Konferenzbeitrag

Double Matching: Social Contacts in a Labour Market with On-the-Job Search

to connected objects

This paper develops a labour market matching model with heterogeneous firms, on-thejob search and referrals. Social capital is endogenous, so that better connected workers bargain higher wages for a given level of productivity. This is a positive effect of referrals on reservation wages. At the same time, employees accept job offers from more productive employers and forward other offers to their unemployed social contacts. Therefore, the average productivity of a referred worker is lower than the average productivity in the market. This is a negative selection effect of referrals on wages. In the equilibrium, wage premiums (penalties) associated with referrals are more likely in labour markets with lower (higher) productivity heterogeneity and lower (higher) worker s bargaining power. Next, the model is extended to allow workers help each other climb a wage ladder. On-the-job search is then intensified and wage inequality is reduced as workers employed in high paid jobs pool their less successful contacts towards the middle range of the productivity distribution.

Language: Englisch

Bibliographic citation: Series: Beiträge zur Jahrestagung des Vereins für Socialpolitik 2013: Wettbewerbspolitik und Regulierung in einer globalen Wirtschaftsordnung - Session: Job Search ; No. G11-V2

Classification: Wirtschaft
Labor Demand
Wage Level and Structure; Wage Differentials
Unemployment: Models, Duration, Incidence, and Job Search

Event: Geistige Schöpfung

(who): Zaharieva, Anna

Event: Veröffentlichung

(who): ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften, Leibniz-Informationszentrum Wirtschaft

(where): Kiel und Hamburg

(when): 2013

Handle: http://hdl.handle.net/10419/79891

Last update: 10.03.2025, 11:44 AM CET

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Object type

Konferenzbeitrag

Associated

Zaharieva, Anna
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften, Leibniz-Informationszentrum Wirtschaft

Time of origin

2013

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