|This centre is a member of The LSE Research Laboratory [RLAB]: CASE | CVER | CEP | SERC | STICERD||Cookies?|
Paper No' TE/1996/315:
Save Reference as: BibTeX File | EndNote Import File
Is hard copy/paper copy available? NO - Paper Copy Out Of Print.
This Paper is published under the following series: Theoretical Economics
Share this page: Google Bookmarks | Facebook | Twitter
Abstract:The Two-Sided Perfect Matching model is generalised to an Imperfect Matching model with search frictions. A search model is proposed which is characterised by bilateral search and vertical heterogeneity and allows for a generally specified utility function. The fundamental result is that with common beliefs about the evolving population, a unique Imperfect Matching equilibrium exists in iterated strict dominance. This holds independent of the characteristics of the utility function. The properties of equilibrium are analysed for different pay-off specifications. It is shown that for multiplicatively separable pay-offs both Steady State distributions are endogenously partitioned into classes. This fails to hold however out of Steady State. With search frictions disappearing, the limit case of the search model is the Gale-Shapley-Becker Perfect Matching model.
Copyright © RLAB & LSE 2003 - 2017 | LSE, Houghton Street, London WC2A 2AE | Contact: RLAB | Site updated 25 February 2017