Search, Screening and Sorting

Xiaoming Cai, Pieter Gautier and Ronald Wolthoff

Working Papers from University of Toronto, Department of Economics

Abstract: We investigate the effect of search frictions on labor market sorting by constructing a model which is in line with recent evidence that employers collect a pool of applicants before interviewing a subset of them. In this environment, we derive the necessary and sufficient conditions for sorting in applications as well as in matches. We show that positive sorting is obtained when production complementarities outweigh a force against sorting measured by a (novel) quality-quantity elasticity. Interestingly, we find that the required degree of production complementarity for positive sorting can be increasing in the number of interviews: for sorting to hold for any distribution of workers and firms, it ranges from square-root-supermodularity if each firm can interview a single applicant to log-supermodularity if each firm can interview all its applicants.

Keywords: sorting; complementarity; search frictions; information frictions; heterogeneity (search for similar items in EconPapers)
JEL-codes: D82 D83 E24 (search for similar items in EconPapers)
Pages: Unknown pages
Date: 2022-09-06
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https://www.economics.utoronto.ca/public/workingPapers/tecipa-735.pdf Main Text (application/pdf)

Related works:
Working Paper: Search, Screening and Sorting (2021)
Working Paper: Search, Screening and Sorting (2021)
Working Paper: Search, Screening and Sorting (2021)
Working Paper: Search, Screening and Sorting (2021)
Working Paper: Search, Screening and Sorting (2021)
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