Equilibrium Directed Search with Multiple Applications
James Albrecht (),
Pieter Gautier () and
Susan Vroman ()
No 03-004/3, Tinbergen Institute Discussion Papers from Tinbergen Institute
We analyse a model of equilibrium directed search in a large labour market. Each worker, observing the wages posted at all vacancies, makes a fixed, finite number of applications, a. We allow for the possibility of ex post competition should more than one vacancy want to hire the same worker. For each a, there is a unique symmetric equilibrium in which all vacancies post the same wage. When a= 1, the common posted wage lies between the competitive and monopsony levels, and equilibrium is efficient. When a > 1, all vacancies post the monopsony wage. Some workers fail to find a job, some find a job at the monopsony wage, and some—those for whom there is competition—get the competitive wage. Equilibrium is inefficient when a > 1; in particular, there is excessive vacancy creation. See the publication in the Review of Economic Studies , 2006, 73(4) 869-91.
Keywords: directed search; matching; wage dispersion; efficiency. (search for similar items in EconPapers)
JEL-codes: J64 D83 J41 (search for similar items in EconPapers)
Date: 2003-01-09, Revised 2004-02-14
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Journal Article: Equilibrium Directed Search with Multiple Applications (2006)
Working Paper: Equilibrium Directed Search with Multiple Applications (2004)
Working Paper: Equilibrium Directed Search with Multiple Application (2003)
Working Paper: Equilibrium Directed Search with Multiple Applications (2003)
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Persistent link: https://EconPapers.repec.org/RePEc:tin:wpaper:20030004
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