Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/73825
Authors: 
Holzner, Christian
Launov, Andrey
Year of Publication: 
2005
Series/Report no.: 
Ifo Working Paper 23
Abstract: 
We introduce skill groups and different production technologies into the Burdett-Mortensen model of on the job search. Supermodularity of the different skill groups in the production process leads to a positive intra-firm wage correlation between skill groups. Increasing returns to scale allow the theoretical earnings density to be unimodal with a long right tail even in the absence of productivity dispersion. We perform the structural estimation the model and evaluate the effect that arises from the marginal shift of the skill structure towards larger fraction of high-skilled workers. Our estimates of the production parameters demonstrate economy-wide increasing returns to scale.
Subjects: 
Search
wage correlation
social returns to education
JEL: 
J21
J23
J64
Document Type: 
Working Paper

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