IDEAS home Printed from https://ideas.repec.org/p/ctl/louvir/2011027.html
   My bibliography  Save this paper

Youth Labor Market Outcomes: A Model with Learning on Match Quality

Author

Listed:
  • Anne BUCHER

    (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES))

Abstract

To investigate why young workers exhibit higher unemployment and separation rates, I extend the basic matching model of Pissarides by incorporating learning on match quality as Pries and Rogerson (2005). Match quality is heterogenous and is inferred from the output performance. Because matches revealed to be bad are dissolved, the separation risk decreases with job tenure. Within the framework, the specificity of youth only comes from their entry position on the labor market. Discrepancies between age-groups arise as young workers are mainly unemployed searching for their first job, or newly employed facing higher unemployment risks. The model, calibrated above French data, performs well in reproducing the intergenerational gap in worker separation and unemployment rates.

Suggested Citation

  • Anne BUCHER, 2011. "Youth Labor Market Outcomes: A Model with Learning on Match Quality," LIDAM Discussion Papers IRES 2011027, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    • Handle: RePEc:ctl:louvir:2011027
    as

    Download full text from publisher

    File URL: http://sites.uclouvain.be/econ/DP/IRES/2011027.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Mortensen, Dale & Pissarides, Christopher, 2011. "Job Creation and Job Destruction in the Theory of Unemployment," Ekonomicheskaya Politika / Economic Policy, Russian Presidential Academy of National Economy and Public Administration, vol. 1, pages 1-19.
    2. Dale T. Mortensen, 1982. "The Matching Process as a Noncooperative Bargaining Game," NBER Chapters, in: The Economics of Information and Uncertainty, pages 233-258, National Bureau of Economic Research, Inc.
    3. Quintini, Glenda & Martin, John P. & Martin, Sébastien, 2007. "The Changing Nature of the School-to-Work Transition Process in OECD Countries," IZA Discussion Papers 2582, Institute of Labor Economics (IZA).
    4. repec:wop:calsdi:97-23 is not listed on IDEAS
    5. Christopher A. Pissarides & Barbara Petrongolo, 2001. "Looking into the Black Box: A Survey of the Matching Function," Journal of Economic Literature, American Economic Association, vol. 39(2), pages 390-431, June.
    6. Arnaud Chéron & Jean-Olivier Hairault & François Langot, 2013. "Life-Cycle Equilibrium Unemployment," Journal of Labor Economics, University of Chicago Press, vol. 31(4), pages 843-882.
    7. Renato Faccini, 2014. "Reassessing Labour Market Reforms: Temporary Contracts as a Screening Device," Economic Journal, Royal Economic Society, vol. 124(575), pages 167-200, March.
    8. Jovanovic, Boyan, 1979. "Job Matching and the Theory of Turnover," Journal of Political Economy, University of Chicago Press, vol. 87(5), pages 972-990, October.
    9. Garey Ramey & Wouter J. den Haan & Joel Watson, 2000. "Job Destruction and Propagation of Shocks," American Economic Review, American Economic Association, vol. 90(3), pages 482-498, June.
    10. Neal, Derek, 1999. "The Complexity of Job Mobility among Young Men," Journal of Labor Economics, University of Chicago Press, vol. 17(2), pages 237-261, April.
    11. Anne Bucher, 2010. "The dynamics of youth labor market integration," Working Papers halshs-00812067, HAL.
    12. Michael J. Pries, 2004. "Persistence of Employment Fluctuations: A Model of Recurring Job Loss," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 71(1), pages 193-215.
    13. Éva Nagypál, 2007. "Learning by Doing vs. Learning About Match Quality: Can We Tell Them Apart?," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 74(2), pages 537-566.
    14. Pissarides, Christopher A, 1985. "Short-run Equilibrium Dynamics of Unemployment Vacancies, and Real Wages," American Economic Review, American Economic Association, vol. 75(4), pages 676-690, September.
    15. Arthur J. Hosios, 1990. "On The Efficiency of Matching and Related Models of Search and Unemployment," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 57(2), pages 279-298.
