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http://hdl.handle.net/10419/20244
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| Title: | | Signaling in the Labor Market: New Evidence on Layoffs and Plant Closings  |
| Authors: | | Rodríguez-Planas, Núria |
| Issue Date: | | 2004 |
| Series/Report no.: | | IZA Discussion paper series 1009 |
| Abstract: | | In my asymmetric-information model of layoffs, high-productivity workers are more likely to be recalled to their former employer and may choose to remain unemployed rather than to accept a low-wage job. In this case, unemployment can serve as a signal of productivity, and duration of unemployment may be positively related to post-laid-off wages even among workers who are not recalled. In contrast, because workers whose plant closed cannot be recalled, longer unemployment for them should not have a positive signaling benefit. Analysis of the data from the January 1988-2000 Displaced Workers Supplements to the Current Population Survey reveals that the wage/unemployment duration relation differs between laid-off workers and workers displaced through plant closings in the predicted way, and finds evidence consistent with asymmetric information in the U.S. labor market. |
| Subjects: | | laid-off workers signaling unemployment wages |
| JEL: | | J30 J60 |
| Document Type: | | Working Paper |
| Appears in Collections: | | IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)
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