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Worker Selection, Hiring, and Vacancies

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  • Ismail Baydur

Abstract

This paper incorporates worker selection into a random matching model with multi-worker firms. Unlike the standard Diamond-Mortensen-Pissarides (DMP) model, the extended model is compatible with cross-sectional behavior of vacancy yields, which rise with employment growth and worker turnover, but fall with establishment size. Using calibrated versions of the standard and worker selection models, I show that accounting for these patterns has quantitatively important policy implications. I also compare the worker selection and the directed search models. While both models account for these patterns equally well, they differ with regard to labor market policy.

Suggested Citation

  • Ismail Baydur, 2017. "Worker Selection, Hiring, and Vacancies," American Economic Journal: Macroeconomics, American Economic Association, vol. 9(1), pages 88-127, January.
    • Handle: RePEc:aea:aejmac:v:9:y:2017:i:1:p:88-127
    Note: DOI: 10.1257/mac.20140260
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    Cited by:

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    2. Hochmuth, Brigitte & Kohlbrecher, Britta & Merkl, Christian & Gartner, Hermann, 2021. "Hartz IV and the decline of German unemployment: A macroeconomic evaluation," Journal of Economic Dynamics and Control, Elsevier, vol. 127(C).
    3. Kohlbrecher, Britta & Merkl, Christian, 2022. "Business cycle asymmetries and the labor market," Journal of Macroeconomics, Elsevier, vol. 73(C).
    4. Jessalynn James & Matthew A. Kraft & John P. Papay, 2023. "Local supply, temporal dynamics, and unrealized potential in teacher hiring," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 42(4), pages 1010-1044, September.
    5. Chugh, Sanjay K. & Lechthaler, Wolfgang & Merkl, Christian, 2018. "Optimal fiscal policy with labor selection," Journal of Economic Dynamics and Control, Elsevier, vol. 94(C), pages 142-189.
    6. Lochner, Ben & Merkl, Christian & Stüber, Heiko & Gürtzgen, Nicole, 2019. "A note on recruiting intensity and hiring practices: Cross-sectional and time-series evidence," FAU Discussion Papers in Economics 04/2019, Friedrich-Alexander University Erlangen-Nuremberg, Institute for Economics, revised 2019.
    7. Sahin Avcioglu & Bilgehan Karabay, 2020. "Labor market regulation under self‐enforcing contracts," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 22(6), pages 1965-2018, December.
    8. Lochner, Benjamin & Merkl, Christian & Stüber, Heiko & Gürtzgen, Nicole, 2021. "Recruiting intensity and hiring practices: Cross-sectional and time-series evidence," Labour Economics, Elsevier, vol. 68(C).
    9. Eliason, Marcus & Hensvik, Lena & Kramarz, Francis & Nordström Skans, Oskar, 2017. "The causal impact of social Connections on firms' outcomes," Working Paper Series 2017:11, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    10. Sengul, Gonul, 2017. "Learning about match quality: Information flows and labor market outcomes," Labour Economics, Elsevier, vol. 46(C), pages 118-130.

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    More about this item

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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