    16. Michael Pries & Richard Rogerson, 2005. "Hiring Policies, Labor Market Institutions, and Labor Market Flows," Journal of Political Economy, University of Chicago Press, vol. 113(4), pages 811-839, August.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Yashiv, Eran, 2007. "Labor search and matching in macroeconomics," European Economic Review, Elsevier, vol. 51(8), pages 1859-1895, November.
    2. Gorry, Aspen, 2013. "Minimum wages and youth unemployment," European Economic Review, Elsevier, vol. 64(C), pages 57-75.
    3. Richard Rogerson & Robert Shimer & Randall Wright, 2004. "Search-Theoretic Models of the Labor Market-A Survey," NBER Working Papers 10655, National Bureau of Economic Research, Inc.
    4. Robert Shimer, 2003. "The Cyclical Behavior of Equilibrium Unemployment and Vacancies: Evidence and Theory," NBER Working Papers 9536, National Bureau of Economic Research, Inc.
    5. Murat Tasci, 2006. "On-the-Job Search and Labor Market Reallocation," 2006 Meeting Papers 333, Society for Economic Dynamics.
    6. Steinar Holden & Åsa Rosén, 2014. "Discrimination And Employment Protection," Journal of the European Economic Association, European Economic Association, vol. 12(6), pages 1676-1699, December.
    7. Nicolas L. Jacquet, 2007. "Inefficient Worker Turnover," Working Papers 17-2007, Singapore Management University, School of Economics.
    8. Anne Bucher, 2010. "The dynamics of youth labor market integration," TEPP Working Paper 2010-16, TEPP.
    9. Esteban-Pretel, Julen & Fujimoto, Junichi, 2012. "Life-cycle search, match quality and Japan’s labor market," Journal of the Japanese and International Economies, Elsevier, vol. 26(3), pages 326-350.
    10. Matthias S. Hertweck & Vivien Lewis & Stefania Villa, 2021. "Going the Extra Mile: Effort by Workers and Job‐Seekers," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 53(8), pages 2099-2127, December.
    11. Krolikowski, Pawel M. & McCallum, Andrew H., 2021. "Goods-market frictions and international trade," Journal of International Economics, Elsevier, vol. 129(C).
    12. Pissarides, Christopher & Mortensen, Dale T., 2001. "Taxes, Subsidies and Equilibrium Labour Market Outcomes," CEPR Discussion Papers 2989, C.E.P.R. Discussion Papers.
    13. Philip Jung & Moritz Kuhn, 2019. "Earnings Losses and Labor Mobility Over the Life Cycle," Journal of the European Economic Association, European Economic Association, vol. 17(3), pages 678-724.
    14. Hashimoto, Ken-ichi & Ono, Yoshiyasu & Schlegl, Matthias, 2023. "Structural unemployment, underemployment, and secular stagnation," Journal of Economic Theory, Elsevier, vol. 209(C).
    15. Petrosky-Nadeau, Nicolas & Wasmer, Etienne, 2015. "Macroeconomic dynamics in a model of goods, labor, and credit market frictions," Journal of Monetary Economics, Elsevier, vol. 72(C), pages 97-113.
    16. Kenneth Beauchemin & Murat Tasci, 2005. "On the Cyclicality of Labor Market Mismatch and Aggregate Employment Flows," Discussion Papers 05-01, University at Albany, SUNY, Department of Economics.
    17. Anne Bucher, 2010. "Hiring Practices, Employment Protection and Temporary Jobs," TEPP Working Paper 2010-13, TEPP.
    18. Bjoern Bruegemann, 2023. "Invariance of Unemployment and Vacancy Dynamics with Respect to Diminishing Returns to Labor at the Firm Level," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 51, pages 915-942, December.
    19. Miquel Faig, 2008. "Labor Market Cycles and Unemployment Insurance Eligibility," 2008 Meeting Papers 183, Society for Economic Dynamics.
    20. Rogerson, Richard & Shimer, Robert, 2011. "Search in Macroeconomic Models of the Labor Market," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 4, chapter 7, pages Pages: 61, Elsevier.

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ctl:louvir:2011027. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Virginie LEBLANC (email available below). General contact details of provider: https://edirc.repec.org/data/iruclbe.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.