On-the-Job Search in a Matching Model with Heterogeneous Jobs and Workers Articles uri icon

publication date

  • February 2009

start page

  • 200

end page

  • 228

issue

  • 534

volume

  • 119

international standard serial number (ISSN)

  • 0013-0133

abstract

  • This article examines the effects of transitory skill mismatch in a matching model with heterogeneous jobs and workers. In our model, some highly-educated workers may accept unskilled jobs for which they are over-qualified but are allowed to engage in on-the-job search in pursuit of a better job. We show that this feature has relevant implications for the set of potential equilibria, the unemployment rates of the different types of workers, the degree of wage inequality, and the response of the labour market to shifts in the demand and supply of skills.