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Aggregate Reallocation Shocks, Occupational Employment and Distance

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  • Jacob Wong

    (School of Economics, University of Adelaide)

Abstract

A unique general equilibrium model featuring many occupations and aggregate shocks is created to study occupational employment dynamics by imposing a correlated TFP structure across occupations along with distance between occupations. Productivity processes across occupations are correlated with similar occupations experiencing similar fluctuations. Mobility frictions and the correlated-productivity structure produce a systematic relationship between occupational employment correlations and occupational distance that does not arise when productivity processes are independent. Using employment data and measures of task-distance between occupations from the U.S. economy, a negative relationship between the correlation of occupational employment and task-distance separating occupation-pairs is uncovered.

Suggested Citation

  • Jacob Wong, 2017. "Aggregate Reallocation Shocks, Occupational Employment and Distance," School of Economics and Public Policy Working Papers 2017-09, University of Adelaide, School of Economics and Public Policy.
    • Handle: RePEc:adl:wpaper:2017-09
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    File URL: https://media.adelaide.edu.au/economics/papers/doc/wp2017-09.pdf
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Labour reallocation; Occupation switching; Task-distance;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion

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