Is Nepotism Inevitable Under Search and Matching Friction?

Debojyoti Mazumder and Rajit Biswas

MPRA Paper from University Library of Munich, Germany

Abstract: The present article develops a search and matching framework to model political nepotism in the job market. The model argues that labor market friction generates incentives for the political leaders to provide nepotism under a democratic set up. Both the leaders optimally choose nepotism when the labor market friction is higher. It is shown that even for a relatively lesser labor market friction at least one leader would always choose nepotism. The results of the basic model remain robust in an extension where followers can pay a price and choose their allegiance, to any one of the political parties.

Keywords: search and matching; nepotism; political regime change (search for similar items in EconPapers)
JEL-codes: D72 J64 J71 (search for similar items in EconPapers)
Date: 2018-11-02
New Economics Papers: this item is included in nep-cdm, nep-dge and nep-lma
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:89836

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