Job search and savings:: Wealth effects and duration dependence

• 成果类型: Article
• 署名作者: Lentz, R; Tranæs, T
• 署名单位: Boston University
• 刊物名称: JOURNAL OF LABOR ECONOMICS
• ISSN/ISSBN: 0734-306X
• DOI: 10.1086/430284
• 发表日期: 2005
• 页码: 467-489
• 关键词: optimal unemployment-insurance; transitions

摘要

This article studies a risk-averse worker's optimal savings and job search behavior as she moves back and forth between employment and unemployment. We show that job search effort is negatively related to wealth under the assumption of additively separable utility. Consequently, job search exhibits positive unemployment duration dependence because wealth is drawn down to smooth consumption as the spell progresses. Finally, given optimal search, savings still provide imperfect insurance against income fluctuations; precautionary savings are built up during employment spells and run down during unemployment spells, but the consumption path will not be perfectly smooth over states.