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Playing Hard to Get: Theory and Evidence on Layoffs, Recalls and Unemployment

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  • Rodriguez-Planas, N.

Abstract

Given the importance of recall to previous employer in the United States, I provide both theoretical and empirical analyses of an asymmetric information model with an endogenous layoff-rehire process. I show that taking into account the possibility of recalls has important implications for the study of post-displacement earnings and unemployment duration of laid-off workers in the US. I find that high-productivity laid-off workers may choose unemployment over a low paid job, even though they may not be recalled.

Suggested Citation

  • Rodriguez-Planas, N., 1998. "Playing Hard to Get: Theory and Evidence on Layoffs, Recalls and Unemployment," Papers 86, Boston University - Industry Studies Programme.
  • Handle: RePEc:fth:bostin:86
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    Cited by:

    1. Nakamura, Emi, 2008. "Layoffs and lemons over the business cycle," Economics Letters, Elsevier, vol. 99(1), pages 55-58, April.

    More about this item

    Keywords

    UNEMPLOYMENT ; ASYMETRIC INFORMATION;

    JEL classification:

    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • J60 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - General

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