EconPapers    
Economics at your fingertips  
 

On-the-job Search and the Cyclical Dynamics of the Labor Market

Michael Krause () and T.A. Lubik

No 2004-92, Discussion Paper from Tilburg University, Center for Economic Research

Abstract: We develop a dynamic general equilibrium model where workers can engage in search while on the job.We show that on-the-job search is a key component in explaining labor market dynamics in models of equilibrium unemployment.The model predicts fluctuations of unemployment, vacancies, and labor productivity whose relative magnitudes replicate the data.A standard search and matching model suggests much lower volatitilities of these variables.Intuitively, in a boom, rising search activity on the job avoids excessive tightening of the labor market for expanding firms.This keeps wage pressures low, thus further increasing firms' incentives to post new jobs.Labor market tightness as measured by the vacancy-unemployment ratio is as volatile as in the data.The interaction between on-the-job search and job creation also generates a strong internal propagation mechanism.

Keywords: labour market; curves; business cycles (search for similar items in EconPapers)
JEL-codes: E24 E32 J64 (search for similar items in EconPapers)
Date: 2004
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6) Track citations by RSS feed

Downloads: (external link)
https://pure.uvt.nl/ws/portalfiles/portal/629099/92.pdf (application/pdf)

Related works:
Working Paper: On-the-job search and the cyclical dynamics of the labor market (2010) Downloads
Working Paper: On-the-job search and the cyclical dynamics of the labor market (2007) Downloads
Working Paper: On-the-Job Search and the Cyclical Dynamics of the Labor Market (2006)
Working Paper: On-the-job Search and the Cyclical Dynamics of the Labor Market (2005) Downloads
Working Paper: On-the-Job Search and the Cyclical Dynamics of the Labor Market (2004) Downloads
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:tiu:tiucen:08a72137-ff72-4e18-add3-1211ef186a6b

Access Statistics for this paper

More papers in Discussion Paper from Tilburg University, Center for Economic Research
Bibliographic data for series maintained by Richard Broekman ().

 
Page updated 2019-09-28
Handle: RePEc:tiu:tiucen:08a72137-ff72-4e18-add3-1211ef186a6b