Working Paper: CEPR ID: DP2576
Authors: Giuseppe Bertola; Pietro Garibaldi
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.
Keywords: firm size; distribution; recruiting; wage dispersion
JEL Codes: J30; J60
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Employer Size (L25) | Wages (J31) |
| Employer Size (L25) | Wage Dispersion (J31) |