Using firm data to assess the performance of equilibrium search models of the labor market
AbstractEquilibrium search models are useful tools for the evaluation of labor market policies. Recently developed equilibrium search models of the labor market are able to fit the wage distribution perfectly with longitudinal labor supply data, by estimating an appropriate distribution of labor productivity across firms. This paper formally compares such structural estimates to their directly observed counterparts in firm data. More generally, we investigate the extent to which these models are able to explain the observed distributions of wages, productivities and firm sizes across firms, as well as the extent to which they are able to explain the observed relationships between these variables across firms. The parameters that capture search frictions are estimated with worker data that are matched to the firm data.
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Bibliographic InfoPaper provided by VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics in its series Serie Research Memoranda with number 0023.
Date of creation: 2000
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Web page: http://www.feweb.vu.nl
Equilibrium search; wages; structural econometrics; matched worker-firm data; mobility; productivity; firm size.;
Other versions of this item:
- Gérard VAN DEN BERG & Aïco VAN VUUREN, 2002. "Using Firm Data to Assess the Performance of Equilibrium Search Models of the Labor Market," Annales d'Economie et de Statistique, ENSAE, issue 67-68, pages 227-256.
- Gerard J. van den Berg & Aico van Vuuren, 2000. "Using Firm Data to assess the Performance of Equilibrium Search Models of the Labor Market," Tinbergen Institute Discussion Papers 00-067/3, Tinbergen Institute.
- J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
- J42 - Labor and Demographic Economics - - Particular Labor Markets - - - Monopsony; Segmented Labor Markets
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
- C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
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