Are the Unemployed Unemployable?
This paper develops a matching model of the labour market under wage rigidity when hiring decisions are irreversible. There are two types of workers, the skilled and the unskilled. The model is used to analyse whether technological advances may have increased unemployment, and shows that this is likely to occur if technological change is associated with an increase in the productivity and/or the supply of skilled relative to unskilled workers. These effects are stronger when hiring decisions are more irreversible.
|Date of creation:||Aug 1992|
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- Calmfors, L., 1992.
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- Saint-Paul, Gilles, 1992.
"Are the Unemployed Unemployable?,"
CEPR Discussion Papers
689, C.E.P.R. Discussion Papers.
- Layard, R. & Nickell, S., 1991.
"Unemployment in the OECD Countries,"
Economics Series Working Papers
99130, University of Oxford, Department of Economics.
- Christopher A. Pissarides, 1992. "Loss of Skill During Unemployment and the Persistence of Employment Shocks," The Quarterly Journal of Economics, Oxford University Press, vol. 107(4), pages 1371-1391.
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