Homogenous Agent Wage-Posting Model with Wage Dispersion
AbstractIn the paper we test a homogenous agent version of the Montgomery's (1991) non-cooperative wage posting model. The inclusion of intrinsic costs, related to the uncertainty when changing the alternative agents are already using, alters the outcome of the model in two respects: firstly, it significantly prolongs the convergence-time to the equilibrium, and, more importantly, it may lead to the wage dispersion, irrespective of equally-productive-agent proposition, something not present in the model of Montgomery.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 16114.
Date of creation: Jul 2009
Date of revision:
Job-search model; wage posting; wage dispersion; numerical optimization;
Find related papers by JEL classification:
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
- D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search, Learning, and Information
- C15 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Statistical Simulation Methods: General
- C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-07-11 (All new papers)
- NEP-BEC-2009-07-11 (Business Economics)
- NEP-LAB-2009-07-11 (Labour Economics)
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.:
- Montgomery, James D, 1991. "Equilibrium Wage Dispersion and Interindustry Wage Differentials," The Quarterly Journal of Economics, MIT Press, vol. 106(1), pages 163-79, February.
- Burdett, Kenneth & Judd, Kenneth L, 1983. "Equilibrium Price Dispersion," Econometrica, Econometric Society, vol. 51(4), pages 955-69, July.
- Hirshleifer, David, 2001.
"Investor Psychology and Asset Pricing,"
5300, University Library of Munich, Germany.
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