Search, Screening and Sorting

Xiaoming Cai (), Pieter Gautier and Ronald Wolthoff
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Xiaoming Cai: Peking University

No 14501, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We investigate the effect of search frictions on labor market sorting by constructing a model which is in line with recent evidence that employers collect a pool of applicants before interviewing a subset of them. In this environment, we derive the necessary and sufficient conditions for sorting in applications as well as matches. We show that positive sorting is obtained when production complementarities outweigh a force against sorting measured by a quality-quantity elasticity. Interestingly, we find that the required degree of production complementarity for positive sorting is increasing in the number of interviews: it ranges from square-root-supermodularity if each firm can interview a single applicant to log-supermodularity if each firm can interview all its applicants.

Keywords: information frictions; search frictions; complementarity; sorting; heterogeneity (search for similar items in EconPapers)
JEL-codes: C78 D82 D83 E24 (search for similar items in EconPapers)
Pages: 70 pages
Date: 2021-06
New Economics Papers: this item is included in nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Forthcoming - forthcoming in: American Economic Journal: Macroeconomics

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Related works:
Working Paper: Search, Screening and Sorting (2022)
Working Paper: Search, Screening and Sorting (2021)
Working Paper: Search, Screening and Sorting (2021)
Working Paper: Search, Screening and Sorting (2021)
Working Paper: Search, Screening and Sorting (2021)
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