The Role of Career Choice in Understanding Job Mobility

Authors


  • I thank Nathaniel Baum-Snow, Jeffrey Campbell, Lars Hansen, Mario Macis, Natalia Ramondo, Alejandro Rodriguez, Robert Shimer, and especially Derek Neal for helpful comments and discussions. I also thank participants of the Micro Lunch at the Federal Reserve of Chicago, of the Workshop in Empirical Economics at the University of Chicago, and of the Villa Mondragone Workshop in Economic Theory and Econometrics. All remaining errors are my own.

Ronni Pavan, Department of Economics, University of Rochester, Harkness Hall, Rochester, NY 14627, USA. E-mail: rpavan@mail.rochester.edu.

Abstract

This paper presents a simple model that explains how the likelihood of job changes and their complexity changes over a worker's career, and the empirical work presented here uses the life cycle patterns of mobility and their complexity to infer the relative importance of firm-specific versus career-specific concerns as determinants of mobility decisions. The estimates of the model indicate that the contemporaneous presence of two quality matches, one career-specific and one firm-specific, is necessary to understand the patterns of the data. The model also predicts that the welfare losses implied by a disappearance of a career can be on average twice as large as the losses implied by a plant closure.

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