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Job mobility, wage dispersion, and technological change: An asymmetric information perspective

  • Li, Jin
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    This paper develops a model of job mobility and wage dispersion with asymmetric information. Contrary to existing models in which the superior information of current employers leads to market collapse, this model generates a unique equilibrium outcome in which (a) positive turnover exists and (b) identical workers may be paid differently. The model implies that, in the presence of technological change that is skill-biased and favors general skills over firm-specific skills, the wage distribution becomes more spread out (corresponding to greater inequality) and job mobility increases.

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    File URL: http://www.sciencedirect.com/science/article/pii/S0014292113000159
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    Article provided by Elsevier in its journal European Economic Review.

    Volume (Year): 60 (2013)
    Issue (Month): C ()
    Pages: 105-126

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    Handle: RePEc:eee:eecrev:v:60:y:2013:i:c:p:105-126
    DOI: 10.1016/j.euroecorev.2013.01.008
    Contact details of provider: Web page: http://www.elsevier.com/locate/eer

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    24. Daron Acemoglu, 2002. "Technical Change, Inequality, and the Labor Market," Journal of Economic Literature, American Economic Association, vol. 40(1), pages 7-72, March.
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    28. David H. Autor & Lawrence F. Katz & Melissa S. Kearney, 2005. "Trends in U. S. Wage Inequality: Re-Assessing the Revisionists," Harvard Institute of Economic Research Working Papers 2095, Harvard - Institute of Economic Research.
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