Equilibrium Search with Continuous Productivity Dispersion: Theory and Nonparametric Estimation
In this article we develop an equilibrium search model with a continuous distribution of firm productivity types within a given labor market. We characterize equilibrium, derive expressions for the endogenous equilibrium wage distributions, and characterize the set of wage distributions that can be generated by the model. We develop a structural nonparametric estimation method for the productivity distribution. We estimate the model using French longitudinal survey data on labor supply, and we compare the results with those from a French panel data set of firms. The results are informative on the degree to which firms exploit search frictions.
|Date of creation:||2000|
|Date of revision:|
|Publication status:||Published in International Economic Review|
|Contact details of provider:|| Postal: |
Web page: http://www.international.inra.fr
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