EconPapers    
Economics at your fingertips  
 

How Sticky Wages in Existing Jobs Can Affect Hiring

Mark Bils, Yongsung Chang and Sun-Bin Kim

No 19821, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We consider a matching model of employment with wages that are flexible for new hires, but sticky within matches. We depart from standard treatments of sticky wages by allowing effort to respond to the wage being too high or low. Shimer (2004) and others have illustrated that employment in the Mortensen-Pissarides model does not depend on the degree of wage flexibility in existing matches. But this is not true in our model. If wages of matched workers are stuck too high in a recession, then firms will require more effort, lowering the value of additional labor and reducing new hiring.

JEL-codes: E24 E32 J22 J23 (search for similar items in EconPapers)
Date: 2014-01
New Economics Papers: this item is included in nep-lab, nep-lma and nep-mac
Note: EFG
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12)

Published as Mark Bils & Yongsung Chang & Sun-Bin Kim, 2022. "How Sticky Wages in Existing Jobs Can Affect Hiring," American Economic Journal: Macroeconomics, vol 14(1), pages 1-37.

Downloads: (external link)
http://www.nber.org/papers/w19821.pdf (application/pdf)

Related works:
Journal Article: How Sticky Wages in Existing Jobs Can Affect Hiring (2022) Downloads
Working Paper: How Sticky Wages In Existing Jobs Can Affect Hiring (2019) Downloads
Working Paper: How Sticky Wages In Existing Jobs Can Affect Hiring (2014) Downloads
Working Paper: How Sticky Wages in Existing Jobs can affect Hiring (2013) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:19821

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w19821

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().

 
Page updated 2025-03-19
Handle: RePEc:nbr:nberwo:19821