JobSearch.nlogo

;a simple model of job search and unemployment benefits

Globals [
minimumWage
UI
productivity
priceofgoods
unemploymentrate-list
]


breed [firms firm]
breed [workers worker]
directed-link-breed [jobs job]
links-own [wage]

firms-own [hiring? maxValue numberofworkers numberofjobs wageoffer lastwageoffer profit periodsofloss]
workers-own [reservationWage timeUnemployed employed? currentwage previouswage moneyinthebank firmoffer UIbenefit]

to setup ; initialize workers and firms, set shape of the agents and spread them
         ; throughout the x y space. set firm shape and size based on numberofworkers
         ; initialize reservationWage values over interval [c,maxWage], where c
         ; where c is ifelse function of a constant, or unemployment benefit minimum
         ; initialize wageoffer values over interval [minWageOffer,maxWage]
         ; where minWageOffer is either 0 or minimum wage level set by government
clear-all
  ;Globals
  set unemploymentrate-list []
  set minimumWage minwage

  set UI unemploymentInsurance
  set productivity 2
  set priceofgoods 10

  create-firms NumberofFirms [
    setxy random 32 random 32
    set shape "square"
    set size 1
    set color yellow
    set maxValue (minimumWage + random (50))
    set numberofworkers 1
    set numberofjobs 1
    set wageoffer 0
    set lastwageoffer 0
    set hiring? true
    set periodsofloss 0
  ]

  create-workers LaborForce [
    setxy random 32 random 32
    set shape "person"
    set size .75
    set color green
    set reservationWage random (50)
    set employed? false
    set previouswage 0
    set moneyinthebank 0
    set UIbenefit UI
  ]

reset-ticks
end

to go
  do-jobmatch ; the main function of job search with wage contracts
  calculate-profit ; this block calculates profit and 'kills' firms or grows firms
  collect-benefits; provides unemployment insurance to unmatched workers
  job-destruction; we will have the option of randomly destroying links
  calc-unemployment; update graph of unemployment rate, number of firms, wage statistics
  tick
  if ticks > 2000 [stop]
end

;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;;
to do-jobmatch
  ask workers with [not any? my-links][
    ifelse employed? = false [ ;            trying to do this for all employees
      let candidatefirms firms in-radius 5 with [hiring? = true]
      ifelse any? candidatefirms [
        let targetfirm min-one-of candidatefirms [distance myself]
        move-to targetfirm
        set firmOffer [maxValue] of one-of firms-here ; one-of firms-here
        ifelse firmOffer > reservationWage [
          set currentwage firmOffer
          ifelse currentwage >= UIBenefit [
              create-job-to one-of firms-here[ set hidden? true] ;WHY CAN"T I SET link.wage = wageoffer??
              set employed? true
            set timeunemployed 0
              ask one-of firms-here [
                set numberofworkers count my-links
                set size 1 + (numberofworkers / 100)
                set wageoffer [currentwage] of myself ]
      ]
        [ set employed? false
          set currentwage UIBenefit
          set color red
          set timeunemployed timeunemployed + 1
        ]
      ]
       [
        set employed? false
        set currentwage UI
        set color red
        set timeunemployed timeunemployed + 1
    ]
  ]
    [face one-of other firms
      fd 1]
  ]
    [set previouswage currentwage
      set moneyinthebank moneyinthebank + previouswage
    ]
  ]
end

;;;;;;;;;;;;;;;;;;;;;;;;;;;;
to calculate-profit
  ask firms [
    let totalcost  numberofworkers * wageoffer
    let output  numberofworkers * productivity
    set profit  (output * priceofgoods) - totalcost
  ifelse profit < 0 [
      ifelse maxValue > minimumWage [set maxValue maxValue - 1] [set maxValue minimumWage] ; reduce wage offer
      set periodsofloss periodsofloss + 1
    ]
    [set periodsofloss 0]
    if periodsofloss >= 10 [
      die]
    ;ifelse numberofworkers > 100 [set hiring? false] [set hiring? true]
  ]

  histogram [profit] of firms
  histogram [numberofworkers] of firms
  histogram [timeunemployed] of workers
end



;;;;;;;;;;;;;;;;;
to collect-benefits
  ask workers with [employed? = false] [
    ifelse timeunemployed < 10
    [ set UIbenefit UI]
  [set UIbenefit 0]
]
end


;;;;;;;;;;;;;;;;;;;;;;;;
to job-destruction
  let %d jobdestructionrate ; where 10% is the job destruction rate
  let n count jobs
  ask (n-of (%d * n) jobs) [die]
  ask workers with [not any? my-links]
  [set employed? false]

  if count firms < 10 [
    create-firms 3 [
    setxy random 32 random 32
    set shape "square"
    set size 1
    set color yellow
    set maxValue (minimumWage + random-float (40))
    set numberofworkers 0
    set numberofjobs 0
    set wageoffer 0
    set lastwageoffer 0
    set hiring? true
    set periodsofloss 0
      ]
  ]

end

to calc-unemployment
  let currentUnemploymentRate 0
  let avg-unemployment 0
  let a count workers with [employed? = false]
  let b count workers
  set currentUnemploymentRate (a / b)
  set unemploymentrate-list lput (count workers with [employed? = false] / (count workers)) unemploymentrate-list
  set avg-unemployment (mean unemploymentrate-list)

