The Uncertainty of Displacement

Paul Storer and Marc Van Audenrode ()

Cahiers de recherche from Université Laval - Département d'économique

Abstract: In this paper, we document the importance of individual variations in wage outcomes of displacement, as opposed to the change in the wage distribution itself. Most of the research on displaced workers has focused on analyzing changes in the wage distribution. We show that, while the changes in the distribution of wages before and after displacement are real, as shown in many previous studies, they are negligible compared to the enormous game of musical chair taking place between workers within these distributions. When studying displaced workers, we show that, from an individual worker's point of view, the change in the distribution of wages matters much less than the draw they will make within these distributions. We show that workers suffer large movements within the distribution of wages before and after displacement. Finally, we show that even with reasonable levels of risk aversion, these large movements inside the wage distribution translate into important losses of utility for the workers.

Date: 1998
New Economics Papers: this item is included in nep-eec
References: Add references at CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://www.ecn.ulaval.ca/w3/recherche/cahiers/1998/9823.pdf (application/pdf)

Related works:
Working Paper: The Uncertainty of Displacement (1998)
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:lvl:laeccr:9823

Access Statistics for this paper

More papers in Cahiers de recherche from Université Laval - Département d'économique Contact information at EDIRC.
Bibliographic data for series maintained by Manuel Paradis ().