Gottfries, Nils: Ranking of Job Applicants, On-the-Job Search and Persistent Unemployment
World Conference Econometric Society, 2000, Seattle

Stefan Eriksson, Uppsala University
Nils Gottfries, Uppsala University
Ranking of Job Applicants, On-the-Job Search and Persistent Unemployment
Session: C-9-11  Monday 14 August 2000  by Gottfries, Nils
We formulate a labor market model with on-the-job search where wage setting is affected by turnover considerations due to hiring costs. We then analyze a situation where employers use information on whether the searching worker is employed or unemployed as a hiring criterion. We show theoretically that ranking by employment status will affect both the level and the persistence of unemployment and numerically that these effects may be substantial. We also argue that more prevalent ranking in Europe compared to the US may be a factor contributing to high and persistent unemployment in Europe.


File created by Jurgen Doornik with eswc2000.ox on 2-01-2001