@TechReport{iza:izadps:dp8439, author={Abowd, John M. and Kramarz, Francis and Pérez-Duarte, Sébastien and Schmutte, Ian M.}, title={Sorting Between and Within Industries: A Testable Model of Assortative Matching}, year={2014}, month={Aug}, institution={Institute of Labor Economics (IZA)}, address={Bonn}, type={IZA Discussion Paper}, number={8439}, url={https://www.iza.org/publications/dp8439}, abstract={We test for sorting of workers between and within industrial sectors in a directed search model with coordination frictions. We fit the model to sector-specific vacancy and output data along with publicly-available statistics that characterize the distribution of worker and employer wage heterogeneity across sectors. Our empirical method is general and can be applied to a broad class of assignment models. The results indicate that industries are the loci of sorting-more productive workers are employed in more productive industries. The evidence confirms assortative matching can be present even when worker and employer components of wage heterogeneity are weakly correlated.}, keywords={industries;sorting}, }