The effect of search frictions on wages

G.J. van den Berg, A.P. van Vuuren

Research output: Contribution to JournalArticleAcademicpeer-review


We aim to test whether the degree of informational search frictions in the labor market has a negative effect on wages. In a range of equilibrium search models of the labor market, this effect is predicted to be negative. Nevertheless, this has never been tested. We perform tests with matched worker-firm data. The worker data are informative on individual wages and labor market transitions, and this allows for estimation of the degree of search frictions. The firm data are informative on labor productivity. This allows us to investigate how the mean difference between labor productivity and wages in a market depends on the degree of frictions and other determinants, and to assess the quantitative relevance of frictions for wages. © 2010 Elsevier B.V.
Original languageEnglish
Pages (from-to)875-885
Number of pages11
JournalLabour Economics
Issue number66
Publication statusPublished - 2010


Dive into the research topics of 'The effect of search frictions on wages'. Together they form a unique fingerprint.

Cite this