Wage Risk and the Value of Job Mobility in Early Employment Careers

Arbeitspapier

This paper shows that job mobility is a valuable channel which employed workers use to mitigate bad labor market shocks. I construct and estimate a model of wage dynamics jointly with a dynamic model of job mobility. The key feature of the model is the specification of wage shocks at the worker- firm match level, for workers can respond to these shocks by changing jobs. The model is estimated using a sample of young male workers from the 1996 panel of Survey of Income and Program Participation. The first result is that the variance of match-level shocks is large, and the consequent value of job mobility is substantial. The second result is that true wage risk is almost three times as large as the wage variance observed after job mobility, which is what other papers in the literature have called wage risk. This suggests a very different picture of the risks facing employed workers in the labor market.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: IZA Discussion Papers ; No. 9256

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Micro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making‡ ; Wage Level and Structure; Wage Differentials ; Job, Occupational, and Intergenerational Mobility; Promotion
• Thema: job mobility ; wage dynamics ; wage risk ; employment

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Liu, Kai
• Ereignis: Veröffentlichung
• (wer): Institute for the Study of Labor (IZA)
• (wo): Bonn
• (wann): 2015

Weitere Informationen

• Handle: http://hdl.handle.net/10419/114131
• Letzte Aktualisierung: 10.03.2025, 11:42 MEZ