Work

On‐the‐Job Search and the Wage Distribution

Year: 2005

Type: article

Abstract: The article structually estimates an on‐the‐job search model of job separations. Given each employer pays observably equivalent workers the same but wages are dispersed across employers, an employer's separation flow is the sum of an exogenous outflow unrelated to the wage and a job‐to‐job flow that decreases with the employer's wage. Using data from the Danish Integrated Database for Labour Market Research, the empirical results imply, as predicted by theory, that search effort declines with the wage. Furthermore, the estimates explain the employment effect, defined as the horizontal difference between the distribution of wages earned and the wage offer distribution.

Source: Journal of Labor Economics

DOI: 10.1086/425432

Authors: Bent Jesper Christensen, Rasmus Lentz, Dale T. Mortensen, George R. Neumann, Axel Werwatz

Institutions: Aarhus University, Boston University, Northwestern University, University of Iowa, German Institute for Economic Research, University of Potsdam

Language: English

Topic: Labor market dynamics and wage inequality

Subfield: Economics and Econometrics

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDGs: Decent work and economic growth, Reduced inequalities

Open Access status: green

OpenAlex ID: W2107839761

FWCI: 28.23

Cites: 30

Cited by: 222

Related to: 10