  ;let unemploymentrate  ((count workers with [employed? = false])/(count workers))

  ;let unemploymentspell max (timeunemployed)
  ;let averagewage mean (wageoffer)

end


;  in the first iteration of this model we are going to keep it simple:
;     we will not update unemployment insurance to reflect people's last wage
;     we will also not have firms update their wageoffer downward after a success or
;       upward following unsuccess
;     we will allow firm growth to be unlimited, and have firms be able to die, but not
;        be born
;     we will have a switch to have on random job destruction
;     we will not have agents decide whether or not they want to work based on
;        money in the bank
@#$#@#$#@
GRAPHICS-WINDOW
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SLIDER
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LaborForce
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BUTTON
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setup
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T
OBSERVER
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SLIDER
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go
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T
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T
OBSERVER
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Number

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go
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T
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PLOT
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Unemployment Rate
ticks
unemployment rate
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false
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"" ""
PENS
"default" 1.0 0 -16777216 true "" "plot (count workers with [employed? = false] / (count workers))"

SLIDER
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20
907
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MinWage
MinWage
0
50
25.0
1
1
NIL
HORIZONTAL

SLIDER
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55
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unemploymentInsurance
unemploymentInsurance
0
50
20.0
1
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NIL
HORIZONTAL

MONITOR
5
150
98
195
average wage
mean [currentwage] of workers with [employed? = true]
3
1
11

MONITOR
100
150
205
195
employed number
count workers with [employed? = true]
17
1
11

MONITOR
5
255
147
300
max wage offer by firm
max [maxValue] of firms
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1
11

MONITOR
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94
405
count of firms
count firms
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1
11

PLOT
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925
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histogram
NIL
NIL
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0.0
111.0
false
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"" ""
PENS
"default" 1.0 1 -16777216 true "" "histogram [timeunemployed] of workers"

MONITOR
5
310
140
355
Lowest Firm Wage Offer
min [maxValue] of firms
3
1
11

MONITOR
100
360
212
405
size of largest firm
max [numberofworkers] of firms
2
1
11

MONITOR
5
205
100
250
Mean Unemployment Spell
mean [timeunemployed] of workers
3
1
11

MONITOR
110
205
205
250
max unemployment spell
max [timeunemployed] of workers
17
1
11

MONITOR
230
360
292
405
sd unemp
standard-deviation unemploymentrate-list
3
1
11

MONITOR
310
360
382
405
avg unemp
mean  unemploymentrate-list
3
1
11

@#$#@#$#@
## WHAT IS IT?

This is a simple model of job search and unemployment dynamics using zero intelligence agents. 

## HOW IT WORKS

Two main types of agents in this model: workers and firms. 
Workers - these agents are created and assigned a random value from a uniform distribution that is their reservation wage.
Firms - these agents are created and assigned a random value (maxValue) from a uniform distribution that they are willing to pay for labor. Firms use exogenous variables price and labor productivity to create and sell output. Firms keep track of their profits, positive or negative.

Every period, unemployed workers move to their nearest firm. If the wage offer of the firm exceeds the worker's reservation wage, and exceeds the unemployment benefit and the minimum wage, the worker will accept the offer and take the job. If the wage offer does not exceed this amount, the worker continues her search to another nearby firm. If no firm is nearby, they locate the nearest firm and move towards it while collecting unemployment benefits if any.

Firms calculate their profit every period. If they have negative profits, they reduce their wage offer by $1 in order to reduce costs. After 10 consecutive periods of negative profits, the firm dies.

Every period a percentage of jobs are randomly destroyed, leading to another job search of previously employed workers. 

If there are fewer than 10 firms at any point, new firms are created. There is no maximum number of workers any one firm may hire.

## HOW TO USE IT

Choose the numebr of workers and number of firms, along with the job destruction rate, the minimum wage, and unemployment benefits. Click Setup and then Go (forever). The simulation ends after 2000 iterations.

## THINGS TO NOTICE

Watch the monitors to see the average wage offer of workers with jobs, the number of firms that remain, and the largest firm size. The plots also show the unemployment rate over time, as well as a historgram of the length of unemployment spells experienced by workers. 

## THINGS TO TRY

Adjust the minimum wage and the unemployment benefit to isolate the effect of these policies on the unemployment rate and firm sizes. 

## EXTENDING THE MODEL

Too many to list here, but see the accompanying paper. 

