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Sorting on Skills and Preferences: Tinbergen Meets Sattinger

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  • Dupuy, Arnaud

    (University of Luxembourg)

Abstract

This paper proposes an assignment model where sorting occurs on attributes including both skills (Sattinger, 1979) and preferences (Tinbergen, 1956). The key feature of this model is that the wage function admits both jobs' and workers' attributes as arguments. Since this function is generically nonlinear (Ekeland et al., 2004), even under positive assortative matching, the correlation between the contribution of workers' attributes to wages and that of jobs' attributes can vary from -1 to 1 depending on the parameters of the model, i.e. preference, technology and the distribution of both sets of attributes. The paper discusses a closed form solution of the model, presents conditions under which nonadditive marginal utility and production function are nonparametrically identified using observations from a single hedonic market and proposes a nonparametric estimator.

Suggested Citation

  • Dupuy, Arnaud, 2010. "Sorting on Skills and Preferences: Tinbergen Meets Sattinger," IZA Discussion Papers 5143, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp5143
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    Cited by:

    1. Arnaud Dupuy, 2021. "Migration in China: To work or to wed?," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 36(4), pages 393-415, June.
    2. Jan Eeckhout & Philipp Kircher, 2011. "Identifying Sorting--In Theory," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 78(3), pages 872-906.

    More about this item

    Keywords

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    JEL classification:

    • D3 - Microeconomics - - Distribution
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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