Are the Unemployed Unemployable?
June 1, 1994
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Summary
This paper develops a matching model of the labor market under wage rigidity when hiring decisions are irreversible. There are two types of workers, the skilled and the unskilled. The model is used to analyze whether technological advances may have increased unemployment. It is shown that it is likely to be so if they are associated with an increase in the productivity and/or the supply of skilled workers relative to unskilled workers. These effects are stronger when hiring decisions are more irreversible.
Subject: Labor force, Labor markets, Unemployment, Unemployment rate, Unskilled labor
Keywords: WP
Pages:
24
Volume:
1994
DOI:
Issue:
064
Series:
Working Paper No. 1994/064
Stock No:
WPIEA0641994
ISBN:
9781451848496
ISSN:
1018-5941
