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Search-Theoretic Models of the Labor Market-A Survey

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Listed author(s):
  • Richard Rogerson
  • Robert Shimer
  • Randall Wright

Abstract

We survey search-theoretic models of the labor market and discuss their usefulness for analyzing labor market dynamics, job turnover, and wages. We first examine single-agent models, showing how they can incorporate many interesting features and generate rich predictions. We then consider equilibrium models that endogenize several variables that are treated parametrically in single-agent models, including the arrival rate of job offers and the wage distribution. We survey alternative formulations of these models, emphasizing two key issues: how workers and firms meet, and how wages are determined. We emphasize throughout the implications of alternative assumptions for turnover, wage dispersion, and efficiency.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 10655.

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Date of creation: Jul 2004
Publication status: published as Rogerson, Richard, Robert Shimer and Randall Wright. "Search-Theoretic Models Of The Labor Market: A Survey," Journal of Economic Literature, 2005, v43(4,Dec), 959-988.
Handle: RePEc:nbr:nberwo:10655
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Find related papers by JEL classification:

  • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
  • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers

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