Arbeitspapier
Product market imperfections and employment dynamics
How important is imperfect competition in the product market for employment dynamics? To investigate this, we formulate a theoretical model of employment adjustment with imperfect competition in the product market, search frictions, and convex adjustment costs. From this model, we derive a structural equation for employment that we estimate on firm-level data. We find that product market demand shocks have significant and quantitatively large effects on employment. Thus, product market imperfections seem to be important for employment dynamics. However, we find no evidence that the tightness of the local labor market affects job creation in existing firms.
- Language
-
Englisch
- Bibliographic citation
-
Series: Working Paper ; No. 2006:7
Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
Labor Demand
Unemployment: Models, Duration, Incidence, and Job Search
Job Creation
Unemployment
Labor Demand
Eriksson, Stefan
Gottfries, Nils
- Handle
- Last update
-
20.09.2024, 8:22 AM CEST
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Carlsson, Mikael
- Eriksson, Stefan
- Gottfries, Nils
- Uppsala University, Department of Economics
Time of origin
- 2011