@#$#@#$#@
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@#$#@#$#@
NetLogo 6.1.0
@#$#@#$#@
@#$#@#$#@
@#$#@#$#@
<experiments>
  <experiment name="baseline" repetitions="5" runMetricsEveryStep="false">
    <setup>setup</setup>
    <go>go</go>
    <metric>mean [currentwage] of workers with [employed? = TRUE]</metric>
    <metric>min [maxValue] of firms</metric>
    <metric>max [numberofworkers] of firms</metric>
    <metric>count firms</metric>
    <metric>mean unemploymentrate-list</metric>
    <metric>standard-deviation unemploymentrate-list</metric>
    <metric>mean [timeunemployed] of workers</metric>
    <enumeratedValueSet variable="jobdestructionrate">
      <value value="0.05"/>
    </enumeratedValueSet>
    <enumeratedValueSet variable="unemploymentInsurance">
      <value value="10"/>
    </enumeratedValueSet>
    <enumeratedValueSet variable="NumberOfFirms">
      <value value="50"/>
    </enumeratedValueSet>
    <enumeratedValueSet variable="MinWage">
      <value value="25"/>
    </enumeratedValueSet>
    <enumeratedValueSet variable="LaborForce">
      <value value="500"/>
    </enumeratedValueSet>
  </experiment>
  <experiment name="VaryingMinWage" repetitions="5" runMetricsEveryStep="false">
    <setup>setup</setup>
    <go>go</go>
    <metric>mean [currentwage] of workers with [employed? = TRUE]</metric>
    <metric>min [maxValue] of firms</metric>
    <metric>max [numberofworkers] of firms</metric>
    <metric>count firms</metric>
    <metric>mean unemploymentrate-list</metric>
    <metric>standard-deviation unemploymentrate-list</metric>
    <metric>mean [timeunemployed] of workers</metric>
    <enumeratedValueSet variable="jobdestructionrate">
      <value value="0.05"/>
    </enumeratedValueSet>
    <enumeratedValueSet variable="unemploymentInsurance">
      <value value="10"/>
    </enumeratedValueSet>
    <enumeratedValueSet variable="NumberOfFirms">
      <value value="50"/>
    </enumeratedValueSet>
    <enumeratedValueSet variable="MinWage">
      <value value="0"/>
      <value value="5"/>
      <value value="10"/>
      <value value="15"/>
      <value value="20"/>
      <value value="25"/>
    </enumeratedValueSet>
    <enumeratedValueSet variable="LaborForce">
      <value value="500"/>
    </enumeratedValueSet>
  </experiment>
  <experiment name="VaryingMinWage" repetitions="1" runMetricsEveryStep="false">
    <setup>setup</setup>
    <go>go</go>
    <metric>mean [currentwage] of workers with [employed? = TRUE]</metric>
    <metric>min [maxValue] of firms</metric>
    <metric>max [numberofworkers] of firms</metric>
    <metric>count firms</metric>
    <metric>mean unemploymentrate-list</metric>
    <metric>standard-deviation unemploymentrate-list</metric>
    <metric>mean [timeunemployed] of workers</metric>
    <enumeratedValueSet variable="jobdestructionrate">
      <value value="0.05"/>
    </enumeratedValueSet>
    <enumeratedValueSet variable="unemploymentInsurance">
      <value value="10"/>
    </enumeratedValueSet>
    <enumeratedValueSet variable="NumberOfFirms">
      <value value="50"/>
    </enumeratedValueSet>
    <enumeratedValueSet variable="MinWage">
      <value value="30"/>
      <value value="40"/>
    </enumeratedValueSet>
    <enumeratedValueSet variable="LaborForce">
      <value value="500"/>
    </enumeratedValueSet>
  </experiment>
  <experiment name="VaryingMinWage" repetitions="1" runMetricsEveryStep="false">
    <setup>setup</setup>
    <go>go</go>
    <metric>mean [currentwage] of workers with [employed? = TRUE]</metric>
    <metric>min [maxValue] of firms</metric>
    <metric>max [numberofworkers] of firms</metric>
    <metric>count firms</metric>
    <metric>mean unemploymentrate-list</metric>
    <metric>standard-deviation unemploymentrate-list</metric>
    <metric>mean [timeunemployed] of workers</metric>
    <enumeratedValueSet variable="jobdestructionrate">
      <value value="0.05"/>
    </enumeratedValueSet>
    <enumeratedValueSet variable="unemploymentInsurance">
      <value value="0"/>
      <value value="10"/>
      <value value="20"/>
      <value value="30"/>
      <value value="40"/>
      <value value="50"/>
    </enumeratedValueSet>
    <enumeratedValueSet variable="NumberOfFirms">
      <value value="50"/>
    </enumeratedValueSet>
    <enumeratedValueSet variable="MinWage">
      <value value="25"/>
    </enumeratedValueSet>
    <enumeratedValueSet variable="LaborForce">
      <value value="500"/>
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