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Isaac SORKIN (Stanford University) – "Granular Search, Market Structure, and Wages"
Time: 12:15 pm – 1:30 pm
Date: 5 th of September 2019 Exceptionally Thursday
Place: Room 3001
Isaac SORKIN (Stanford University) – “Granular Search, Market Structure, and Wages”
Abstract: We build a framework where firm size is a source of market power. The key mechanism is that a granular employer can eliminate its own vacancies from a worker’s outside option in the wage bargain. Hence, a granular employer does not compete with itself. Using the framework in Austrian micro-data, we find that granular market power depresses wages by 9-13 percent and can explain 40 percent of the observed decline in the labor share from 1997 to 2015. Merging the two largest firms in every labor market depresses market-wide wages by six percent. (with Gregor Jarosch and Jan Sebastian Nimczik)
Xavier D’HAULTFOEUILLE (Laboratoire de Microéconométrie-CREST)
Benoît SCHMUTZ (Laboratoire de Microéconométrie-CREST)