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Hierarchical Assignments: Stability and Fairness

Author

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  • Eriksson, Kimmo

    (Department of Mathematics)

  • Karlander, Johan

    (Department of Mathematics)

  • Öller, Lars-Erik

    (Dept. of Economic Statistics, Stockholm School of Economics)

Abstract

We study a simple model of the job market, where workers are assigned to employers. We specify conditions under which the market is hierarchical in a natural sense. For such hierarchies, we can state explicit values for the earnings in the worker-optimal and employer-optimal solutions. This is a discrete analogue to the Ricardian differential rent model of Sattinger (1979). We discuss the compatibility problems between fairness and stability of earnings and assignments and argue for a certain solution.

Suggested Citation

  • Eriksson, Kimmo & Karlander, Johan & Öller, Lars-Erik, 1997. "Hierarchical Assignments: Stability and Fairness," SSE/EFI Working Paper Series in Economics and Finance 201, Stockholm School of Economics.
    • Handle: RePEc:hhs:hastef:0201
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    References listed on IDEAS

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    1. Varian, Hal R., 1974. "Equity, envy, and efficiency," Journal of Economic Theory, Elsevier, vol. 9(1), pages 63-91, September.
    2. Roth,Alvin E. & Sotomayor,Marilda A. Oliveira, 1992. "Two-Sided Matching," Cambridge Books, Cambridge University Press, number 9780521437882, October.
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    7. Sattinger, Michael, 1993. "Assignment Models of the Distribution of Earnings," Journal of Economic Literature, American Economic Association, vol. 31(2), pages 831-880, June.
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    Cited by:

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    3. Meredith Beechey & Pär Österholm, 2014. "Central Bank Forecasts of Policy Interest Rates: An Evaluation of the First Years," Economic Notes, Banca Monte dei Paschi di Siena SpA, vol. 43(1), pages 63-78, February.
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    6. Lindén, Johan, 2004. "The Labor Market in KIMOD," Working Papers 89, National Institute of Economic Research.
    7. P�r Österholm, 2014. "Survey data and short-term forecasts of Swedish GDP growth," Applied Economics Letters, Taylor & Francis Journals, vol. 21(2), pages 135-139, January.
    8. Österholm, Pär, 2013. "Forecasting Business Investment in the Short Term Using Survey Data," Working Papers 131, National Institute of Economic Research.
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    10. Vartiainen, Juhana, 2010. "Interpreting Wage Bargaining Norms," Working Papers 116, National Institute of Economic Research.
    11. Lindström, Tomas, 2003. "The Role of High-Tech Capital Formation for Swedish Productivity Growth," Working Papers 83, National Institute of Economic Research.
    12. Forslund, Johanna & Samakovlis, Eva & Vredin Johansson, Maria, 2006. "Matters Risk? The Allocation of Government Subsidies for Remediation of Contaminated Sites under the Local Investment Programme," Working Papers 94, National Institute of Economic Research.

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    More about this item

    Keywords

    Hierarchies; assignment; fairness; envy;
    All these keywords.

    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory

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