Wages and Turnover: A Parametrization of the Job-Matching Model
Recent empirical work on turnover has emphasized job-matching as the major cause for job-change. Even where job-separations can ultimately be traced to a decline in the demand for the firm’s product, it is the poorly matched who are likely to separate from their jobs. More effort is needed, however, in bringing theory and econometrics closer together in this area. On the one hand, there has been no rigorous test of a matching model, and on the other, evidence has been interpreted as contrary to the matching model when in fact it is not.
KeywordsHazard Rate Wage Equation Separation Equation Standard Wiener Process Recent Empirical Work
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