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Wages and the Size of Firms in Dynamic Matching Models

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  • Bertola, Giuseppe
  • Garibaldi, Pietro

Abstract

This paper studies the joint distribution of wages and employment levels in simple matching models of job creation and destruction with costly search and firm-specific labour demand shocks. Existing evidence on the relationship between employer size, the mean and variance of employees' wages, and the character of gross job creation and destruction by continuing firms are broadly consistent with decreasing returns in firm-level production and hiring technologies.

Suggested Citation

  • Bertola, Giuseppe & Garibaldi, Pietro, 2000. "Wages and the Size of Firms in Dynamic Matching Models," CEPR Discussion Papers 2576, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:2576
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Wage dispersion; Firm size distribution; Recruiting;
    All these keywords.

    JEL classification:

    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • J60 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - General

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