Matching and Price Competition

Jeremy Bulow and Jonathan Levin

American Economic Review, 2006, vol. 96, issue 3, 652-668

Abstract: We develop a model in which firms set impersonal salary levels before matching with workers. Wages fall relative to any competitive equilibrium while profits rise almost as much, implying little inefficiency. Furthermore, the best firms gain the most from the system while wages become compressed. In light of our results, we discuss the performance of alternative institutions and the recent antitrust case against the National Resident Matching Program. (JEL D44, J41, L44)

Date: 2006
Note: DOI: 10.1257/aer.96.3.652
References: Add references at CitEc
Citations: View citations in EconPapers (98)

Downloads: (external link)
http://www.aeaweb.org/articles.php?doi=10.1257/aer.96.3.652 (application/pdf)
Access to full text is restricted to AEA members and institutional subscribers.

Related works:
Working Paper: Matching and Price Competition (2005)
Working Paper: Matching and Price Competition (2004)
Working Paper: Matching and Price Competition (2003)
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: https://EconPapers.repec.org/RePEc:aea:aecrev:v:96:y:2006:i:3:p:652-668

Ordering information: This journal article can be ordered from
https://www.aeaweb.org/journals/subscriptions

Access Statistics for this article

American Economic Review is currently edited by Esther Duflo

More articles in American Economic Review from American Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Michael P. Albert ().