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Endogenous Inequality in Integrated Labor Markets with Two-Sided Search Author info | Abstract | Publisher info | Download info | Related research | Statistics George J. Mailath
Larry Samuelson
Avner Shaked
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We consider a market with "red" and "green" workers, where labels are payoff irrelevant. Workers may acquire skills. Skilled workers search for vacancies, while firms search for workers. A unique symmetric equilibrium exists in which color is irrelevant. There are also asymmetric equilibria in which firms search only for green workers, more green than red workers acquire skills, skilled green workers receive higher wages, and the unemployment rate is higher among skilled red workers. Discrimination between ex ante identical individuals arises in equilibrium, and yet firms have perfect information about their workers, and strictly prefer to hire minority workers.
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Article provided by American Economic Association in its journal American Economic Review .
Volume (Year): 90 (2000)
Issue (Month): 1 (March)
Pages: 46-72
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Handle: RePEc:aea:aecrev:v:90:y:2000:i:1:p:46-72Contact details of provider: Email: Web page: http://www.aeaweb.org/aer/ More information through EDIRC
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SEABRIGHT, Paul, 2004.
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Adrian Masters, 2004.
"Firm level hiring policy with culturally biased testing ,"
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Luca Flabbi, 2005.
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Other versions: Nicola Persico, 2002.
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