Does bargaining matter in the small firms matching model?

Olivier L’haridon (), Franck Malherbet and Sebastien Perez-Duarte
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Olivier L’haridon: CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR - Université de Rennes - CNRS - Centre National de la Recherche Scientifique, IUF - Institut universitaire de France - M.E.N.E.S.R. - Ministère de l'Education nationale, de l’Enseignement supérieur et de la Recherche, TEPP - Travail, Emploi et Politiques Publiques - UPEM - Université Paris-Est Marne-la-Vallée - CNRS - Centre National de la Recherche Scientifique
Authors registered in the RePEc Author Service: Olivier L'Haridon

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Abstract: In this article, we use a stylized model of the labor market to investigate the effects of three alternative and well-known bargaining solutions. We apply the Nash, the Egalitarian and the Kalai-Smorodinsky bargaining solutions in the small firm's matching model of unemployment. First, we show that the Egalitarian and the Kalai-Smorodinsky solutions are easily implementable within search-matching economies. Second, our results show that even though the traditional results of bargaining theory apply in the context of search-matching economies, they are quantitatively weaker than expected compared to the results established in the earlier literature. In addition, and excluding a model with on-the-job search, it appears that the policy implications of labor taxes and employment protection are not very sensitive to the choice of the bargaining solution.

Keywords: Search and matching models; bargaining theory; Nash; egalitarian; Kalai-Smorodinsky (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (6)

Published in Labour Economics, 2013, 21, pp.42-58. ⟨10.1016/j.labeco.2012.12.002⟩

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Related works:
Journal Article: Does bargaining matter in the small firms matching model? (2013)
Working Paper: Does bargaining matter in the small firm's matching model? (2011)
Working Paper: Does Bargaining Matter in the Small Firm’s Matching Model? (2011)
Working Paper: Does bargaining matter in the small firm's matching Mmodel? (2010)
Working Paper: Does Bargaining Matter in the Small Firm's Matching Model? (2010)
Working Paper: Does Bargaining Matter in the Small Firm Matching Model? (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-00801343

DOI: 10.1016/j.labeco.2012.12.002

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