The Assignment of Workers to Jobs in an Economy with Coordination Frictions.
This paper studies the assignment of heterogeneous workers to heterogeneous jobs. Owing to the anonymity of a large labor market, workers use mixed strategies when applying for jobs. This randomness generates coordination frictions. Two workers may apply for a particular job, whereas an identical jo...
| Published in: | Journal of Political Economy Vol. 113; no. 5; pp. 996 - 1026 |
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| Format: | Article |
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University of Chicago Press
October 2005
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| Subjects: | |
| Online Access: | View this record in EBSCOhost |
| Summary: | This paper studies the assignment of heterogeneous workers to heterogeneous jobs. Owing to the anonymity of a large labor market, workers use mixed strategies when applying for jobs. This randomness generates coordination frictions. Two workers may apply for a particular job, whereas an identical job gets no applications. The model generates assortative matching, with a positive but imperfect correlation between matched workers' and firms' types. It predicts that a worker's wage is increasing in her job's productivity and a firm's profit is increasing in its employees' productivity. The model also yields a version of the welfare theorems. Reprinted by permission of the publisher. |
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