Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/282791 
Year of Publication: 
2023
Series/Report no.: 
IZA Discussion Papers No. 16664
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
This paper develops a macroeconomic model that combines an incomplete-markets overlapping-generations economy with a job ladder featuring sequential wage bargaining, endogenous search effort of employed and non-employed workers, and differences in match quality. The calibrated model offers a good fit to the empirical age profiles of search activity, job-finding rates, wages and savings, so that we use the model to examine the role of age and wealth for worker flows and for the consequences of job loss. We further analyze the impact of unemployment insurance and progressive taxation for labor market dynamics and aggregate economic activity via capital, employment and labor efficiency channels. Lower unemployment benefits or a less progressive tax schedule bring about welfare losses for a newborn worker household.
Subjects: 
search and matching
job-to-job transitions
incomplete markets
overlapping generations
wealth accumulation
JEL: 
E21
E24
H24
J64
J65
Document Type: 
Working Paper

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