The Balance Condition in Search-and-Matching Models

Stephan Lauermann, Georg Nöldeke and Thomas Tröger ()
Authors registered in the RePEc Author Service: Thomas Troeger

CRC TR 224 Discussion Paper Series from University of Bonn and University of Mannheim, Germany

Abstract: Most of the literature that studies frictional search-and-matching models with heterogeneous agents and random search investigates steady-state equilibria. Steady-state equilibrium requires, in particular, that the flows of agents into and out of the population of unmatched agents balance. We investigate the structure of this balance condition, taking agents' matching behavior as given. Building on the "fundamental matching lemma" for quadratic search technologies in Shimer and Smith (2000), we establish existence, uniqueness, and comparative-static properties of the solution to the balance condition for any search technology satisfying minimal regularity conditions. Implications for the existence and structure of steady-state equilibria are noted.

Keywords: Search; Matching; Steady State (search for similar items in EconPapers)
Pages: 29
Date: 2019-08
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Journal Article: The Balance Condition in Search‐and‐Matching Models (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:bon:boncrc:crctr224_2019_120

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