The market for job placement : a model of head-hunters
AbstractThis paper deals with the consequences of the existence of private employment agencies on the labor market. Using a matching framework, we study the conditions of existence of private employment agencies and the consequences of competition on the market for job placement. We show that the private employment agencies enter in the labour market only if they are much more efficient than the private agency. Moreover, the level of the unemployment benefits is a disincentive to manage workers for the private agency. Because of a high fallback position for the worker, it is costly for the private employment agency to manage a worker having some low probabilities to exit from unemployment. If these conditions are satisfied, the existence of private employment agencies improves the labor market through shorter unemployment spells and a lower unemployment rate. Moreover, an improvement in the matching process is an incentive for the firms to post vacancies at the private agencies. Nevertheless, the workers managed by the private agencies receive some lower wages than the other workers because of the payment by the firm for recruiting a worker. Finally, we show that private employment agencies have a natural disincentive to manage unskilled workers. But, the introduction of a subsidy to match an unskilled worker with a vacancy seems to be a sufficient incentive to make the private employment agencies managing unskilled workers.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Université Panthéon-Sorbonne (Paris 1) in its series Cahiers de la Maison des Sciences Economiques with number v06027.
Length: 41 pages
Date of creation: Jul 2005
Date of revision:
Contact details of provider:
Postal: 106 - 112 boulevard de l'Hôpital, 75647 Paris cedex 13
Phone: 01 44 07 81 00
Fax: 01 44 07 81 09
Web page: http://mse.univ-paris1.fr/
More information through EDIRC
Unemployment; matching model; public employment agencies; private employment agencies.;
Other versions of this item:
- Etienne Campens & Solenne Tanguy, 2006. "The market for job placement : a model of headhunters," UniversitÃ© Paris1 PanthÃ©on-Sorbonne (Post-Print and Working Papers) halshs-00113476, HAL.
- J60 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - General
- J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
- J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
- J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy
This paper has been announced in the following NEP Reports:
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Diamond, Peter A, 1981.
"Mobility Costs, Frictional Unemployment, and Efficiency,"
Journal of Political Economy,
University of Chicago Press, vol. 89(4), pages 798-812, August.
- P. Diamond, 1980. "Mobility Costs, Frictional Unemployment and Efficiency," Working papers 257, Massachusetts Institute of Technology (MIT), Department of Economics.
- Dolado, Juan J. & Felgueroso, Florentino & Jimeno, Juan F., 2000. "Youth labour markets in Spain: Education, training, and crowding-out," European Economic Review, Elsevier, vol. 44(4-6), pages 943-956, May.
- Barbara Petrongolo & Christopher A. Pissarides, 2000.
"Looking Into the Black Box: A Survey of the Matching Function,"
CEP Discussion Papers
dp0470, Centre for Economic Performance, LSE.
- Christopher A. Pissarides & Barbara Petrongolo, 2001. "Looking into the Black Box: A Survey of the Matching Function," Journal of Economic Literature, American Economic Association, vol. 39(2), pages 390-431, June.
- Petrongolo, Barbara & Pissarides, Christopher, 2000. "Looking Into The Black Box: A Survey Of The Matching Function," CEPR Discussion Papers 2409, C.E.P.R. Discussion Papers.
- Yavas, Abdullah, 1994. "Middlemen in Bilateral Search Markets," Journal of Labor Economics, University of Chicago Press, vol. 12(3), pages 406-29, July.
- René Böheim & Mark P Taylor, 2002.
"Job search methods, intensity and success in Britain in the 1990s,"
Economics working papers
2002-06, Department of Economics, Johannes Kepler University Linz, Austria.
- Addison, John T. & Portugal, Pedro, 1998.
"Job Search Methods and Outcomes,"
ZEW Discussion Papers
98-41, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
- Acemoglu, Daron, 2001. "Good Jobs versus Bad Jobs," Journal of Labor Economics, University of Chicago Press, vol. 19(1), pages 1-21, January.
- Ours, J.C. van & Lindeboom, M. & Renes, G., 1994.
"Matching Employers and Workers: an Empirical Analysis on the Effectiveness of Search,"
Open Access publications from Tilburg University
urn:nbn:nl:ui:12-142172, Tilburg University.
- Lindeboom, Maarten & van Ours, Jan C & Renes, Gusta, 1994. "Matching Employers and Workers: An Empirical Analysis on the Effectiveness of Search," Oxford Economic Papers, Oxford University Press, vol. 46(1), pages 45-67, January.
- Lindeboom, M. & Ours, J.C. & Renes, G., 1991. "Matching employers and workers : an empirical analysis on the effectiveness of search," Serie Research Memoranda 0063, VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics.
- Dale Mortensen, 1984.
"Job Search and Labor Market Analysis,"
594, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Harry J. Holzer, 1986.
"Search Method Use by Unemployed Youth,"
NBER Working Papers
1859, National Bureau of Economic Research, Inc.
- Blau, David M & Robins, Philip K, 1990. "Job Search Outcomes for the Employed and Unemployed," Journal of Political Economy, University of Chicago Press, vol. 98(3), pages 637-55, June.
- Osberg, Lars, 1993.
"Fishing in Different Pools: Job Search Strategies and Job-Finding Success in Canada in the Early 1980s,"
Journal of Labor Economics,
University of Chicago Press, vol. 11(2), pages 348-86, April.
- Osberg, L., 1989. "Fishing In Different Pools: Job Search Strategies And Job-Finding Success In Canada In The Early 1980s," Department of Economics at Dalhousie University working papers archive 89-03, Dalhousie, Department of Economics.
- Pissarides, C A, 1979. "Job Matchings with State Employment Agencies and Random Search," Economic Journal, Royal Economic Society, vol. 89(356), pages 818-33, December.
- Neugart, Michael & Storrie, Donald, 2002.
"Temporary work agencies and equilibrium unemployment,"
Working Papers in Economics
83, University of Gothenburg, Department of Economics.
- Neugart, Michael & Storrie, Donald, 2002. "Temporary work agencies and equilibrium unemployment," Discussion Papers, Research Unit: Labor Market Policy and Employment FS I 02-203, Social Science Research Center Berlin (WZB).
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Lucie Label).
If references are entirely missing, you can add them using this form.