Too rich to do the dirty work? Job quality, search and wealth

Abstract

This paper uses panel data on jobs and windfalls to investigate the impact of wealth on job choices in a framework of multidimensional jobs. In a labour market characterised by informational frictions, windfalls (lottery wins, inheritance...) are expected to affect job durations differentially depending on job quality (here measured by subjective job satisfaction). The impact of unanticipated wealth shocks on the demand for job characteristics can be reconstructed to test the hypothesis that rich people are more interested in good quality jobs. Tracking transitions after wealth shocks (both between jobs and to non-participation) provides a new strategy for assessing demand for non-monetary job characteristics.
A preliminary model allowing for endogenous changes in wealth (i.e. capital accumulation) in a qualitative labour market is sketched. The implications of allowing workers to save part of their earnings in a job search model are considered. (This is work in progress.)