London School of Economics
Information about this author at RePEc
NBER Working Papers and Publications
|September 2016||Aggregate Recruiting Intensity|
with Simon Mongey, Giovanni L. Violante: w22677
We develop a model of firm dynamics with random search in the labor market where hiring firms exert recruiting effort by spending resources to fill vacancies faster. Consistent with micro evidence, in the model fast-growing firms invest more in recruiting activities and achieve higher job-filling rates. In equilibrium, individual decisions of hiring firms aggregate into an index of economy-wide recruiting intensity. We use the model to study how aggregate shocks transmit to recruiting intensity, andwhether this channel can account for the dynamics of aggregate matching efficiency around the Great Recession. Productivity and financial shocks lead to sizable pro-cyclical fluctuations inmatching efficiency through recruiting effort. Quantitatively, the main mechanism is that firms attain thei...
|September 2007||Dynamic Inefficiencies in Employment-Based Health Insurance System Theory and Evidence|
with Hanming Fang: w13371
We investigate how the employment-based health insurance system in the U.S. affects individuals' life-cycle health-care decisions. We take the viewpoint that health is a form of human capital that affects workers' productivities on the job, and derive implications of employees' turnover on the incentives to undertake health investment. Our model suggests that employee turnovers lead to dynamic inefficiencies in health investment, and particularly, it suggests that employment-based health insurance system in the U.S. might lead to an inefficient low level of individual health during individuals' working ages. Moreover, we show that under-investment in health is positively related to the turnover rate of the workers' industry and increases medical expenditure in retirement. We provide empiri...
Published: Fang, Hanming, and Alessandro Gavazza. 2011. "Dynamic Inefficiencies in an Employment-Based Health Insurance System: Theory and Evidence." American Economic Review, 101(7): 3047-77. DOI: 10.1257/aer.101.7.3047