Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/35528
Year of Publication: 
2009
Series/Report no.: 
IZA Discussion Papers No. 4097
Publisher: 
Institute for the Study of Labor (IZA), Bonn
Abstract: 
We show that in a search/matching model with endogenous participation in which workers are heterogeneous with respect to market productivity, satisfying the Hosios rule leads to excessive vacancy creation. The reason is that the marginal worker does not internalize the effect of his or her participation on average productivity.
Subjects: 
Search
matching
efficiency
participation
Hosios rule
JEL: 
D8
J6
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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