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Title: Essays in Macroeconomics
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1. Murali, Srinivasan
Essays in Macroeconomics
Ph.D. Dissertation, Department of Economics, The Ohio State University, 2018
Cohort(s): NLSY79, NLSY97
Publisher: ProQuest Dissertations & Theses (PQDT)
Keyword(s): Armed Services Vocational Aptitude Battery (ASVAB); Job Skills; Job Tenure; Job Turnover; Occupational Information Network (O*NET)

Permission to reprint the abstract has not been received from the publisher.

Chapter 1 titled Job Specialization and Labor Market Turnover explores the secular decline in the labor market turnover over the recent decades. Even though there is a growing empirical literature documenting the decline of labor market turnover over time, there is still no consensus on the underlying economic factors driving this decline. This paper contributes to this gap in the literature. I analyze the role of an increase in the specialization of jobs in accounting for this decline. Combining individual level worker data from NLSY79 and NLSY97 with data on skills from the ASVAB and O*NET, I estimate a standard Mincerian wage regression augmented with an empirical measure of mismatch. I find that jobs on average are specialized and that specialization has increased by 14 percentage points post 1995. To quantify the impact of this increasing job specialization on labor market turnover, I build an equilibrium search and matching model with two-sided ex-ante heterogeneity. Workers have different skill endowments and jobs have different skill requirements. The specialization of a job measures the impact of mismatch on match productivity. I show that as jobs become more specialized, my model is able to explain over 20\% of the observed decline in labor market turnover. As job specialization increases, well-matched firms and workers choose to remain in their matches longer. This leads to an increase in the proportion of well-matched workers and firms, which in turn results in a decline in labor market turnover.
Bibliography Citation
Murali, Srinivasan. Essays in Macroeconomics. Ph.D. Dissertation, Department of Economics, The Ohio State University, 2018.