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Title: Three Essays on Frictional Labor Markets
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Majumdar, Sumon |
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Three Essays on Frictional Labor Markets Ph.D. Dissertation, Boston University, 2001. DAI, 61, no. 04A (2001): p. 1542 Cohort(s): NLSY79 Publisher: UMI - University Microfilms, Bell and Howell Information and Learning Keyword(s): Labor Market Demographics; Labor Market Segmentation; Labor Market, Secondary; Modeling; Training, On-the-Job; Unemployment; Wage Differentials; Welfare Labor markets are rarely perfect. Most markets for labor are characterized by frictions and imperfect information so that firms must search for workers and workers must search for firms. This dissertation addresses the effects of specific market frictions on welfare, productivity and unemployment. The first essay uses a nonsequential search model to examine the consequences of labor market frictions for the theory of hedonic wages. Once markets are not perfect, it is shown that wage differentials between jobs with disparate characteristics need not be compensating. Nevertheless, if all workers have identical preferences over these characteristics, the unregulated equilibrium is efficient. When workers differ in their relative preferences for job-characteristics, the labor market may get segmented into good and bad jobs. Further, in this case, certain regulatory constraints on offers made by firms have the potential to benefit all groups. The second essay analyzes the impact of local labor market conditions on firms' incentives to impart costly training to their workers. The formal model demonstrates that the incidence of training should decrease when the market for labor becomes less competitive. However, not all workers are equally likely to be affected. It is shown that during a downturn, firms will be more inclined to train workers coming from their own sector rather than those from other sectors. Evidence from the National Longitudinal Survey of Youth confirms both predictions of the theoretical model. The pressure of a deadline is encountered in many situations. The third essay sets up a model of multi-dimensional search with a deadline. It examines the sensitivity of behavior to changes in the deadline. In the two-dimensional case, a simple characterization of the optimal search policy is possible, and a wide variety of behaviors can be rationalized as the length of the deadline increases. This characterization is shown to be behaviorally distinct from the traditional case of geometric discounting under an infinite horizon. |
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Bibliography Citation
Majumdar, Sumon. Three Essays on Frictional Labor Markets. Ph.D. Dissertation, Boston University, 2001. DAI, 61, no. 04A (2001): p. 1542. |