Date of Award
Doctor of Philosophy
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.
Kennes, John Robert, "Job Matching And Unemployment Dynamics" (1996). Digitized Theses. 2636.