The Distribution of Earnings in an Equilibrium Search Model with State-Dependent Offers and Counteroffers

Fabien Postel-Vinay and Jean-Marc Robin

Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) from HAL

Abstract: We construct an equilibrium job search model with on-the-job search in which firms implement optimal-wage strategies under full information in the sense that they leave no rent to their employees and counter the offers received by their employees from competing firms. Productivity dispersion across firms results in wage mobility both within and across firms. Workers may accept wage cuts to move to firms offering higher future wage prospects. Equilibrium productivity dispersion across ex ante homogeneous firms can be endogenously generated. Productivity dispersion then generates a nontrivial wage distribution which is generically thin-tailed, as typically observed in the data

Keywords: The; Distribution; of; Earnings (search for similar items in EconPapers)
Date: 2002
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Published in International Economic Review, 2002, 43 (4), pp.989-1016. ⟨10.1111/1468-2354.t01-1-00045⟩

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Related works:
Journal Article: The Distribution of Earnings in an Equilibrium Search Model with State-Dependent Offers and Counteroffers (2002)
Working Paper: The Distribution of Earnings in an Equilibrium Search Model with State-Dependent Offers and Counteroffers (2002)
Working Paper: The distribution of earnings in an equilibrium search model with state-dependent offers and counteroffers (2002)
Working Paper: The distribution of earnings in an equilibrium search model with state-dependent offers and counteroffers (2002)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:cesptp:hal-00357753

DOI: 10.1111/1468-2354.t01-1-00045

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