Date of Award
1996
Degree Type
Dissertation
Degree Name
Doctor of Philosophy
Abstract
The first chapter of the thesis considers a job search model with entrepreneurial decisions by unemployed workers. A conventional job search model predicts a log-linear relationship between the vacancy: unemployment ratio and the job finding rates of unemployed workers. However, empirical evidence suggests that the relationship is concave. The model presented in this chapter exhibits concavity as a result of entrepreneurial specialization in the pool of unemployed workers.;The second chapter of the thesis develops a general equilibrium model of vacancies and unemployment with competition between on and off-the-job searchers. Under-employed workers at low productivity jobs make up the pool of on-the-job searchers while unemployed workers make up the pool of off-the-job searchers. The model predicts that the job finding rate of unemployed workers is a function of the vacancy: unemployment ratio and the underemployment: unemployment ratio. The model also uses the underemployment: unemployment ratio to predict that labor market tightness can either overshoot or undershoot future values in response to a change in the aggregate productivity of job matches. Overshooting occurs if the underemployment: unemployment ratio follows a downward adjustment path during a recovery while undershooting occurs if the underemployment: unemployment ratio follows an upward adjustment path.;The final chapter of the thesis considers insider decisions in a search equilibrium. The model predicts that insiders have strict preferences for a two-tier wage structure over a single-tier wage structure, if there are complementarities between experienced insiders and inexperienced outsiders. Given complementarities, the model also predicts that a temporary aggregate productivity shock leads to persistent adjustments to unemployment, labor market tightness, and insider wages.
Recommended Citation
Kennes, John Robert, "Job Matching And Unemployment Dynamics" (1996). Digitized Theses. 2636.
https://ir.lib.uwo.ca/digitizedtheses/2636