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Directed Search with Phantom Vacancies

Author

Listed:
  • James Albrecht

    (Department of Economics, Georgetown University, IZA - Institute for the study of labor - Institute for the Study of Labor - IZA)

  • Bruno Decreuse

    (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique)

  • Susan Vroman

    (Department of Economics, Georgetown University, IZA - Institute for the study of labor - Institute for the Study of Labor - IZA)

Abstract

When vacancies are filled, the ads that were posted are generally not withdrawn, creating phantom vacancies. The existence of phantoms implies that older job listings are less likely to represent true vacancies than are younger ones. We assume that job seekers direct their search based on the listing age for otherwise identical listings and so equalize the probability of matching across listing age. Forming a match with a vacancy of age a creates a phantom of age a and thus creates a negative informational externality that affects all vacancies of age a or older. The magnitude of this externality decreases with a. The directed search behavior of job seekers leads them to over-apply to younger listings. We calibrate the model using US labor market data. The contribution of phantoms to overall frictions is large, but, conditional on the existence of phantoms, the social planner cannot improve much on the directed search allocation.

Suggested Citation

  • James Albrecht & Bruno Decreuse & Susan Vroman, 2017. "Directed Search with Phantom Vacancies," Working Papers halshs-01484717, HAL.
    • Handle: RePEc:hal:wpaper:halshs-01484717
    Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-01484717
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    References listed on IDEAS

    as
    1. Galenianos, Manolis & Kircher, Philipp, 2009. "Directed search with multiple job applications," Journal of Economic Theory, Elsevier, vol. 144(2), pages 445-471, March.
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    13. Stefano Banfi & Benjamín Villena-Roldán, 2019. "Do High-Wage Jobs Attract More Applicants? Directed Search Evidence from the Online Labor Market," Journal of Labor Economics, University of Chicago Press, vol. 37(3), pages 715-746.
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    Full references (including those not matched with items on IDEAS)

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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Directed Search with Phantom Vacancies
      by Christian Zimmermann in NEP-DGE blog on 2017-04-18 20:10:17

    Citations

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    Cited by:

    1. Karahan, Fatih & Mitman, Kurt & Moore, Brendan, 2019. "Individual and Market-Level Effects of UI Policies: Evidence from Missouri," IZA Discussion Papers 12805, Institute of Labor Economics (IZA).
    2. Bhole, Monica & Fradkin, Andrey & Horton, John, 2021. "Information About Vacancy Competition Redirects Job Search," SocArXiv p82fk, Center for Open Science.
    3. Michèle Belot & Philipp Kircher & Paul Muller, 2022. "How Wage Announcements Affect Job Search—A Field Experiment," American Economic Journal: Macroeconomics, American Economic Association, vol. 14(4), pages 1-67, October.
    4. Gökten, Meryem & Heimberger, Philipp & Lichtenberger, Andreas, 2024. "How far from full employment? The European unemployment problem revisited," European Economic Review, Elsevier, vol. 164(C).
    5. Ehrenfried, Felix & Holzner, Christian, 2019. "Dynamics and endogeneity of firms’ recruitment behaviour," Labour Economics, Elsevier, vol. 57(C), pages 63-84.
    6. Stef Garasto & Jyldyz Djumalieva & Karlis Kanders & Rachel Wilcock & Cath Sleeman, 2021. "Developing experimental estimates of regional skill demand," Economic Statistics Centre of Excellence (ESCoE) Discussion Papers ESCoE DP-2021-02, Economic Statistics Centre of Excellence (ESCoE).
    7. Stefano Banfi & Benjamin Villena-Roldan & Sekyu Choi, 2018. "Deconstructing job search behavior," 2018 Meeting Papers 368, Society for Economic Dynamics.
    8. Sushant Acharya & Shu Lin Wee, 2018. "Replacement Hiring," 2018 Meeting Papers 758, Society for Economic Dynamics.
    9. Ciao-Wei Chen & Laura Yue Li, 2023. "Is hiring fast a good sign? The informativeness of job vacancy duration for future firm profitability," Review of Accounting Studies, Springer, vol. 28(3), pages 1316-1353, September.
    10. Altmann, Steffen & Glenny, Anita Marie & Mahlstedt, Robert & Sebald, Alexander, 2022. "The Direct and Indirect Effects of Online Job Search Advice," IZA Discussion Papers 15830, Institute of Labor Economics (IZA).
    11. Sushant Acharya & Shu Lin Wee, 2018. "Replacement hiring and the productivity-wage gap," Staff Reports 860, Federal Reserve Bank of New York.
    12. Carter, Charles & Delaney, Judith M. & Papps, Kerry L., 2024. "The Effect of Wages on Job Vacancy Duration: Evidence from a Spatial Discontinuity," IZA Discussion Papers 17273, Institute of Labor Economics (IZA).
    13. Acharya, Sushant & Wee, Shu Lin, 2020. "On-the-job Search and the Productivity-Wage Gap," CEPR Discussion Papers 14430, C.E.P.R. Discussion Papers.
    14. Fatih Karahan & Kurt Mitman & Brendan Moore, 2019. "Micro and Macro Effects of UI Policies: Evidence from Missouri," Staff Reports 905, Federal Reserve Bank of New York.
    15. He, Chuan & Mau, Karsten & Xu, Mingzhi, 2021. "Trade Shocks and Firms Hiring Decisions: Evidence from Vacancy Postings of Chinese Firms in the Trade War," Labour Economics, Elsevier, vol. 71(C).

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    More about this item

    Keywords

    directed search; information persistence; vacancy age;
    All these keywords.

    JEL classification:

    • J60 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - General
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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