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Experience and Worker Flows

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  • Gorry, Aspen

Abstract

This paper extends the literature on learning in labor markets by parameterizing the amount of learning that transfers across jobs. Previous models have assumed that learning is either job specific as in Jovanovic (1979) or perfectly transferable across jobs as in Gibbons et al. (2005). By allowing some but not all learning to be transferred, this model generates novel predictions of a decline in job finding rates with age and a decline in the variance of wages with experience that are consistent with observed worker outcomes.

Suggested Citation

  • Gorry, Aspen, 2010. "Experience and Worker Flows," MPRA Paper 25298, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:25298
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    References listed on IDEAS

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    1. Ann P. Bartel & George J. Borjas, 1981. "Wage Growth and Job Turnover: An Empirical Analysis," NBER Chapters,in: Studies in Labor Markets, pages 65-90 National Bureau of Economic Research, Inc.
    2. McCall, Brian P, 1990. "Occupational Matching: A Test of Sorts," Journal of Political Economy, University of Chicago Press, vol. 98(1), pages 45-69, February.
    3. Ronni Pavan, 2011. "Career Choice and Wage Growth," Journal of Labor Economics, University of Chicago Press, vol. 29(3), pages 549-587.
    4. George Baker & Michael Gibbs & Bengt Holmstrom, 1994. "The Wage Policy of a Firm," The Quarterly Journal of Economics, Oxford University Press, vol. 109(4), pages 921-955.
    5. Francisco M. Gonzalez & Shouyong Shi, 2010. "An Equilibrium Theory of Learning, Search, and Wages," Econometrica, Econometric Society, vol. 78(2), pages 509-537, March.
    6. Neal, Derek, 1999. "The Complexity of Job Mobility among Young Men," Journal of Labor Economics, University of Chicago Press, vol. 17(2), pages 237-261, April.
    7. Henry S. Farber & Robert Gibbons, 1996. "Learning and Wage Dynamics," The Quarterly Journal of Economics, Oxford University Press, vol. 111(4), pages 1007-1047.
    8. Joseph G. Altonji & Robert A. Shakotko, 1987. "Do Wages Rise with Job Seniority?," Review of Economic Studies, Oxford University Press, vol. 54(3), pages 437-459.
    9. Miller, Robert A, 1984. "Job Matching and Occupational Choice," Journal of Political Economy, University of Chicago Press, vol. 92(6), pages 1086-1120, December.
    10. Flinn, Christopher J, 1986. "Wages and Job Mobility of Young Workers," Journal of Political Economy, University of Chicago Press, vol. 94(3), pages 88-110, June.
    11. Koenker,Roger, 2005. "Quantile Regression," Cambridge Books, Cambridge University Press, number 9780521845731, March.
    12. Robert H. Topel & Michael P. Ward, 1992. "Job Mobility and the Careers of Young Men," The Quarterly Journal of Economics, Oxford University Press, vol. 107(2), pages 439-479.
    13. Robert Shimer, 2012. "Reassessing the Ins and Outs of Unemployment," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 15(2), pages 127-148, April.
    14. Neal, Derek & Rosen, Sherwin, 2000. "Theories of the distribution of earnings," Handbook of Income Distribution,in: A.B. Atkinson & F. Bourguignon (ed.), Handbook of Income Distribution, edition 1, volume 1, chapter 7, pages 379-427 Elsevier.
    15. Fabian Lange, 2007. "The Speed of Employer Learning," Journal of Labor Economics, University of Chicago Press, vol. 25, pages 1-35.
    16. Costas Meghir & Luigi Pistaferri, 2004. "Income Variance Dynamics and Heterogeneity," Econometrica, Econometric Society, vol. 72(1), pages 1-32, January.
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    18. Jovanovic, Boyan, 1979. "Job Matching and the Theory of Turnover," Journal of Political Economy, University of Chicago Press, vol. 87(5), pages 972-990, October.
    19. Ronni Pavan, 2010. "The Role of Career Choice in Understanding Job Mobility," LABOUR, CEIS, vol. 24(2), pages 107-127, June.
    20. Kim B. Clark & Lawrence H. Summers, 1982. "Labour Force Participation: Timing and Persistence," Review of Economic Studies, Oxford University Press, vol. 49(5), pages 825-844.
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    22. Theodore Papageorgiou, 2014. "Learning Your Comparative Advantages," Review of Economic Studies, Oxford University Press, vol. 81(3), pages 1263-1295.
    23. Rubinstein, Yona & Weiss, Yoram, 2006. "Post Schooling Wage Growth: Investment, Search and Learning," Handbook of the Economics of Education, Elsevier.
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    Citations

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    Cited by:

    1. Ludo Visschers & Carlos Carrillo-Tudela, 2011. "Unemployment and Endogenous Reallocation over the Business Cycle," 2011 Meeting Papers 1101, Society for Economic Dynamics.
    2. Guido Menzio & Irina Telyukova & Ludo Visschers, 2016. "Directed Search over the Life Cycle," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 19, pages 38-62, January.
    3. Pries, Michael J., 2016. "Uncertainty-driven labor market fluctuations," Journal of Economic Dynamics and Control, Elsevier, vol. 73(C), pages 181-199.
    4. Gorry, Aspen, 2013. "Minimum wages and youth unemployment," European Economic Review, Elsevier, vol. 64(C), pages 57-75.
    5. Gervais, Martin & Jaimovich, Nir & Siu, Henry E. & Yedid-Levi, Yaniv, 2016. "What should I be when I grow up? Occupations and unemployment over the life cycle," Journal of Monetary Economics, Elsevier, vol. 83(C), pages 54-70.
    6. Basit Zafar, 2011. "How Do College Students Form Expectations?," Journal of Labor Economics, University of Chicago Press, vol. 29(2), pages 301-348.
    7. Esteban-Pretel, Julen & Fujimoto, Junichi, 2012. "Life-cycle search, match quality and Japan’s labor market," Journal of the Japanese and International Economies, Elsevier, vol. 26(3), pages 326-350.
    8. Katarina Borovickova, 2012. "Learning and Labor Market Flows," 2012 Meeting Papers 652, Society for Economic Dynamics.

    More about this item

    Keywords

    Job finding rate; job separation rate; experience; wage volatility;

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • 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

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