41-79, 02. [Downloadable!] (restricted)
  8. Andrew Clark & Yannis Georgellis & Peter Sanfey, . "Job Satisfaction, Wage changes and Quits: Evidence from Germany," Economics and Finance Discussion Papers 98-06, Economics and Finance Section, School of Social Sciences, Brunel University.
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  9. Jovanovic, Boyan, 1979. "Job Matching and the Theory of Turnover," Journal of Political Economy, University of Chicago Press, vol. 87(5), pages 972-90, October. [Downloadable!] (restricted)
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  10. Garcia Perez, Jose Ignacio & Rebollo Sanz, Yolanda, 2005. "Wage changes through job mobility in Europe: A multinomial endogenous switching approach," Labour Economics, Elsevier, vol. 12(4), pages 531-555, August. [Downloadable!] (restricted)
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  11. Farber, Henry S., 1999. "Mobility and stability: The dynamics of job change in labor markets," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 37, pages 2439-2483 Elsevier. [Downloadable!] (restricted)
  12. George A. Akerlof & Andrew K. Rose & Janet L. Yellen, 1988. "Job Switching and Job Satisfaction in the U.S. Labor Market," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 19(1988-2), pages 495-594. [Downloadable!]
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