SIGNALING EFFECTS OF LAYOFFS IN SOUTH KOREA

I examine an asymmetric-information model of layoffs (Gibbons andKatz, 1991) by comparing changes in earnings of laid-off workers andd isplacedworkers by plant closings using Korean data. The estimation result shows that laid-off male workers experience 11.5% greater earnings losses than those displ...

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Bibliographic Details
Published inHitotsubashi journal of economics Vol. 60; no. 2; pp. 163 - 188
Main Author Kim, Taehoon
Format Journal Article
LanguageEnglish
Published Tokyo Hitotsubashi University 01.12.2019
Subjects
Collective bargaining
Displaced workers
Earnings
Employers
Estimates
Female employees
Labor market
Layoffs
Male employees
Occupations
Payment systems
Seniority
Signaling
Unemployment
Unionization
Wages & salaries
United States > US
South Korea
Online AccessGet full text
ISSN0018-280X
2436-097X
DOI10.15057/30889

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Summary:I examine an asymmetric-information model of layoffs (Gibbons andKatz, 1991) by comparing changes in earnings of laid-off workers andd isplacedworkers by plant closings using Korean data. The estimation result shows that laid-off male workers experience 11.5% greater earnings losses than those displaced by plant closings. Laid-off workers also have longer unemployment spells. Contrary to previous studies, the signaling effect of layoffs is observednot only in white-collar but also blue-collar occupations in South Korea. The seniority-basedwage payment system andlow unionization rate in South Korea are suggested as possible reasons for this unique finding.
Bibliography:ObjectType-Article-1
SourceType-Scholarly Journals-1
ObjectType-Feature-2
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ISSN:0018-280X
2436-097X
DOI:10.15057/30889