Aggregate recruiting intensity

Alessandro Gavazza, Simon Mongey and Giovanni L Violante

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: We develop an equilibrium model of firm dynamics with random search in the labor market where hiring firms exert recruiting effort by spending resources to fill vacancies faster. Consistent with microevidence, fast-growing firms invest more in recruiting activities and achieve higher job-filling rates. These hiring decisions of firms aggregate into an index of economywide recruiting intensity. We study how aggregate shocks transmit to recruiting intensity, and whether this channel can account for the dynamics of aggregate matching efficiency during the Great Recession. Productivity and financial shocks lead to sizable pro-cyclical fluctuations in matching efficiency through recruiting effort. Quantitatively, the main mechanism is that firms attain their employment targets by adjusting their recruiting effort in response to movements in labor market slackness

JEL-codes: J01 J1 R14 (search for similar items in EconPapers)
Date: 2018-08-01
New Economics Papers: this item is included in nep-dge
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Citations: View citations in EconPapers (49)

Published in American Economic Review, 1, August, 2018, 108(8), pp. 2088-2127. ISSN: 0002-8282

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http://eprints.lse.ac.uk/85652/ Open access version. (application/pdf)

Related works:
Journal Article: Aggregate Recruiting Intensity (2018)
Working Paper: Aggregate Recruiting Intensity (2017)
Working Paper: Aggregate recruiting intensity (2016)
Working Paper: Aggregate Recruiting Intensity (2016)
Working Paper: Aggregate recruiting intensity (2016)
Working Paper: Aggregate Recruiting Intensity (2016)
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