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Endogenous Labour Market Segmentation in a Matching Model

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  • Alan Manning

Abstract

This paper extends work by Burdett and Mortensen (1989) and Mortensen and Vishwanath (1991) and examines equilibria in a matching model with identical firms and workers in which employed as well as unemployed workers receive wage offers. It shows that there are generally a continuum of equilibria often of a form that resembles labour market segmentation in that there are some firms paying high wages and facing excess supply of labour and some firms paying low wages with an excess demand for labour. The implication of the model are explored.

Suggested Citation

  • Alan Manning, 1993. "Endogenous Labour Market Segmentation in a Matching Model," CEP Discussion Papers dp0126, Centre for Economic Performance, LSE.
    • Handle: RePEc:cep:cepdps:dp0126
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    Cited by:

    1. van den Berg, Gerard J, 1999. "Empirical Inference with Equilibrium Search Models of the Labour Market," Economic Journal, Royal Economic Society, vol. 109(456), pages 283-306, June.
    2. J. Ignacio Garcia-Perez, 2002. "Equilibrium search models: the role of the assumptions," Investigaciones Economicas, Fundación SEPI, vol. 26(2), pages 255-284, May.
    3. Garloff, Alfred, 2008. "Minimum wages, wage dispersion and unemployment : a review on new search models," IAB-Discussion Paper 200833, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].

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