Analyzing Labor Market Institutions through the Lens of Search-and-Matching Models: Application to International Trade Shocks

Details

Supervisors

Hungerbühler, Mathias

Faculty

Faculté des sciences économiques, sociales, politiques et de communication

Degree label

Master [120] en sciences économiques, orientation économétrie, à finalité approfondie

Abstract

enThis paper evaluates the search-and-matching framework as a unifying structural model for analyzing minimum wage, unemployment insurance, and collective bargaining within a tractable theoretical envi- ronment. These models are analytically appealing because they provide a realistic representation of labor markets by explicitly incorporating search frictions into the matching process. This feature is particu- larly important, as the literature has often criticized neoclassical models for their inability to adequately capture the effects of labor market institutions. Moreover, search-and-matching models can be combined with modern econometric methods, notably the use of exogenous shocks as quasi-natural experiments to identify the causal effects of institutions on labor market outcomes. Following recent developments in macroeconomics, these two approaches can be integrated effectively by combining a structural framework with empirical evidence used for calibration and validation. The purpose of this paper is to examine how search-and-matching models can serve as the theoretical foundation for this broader research agenda when exposed to international trade shocks.