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Published December 1977 | public
Journal Article

Labor market equilibrium under nonsequential search

Abstract

This study presents a full model of the labor market under imperfect information. Workers bear the burden of search and are assumed to use a stochastic variant of an optimal sample size search strategy. The existence and uniqueness of a nondegenerate equilibrium distribution of wage offers is established. Infficiencies which lead to underinvestment in search are uncovered and analyzed.

Additional Information

© 1977 Academic Press, Inc. Received 27 September 1976, Revised 5 July 1977. This research was supported by U.S. Department of Labor Grant DOL 91-36-75-40. The report does not represent the official opinion or policy of the Department of Labor. I would like to thank Professors Sherwin Rosen and Ed Zabel of the University of Rochester for extremely helpful comments. Professor Gary Becker and members of the Workshop in Applications in Economics of the University of Chicago also provided useful discussion of an earlier version. The presentation of this material has benefited from the suggestions of Charles Wilson and an anonymous referee. Formerly SSWP 153.

Additional details

Created:
August 19, 2023
Modified:
October 17, 2023