A model of job and worker flows

Nobuhiro Kiyotaki and Ricardo Lagos

No 358, Staff Report from Federal Reserve Bank of Minneapolis

Abstract: We develop a model of gross job and worker flows and use it to study how the wages, permanent incomes, and employment status of individual workers evolve over time. Our model helps explain various features of labor markets, such as the amount of worker turnover in excess of job reallocation, the length of job tenures and unemployment duration, and the size and persistence of the changes in income that workers experience due to displacements or job-to-job transitions. We also examine the effects that labor market institutions and public policy have on the gross flows, as well as on the resulting wage distribution and employment in the equilibrium. From a theoretical standpoint, we propose a notion of competitive equilibrium for random matching environments, and study the extent to which it achieves an efficient allocation of resources.

Keywords: Labor mobility; Labor market; Labor turnover (search for similar items in EconPapers)
Date: 2006
New Economics Papers: this item is included in nep-dge and nep-lab
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Citations: View citations in EconPapers (6)

Published in Journal of Political Economy> (Vol. 115, No. 5, October 2007, pp. 770-819)

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Related works:
Journal Article: A Model of Job and Worker Flows (2007)
Working Paper: A Model of Job and Worker Flows (2004)
Working Paper: A Model of Job and Worker Flows (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedmsr:358

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