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The cyclicality of job-to-job transitions and its implications for aggregate productivity

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  • Toshihiko Mukoyama

Abstract

This paper analyzes the job-to-job transitions of workers in the United States. I propose a new method of correcting the time-aggregation bias. The bias-corrected series from 1996 to 2011 reveals a procyclical pattern of job-to-job transition and a large decline since the beginning of the 2000s. I construct a model of on-the-job search and explore the implications of this phenomenon. The calibrated model shows that the decline in the reallocation of workers through job-to-job transitions has had a substantial effct on total factor productivity (TFP). From 2009 to 2011, the model accounts for about 0.5%-0.7% annual decline in TFP.

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Bibliographic Info

Paper provided by Board of Governors of the Federal Reserve System (U.S.) in its series International Finance Discussion Papers with number 1074.

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Date of creation: 2013
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Handle: RePEc:fip:fedgif:1074

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  1. Alan B. Krueger & Andreas Mueller, 2011. "Job Search, Emotional Well-Being and Job Finding in a Period of Mass Unemployment: Evidence from High-Frequency Longitudinal Data," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 42(1 (Spring), pages 1-81.
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  9. Toshihiko Mukoyama, 2013. "The cyclicality of job-to-job transitions and its implications for aggregate productivity," International Finance Discussion Papers 1074, Board of Governors of the Federal Reserve System (U.S.).
  10. Moscarini, Giuseppe & Thomsson, Kaj, 2006. "Occupational and Job Mobility in the US," Working Papers 19, Yale University, Department of Economics.
  11. Bruce Fallick & John Haltiwanger & Erika McEntarfer, 2012. "Job-to-job flows and the consequences of job separations," Finance and Economics Discussion Series 2012-73, Board of Governors of the Federal Reserve System (U.S.).
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  13. Andreas Mueller & Robert Hall, 2013. "Viewing Job-Seekers' Reservation Wages and Acceptance Decisions through the Lens of Search Theory," 2013 Meeting Papers 486, Society for Economic Dynamics.
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  17. Michael W. Elsby & Ryan Michaels & Gary Solon, 2007. "The Ins and Outs of Cyclical Unemployment," NBER Working Papers 12853, National Bureau of Economic Research, Inc.
  18. Oliver Jean Blanchard & Peter Diamond, 1990. "The Cyclical Behovior of the Gross Flows of U.S. Workers," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 21(2), pages 85-156.
  19. Hyatt, Henry R. & Spletzer, James R., 2013. "The Recent Decline in Employment Dynamics," IZA Discussion Papers 7231, Institute for the Study of Labor (IZA).
  20. Edward P. Lazear & James R. Spletzer, 2012. "Hiring, Churn and the Business Cycle," NBER Working Papers 17910, National Bureau of Economic Research, Inc.
  21. Robert H. Topel & Michael P. Ward, 1988. "Job Mobility and the Careers of Young Men," NBER Working Papers 2649, National Bureau of Economic Research, Inc.
  22. Robert Shimer, 2005. "The Cyclical Behavior of Equilibrium Unemployment and Vacancies," American Economic Review, American Economic Association, vol. 95(1), pages 25-49, March.
  23. Robert Shimer, 2005. "The cyclicality of hires, separations, and job-to-job transitions," Review, Federal Reserve Bank of St. Louis, issue Jul, pages 493-508.
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Cited by:
  1. Mukoyama, Toshihiko, 2014. "The cyclicality of job-to-job transitions and its implications for aggregate productivity," Journal of Economic Dynamics and Control, Elsevier, vol. 39(C), pages 1-17.

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