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Mass Layoffs and Unemployment / Andrew Caplin, John Leahy.
- Format:
- Book
- Author/Creator:
- Caplin, Andrew.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w4766.
- NBER working paper series no. w4766
- Language:
- English
- Subjects (All):
- Layoff systems.
- Job hunting--Mathematical models.
- Job hunting.
- Unemployment--Mathematical models.
- Unemployment.
- Plant shutdowns--Mathematical models.
- Plant shutdowns.
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 1994.
- Cambridge, MA : National Bureau of Economic Research, 1994.
- Summary:
- Mass layoffs give rise to groups of unemployed workers who possess similar characteristics and therefore may learn from one another's experience searching for a new job. Two factors lead them to be too selective in the job offers that they accept. The first is an information externality: searchers fail to take into account the value of their experience to others. The second is an incentive to free ride: each worker would like others to experiment and reveal information concerning productive jobs. Together these forces imply that in equilibrium the natural rate of unemployment is too high.
- Notes:
- Print version record
- June 1994.
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