Sorting Models of Labor Mobility, Turnover, and Unemployment
Utilizing a model in which individuals search among lotteries on likely success at different jobs, this paper analyzes both the search decision when unemployed and the implications of the sorting process. The model correctly predicts both the direction and convexity of the age-unemployment relationship and the impact of experience on turnover and wages. Actions taken when unemployed have an important impact on equilibrium turnover rates, unemployment rates, and the work history of the pool of unemployed. The sorting model is used to analyze racial differences in youth unemployment and major empirical features of low income labor markets.
|Date of creation:||Jul 1979|
|Date of revision:|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
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- Parsons, Donald O, 1972. "Specific Human Capital: An Application to Quit Rates and Layoff Rates," Journal of Political Economy, University of Chicago Press, vol. 80(6), pages 1120-43, Nov.-Dec..
- Edward P. Lazear, 1974.
"Age, Experience and Wage Growth,"
NBER Working Papers
0051, National Bureau of Economic Research, Inc.
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- Kenneth Burdett & Dale T. Mortensen, 1977. "Labor Supply Under Uncertainty," Discussion Papers 297, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Robert J. Flanagan, 1978. "Discrimination Theory, Labor Turnover, and Racial Unemployment Differentials," Journal of Human Resources, University of Wisconsin Press, vol. 13(2), pages 187-207.
- Jovanovic, Boyan, 1979.
"Job Matching and the Theory of Turnover,"
Journal of Political Economy,
University of Chicago Press, vol. 87(5), pages 972-90, October.
- Toikka, Richard S, 1976. "A Markovian Model of Labor Market Decisions by Workers," American Economic Review, American Economic Association, vol. 66(5), pages 821-34, December.
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