Marriage and employment participation with wage bargaining in search equilibrium. (2nd August 2021)

• Record Type: Journal Article
• Authors: Bonilla, Roberto; Trejos, Alberto
• Is Part Of: Scottish journal of political economy. Volume 68:Number 4(2021)
• Page Start: 517
• Page End: 533
• Publication Date: 2021-08-02
• Subjects: labour market participation -- linked search markets -- marriage market -- wage formation; Great Britain -- Economic conditions -- 1945-1964 -- Periodicals; Great Britain -- Economic conditions -- 1964-1979 -- Periodicals; Great Britain -- Economic conditions -- 1979-1997 -- Periodicals; 330.9411005
• DOI: 10.1111/sjpe.12289
• Languages: English
• ISSNs: 0036-9292

Abstract

Abstract: We build an equilibrium search model where married couples make joint decisions on home production and labour market participation and analyse the implications of our results for a frictional marriage market. A worker's bargaining position reflects their productivity, and the productivity and employment status of their spouse. People sometimes accept transitory jobs only to raise the spouse's long‐term wages. Firms sometimes reduce turnover by unilaterally increasing a worker's wage, ensuring that the spouse stays at home.