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A model of globalization and firm-worker matching: How good is good enough?

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Author Info

  • Davidson, Carl
  • Matusz, Steven J.

Abstract

More able workers are more productive than less able workers, but their outside opportunities also allow them to command a higher wage. As a result, it is not clear which workers firms will prefer to hire. Moreover, with worker heterogeneity and labor market frictions, firms may not always get their first choice of worker. We investigate circumstances under which the second best is good enough, and show how globalization can either narrow or broaden the conditions under which second best is acceptable.

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Bibliographic Info

Article provided by Elsevier in its journal International Review of Economics & Finance.

Volume (Year): 23 (2012)
Issue (Month): C ()
Pages: 5-15

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Handle: RePEc:eee:reveco:v:23:y:2012:i:c:p:5-15

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Web page: http://www.elsevier.com/locate/inca/620165

Related research

Keywords: Globalization; Worker-firm mismatch; Heterogeneity;

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Cited by:
  1. Schmerer, Hans-Jörg, 2014. "Foreign direct investment and search unemployment: Theory and evidence," International Review of Economics & Finance, Elsevier, vol. 30(C), pages 41-56.
  2. Gene M. Grossman, 2013. "Heterogeneous Workers and International Trade," NBER Working Papers 18788, National Bureau of Economic Research, Inc.

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