We adapt the models of Menzio and Moen (2010) and Snell and Thomas (2010) to consider a labour market in which firms can commit to wage contracts but cannot commit not to replace incumbent workers. Workers are risk averse, so that there exists an incentive for firms to smooth wages. Real wages...

We consider a labour market with risk averse workers, directed search and asymmetric information in which firms can commit to wage contracts but not to retain workers. The model predicts that in downturns i) firms smooth wages of incumbent workers at a level sufficient to ensure they are not...

We consider a labour market with risk averse workers, directed search and asymmetric information in which firms can commit to wage contracts but not to retain workers. The model predicts that in downturns i) firms smooth wages of incumbent workers at a level sufficient to ensure they are not...

In this paper the evolution of skill imbalances in the UK labor market over the past two decades is investigated. Movements in the relative ease with which firms can recruit skilled workers can affect unemployment, inflation, and productivity. Any assessment of changes in the skill balance is...

Labour market tightness is a phrase often used by commentators and policy-makers, but it is rarely defined. In this paper, the phrase 'labour market tightness' is interpreted as describing the balance between the demand for, and the supply of, labour. A logical consequence of this approach is...