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"Endogenous Inequality in Integrated Labor Markets with Two-sided Search''

Author

Listed:
  • George J. Mailath
  • Larry Samuelson
  • Avner Shaked

Abstract

We consider a market with "red" and "green" workers, where labels are payoff irrelevant. Workers may acquire skills. Skilled workers search for vacancies, while firms search for workers. A unique symmetric equilibrium exists in which color is irrelevant. There are also asymmetric equilibria in which firms search only for green workers, more green than red workers acquire skills, skilled green workers receive higher wages, and the unemployment rate is higher among skilled red workers. Discrimination between ex ante identical individuals arises in equilibrium, and yet firms have perfect information about their workers, and strictly prefer to hire minority workers.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • George J. Mailath & Larry Samuelson & Avner Shaked, "undated". ""Endogenous Inequality in Integrated Labor Markets with Two-sided Search''," CARESS Working Papres 98-06, University of Pennsylvania Center for Analytic Research and Economics in the Social Sciences.
  • Handle: RePEc:wop:pennca:98-06
    as

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    File URL: http://www.ssc.upenn.edu/econ/CARESS/CARESSpdf/98-06.pdf
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    References listed on IDEAS

    as
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    6. Cornell, Bradford & Welch, Ivo, 1996. "Culture, Information, and Screening Discrimination," Journal of Political Economy, University of Chicago Press, vol. 104(3), pages 542-571, June.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    JEL classification:

    • J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts
    • J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

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