Derived demand shifts, on-the-job training, and labor market dynamics: A theoretical and empirical analysis.
Item
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Title
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Derived demand shifts, on-the-job training, and labor market dynamics: A theoretical and empirical analysis.
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Identifier
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AAI9000715
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identifier
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9000715
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Creator
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Mizuno, Atsushi.
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Contributor
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Adviser: Michael Grossman
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Date
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1989
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Language
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English
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Publisher
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City University of New York.
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Subject
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Economics, Labor
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Abstract
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The purpose of this dissertation is to analyze wage changes and job turnover of an individual worker by combining the derived demand for labor (DDL) with the human capital investment (HCI) hypothesis. Most existing models try to explain these topics by neglecting a firm's situation in the product market. This dissertation tries to address this weakness in the existing literature and shows that the HCI models can improve the power to explain the wage growth and job turnover by combining the idea of the DDL hypothesis.;The dissertation has six chapters. Chapter II derives the theoretical model of wage dynamics. It shows why a standard HCI model is weak in explaining quit rates and when a worker with a long-run view also compares current wages in his quit-or-stay decision. After deriving some interesting propositions about the wage growth and quit rates, it provides motivation for empirical estimation of the model. Chapter III estimates the earnings function that is derived in chapter II by merging the Panel Study of Income Dynamics with published data on industry prices and other demand variables pertaining to the industry in which the respondent works. After eliminating macro business cycle effects, the chapter finds that a worker is paid more as industry product demand becomes higher and has more cyclical fluctuations. It also finds that if the product demand variables are excluded in estimating an earnings function, it will lead to a downward bias in the wage-tenure profile. Chapter IV analyzes the possible censoring problem in the observed wage data. Chapter V estimates a job separation function. The empirical finding suggests that product demand in the industry rises and as job tenure increases, a worker tends to stay longer in the same firm. Furthermore, a quit probability is more sensitive to product demand than a layoff probability. Chapter VI estimates the expected result of job search. The result suggests that unemployment experience and product demand are important in determining whether workers become better off after changing jobs.
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Type
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dissertation
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Source
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PQT Legacy CUNY.xlsx
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degree
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Ph.D.
