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Statistical Mechanics of Labor Markets

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  • He Chen
  • Jun-ichi Inoue

Abstract

We introduce a probabilistic model of labor markets for university graduates, in particular, in Japan. To make a model of the market efficiently, we take into account several hypotheses. Namely, each company fixes the (business year independent) number of opening positions for newcomers. The ability of gathering newcomers depends on the result of job matching process in past business years. This fact means that the ability of the company is weaken if the company did not make their quota or the company gathered applicants too much over the quota. All university graduates who are looking for their jobs can access the public information about the ranking of companies. Assuming the above essential key points, we construct the local energy function of each company and describe the probability that an arbitrary company gets students at each business year by a Boltzmann-Gibbs distribution. We evaluate the relevant physical quantities such as the employment rate. We find that the system undergoes a sort of `phase transition' from the `good employment phase' to `poor employment phase' when one controls the degree of importance for the ranking.

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  • He Chen & Jun-ichi Inoue, 2013. "Statistical Mechanics of Labor Markets," Papers 1309.5156, arXiv.org.
    • Handle: RePEc:arx:papers:1309.5156
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    References listed on IDEAS

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    1. Casares, Miguel & Moreno, Antonio & Vázquez, Jesús, 2014. "An estimated New-Keynesian model with unemployment as excess supply of labor," Journal of Macroeconomics, Elsevier, vol. 40(C), pages 338-359.
    2. Roberto Gabriele, 2002. "Labor Market Dynamics and Institutions: an Evolutionary Approach," LEM Papers Series 2002/07, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
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    Cited by:

    1. He Chen & Jun-ichi Inoue, 2013. "Learning curve for collective behavior of zero-intelligence agents in successive job-hunting processes with a diversity of Jaynes-Shannon's MaxEnt principle," Papers 1309.5053, arXiv.org.
    2. Bohnert, Alexander & Gatzert, Nadine & Jørgensen, Peter Løchte, 2015. "On the management of life insurance company risk by strategic choice of product mix, investment strategy and surplus appropriation schemes," Insurance: Mathematics and Economics, Elsevier, vol. 60(C), pages 83-97.
    3. Takao Hishikawa & Jun-ichi Inoue, 2014. "Probabilistic flows of inhabitants in urban areas and self-organization in housing markets," Papers 1406.6100, arXiv.org.

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