Job creation and job destruction with heterogeneous workersa theory of self-employment

Resumo

How does the worker's outside option (self-employment income/reservation income) impact the Job Creation and Job Destruction rate in the economy? To evaluate this question, I built an extension of Mortensen and Pissarides (1994) with endogenous job destruction where workers are heterogeneous in their self-employment income. Assuming the exact calibration as Mortensen and Pissarides (1994) and using a simplified version of the Homotopy method to solve the model numerically, the results show that each type of worker produces an externality over the other by introducing heterogeneous workers. I found that the higher the difference between the self-employment income of workers and the higher the proportion of low-type workers in the economy, the more jobs are created, and the rate at which high-type workers lead to unemployment also increases.

Ficha do documento

Tipo

Dissertação

Ano

2025

Instituição

Fundação Getulio Vargas

Fonte

Repositório da FGV

Idioma

Inglês

Acesso

Acesso aberto

Identificador

oai:repositorio.fgv.br:10438/36523

Temas

Economia

Palavras-chave

Agentes heterogêneosCriação de empregosDestruição de empregosModelos econômicosDesempregoMercado de trabalho