Displacement, Asymmetric Information, and HeterogeneousHuman Capital

Luojia Hu and Christopher Taber

Journal of Labor Economics, 2011, vol. 29, issue 1, 113-152

Abstract: Gibbons and Katz's asymmetric information model of the labormarket predicts that wage losses following displacement should belarger for layoffs than for plant closings. This was borne out intheir empirical work. In this article, we examine how the differencein wage losses across plant closing and layoff varies with race andgender. We find that the basic prediction by Gibbons and Katz holdsonly for white males. We augment their asymmetric information modelwith heterogeneous human capital and show that this augmented modelcan match the data. (c) 2011 by The University of Chicago. Allrights reserved.

Date: 2011
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Working Paper: Displacement, asymmetric information and heterogeneous human capital (2008)
Working Paper: Displacement, Asymmetric Information, and Heterogeneous Human Capital (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:ucp:jlabec:v:29:y:2010:i:1:p:113-152

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