Not all meetings, however, necessarily lead to transactions. A match occurs if and only if the sale results in a positive surplus; otherwise, the potential buyer and seller continue to search. The continuation flow values that the prospective buyer and seller bring to the table as well as the...

There is a unique stationary equilibrium in the price-posting game played by firms. Depending on parameters, this equilibrium can take one of three possible forms. First the equilibrium can be one in which all firms post a high price. Second, all firms could post a low price. Finally, there can...

This result would seem to imply that the more members on a committee the lower the average search duration. It turns out that this does not immediately follow, and in fact, the average search duration may increase as the committee grows in size. Thus, we cannot simply compare thresholds to...

We consider a housing market with large numbers of buyers and sellers. Sellers differ in their reservation prices; buyers are ex ante identical. In the first stage of the game, each seller posts an asking price. Next, each buyer, after observing all asking prices, chooses a house to visit. Upon...

In this paper, we extend the standard Pissarides model of equilib- rium unemployment to incorporate public-sector employment. We modify the Pissarides model in three ways. First, we assume that workers are het- erogeneous in terms of human capital. Second, we assume that productivity is match...

In this paper, we consider the efficiency of entry in a model of competitive search. By "competitive search" we mean that we analyze a large market in which buyers (or sellers) can direct their search based on the terms of trade that are posted (with commitment) by their counterparts on the...

We construct a bilateral search model of the housing market in which agents differ in their flow rewards while searching. Buyers and sellers enter the market with high flow rewards, but move at a Poisson rate to a state with low flow rewards if they do not transact in the meantime. We...

In developing economies, substantial economic activity takes place in the informal labor market, beyond the reach of government policy. Labor market policies, which by definition apply only to the formal-sector labor market, then have important spillover effects. The relative sizes of the...

The Swedish adult education program known as the Knowledge Lift (kunskapslyftet) is unprecedented in size and scope. This paper evaluates the effects of program participation on individual labor market outcomes, in particular, employment and annual income, as well as on labor market equilibrium....

In this paper, we present a directed search model of the housing market. The pricing mechanism we analyze reflects the way houses are bought and sold in the United States. Our model is consistent with the observation that houses are sometimes sold above, sometimes below and sometimes at the...