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Assortative matching through signals

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  • Poeschel, Friedrich

    (Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany])

Abstract

"The matching of likes is a frequently observed phenomenon. However, for such assortative matching to arise in a search model, often implausibly strong conditions are required. This paper shows that, once signals are introduced, a search model can generate even perfect assortative matching under weak conditions: supermodularity of the match production function is a necessary and sufficient condition. It simultaneously drives sorting and functions as a single-crossing property ensuring that agents choose truthful signals. The information thereby transmitted allows agents to avoid all unnecessary costs of random search, which creates in effect an almost frictionless environment. Hence the unique separating equilibrium in the model achieves nearly unconstrained efficiency despite frictions." (Author's abstract, IAB-Doku) ((en))

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Bibliographic Info

Paper provided by Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany] in its series IAB Discussion Paper with number 201215.

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Length: 37 pages
Date of creation: 29 Jun 2012
Date of revision:
Handle: RePEc:iab:iabdpa:201215

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Keywords: Arbeitsuche; Produktionsfunktion; Suchverfahren; Strukturierung; ökonomische Theorie;

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Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. Assortative matching through signals
    by Christian Zimmermann in NEP-DGE blog on 2013-01-19 23:06:20
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Cited by:
  1. Dauth, Wolfgang & Findeisen, Sebastian & Suedekum, Jens, 2013. "The rise of the East and the Far East: German labor markets and trade integration," DICE Discussion Papers 127, Heinrich‐Heine‐Universität Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
  2. Stops, Michael, 2012. "Job matching across occupational labour markets," IAB Discussion Paper 201227, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  3. Carlos Canon, 2011. "Matching & Information Provision by One-Sided and Two-Sided Platforms," Working Papers 11-20, NET Institute, revised Oct 2011.
  4. Antoni, Manfred & Heineck, Guido, 2012. "Do literacy and numeracy pay off? On the relationship between basic skills and earnings," BERG Working Paper Series 86, Bamberg University, Bamberg Economic Research Group.
  5. Jens Suedekum & Wolfgang Dauth, 2013. "Profiles of local growth and industrial change: Facts and an explanation," ERSA conference papers ersa13p247, European Regional Science Association.
  6. Scholz, Theresa, 2012. "Employers' selection behavior during short-time work," IAB Discussion Paper 201218, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  7. Münich, Daniel & Srholec, Martin & Moritz, Michael & Schäffler, Johannes, 2012. "Mothers and Daughters: Heterogeneity of German direct investments in the Czech Republic. Evidence from the IAB-ReLOC survey," IAB Discussion Paper 201217, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  8. Blien, Uwe & Messmann, Susanne & Trappmann, Mark, 2012. "Do reservation wages react to regional unemployment?," IAB Discussion Paper 201222, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].

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