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Family Job Search, Wage Bargaining, and Optimal Unemployment Insurance

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  • Ek, Susanne

    (Uppsala Center for Labor Studies)

  • Holmlund, Bertil

    (Uppsala Center for Labor Studies)

Abstract

In this paper we develop an equilibrium search and matching model where two-person families as well as singles participate in the labor market. We show that equilibrium entails wage dispersion among equally productive risk-averse workers. Marital status as well as spousal labor market status matters for wage outcomes. In general, employed members of two-person families receive higher wages than employed singles. The model is applied to a welfare analysis of alternative unemployment insurance systems, while recognizing the role of spousal employment as a partial substitute for public insurance. The optimal system involves benefit differentiation based on marital status as well as spousal labor market status

Suggested Citation

  • Ek, Susanne & Holmlund, Bertil, 2010. "Family Job Search, Wage Bargaining, and Optimal Unemployment Insurance," Working Paper Series, Center for Labor Studies 2010:1, Uppsala University, Department of Economics.
    • Handle: RePEc:hhs:uulswp:2010_001
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    References listed on IDEAS

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    Cited by:

    1. Ek Susanne & Holmlund Bertil, 2010. "Family Job Search, Wage Bargaining, and Optimal Unemployment Insurance," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 10(1), pages 1-27, May.
    2. J. Ignacio García‐Pérez & Sílvio Rendon, 2020. "Family job search and wealth: The added worker effect revisited," Quantitative Economics, Econometric Society, vol. 11(4), pages 1431-1459, November.
    3. Zaharieva, Anna, 2013. "Social welfare and wage inequality in search equilibrium with personal contacts," Labour Economics, Elsevier, vol. 23(C), pages 107-121.
    4. Björn Nilsson, 2019. "The School-to-Work Transition in Developing Countries," Journal of Development Studies, Taylor & Francis Journals, vol. 55(5), pages 745-764, May.
    5. Malmberg, Jonas, 2010. "Posting Post Laval International and National Responses," Working Paper Series, Center for Labor Studies 2010:5, Uppsala University, Department of Economics.
    6. Mauring, Eeva, 2016. "A two-agent model of sequential search and choice," Journal of Economic Behavior & Organization, Elsevier, vol. 123(C), pages 122-137.
    7. Valladares-Esteban, Arnau & Choi, Sekyu, 2016. "On households and unemployment insurance," Discussion Paper Series In Economics And Econometrics 1508, Economics Division, School of Social Sciences, University of Southampton.
    8. Valladares-Esteban, Arnau & Choi, Sekyu, 2016. "The marriage unemployment gap," Discussion Paper Series In Economics And Econometrics 1509, Economics Division, School of Social Sciences, University of Southampton.
    9. Sekyu Choi, 2013. "On Households and Unemployment," 2013 Meeting Papers 992, Society for Economic Dynamics.
    10. Zaharieva, Anna, 2015. "Social contacts and referrals in a labor market with on-the-job search," Labour Economics, Elsevier, vol. 32(C), pages 27-43.
    11. Anders, Forslund & Fredriksson, Peter, 2009. "Income support systems, labour supply incentives and employment – some cross-country evidence," Working Paper Series, Center for Labor Studies 2010:3, Uppsala University, Department of Economics.
    12. Zaharieva, Anna & Mitkova, Mariya & Damdinsuren, Erdenebulgan, 2022. "Parental Networks, Wage Expectations, and the IntergenerationalEducational Mobility," VfS Annual Conference 2022 (Basel): Big Data in Economics 264100, Verein für Socialpolitik / German Economic Association.
    13. Joanna Venator, 2022. "Dual-Earner Migration Decisions, Earnings, and Unemployment Insurance," Boston College Working Papers in Economics 1052, Boston College Department of Economics.

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    More about this item

    Keywords

    Job search; wage bargaining; wage differentials; unemployment; unemployment insurance;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • J65 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment Insurance; Severance Pay; Plant Closings

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