On-the-Job Search, MinimumWages, and Labor Market Outcomes in an Equilibrium Bargaining Framework1
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چکیده
We look at the impact of a binding minimum wage on labor market outcomes and welfare distributions in both partial and general equilibrium models of matching and bargaining a currentlyemployed individual can meet other potential employers (on-the-job search). In analyzing and estimating the model, we use two different specifications of the Nash bargaining problem. In one, firms engage in a Bertrand competition for the services of an individual, as in Postel-Vinay and Robin (2002), Dey and Flinn (2005), and Cahuc et al. (2006). In the other, firms do not engage in such competitions, and the outside option used in bargaining is always the value of unemployed search. We estimate both bargaining specifications using a Method of Simulated Moments estimator applied to data from a recent wave of the Survey of Income and Program Participation. Even though individuals will be paid the minimum wage for a small proportion of their labor market careers, we find significant effects of the minimum wage on the ex ante value of labor market careers, particularly in the case of Bertrand competition between firms. We carry out a test of which bargaining structure is more consistent with the sample information used in the estimator, and find strong support for the no-renegotiation specification.
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On-the-Job Search, MinimumWages, and Labor Market Outcomes in an Equilibrium Bargaining Framework1 Very Preliminary Please do not cite or quote
We look at the impact of a binding minimum wage on labor market outcomes and welfare distributions in a partial equilibrium model of matching and bargaining in the presence of on-the-job search. We use two different specifications of the Nash bargaining problem. In one, firms engage in a Bertrand competition for the services of an individual, as in Postel-Vinay and Robin (2002). In the other, f...
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We look at the impact of a binding minimum wage on labor market outcomes and welfare distributions in a partial equilibrium model of matching and bargaining in the presence of on-the-job search. We use two different specifications of the Nash bargaining problem. In one, firms engage in a Bertrand competition for the services of an individual, as in Postel-Vinay and Robin (2002). In the other, f...
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تاریخ انتشار 2009