Job Ladders and Earnings of Displaced Workers

Pawel Krolikowski

No 1514, Working Papers (Old Series) from Federal Reserve Bank of Cleveland

Abstract: Workers who suffer job displacement experience surprisingly large and persistent earnings losses. This paper proposes an explanation for this robust empirical puzzle in a model of search over match-quality with a significant job ladder. In addition to capturing the depth and persistence of displaced-worker-earnings losses, the model is able to match a) separation rates by tenure; b) the empirical decomposition of earnings losses into reduced wages and employment; c) observed wage dispersion; d) the pattern of employer-to-employer transitions after layoff, and e) the degree of serial correlation in separations.

Keywords: Displacement; earnings; search; match-quality; Diversity (search for similar items in EconPapers)
JEL-codes: D83 E24 J63 J64 (search for similar items in EconPapers)
Pages: 54 pages
Date: 2015-09-03
New Economics Papers: this item is included in nep-dge, nep-lab and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

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Related works:
Journal Article: Job Ladders and Earnings of Displaced Workers (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedcwp:1514

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DOI: 10.26509/frbc-wp-201514

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