Economic Journal, volume 126, issue 594, pp. 1342-1371, August 2016.
Job characteristics can affect worker turnover through their effect on utility and through their effect on outside job opportunities. The aim of this study is to identify and estimate the roles of these two channels separately. Our method exploits information on job changes, and relies on an augmented sample selection correction. To illustrate our approach, we use an exhaustive register of Dutch primary school teachers and show a detailed picture of preferences for school characteristics. We also find that the dependence between current and outside job attributes can affect turnover and thus the allocation of teachers across schools.