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Unskilled Workers In An Economy With Skill-biased Technology

Author

Listed:
  • Shouyong Shi

    (Queen's University)

Abstract

This paper contributes to the search theory of unemployment by endogenously deriving matching functions and surplus sharing rule for skilled and unskilled workers from a wage-posting game. In contrast to previous wage posting models, here both sides of the market are heterogeneous and the resulted matching function can exhibit non-constant returns to scale. The model provides useful explanations for the observed dynamic patterns of within-skill and between-skill wage differentials in the 1970s and 1980s.

Suggested Citation

  • Shouyong Shi, 1999. "Unskilled Workers In An Economy With Skill-biased Technology," Working Paper 987, Economics Department, Queen's University.
    • Handle: RePEc:qed:wpaper:987
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    File URL: https://www.econ.queensu.ca/sites/econ.queensu.ca/files/qed_wp_987.pdf
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    Cited by:

    1. is not listed on IDEAS
    2. Shouyong Shi, 2000. "The Research Agenda: Search Theory beyond the Matching Function," EconomicDynamics Newsletter, Review of Economic Dynamics, vol. 1(2), April.
    3. Ingram, Beth F. & Neumann, George R., 2006. "The returns to skill," Labour Economics, Elsevier, vol. 13(1), pages 35-59, February.

    More about this item

    Keywords

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    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • 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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