PhD course in “Understanding Dynamic Labor Markets”

University of Lausanne, 2016

Pierre Cahuc and Stéphane Carcillo

Objectives: This PhD course provides an overview of the modern view of how labor markets operate. The course introduces the notion of a search friction, the idea that employers and job seekers cannot instantly match. This feature of the labor market produces many of its problems: unemployment and inefficiency. The course also shows how social policies can intervene to improve labor market outcomes. The course covers theoretical notions and reviews empirical studies that document the empirical findings.

Outline: The class is based on Cahuc, Carcillo and Zylberberg (2014, CCZ), and state of the art research papers. The focus of the class is on modelling dynamic markets. To see what this means, we start with studying static labor supply (Lecture 1). We will then move on to discussing dynamic models of how people search for jobs (Lecture 2) and look into models that look at workers and firms simultaneously (Lecture 3). A key concern for policy is increasing inequality and unemployment. We will look into how we can model this (Lecture 4), and how to deal with this problem and other using labor policies (Lecture 5 & 6). A core component of the class is two special sessions. The first session is an ongoing research presentation. The second is a discussion about whether labor economics matters for labor policy. The class ends with an exam covering the class material.

A complementary useful reference is the following textbook:

Cahuc, P. Carcillo, S. and Zylberberg, Labor Economics, The MIT Press, 2014, www.labor-economics.org

Lectures 1: Labor supply

Slides

CCZ, chapter 1

Lecture 2: Job search

Slides

CCZ, chapter 5

Lecture 3: Matching

Slides

CCZ, chapter 9

Lecture 4: Technological progress, unemployment and inequality