Burdett, Kenneth and Carrillo Tudela, Carlos and Coles, Melvyn (2020) The Cost of Job Loss. The Review of Economic Studies, 87 (4). pp. 1757-1798. DOI https://doi.org/10.1093/restud/rdaa014
Burdett, Kenneth and Carrillo Tudela, Carlos and Coles, Melvyn (2020) The Cost of Job Loss. The Review of Economic Studies, 87 (4). pp. 1757-1798. DOI https://doi.org/10.1093/restud/rdaa014
Burdett, Kenneth and Carrillo Tudela, Carlos and Coles, Melvyn (2020) The Cost of Job Loss. The Review of Economic Studies, 87 (4). pp. 1757-1798. DOI https://doi.org/10.1093/restud/rdaa014
Abstract
This paper identifies an equilibrium theory of wage formation and endogenous quit turnover in a labour market with on-the-job search, where risk averse workers accumu- late human capital through learning-by-doing and lose skills while unemployed. Optimal contracting implies the wage paid increases with experience and tenure. Indirect inference using German data determines the deep parameters of the model. The estimated model not only reproduces the large and persistent fall in wages and earnings following job loss, a new structural decomposition finds foregone human capital accumulation (while unemployed) is the worker's major cost of job loss.
Item Type: | Article |
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Additional Information: | Source info: CEPR Discussion Paper No. DP14428 |
Uncontrolled Keywords: | Job search, human capital accumulation, job loss |
Divisions: | Faculty of Social Sciences Faculty of Social Sciences > Economics, Department of |
SWORD Depositor: | Unnamed user with email elements@essex.ac.uk |
Depositing User: | Unnamed user with email elements@essex.ac.uk |
Date Deposited: | 21 Feb 2020 12:33 |
Last Modified: | 30 Oct 2024 17:35 |
URI: | http://repository.essex.ac.uk/id/eprint/26871 |
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