5
votes
Burdett and Mortensen (1998), Equation (22), Integral by parts question
The authors apply in the second step the exact same rules they used in the first step, regarding the calculation of the total differential of an integral, taking also into account that the integral is ...
- 33.9k
4
votes
Accepted
elasticity of labor supply
We have that:
$$
L(s,H) = \frac{f(\theta)}{s + f(\theta)}H.
$$
Take the derivative with respect to $\theta$:
$$
\frac{\partial L}{\partial \theta} = \frac{f'(\theta)}{s + f(\theta)}H - \frac{f(\theta)}...
- 12.5k
3
votes
Accepted
Question regarding preferences in Gale and Shapley (1962)
Gale and Shapley barely make any assumptions about preferences. They don't need a functional form, simply an ordinal ranking of the options. Moreover, there are no transfers in this setting, only the ...
- 5,291
3
votes
Directed search with privately informed buyers and capacities
I am aware of classic models such as Kreps & Scheinkman (1983). I am also aware of Burdett, Shi & Wright (2001), but note that their buyers are ex-post symmetric as both of them have value $...
- 5,291
2
votes
Accepted
What exactly is an exogenous stationary distribution?
Here is explanation for the terms:
Exogenous - determined outside the system/model being studied. For example, if you study macroeconomic model without explicitly modelling weather patterns, bad ...
- 57.7k
2
votes
Accepted
Why is matching function increasing in arguments?
Think about it this way. The function is measuring the number of new matches being created. If we increase either the vacancies or the amount of unemployed, the function will generate more matches. ...
- 661
2
votes
McCall Search Model: Present value of lifetime income
In the version of the McCall search model I'm familiar with, once you accept an offer of wage $w$, you receive that wage $w$ in every period starting from the period of acceptance.
Hence, from the ...
- 2,156
2
votes
Modeling job application process in labor market
Chapters 6-8 (especially 8) in Modern Labor Economics: Theory and Public Policy, a textbook by Ehrenberg and Smith, cover the topics concerning labor supply. I guess the parts in Ch. 8 that discuss ...
- 15.8k
2
votes
Differentiation of the value function in Burdett Mortensen (1998)
When you take the integral of a $\max_{\{\cdot\}}$ operator, I think you have to split the integral into two separate integrals with different supports on them.
Even if your value function is ...
- 6,658
2
votes
Accepted
What are the general charateristics of matching markets that make then different from regular markets?
The deviance from a "normal" market boils down to how that market clears. Matching markets are markets in which prices alone don't clear the market, as thought in mainstream economic theory, and so ...
- 156
2
votes
What is the implication of perfectly reversible capital?
I think I get the answer but I am not 100% sure. Any comment would be welcome.
I realized that this is related to the search-matching nature of the model (comparing to competitive labor market), so ...
- 2,506
2
votes
Search and Matching model with 2 agents?
I am not sure if this is exactly what you are looking for, but this paper has model that sounds like what you want:
Shimer, Robert, 2006. “On-the-job search and strategic bargaining, ”European ...
- 2,772
1
vote
Accepted
Abraham (1987) Simple Job Market Matching Model
Note that function $p$ actually depends upon a single variable $u/v$ and I prefer avoiding the abuse of notation
(source of confusion) and write $p(u/v) = P(u,v)$. This implies:
\begin{equation}
p'(...
- 3,481
1
vote
Has there been an applications of search and matching theory in the Neoclassical Growth Model?
Search and matching models are fairly standard in macroeconomics. I guess this is fair to say since Peter Diamond, Dale Mortensen, and Christopher Pissarides won the Nobel prize in 2010. These are the ...
- 5,291
1
vote
Accepted
Search and matching model: effect of hiring cost on wage curve
It depends on what you define as wage curve. I did not check in the textbooks, but you suggest that Pissarides and Cahuc et al. do not use the same mathemaical expression for the "wage curve".
1) In ...
- 887
1
vote
Stable marriage problem with transferable utilities
There's two implementations that should somewhat cover your needs, matchingR which does reduced-form algorithmic matching and ...
- 778
1
vote
DMP Search Model - Terminology
A vacant job is an asset if we consider that the firm can match with a worker and get a positive expected profit. Firms post vacancies up to a point where $V=0$. If $V$ were positive, more firms would ...
- 6,990
1
vote
A confusion regarding search and matching model in Pissarides's "Equilibrium Unemployment Theory" book
$q(\theta)$ is defined as the job-filling rate. Note that market tightness $\theta$ is not necessarily constant over time (Pissarides makes a dynamic analysis at some point). It may help to denote it $...
- 887
1
vote
Why is matching function increasing in arguments?
Let's refresh the definition of a partial derivative.
partial derivative of a function of several variables is its
derivative with respect to one of those variables, with the others
held ...
- 1,007
1
vote
Price when both supply and demand have market power
I suppose one way to solve this - but I'm still looking for a proper way without - is to fall back to matching.
If there is matching between the intermediate and the final stage, at zero search cost ...
- 10.7k
1
vote
Matching Theory: Search Time
The paper is a couple of years old by now, but I believe the first people to look seriously at the issues you're thinking of are Akbarpour, et al.
It might be useful to look at that paper and the ...
- 2,156
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