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On-the-job search in urban areas

  • Kawata, Keisuke
  • Sato, Yasuhiro

This study develops an on-the-job search model involving spatial structure. In this model, workers are either employed and commute frequently to a central business district (CBD) or unemployed and commute less frequently to the CBD in search of jobs. When an unemployed worker succeeds in off-the-job search, the quality of the job match is determined stochastically: a good match yields high productivity whereas a bad match yields low productivity. While a high-productivity worker does not seek a new job, a low-productivity worker decides whether to conduct on-the-job search, which would require additional commuting to the CBD. Analysis of this model demonstrates that in equilibrium, the relocation path of workers corresponds to their career path. Furthermore, welfare analysis demonstrates that such a spatial structure distorts firms’ decision regarding the posting of vacancies.

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Article provided by Elsevier in its journal Regional Science and Urban Economics.

Volume (Year): 42 (2012)
Issue (Month): 4 ()
Pages: 715-726

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Handle: RePEc:eee:regeco:v:42:y:2012:i:4:p:715-726
Contact details of provider: Web page: http://www.elsevier.com/locate/regec

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  19. Shimer, Robert, 2006. "On-the-job search and strategic bargaining," European Economic Review, Elsevier, vol. 50(4), pages 811-830, May.
  20. Pieter A. Gautier & Coen N. Teulings & Aico Van Vuuren, 2010. "On-the-Job Search, Mismatch and Efficiency ," Review of Economic Studies, Oxford University Press, vol. 77(1), pages 245-272.
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