Incentives in competitive search equilibrium
By: Espen R. Moen and Åsa Rosén.
Contributors: Rosén, Åsa.; London School of Economics and Political Science. Centre for Economic Performance.
Series: CEP discussion paper -- no. 832
Publisher: Centre for Economic Performance, London School of Economics and Political Science
Published: 2007
Place of publication: London
Language: eng
Format: Electronic resource
Description: This paper analyses the interaction between internal agency problems within firms and external search frictions when workers have private information. We show that the allocation of resources is determined by a modified Hosios Rule. We then analyze the effect of changes in the macro economic variables on the wage contract and the unemployment rate. We find that private information may increase the responsiveness of the unemployment rate to changes in productivity. The incentive power of the wage contracts is positively related to high productivity, low unemployment benefits and high search frictions.
Notes: Title from publisher's abstract page (viewed on Jan. 4, 2008).

"November 2007."

Includes bibliographical references.

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