Search-theoretic models of the labor market: A survey

Richard Rogerson, Robert Shimer, Randall Wright

Research output: Contribution to journalReview articlepeer-review

482 Scopus citations

Abstract

We survey the literature on search-theoretic models of the labor market. We show how this approach addresses many issues, including the following: Why do workers sometimes choose to remain unemployed? What determines the lengths of employment and unemployment spells? How can there simultaneously exist unemployed workers and unfilled vacancies? What determines aggregate unemployment and vacancies? How can homogeneous workers earn different wages? What are the tradeoffs firms face from different wages? How do wages and turnover interact? What determines efficient turnover? We discuss various modeling choices concerning wage determination and the meeting process, including recent models of directed search.

Original languageEnglish (US)
Pages (from-to)959-988
Number of pages30
JournalJournal of Economic Literature
Volume43
Issue number4
DOIs
StatePublished - Dec 2005
Externally publishedYes

All Science Journal Classification (ASJC) codes

  • Economics and Econometrics

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