Incentives in Competitive Search Equilibrium

S-Tier
Journal: Review of Economic Studies
Year: 2011
Volume: 78
Issue: 2
Pages: 733-761

Authors (2)

Espen R. Moen (BI Handelshøyskolen) Åsa Rosén (not in RePEc)

Score contribution per author:

4.022 = (α=2.01 / 2 authors) × 4.0x S-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

This paper proposes a labour market model with job search frictions where workers have private information on match quality and effort. Firms use wage contracts to motivate workers. In addition, wages are also used to attract employees. We define and characterize competitive search equilibrium in this context, and show that it satisfies a simple modified Hosios rule. We also analyse the interplay between macroeconomic variables and optimal wage contracts. Finally, we show that private information may increase the responsiveness of the unemployment rate to changes in the aggregate productivity level and, in particular, to changes in the information structure. Copyright 2011, Oxford University Press.

Technical Details

RePEc Handle
repec:oup:restud:v:78:y:2011:i:2:p:733-761
Journal Field
General
Author Count
2
Added to Database
2026-01-26