Abstract

http://ssrn.com/abstract=1460746
 


 



Job Search with Bidder Memories


Carlos Carrillo-Tudela


University of Leicester; Institute for the Study of Labor (IZA)

Eric Smith


University of Essex - Department of Economics

Guido Menzio


University of Pennsylvania - Department of Economics; National Bureau of Economic Research (NBER)

July 1, 2009

PIER Working Paper No. 09-027

Abstract:     
This paper revisits the no-recall assumption in job search models with take-it-or-leave-it offers. Workers who can recall previously encountered potential employers in order to engage them in Bertrand bidding have a distinct advantage over workers without such attachments. Firms account for this difference when hiring a worker. When a worker first meets a firm, the firm offers the worker a sufficient share of the match rents to avoid a bidding war in the future. The pair share the gains to trade. In this case, the Diamond paradox no longer holds.

Number of Pages in PDF File: 27

Keywords: Job search, recall, wage determination, Diamond paradox

JEL Classification: J24, J42, J64

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Date posted: August 24, 2009  

Suggested Citation

Carrillo-Tudela, Carlos and Smith, Eric and Menzio, Guido, Job Search with Bidder Memories (July 1, 2009). PIER Working Paper No. 09-027. Available at SSRN: http://ssrn.com/abstract=1460746 or http://dx.doi.org/10.2139/ssrn.1460746

Contact Information

Carlos Carrillo-Tudela
University of Leicester ( email )
University Road
Leicester, LE1 7RH
United Kingdom
Institute for the Study of Labor (IZA)
P.O. Box 7240
Bonn, D-53072
Germany
Eric Smith
University of Essex - Department of Economics ( email )
Wivenhoe Park
Colchester CO4 3SQ
United Kingdom
Guido Menzio (Contact Author)
University of Pennsylvania - Department of Economics ( email )
3718 Locust Walk
Philadelphia, PA 19104
United States
215-898-5170 (Phone)
National Bureau of Economic Research (NBER) ( email )
1050 Massachusetts Avenue
Cambridge, MA 02138
United States
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