【Brownbag】The Role of Hiring Costs and Vacancy Creation Costs in Labor Market Tightness Dynamics
2025/08/22
研討會日期 : 2025-08-22
時間 : 12:10
主講人 : Professor Jhih-Chian Wu (吳致謙)
地點 : Conference Room B110
演講者簡介 : Professor Jhih-Chian Wu received his Ph.D. in Economics from the University of Illinois at Urbana-Champaign in 2018. He is currently an Assistant Research Fellow at the Academia Sinica. His research fields are Macroeconomics, Labor Economics, and Applied Time Series Econometrics.
演講摘要 : In the Diamond-Mortensen-Pissarides model, equilibrium tightness is independent of unemployment. Therefore, the model cannot produce the observed negative correlation between tightness and unemployment conditional on technology and separation shocks, instead generating a zero correlation. It also generates a negligible decline in tightness following a separation shock, leading to an incorrect positive Beveridge curve slope when countercyclical separations are introduced. This paper shows that introducing hiring costs or vacancy creation costs makes firms' recruiting expenses increase with unemployment. Under either cost, increased unemployment raises recruiting expenses, discouraging vacancy postings and reducing tightness. Consequently, the model with either cost reproduces the observed negative correlation between tightness and unemployment and the sharp decline in tightness after a separation shock, resulting in the observed negative Beveridge curve slope. Specifically, reposting vacated jobs due to separations raises tightness, weakening the ability of the model with vacancy creation costs to generate this sharp decline in tightness.
