Directed search, mismatch and efficiency

Abstract : This short paper provides a directed search model of the labor market in which the persistency of vacant jobs results from a mismatch problem, not from a pure coordination problem. Since firms cannot commit to an output cutoff lower than the posted wage, laissez-faire is inefficient. But, under a binding condition, public policy can restore market efficiency by associating a minimum wage with a layoff tax.
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https://halshs.archives-ouvertes.fr/halshs-02083453
Contributor : Frédéric Gavrel <>
Submitted on : Friday, March 29, 2019 - 9:34:11 AM
Last modification on : Friday, April 12, 2019 - 1:16:19 AM
Long-term archiving on : Sunday, June 30, 2019 - 12:51:07 PM

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Frédéric Gavrel. Directed search, mismatch and efficiency. 2019. ⟨halshs-02083453⟩

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