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This paper presents a model in which mismatch employment arises in a constrained efficient equilibrium. In the decentralized economy, however, mismatch gives rise to a congestion externality whereby heterogeneous job seekers fail to internalize how their individual actions affect the labor...
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limited network connections. The model implies that essentially similar workers can have markedly different wages and further … that the inequality of wages is partly explained by variations in the sizes of workers' networks. Our results indicate that … wages. We also show that reasonable differences in the average number of links between blacks and whites can explain the …
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