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Job Differentiation vs. Unemployment

Author

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  • Amine Samir

    (Université du Québec en Outaouais and CIRANO, 283 boul. Alexandre-Taché, C.P. 1250, succursale Hull, Gatineau, Québec, Canada, J8X 3X7, and CIRANO, Montréal, Canada)

Abstract

We use a matching model in which the horizontal job differentiation results from the rationale response of firms to the state of the labor market. We show that a decrease in the labor market tightness gives firms an incentive to raise the differentiation degree of jobs. Comparative statics suggests that an increase in unemployment benefits and in the minimum wage improves productivity of skilled workers by making jobs more differentiated, and leads to a raise in unemployment rate.

Suggested Citation

  • Amine Samir, 2013. "Job Differentiation vs. Unemployment," Review of Economic Perspectives, Sciendo, vol. 13(1), pages 30-42, March.
    • Handle: RePEc:vrs:reoecp:v:13:y:2013:i:1:p:30-42:n:2
    DOI: 10.2478/v10135-012-0014-6
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