IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this paper

Non-cooperative foundations of hedonic equilibrium

Listed author(s):
  • Peters, Michael

This paper studies Bayesian equilibrium in a worker firm matching problem in which workers choose their human capi- tal investment and firms choose wages before the matching process occurs. Symmetric equilibrium exists, and supports assortative matching. However, when the number of traders is large, low types tend to invest too much, while higher types invest in a way that is bilaterally efficient. In this sense the upper end of the market be- haves in a manner that is similar to the way they would behave in a competitive (hedonic) equilibrium. The lower end of the market, however, does not. All types end up investing more and being paid higher wages than they are in a simple hedonic equilibrium. In the limit, the Bayesian game supports and outcome that looks like a Truncated Hedonic Equilibrium as described in Peters (2006).

If 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.

File URL:
Download Restriction: no

Paper provided by Vancouver School of Economics in its series working papers with number peters-07-12-10-02-47-06.

in new window

Length: 20 pages
Date of creation: 10 Dec 2007
Date of revision: 06 Jun 2008
Handle: RePEc:ubc:pmicro:peters-07-12-10-02-47-06
Contact details of provider: Web page:

References listed on IDEAS
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.:

in new window

  1. Michael Peters & Aloysius Siow, 2002. "Competing Premarital Investments," Journal of Political Economy, University of Chicago Press, vol. 110(3), pages 592-608, June.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:ubc:pmicro:peters-07-12-10-02-47-06. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Maureen Chin)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.