A Job Ladder Model with Stochastic Employment Opportunities

Bradley, Jake; Gottfries, Axel

Abstract

We set up a model with on-the-job search in which firms infrequently post vacancies for which workers occasionally apply. The model nests the standard job ladder and stock-flow models as special cases, while remaining analytically tractable and easy to estimate from standard panel data sets. The parameters from a structurally estimated model on US data are significantly different from either the restrictions imposed by a stock-flow or job ladder model. Imposing these restrictions significantly understates the search option associated with employment and are, unlike our model, inconsistent with recent survey evidence and declining job finding rates and starting wage with duration of unemployment, both of which are present in the data.

Citation

Bradley, J., & Gottfries, A. (2021). A Job Ladder Model with Stochastic Employment Opportunities. Quantitative Economics, 12(4), 1399-1430. https://doi.org/10.3982/QE1394

• Journal Article Type: Article
• Acceptance Date: Apr 29, 2021
• Online Publication Date: Nov 11, 2021
• Publication Date: Nov 1, 2021
• Deposit Date: Apr 30, 2021
• Publicly Available Date: Apr 30, 2021
• Journal: Quantitative Economics
• Print ISSN: 1759-7323
• Electronic ISSN: 1759-7331
• Publisher: Econometric Society
• Peer Reviewed: Peer Reviewed
• Volume: 12
• Issue: 4
• Pages: 1399-1430
• DOI: https://doi.org/10.3982/QE1394
• Keywords: on-the-job search; wage dispersion; wage posting; stock-flow JEL Classification: J31; J64 * First version: April 21; 2017 We would like to thank Vasco Carvalho; Mike Elsby; Per Krusell; Hannes Malmberg; Kurt Mitman; Fabien Postel-Vinay; Pontus Rendahl; an
• Public URL: https://nottingham-repository.worktribe.com/output/5504086
• Publisher URL: https://onlinelibrary.wiley.com/doi/10.3982/QE1394?af=R