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Targeted Search in Matching Markets

Author

Listed:
  • Paulina Restrepo-Echavarria

    (Federal Reserve Bank of St Louis)

  • Antonella Tutino

    (Federal Reserve Bank of Dallas)

  • Anton Cheremukhin

    (Federal Reserve Bank of Dallas)

Abstract

We endogenize the degree of randomness in the matching process by proposing a model where agents have to pay a search cost to locate potential matches more accurately. The model features a tension between an agent's desire to nd a more productive match and to maximize the odds of nding a match. This tension drives a wedge between the shape of sorting patterns and the shape of the underlying match payo function. We show the empirical relevance of the latter prediction by applying the model to the U.S. marriage market.

Suggested Citation

  • Paulina Restrepo-Echavarria & Antonella Tutino & Anton Cheremukhin, 2017. "Targeted Search in Matching Markets," 2017 Meeting Papers 1413, Society for Economic Dynamics.
    • Handle: RePEc:red:sed017:1413
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    References listed on IDEAS

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    1. Les coulisses économiques des sites de rencontres
      by The Conversation in Contrepoints on 2020-08-02 03:35:44

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    2. Bartosz Maćkowiak & Filip Matějka & Mirko Wiederholt, 2023. "Rational Inattention: A Review," Journal of Economic Literature, American Economic Association, vol. 61(1), pages 226-273, March.
    3. Stanislav Rabinovich & Ronald Wolthoff, 2020. "Misallocation Effects of Labor Market Frictions," Working Papers tecipa-662, University of Toronto, Department of Economics.
    4. Xu, Yujing & Yang, Huanxing, 2019. "Targeted search with horizontal differentiation in the marriage market," Journal of Economic Behavior & Organization, Elsevier, vol. 164(C), pages 31-62.
    5. Rabinovich, Stanislav & Wolthoff, Ronald, 2022. "Misallocation inefficiency in partially directed search," Journal of Economic Theory, Elsevier, vol. 206(C).

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    More about this item

    JEL classification:

    • C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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