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On-the-Job Search in a Matching Model with Heterogenous Jobs and Workers

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  • Juan J. Dolado
  • Marcel Jansen
  • Juan F. Jimeno

Abstract

This paper considers a matching model with heterogenous jobs (unskilled and skilled) and workers ( low and high- educated) which allows for on-the-job search by mismatched workers. The latter are high-educated workers who transitorily accept unskilled jobs and continue to search for skilled jobs. Our findings show that on-the-job search introduces an additional source of between and within- group wage inequality. Furthermore, the higher quit rate of mismatched workers exerts a negative externality on unskilled jobs and weakens the labour market position of low-educated workers. This last feature changes the effects of skill-biased technological change and it alters the response of the labour market to shifts in the skill distribution.

Suggested Citation

  • Juan J. Dolado & Marcel Jansen & Juan F. Jimeno, "undated". "On-the-Job Search in a Matching Model with Heterogenous Jobs and Workers," Working Papers 2003-21, FEDEA.
  • Handle: RePEc:fda:fdaddt:2003-21
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    JEL classification:

    • J1 - Labor and Demographic Economics - - Demographic Economics
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts

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