糖心原创

Title: The Active Search Premium

Abstract

We document that the job-finding premium for non-employed active searchers relative to comparable nonparticipants is surprisingly small, strongly procyclical, and declining in the aggregate quantity of active search. This pattern does not support the standard assumption of perfect substitutability between active and passive search; it instead identifies a crowding-out of active search—the relative return to search effort falls as aggregate search effort rises. We develop a matching framework in which the elasticity of substitution is estimated from the premium’s response to the extensive and intensive margins of active search. At the estimated elasticity, aggregate search effort responds less to an economy-wide change in unemployment insurance benefits than micro-data estimates would imply. We formulate sufficient statistics for the extent of crowding-out, characterize its implications for unemployment insurance within a standard Baily–Chetty formula, and quantify the mechanism in an equilibrium business-cycle model.