The increasing quality of job matching

[Research Highlight]

March 03, 2022

Better job screening is decreasing the rate of worker turnover.

Declining Worker Turnover: The Role of Short-Duration Employment Spells

By Michael J. Pries and Richard Rogerson

American Economic Journal: Macroeconomics, January 2022

Using the Quarterly Workforce Indicators database, we document that a significant amount of the decline in labor market turnover during the last two decades is accounted for by the decline in employment spells that last just one or two quarters. This phen...

LinkedIn(to) Job Opportunities: Experimental Evidence from Job Readiness Training

By Laurel Wheeler, Robert Garlick, Eric Johnson, Patrick Shaw, and Marissa Gargano

American Economic Journal: Applied Economics, April 2022

Online professional networking platforms are widely used and may help workers to search for and obtain jobs. We run the first randomized evaluation of training work seekers to join and use one of the largest platforms, LinkedIn. Training increases the end...

Missing Women, Integration Costs, and Big Push Policies in the Saudi Labor Market

By Conrad Miller, Jennifer Peck, and Mehmet Seflek

American Economic Journal: Applied Economics, April 2022

In settings where social norms promote gender segregation, firms may find it costly to employ both men and women. These integration costs may hinder women's employment. We develop a methodology to test for the presence of fixed integration costs and estim...

Unemployment Insurance as a Worker Indiscipline Device? Evidence from Scanner Data

By Lester Lusher, Geoffrey C. Schnorr, and Rebecca L.C. Taylor

American Economic Journal: Applied Economics, April 2022

We provide causal evidence of an ex ante moral hazard effect of unemployment insurance (UI) by matching plausibly exogenous changes in UI benefit duration across state-weeks during the Great Recession to high-frequency productivity measures from individua...

Understanding the Scarring Effect of Recessions

By Christopher Huckfeldt

American Economic Review, April 2022

This paper documents that the earnings cost of job loss is concentrated among workers who find reemployment in lower-skill occupations, and that the cost and incidence of such occupation displacement is higher for workers who lose their job during a reces...

Labor Market Power

By David Berger, Kyle Herkenhoff, and Simon Mongey

American Economic Review, April 2022

We develop, estimate, and test a tractable general equilibrium model of oligopsony with differentiated jobs and concentrated labor markets. We estimate key model parameters by matching new evidence on the relationship between firms' local labor market sha...

Measuring Geopolitical Risk

By Dario Caldara and Matteo Iacoviello

American Economic Review, April 2022

We present a news-based measure of adverse geopolitical events and associated risks. The geopolitical risk (GPR) index spikes around the two world wars, at the beginning of the Korean War, during the Cuban Missile Crisis, and after 9/11. Higher geopolitic...

Pigouvian Cycles

By Renato Faccini and Leonardo Melosi

American Economic Journal: Macroeconomics, April 2022

Current and expected unemployment rates contain information that is highly useful to estimate the effect of news about TFP and to allow a general equilibrium rational expectations model to generate Pigouvian cycles: a large fraction of the comovement of o...

Supply and Demand in Disaggregated Keynesian Economies with an Application to the COVID-19 Crisis

By David Baqaee and Emmanuel Farhi

American Economic Review, May 2022

We study supply and demand shocks in a disaggregated model with multiple sectors, multiple factors, input-output linkages, downward nominal wage rigidities, credit-constraints, and a zero lower bound. We use the model to understand how the COVID-19 cris...

The Labor Market Impacts of Universal and Permanent Cash Transfers: Evidence from the Alaska Permanent Fund

By Damon Jones and Ioana Marinescu

American Economic Journal: Economic Policy, May 2022

Since 1982, all Alaskan residents have received a yearly cash dividend from the Alaska Permanent Fund. Using the Current Population Survey and a synthetic control method, this paper shows that the dividend had no effect on employment and increased part-ti...

