Premium
AN EMPIRICAL EXAMINATION OF THE SOURCES OF CHANGES OVER TIME IN THE JOB FINDING RATE USING RESERVATION WAGES AND REJECTED WAGE OFFERS *
Author(s) -
Lollivier Stefan,
Rioux Laurence
Publication year - 2010
Publication title -
international economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.658
H-Index - 86
eISSN - 1468-2354
pISSN - 0020-6598
DOI - 10.1111/j.1468-2354.2010.00610.x
Subject(s) - reservation , wage , economics , reservation wage , sample (material) , distribution (mathematics) , duration (music) , labour economics , hazard , econometrics , computer science , mathematics , art , computer network , mathematical analysis , chemistry , literature , organic chemistry , chromatography
We consider a structural dynamic job search model where nonstationarity originates from the change over time in the benefit level, the job offer arrival rate, and the wage offer distribution. The model is estimated on the French sample of the ECHP taking advantage of direct observation of reservation wages, rejected job offers, and associated rejected wages. We find that the offered wages deteriorate rapidly (13.8% over six months, 19.2% over one year, and 30% over two years) and that changes in the wage offer distribution are the unique source of negative duration dependence in the hazard.