Wage-Tenure Contracts in a Frictional Labour Market: Firms’ Strategies for Recruitment and Retention
نویسنده
چکیده
This paper analyses the contract-posting equilibrium in a general equilibrium matching model of the labour market with on-the-job turnover. Privately optimal contracts have a rising wage-tenure profile, even when productivity is constant. The effect is to reduce equilibrium turnover; when jobs differ in productivity, turnover is below the level required for efficient matching of workers to jobs. Contracts with a rising wage-tenure profile can be interpreted as a form of monopsonistic price discrimination. Credit constraints, or institutions that limit firms' ability to price discriminate, can improve the efficiency of matching. JEL Classification: J41
منابع مشابه
Equilibrium Wage - Tenure Contracts By
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