MARKET POWER AND EFFICIENCY IN A SEARCH MODEL

• 成果类型: Article
• 署名作者: Galenianos, Manolis; Kircher, Philipp; Virag, Gabor
• 署名单位: Pennsylvania Commonwealth System of Higher Education (PCSHE); Pennsylvania State University; Pennsylvania State University - University Park; University of Oxford; University of Rochester
• 刊物名称: INTERNATIONAL ECONOMIC REVIEW
• ISSN/ISSBN: 0020-6598
• DOI: 10.1111/j.1468-2354.2010.00620.x
• 发表日期: 2011
• 页码: 85-103
• 关键词: equilibrium; assignment; jobs

摘要

We build a theoretical model to study the welfare effects and policy implications of firms' market power in a frictional labor market. The main characteristics of our environment are that wages play a role in allocating labor across firms and the number of agents is finite. The decentralized equilibrium is inefficient and the firms' market power results in the misallocation of workers from the high to the low productivity firms. A minimum wage exacerbates the inefficiencies by forcing the low-productivity firms to increase their wage. Moderate unemployment benefits can increase welfare by improving the workers' outside option.