The Long-Term Effects of Measles Vaccination on Earnings and Employment

By Alicia Atwood

American Economic Journal: Economic Policy, May 2022

The measles vaccine was introduced in 1963. Take-up of the vaccine in the United States occurred quickly and universally, leading to reductions in morbidity and mortality. New biological evidence on how the measles virus interacts with our immune system i...

Raising the Bar: Minimum Wages and Employers' Hiring Standards

By Sebastian Butschek

American Economic Journal: Economic Policy, May 2022

Many scholars have studied the employment effects of minimum wages, but little is known about effects on the composition of hires. I investigate whether Germany's minimum wage introduction raised hiring standards, using worker fixed effects as a proxy for...

Minimum-Wage Increases and Low-Wage Employment: Evidence from Seattle

By Ekaterina Jardim, Mark C. Long, Robert Plotnick, Emma van Inwegen, Jacob Vigdor, and Hilary Wething

American Economic Journal: Economic Policy, May 2022

Seattle raised its minimum wage to as much as $11 in 2015 and as much as $13 in 2016. We use Washington State administrative data to conduct two complementary analyses of its impact. Relative to outlying regions of the state identified by the synthetic ...

Children and the US Social Safety Net: Balancing Disincentives for Adults and Benefits for Children

[Symposium: Childhood Interventions]

By Anna Aizer, Hilary Hoynes, and Adriana Lleras-Muney

Journal of Economic Perspectives, Spring 2022

Economic research on the safety net has evolved over time, moving away from a focus on the negative incentive effects of means-tested assistance on employment, earnings, marriage, and fertility to include the potential positive benefits of such programs...

Joan Robinson on Karl Marx: "His Sense of Reality Is Far Stronger"

By Carolina Alves

Journal of Economic Perspectives, Spring 2022

This paper revisits why Joan Robinson turned to Karl Marx in 1942 and which insights from Marxian economics she sought to incorporate into her later works, while commenting on how her encounter with Marx was received by some her of contemporaries. By th...

Should We Insure Workers or Jobs during Recessions?

[Symposium: Macro Policy in the Pandemic]

By Giulia Giupponi, Camille Landais, and Alice Lapeyre

Journal of Economic Perspectives, Spring 2022

What is the most efficient way to respond to recessions in the labor market? To this question, policymakers on the two sides of the pond gave diametrically opposed answers during the COVID-19 crisis. In the United States, the focus was on insuring worke...

A Social Insurance Perspective on Pandemic Fiscal Policy: Implications for Unemployment Insurance and Hazard Pay

[Symposium: Macro Policy in the Pandemic]

By Christina D. Romer and David H. Romer

Journal of Economic Perspectives, Spring 2022

This paper considers fiscal policy during the pandemic through the lens of optimal social insurance. We develop a simple framework to analyze how government taxes and transfers could mimic the insurance that people would like to have had against pandemi...

The $800 Billion Paycheck Protection Program: Where Did the Money Go and Why Did It Go There?

[Symposium: Macro Policy in the Pandemic]

By David Autor, David Cho, Leland D. Crane, Mita Goldar, Byron Lutz, Joshua Montes, William B. Peterman, David Ratner, Daniel Villar, and Ahu Yildirmaz

Journal of Economic Perspectives, Spring 2022

The Paycheck Protection Program (PPP) provided small businesses with roughly $800 billion dollars in uncollateralized, low-interest loans during the pandemic, almost all of which will be forgiven. With 94 percent of small businesses ultimately receiving...

The Cumulative Costs of Racism and the Bill for Black Reparations

[Symposium: Economics of Slavery]

By William Darity Jr., A. Kirsten Mullen, and Marvin Slaughter

Journal of Economic Perspectives, Spring 2022

Two major procedures for establishing the monetary value of a plan for reparations for Black American descendants of US slavery are considered in this paper: 1) Enumeration of atrocities and assignment of a dollar value to each as a prelude to adding up...