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Returns to Labour Mobility

Author

Listed:
  • Isaac Baley
  • Lars Ljungqvist
  • Thomas J Sargent

Abstract

Returns to labour mobility have too often escaped the attention they deserve as conduits of important forces in macro-labour models. These returns are shaped by calibrations of productivity processes that use theoretical perspectives and data sources from (i) labour economics and (ii) industrial organisation. By investigating earlier prominent studies, we conclude that the focus on firm size dynamics and shocks intermediated through neo-classical production functions in (ii) yields large returns to labour mobility that are robust to parameter perturbations. In contrast, the reliance on statistics in labour economics to calibrate per-worker productivity processes in (i) can give rise to fragilities in the sense that parameter perturbations that generate similar targeted statistics can have very different implications for returns to labour mobility.

Suggested Citation

  • Isaac Baley & Lars Ljungqvist & Thomas J Sargent, 2025. "Returns to Labour Mobility," The Economic Journal, Royal Economic Society, vol. 135(666), pages 430-454.
    • Handle: RePEc:oup:econjl:v:135:y:2025:i:666:p:430-454.
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    File URL: http://hdl.handle.net/10.1093/ej/ueae054
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    Cited by:

    1. Isaac Baley & Lars Ljunqvist & Thomas Sargent, 2023. "Cross-Phenomenon Restrictions: Unemployment Effects of Layoff Costs and Quit Turbulence," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 50, pages 43-60, October.

    More about this item

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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