Job Ladder and Dynamic Monopsony in Production Networks with Emmanuel Dhyne, 2025 (new draft coming soon)
Best Paper Award at the 22nd GEP/CEPR Annual Postgraduate Conference and 17th FIW-Research Conference International Economics
Abstract: This paper examines how workers' outside options are concentrated within the supply chains of their employers. Using Belgian data on firm-to-firm sales relationships merged with a matched employer-employee dataset, we find that workers are connected through the sparse networks of employers and frequently move to buyers or suppliers of their current employers. Movers within these production networks climb up job ladders at a faster pace but with smaller immediate earnings gains than other movers. Motivated by these findings, we develop and estimate an equilibrium model of firm-to-firm trade and on-the-job search. We estimate a higher job-finding rate along production networks, which enables well-connected firms to suppress wages. Accounting for the network search channel increases workers' exposure to correlated shocks in production networks.
Firm Responses and Wage Effects of Foreign Demand Shocks with Fixed Labor Costs and Monopsony with Emmanuel Dhyne, Ayumu Ken Kikkawa, Magne Mogstad, and Felix Tintelnot, 2025
Conditionally accepted by American Economic Review
Abstract: We quantify the firm responses and real wage effects of foreign demand shocks. We use Belgian micro data to construct firm-specific measures of demand shocks which capture that firms pass on foreign demand shocks to domestic suppliers. Our estimates of firm responses to these shocks suggest that firms face upward-sloping labor supply curves and have sizable fixed labor costs. We specify a general equilibrium model with these features to quantify the aggregate effects of simulated tariff shocks on wages. We find that ignoring fixed labor costs substantially underestimates aggregate effects on wages, whereas incorporating upward-sloping labor supply appears less consequential.
Taiwanese Domestic Supply Chains: 2013-2023 with Teddy Chen, Joonkyo Hong, Jin-Tan Liu, and Jen-Kuan Wang, 2025
The Belgian Business-to-Business Transactions Dataset 2002-2021 with Emmanuel Dhyne and Cédric Duprez, NBB Working Paper No 444, 2023
Dual Labor Market and Domestic Outsourcing: Evidence from Belgium with Emmanuel Dhyne
Firm Life Cycle, Endogenous Production Networks, and Frictional Labor Market with Emmanuel Dhyne and Xianglong Kong
Age Sorting in the Labor Market with Hyejin Park