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Directed search with multiple job applications

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  • Galenianos, Manolis
  • Kircher, Philipp

Abstract

We develop an equilibrium directed search model of the labor market where workers can simultaneously apply for multiple jobs. Our main theoretical contribution is to integrate the portfolio choice problem faced by workers into an equilibrium framework. All equilibria of our model exhibit wage dispersion. Consistent with stylized facts, the density of wages is decreasing and higher wage firms receive more applications per vacancy. Unlike most models of directed search, the equilibria are not constrained efficient.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Economic Theory.

Volume (Year): 144 (2009)
Issue (Month): 2 (March)
Pages: 445-471

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Handle: RePEc:eee:jetheo:v:144:y:2009:i:2:p:445-471

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Web page: http://www.elsevier.com/locate/inca/622869

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Keywords: Directed search Multiple applications Portfolio choice;

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