Choosy search and the mismatch of talents

Decreuse, Bruno (2003): Choosy search and the mismatch of talents.

Abstract

This paper proposes a multi-sector matching model where workers have (symmetric) sector-specific skills and the search market is segmented by sector. Workers choose the range of markets they are willing to participate in. I identify a composition externality: workers do not take into account the impact of their choice on sector-specific mean productivity among the pools of job-seekers. Consequently, workers prospect too many market segments, and there is room for public policy even when the so-called Hosios condition holds.

• Item Type: MPRA Paper
• Institution: GREQAM
• Language: English
• Keywords: Composition effects; Heterogeneity; Segmented markets; Efficiency
• Subjects: J - Labor and Demographic Economics > J6 - Mobility, Unemployment, Vacancies, and Immigrant Workers > J64 - Unemployment: Models, Duration, Incidence, and Job Search; D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D83 - Search ; Learning ; Information and Knowledge ; Communication ; Belief ; Unawareness; D - Microeconomics > D6 - Welfare Economics > D62 - Externalities

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