| Publisher | University of British Columbia | ||
|---|---|---|---|
| Format | 274.4KB PDF | Date added | 01 Apr 2004 |
| Topics | Human Capital Management | ||
| Downloads | 18 | ||
The models developed at the end of the 1960s and in the beginning of the 1970s have all stressed the role of wage differentials on employment sector choice. "Migration" from the low-wage sector to the high-wage sector will continue as long as the expected wage in the second sector is higher than in the first sector. This paper shows how unemployment duration while awaiting employment in the high-wage sector is an increasing function of the wage differential between sectors, a decreasing function of the expected differential in unemployment duration and a decreasing function of the individual discount rate.
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