The importance of two-sided heterogeneity for the cyclicality of labour market dynamics

Ronald Bachmann and Peggy Bechara (née David)

No 2009,05, Technical Reports from Technische Universität Dortmund, Sonderforschungsbereich 475: Komplexitätsreduktion in multivariaten Datenstrukturen

Abstract: Using two data sets derived from German administrative data, including a linked employer-employee data set, we investigate the cyclicality of worker and job °ows. The analysis stresses the importance of two-sided labour market heterogeneity in this context, taking into account both observed and unobserved characteristics. We find that small firms hire mainly unemployed workers, and that they do so at the beginning of an economic expansion. Later on in the expansion, hirings more frequently result from direct job-to-job transitions, with employed workers moving to larger firms. Contrary to our expectations, workers moving to larger firms do not experience signi¯cantly larger wage gains than workers moving to smaller establishments. Furthermore, our econometric analysis shows that the interaction of unobserved heterogeneities on the two sides of the labour market plays a more important role for employed job seekers than for the unemployed.

Keywords: worker °ows; accessions; separations; business cycle; job-to-job; employer-to-employer; linked employer-employee (search for similar items in EconPapers)
JEL-codes: E24 J21 J63 J64 (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (4)

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Related works:
Journal Article: The Importance of Two‐Sided Heterogeneity for the Cyclicality of Labour Market Dynamics (2019)
Working Paper: The importance of two-sided heterogeneity for the cyclicality of labour market dynamics (2018)
Working Paper: The Importance of Two-Sided Heterogeneity for the Cyclicality of Labour Market Dynamics (2010)
Working Paper: The Importance of Two-Sided Heterogeneity for the Cyclicality of Labour Market Dynamics (2009)
Working Paper: The importance of two-sided heterogeneity for the cyclicality of labour market dynamics (2009)
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