Affiliation:
1. Cornell University and University of Edinburgh ()
2. Cornell University, Universite Catholique de Louvain, and University of Edinburgh ()
3. Vrije Universiteit Amsterdam and Tinbergen Institute ()
Abstract
In a field experiment, we study how job seekers respond to posted wages by assigning wages randomly to pairs of otherwise similar vacancies in a large number of professions. Higher wages attract significantly more interest. Still, a nontrivial number of applicants only reveal an interest in the low-wage vacancy. With a complementary survey, we show that external raters perceive higher-wage jobs as more competitive. These findings qualitatively support core predictions of theories of directed/competitive search, though in the simplest calibrated model, applications react too strongly to the wage. We discuss extensions such as on-the-job search that rectify this. (JEL C93, J31, J63, J64)
Publisher
American Economic Association
Subject
General Economics, Econometrics and Finance
Cited by
9 articles.
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