Search Intensity, Directed Search, And The Wage Distribution
AbstractWe propose a search equilibrium model in which homogenous rms post wages along with a vacancy to attract job-seekers, while homogenous unemployed workers invest in costly job-seeking. The key innovation relies on the organization of the search market and the search behavior of the job-seekers. The search market is continuously segmented by wage level, individuals can spread their search investment over the diÂ¤erent sub-markets, and search intensity has marginal decreasing returns on each sub-market. We show that there exists a non-degenerate equilibrium wage distribution. The density of this wage distribution is increasing at low wages, and decreasing at high wages. Under additional restrictions, it is hump-shaped, and it can be right-tailed. Our results are illustrated by an example originating a Beta wage distribution.
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Bibliographic InfoArticle provided by European Economic Association in its journal Journal of the European Economic Association.
Volume (Year): 9 (2011)
Issue (Month): 6 (December)
Other versions of this item:
- Bruno Decreuse & André Zylberberg, 2011. "Search Intensity, Directed Search And The Wage Distribution," UniversitÃ© Paris1 PanthÃ©on-Sorbonne (Post-Print and Working Papers) halshs-00638150, HAL.
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