Abstract
In this article we develop an equilibrium search model with a continuous distribution of firm productivity types within a given labor market. We characterize equilibrium, derive expressions for the endogenous equilibrium wage distributions, and characterize the set of wage distributions that can be generated by the model. We develop a structural nonparametric estimation method for the productivity distribution. We estimate the model using French longitudinal survey data on labor supply, and we compare the results with those from a French panel data set of firms. The results are informative on the degree to which firms exploit search frictions.
| Original language | English |
|---|---|
| Pages (from-to) | 305-358 |
| Number of pages | 54 |
| Journal | International Economic Review |
| Volume | 41 |
| Issue number | 2 |
| Publication status | Published - May-2000 |
| Externally published | Yes |