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Mike Elsby, Edinburgh U. Print
Wednesday, 07 November 2018, 16:30 - 18:00

 Joint with NBB, KUL, UA, UCL, UGhent, UHasselt, ULB, ULg and UMons

Mike Elsby, University of Edinburgh

 Vacancy chains

Abstract : Replacement hiring—recruitment that seeks to replace positions vacated by workers who quit—plays a central role in establishment dynamics. We document this phenomenon using rich microdata on U.S. establishments, which frequently report no net change in their employment, often for years at a time, despite facing substantial gross turnover in the form of quits. Motivated by this, we devise a novel theory of the interaction of firm dynamics with on-the-job search, and study its analytical implications. To generate the extent of replacement hiring suggested by the data, we then extend the model to incorporate a putty-clay production structure among establishments. Replacement hiring induces a novel positive feedback channel through which an initial rise in vacancy posting induces still more vacancy posting to replace employees who are poached. This vacancy chain in turn induces volatile responses of vacancies, and thereby unemployment, to cyclical shocks.


The seminar will take place on Wednesday, November 7 from 16.30 until 18.00 in the Auditorium
of the National Bank of Belgium, Room B, Entrance: Warmoesberg 61, 1000 Brussels. Please
include name and car plate number for access the NBB Parking Warmoesberg 41.

Due to security measures, we emphasize the need for you to register by email to
This e-mail address is being protected from spam bots, you need JavaScript enabled to view it before Monday 5 at 4:00 pm if you plan to attend the seminar.
Without registration, you will not be allowed in the seminar room.

You will receive a nominative badge at the entrance. We recommend that you arrive at least
10 minutes before the start of the seminar. 


Location: NBB - Room B