@article{126,
  author = {Simon J{\"a}ger and J{\"o}rg Heining and Nathan Lazarus},
  title = {How Substitutable are Workers? Evidence from Worker Deaths},
  abstract = {<p>We estimate how exogenous worker exits affect firms{\textquoteright} demand for incumbent workers and new hires. Drawing on administrative data from Germany, we analyze 34,000 unexpected worker deaths, which, on average, raise the remaining workers{\textquoteright} wages and retention probabilities. The average effect masks substantial heterogeneity as positive wage effects are concentrated among coworkers in the same occupation as the deceased. We quantify the deviation from a frictionless benchmark model and structurally estimate the size of replacement costs implied by the reduced-form evidence. Our estimates imply large costs of replacing incumbent workers and thus point to substantial frictions in the labor market, especially in thin markets for skill.</p>},
  journal = {American Economic Review, conditionally accepted},
}