Arbeitspapier
An incentive theory of matching
This paper presents a theory explaining the labor market matching process through microeconomic incentives. There are heterogeneous variations in the characteristics of workers and jobs, and firms face adjustment costs in responding to these variations. Matches and separations are described through firms' job offer and firing decisions and workers' job acceptance and quit decisions. This approach obviates the need for a matching function. On this theoretical basis, we argue that the matching function is vulnerable to the Lucas critique. Our calibrated model for the U.S. economy can account for important empirical regularities that the conventional matching model cannot.
- Language
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Englisch
- Bibliographic citation
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Series: CEPR Discussion Paper Series ; No. 7283
- Classification
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Wirtschaft
Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
Business Fluctuations; Cycles
Labor Turnover; Vacancies; Layoffs
Unemployment: Models, Duration, Incidence, and Job Search
- Event
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Geistige Schöpfung
- (who)
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Brown, Alessio J. G.
Merkl, Christian
Snower, Dennis J.
- Event
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Veröffentlichung
- (who)
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Centre for Economic Policy Research (CEPR)
- (where)
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London
- (when)
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2009
- Handle
- Last update
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10.03.2025, 11:41 AM CET
Data provider
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Object type
- Arbeitspapier
Associated
- Brown, Alessio J. G.
- Merkl, Christian
- Snower, Dennis J.
- Centre for Economic Policy Research (CEPR)
Time of origin
- 2009