Unraveling Results from Comparable Demand and Supply: An Experimental Investigation

Muriel Niederle (), Alvin Roth () and M. Utku Ünver

No 15006, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Markets sometimes unravel, with offers becoming inefficiently early. Often this is attributed to competition arising from an imbalance of demand and supply, typically excess demand for workers. However this presents a puzzle, since unraveling can only occur when firms are willing to make early offers and workers are willing to accept them. We present a model and experiment in which workers' quality becomes known only in the late part of the market. However, in equilibrium, matching can occur (inefficiently) early only when there is comparable demand and supply: a surplus of applicants, but a shortage of high quality applicants.

JEL-codes: C78 C9 C92 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-exp
Date: 2009-05
Note: LS
View list of references

Downloads: (external link)
http://www.nber.org/papers/w15006.pdf (application/pdf)
Access to the full text is generally limited to series subscribers, however if the top level domain of the client browser is in a developing country or transition economy free access is provided. More information about subscriptions and free access is available at http://www.nber.org/wwphelp.html.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:nbr:nberwo:15006

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w15006
The price is Paper copy available by mail.

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc
Address: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.
Contact information at EDIRC.
Series data maintained by ().