부산대학교 도서관

We develop a model of late in life job search that accounts for end of life labor force exit and re-entry. Our key assumptions are that job offers consist of both wage and complex non-wage characteristics and that older workers care more about the non-wage characteristics of a job. In equilibrium, young workers choose jobs with high wages, but poor non-wage characteristics, while older workers are willing to trade off lower wages for better non-wage characteristics. However, due to rational inattention, older workers may ex-post regrettably accept low wage jobs with poor non-wage characteristics. Such mistakes produce welfare losses and generate employment patterns in the model consistent with the empirical patterns of older US workers.