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Title

Occupational Choice with Endogenous Spillovers

AuthorsAlbornoz, Facundo; Cabrales, Antonio; Hauk, Esther
Issue DateJul-2019
PublisherOxford University Press
CitationEconomic Journal 129(21): 1953-1970 (2019)
AbstractWe study a model that integrates productive and socialising efforts with occupational choice, and endogenous spillovers. We show that more talented individuals work harder and contribute more to externalities, but also have incentives to segregate. Average socialising increases the productivity of the occupation. The size of an occupation grows with its synergies. Individuals underinvest in productive and socialising effort, and sort themselves inefficiently into occupations. We derive the optimal subsidy for sorting into different occupations. Finally, we derive a rule to identify overpopulated sectors and establish the connection between inequality of talents, socialising, productive efforts and occupation size.
DescriptionThis article is part of a substantial revision of the paper circulated under the title ‘Targeted socialization and production’
Publisher version (URL)http://dx.doi.org/10.1111/ecoj.12634
URIhttp://hdl.handle.net/10261/201920
Identifiersdoi: 10.1111/ecoj.12634
e-issn: 1468-0297
issn: 0013-0133
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