Equilibrium Distribution of Labor Productivity
AbstractWe construct a theoretical model for equilibrium distribution of workers across sectors with different labor productivity, assuming that a sector can accommodate a limited number of workers which depends only on its productivity. A general formula for such distribution of productivity is obtained, using the detail-balance condition necessary for equilibrium in the Ehrenfest-Brillouin model. We also carry out an empirical analysis on the average number of workers in given productivity sectors on the basis of an exhaustive dataset in Japan. The theoretical formula succeeds in explaining the two distinctive observational facts in a unified way, that is, a Boltzmann distribution with negative temperature on the low-to-medium productivity side and a decreasing part in a power-law form on the high productivity side.
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Bibliographic InfoPaper provided by Research Institute of Economy, Trade and Industry (RIETI) in its series Discussion papers with number 12041.
Length: 12 pages
Date of creation: Jun 2012
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This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-07-08 (All new papers)
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