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Search, Applications and Vacancies

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  • Steven Stern

Abstract

This paper examines a generalized rivalry problem in the labour market. It employs a simple labour supply model as a framework to analyse labour markets characterized by search with competition among searchers. First, the labour market process for new hires is described. The searching worker's opportunities are determined by the market parameter which is the probability that an application will not generate a job offer. The model is closed by determining the value of the market parameter given the search strategy that each worker individually follows. There exists a non-trivial eqUilibrium in steady state. At this equilibrium a social planner can improve each worker's welfare by inducing each worker to search less intensively.

Suggested Citation

  • Steven Stern, 1990. "Search, Applications and Vacancies," Virginia Economics Online Papers 398, University of Virginia, Department of Economics.
    • Handle: RePEc:vir:virpap:398
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    References listed on IDEAS

    as
    1. Diamond, P. A. & Maskin, Eric, 1981. "An equilibrium analysis of search and breach of contract II. A non-steady state example," Journal of Economic Theory, Elsevier, vol. 25(2), pages 165-195, October.
    2. Dale T. Mortensen, 1981. "The Economics of Mating," Discussion Papers 482S, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
    3. Diamond, Peter A, 1984. "Money in Search Equilibrium," Econometrica, Econometric Society, vol. 52(1), pages 1-20, January.
    4. Diamond, Peter A, 1981. "Mobility Costs, Frictional Unemployment, and Efficiency," Journal of Political Economy, University of Chicago Press, vol. 89(4), pages 798-812, August.
    5. John M. Barron & Otis W. Gilley, 1979. "The Effect of Unemployment Insurance on the Search Process," ILR Review, Cornell University, ILR School, vol. 32(3), pages 363-366, April.
    6. Wilde, Louis L., 1977. "Labor market equilibrium under nonsequential search," Journal of Economic Theory, Elsevier, vol. 16(2), pages 373-393, December.
    7. Kim B. Clark & Lawrence H. Summers, 1982. "Unemployment Insurance and Labor Force Transitions," NBER Working Papers 0920, National Bureau of Economic Research, Inc.
    8. Peter A. Diamond, 1982. "Wage Determination and Efficiency in Search Equilibrium," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 49(2), pages 217-227.
    9. Glenn C. Loury, 1979. "Market Structure and Innovation," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 93(3), pages 395-410.
    10. Peter A. Diamond & Eric Maskin, 1979. "An Equilibrium Analysis of Search and Breach of Contract, I: Steady States," Bell Journal of Economics, The RAND Corporation, vol. 10(1), pages 282-316, Spring.
    11. Christopher A. Pissarides, 1985. "Taxes, Subsidies and Equilibrium Unemployment," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 52(1), pages 121-133.
    12. Lucas, Robert Jr. & Prescott, Edward C., 1974. "Equilibrium search and unemployment," Journal of Economic Theory, Elsevier, vol. 7(2), pages 188-209, February.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    search;

    JEL classification:

    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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