Potter, Tristan and Bernhardt, Dan (2022) Wage offers and on-the-job search. Canadian Journal of Economics, 55 (1). doi:10.1111/caje.12588 ISSN 0008-4085.

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Abstract

We study the wage-setting problem of an employer with private information about demand for its product when workers can engage in costly on-the-job search. Employers understand that low wage offers may convey bad news that induces workers to search. The unique perfect sequential equilibrium wage strategy is characterized by: (i) pooling by intermediate-revenue employers on a common wage that just deters search, (ii) discontinuously lower revealing offers by low-revenue employers for whom the benefit of deterring search fails to warrant the required high pooling wage and (iii) high revealing offers by high-revenue employers seeking to deter aggressive raiders.

Item Type:	Journal Article
Subjects:	H Social Sciences > HB Economic Theory H Social Sciences > HD Industries. Land use. Labor
Divisions:	Faculty of Social Sciences > Economics
Library of Congress Subject Headings (LCSH):	Wages -- Mathematical models, Job security -- Psychological aspects, Job hunting, Employee retention
Journal or Publication Title:	Canadian Journal of Economics
Publisher:	Wiley-Blackwell Publishing, Inc.
ISSN:	0008-4085
Official Date:	February 2022
Dates:	Date Event 8 April 2022 Available February 2022 Published 18 February 2021 Accepted
Volume:	55
Number:	1
DOI:	10.1111/caje.12588
Status:	Peer Reviewed
Publication Status:	Published
Reuse Statement (publisher, data, author rights):	"This is the peer reviewed version of the following article: Potter, T. and Bernhardt, D. (2022), Wage offers and on-the-job search. Canadian Journal of Economics/Revue canadienne d'économique. https://doi.org/10.1111/caje.12588, which has been published in final form at https://doi.org/10.1111/caje.12588. This article may be used for non-commercial purposes in accordance with Wiley Terms and Conditions for Use of Self-Archived Versions."
Access rights to Published version:	Restricted or Subscription Access
Copyright Holders:	Canadian Economics Association
Date of first compliant deposit:	22 February 2021
Related URLs:	Publisher Publisher

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