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On-the-Job Search Over the Business Cycle

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Author Info
Giuseppe Tattara () (Department of Economics, University Of Venice Cà Foscari)
Marco Valentini (Tolomeo srl)

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Abstract

On-the-Job Search is one of the most common and efficient ways to look for a new job, most of the time workers move directly from one employment position to another (E-to-E) without an intervening spell of unemployment. E-to-E transitions are a relevant component of total labour flows and have a definite cyclical pattern. This paper computes E-to-E worker flows through the development of a vacancy chain model. An iterative procedure is used to compute the successive reallocation runs, beginning from an autonomous vacancy and then to reconstruct the complete E-to-E transition process. The procedure is implemented and applied to a large micro-panel based on a highly industrialized Italian region from 1982 to 1996. E-to-E transitions are an increasingly large portion of worker flows in the labour market. They are clearly cyclic and the number of transitions increases over time as the labour market becomes tighter. These are the flows that explain labour market dynamics in upswings and recessions. Search models that look only at flows between employment, unemployment and outside of the labour force underestimate labour mobility and its cyclical pattern.

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Publisher Info
Paper provided by University of Venice "Ca' Foscari", Department of Economics in its series Working Papers with number 2007_15.

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Length: 21
Date of creation: 2007
Date of revision:
Handle: RePEc:ven:wpaper:2007_15

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Related research
Keywords: Job Flows; Search and Matching; Job to Job Mobility; Worker Flows; Business Cycle; Propagation;

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Find related papers by JEL classification:
E24 - Macroeconomics and Monetary Economics - - Macroeconomics: Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution
E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
J63 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Turnover; Vacancies; Layoffs

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    Other versions:
  2. Burgess, Simon & Lane, Julia & Stevens, David, 2000. "Job Flows, Worker Flows, and Churning," Journal of Labor Economics, University of Chicago Press, vol. 18(3), pages 473-502, July. [Downloadable!] (restricted)
    Other versions:
  3. Mortensen, Dale T & Pissarides, Christopher A, 1994. "Job Creation and Job Destruction in the Theory of Unemployment," Review of Economic Studies, Blackwell Publishing, vol. 61(3), pages 397-415, July. [Downloadable!] (restricted)
    Other versions:
  4. Bingley, P. & Eriksson, T. & Werwatz, A. & Westergard-Nielsen, N., 1999. "Beyond "Manucentrism" - Some Fresh Facts about Job and Worker Flows," Papers 99-09, Centre for Labour Market and Social Research, Danmark-.
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  5. Gomes, Joao & Greenwood, Jeremy & Rebelo, Sergio, 2001. "Equilibrium unemployment," Journal of Monetary Economics, Elsevier, vol. 48(1), pages 109-152, August. [Downloadable!] (restricted)
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  6. Steven J. Davis & John C. Haltiwanger & Scott Schuh, 1998. "Job Creation and Destruction," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262540932.
  7. Oliver Jean Blanchard & Peter Diamond, 1989. "The Beveridge Curve," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 20(1989-1), pages 1-76. [Downloadable!]
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  9. Krause, Michael & Lubik, Thomas A., 2007. "On-the-job search and the cyclical dynamics of the labor market," Discussion Paper Series 1: Economic Studies 2007,15, Deutsche Bundesbank, Research Centre. [Downloadable!]
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  10. Barbara Petrongolo & Christopher A. Pissarides, 2001. "Looking into the Black Box: A Survey of the Matching Function," Journal of Economic Literature, American Economic Association, vol. 39(2), pages 390-431, June. [Downloadable!] (restricted)
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  11. Davis, Steven J. & Haltiwanger, John, 1999. "Gross job flows," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 41, pages 2711-2805 Elsevier. [Downloadable!] (restricted)
  12. Pissarides, Christopher A, 1994. "Search Unemployment with On-the-Job Search," Review of Economic Studies, Blackwell Publishing, vol. 61(3), pages 457-75, July. [Downloadable!] (restricted)
    Other versions:
  13. 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!]
  14. Leonard, J.S. & Van Audenrode M., 1995. "A Difference of Degree: Unemployment Despite Turnover in the Belgian Labor Market," Papers 9523, Laval - Recherche en Politique Economique.
    Other versions:
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