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The happiness gains from sorting and matching in the labor market

Stutzer, Alois and Luechinger, Simon and Winkelmann, Rainer. (2007) The happiness gains from sorting and matching in the labor market. WWZ Discussion Papers, 2007 (01). Basel.

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Official URL: http://edoc.unibas.ch/dok/A4428143

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Abstract

Sorting of people on the labor market not only assures the most productive use of valuable skills but also generates individual utility gains if people experience an optimal match between job characteristics and their preferences. Based on individual data on subjective well-being it is
possible to assess these latter gains from matching. We introduce a two-equation ordered probit model with endogenous switching and study self-selection into government and private sector jobs. In an analysis with data from the European Social Survey, we find considerable gains from matching amounting to an increase in the fraction of very satisfied workers from 53.8 to 58.8 percent relative to a hypothetical random allocation of workers to the two sectors. A companion analysis of data from the German Socio-Economic Panel shows that selection on unobservables
is reduced once we include additional controls for preference heterogeneity.
Faculties and Departments:06 Faculty of Business and Economics > Departement Wirtschaftswissenschaften > Professuren Wirtschaftswissenschaften > Politische ├ľkonomie (Stutzer)
12 Special Collections > WWZ Publications > WWZ Discussion Papers and Working Papers
UniBasel Contributors:Stutzer, Alois
Item Type:Working Paper
Bibsysno:Link to catalogue
Publisher:WWZ
Note: -- Publication type according to Uni Basel Research Database: Discussion paper / Internet publication
Language:English
Identification Number:
  • handle: RePEc:bsl:wpaper:2007/01
Last Modified:14 Mar 2018 08:30
Deposited On:24 May 2013 09:04

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