We develop a model of gross job and worker flows and use it to study how the wages and employment status of individual workers evolve over time and how they are affected by aggregate labor market conditions. We also examine the effects that labor market institutions and public policy have on the...

This paper explores wage-setting in the presence of asymmetric information. Firms know their own productivity, while workers only know the distribution of productivity in the economy. Although there is unemployment in equilibrium, the labor market is competitive in the sense of Moen (1997):...

We investigate the evolution and the sources of aggregate employment reallocation in the United States in the 1976-2000 March files of the Current Population Survey. We focus on the annual flows of male workers across occupations at the Census 3-digit level, the finest disaggregation at which a...

This paper compares the sources of wage growth of young workers in two countries with very different labor market institutions, the United States and Germany. It identifies the return to general human capital accumulation, and provides a lower and upper bound to wage growth due to firm-specific...

The goal of this paper is to determine the effects of different social security regimes on job search. A less generous pension system induces higher savings across the life cycle and makes agents wealthier and thus more reluctant to accept low wage offers. On the other hand, as the social...

This paper examines the causes of observed increase in the duration of unemployment relative to the unemployment rate in the Post-War United States. First we analyze if changes in the demographic composition of U.S. labor force can explain the change in the structure of unemployment duration. In...

We propose a framework to estimate the extent of compliance to minimum wage laws. Cases of non-compliance arise whenever the law enforcement is imperfect, and the share of the match rent offered by a firm to a worker falls below the minimum wage and above the worker’s reservation wage....

In this paper we find out the determinants of consumption variations depending on the employment transitions experienced by household members. We set up a utility-maximizing household search model in which consumption and job search decisions are made jointly. Families determine a level of...

Job search is an unpleasant activity with immediate costs and delayed benefits. The tension between long-run goals and short-run impulses may lead unemployed workers to postpone repeatedly tasks necessary to find a job. In standard economic models, agents are assumed to be time-consistent, so...