Internal labor markets are increasingly important for matching workers to jobs within organizations. We present evidence from a randomized trial that compares matching workers to jobs using the deferred acceptance (DA) algorithm to the traditional manager‐directed matching process. Our setting is the U.S. Army's internal labor market, which matches over 14,000 officers to units annually. We find that DA reduces administrative burden and increases match quality as measured by reduced justified envy, increased truthful preference reporting, and officers' and units' preferences over their matches. The overall impact of DA on officer retention and performance in the two years after officers started their new jobs is limited by strategic preference coordination between officers and units. However, DA leads to significant improvements in officer retention and promotions in markets with inexperienced managers. Our findings suggest that cross‐market communication between agents in internal labor markets can attenuate the benefits of strategyproof matching algorithms.

In many economic situations, individuals carry out activities as coalitions, and have personal preferences for belonging to specific groups (coalitions). These situations are studied in the framework of cooperative games with coalition structures, by defining for each player a utility function with two arguments, namely his consumption bundle and the coalition to which (s)he belongs. The optimality analysis brings out a surprising property of the games with coalitions, namely that transfers among coalitions may be necessary to attain Pareto optimality. Moreover, quite restrictive assumptions are needed to rule out this property. The analysis is concerned with the conditions under which no has incentives and opportunities to change Two concepts of individual stability of a coalition structure are introduced, and their existence properties are analyzed. 1.1 Summary IN MANY ECONOMIC SITUATIONS, individuals carry out activities as Thus, individuals organize themselves in firms for production purposes and in clubs for consumption purposes; or they rely upon local communities for the provision of public goods. In such situations, individuals typically have personal preferences for belonging to specific groups (coalitions). First, they are concerned with the size of the group and personalities of its members. Second, they are concerned with qualitative and quantitative characteristics of the group activities: Working conditions in the firms, facilities available at the clubs, local public goods. Cooperative games with coalition structures provide a natural framework for a formal analysis of these situations, when the individuals partition themselves into A general way of introducing explicitly personal preferences for membership in specific coalitions is to define for each player a utility function with two arguments, namely his consumption bundle and the coalition to which he belongs. It then seems natural to speak about games with hedonic coalitions. A model of an economy, or cooperative game, with coalitions is introduced in Section 1.2. The agents organize themselves in coalitions which form a partition (i.e., each agent belongs to one and only one coalition). Each coalition, endowed with a production set, produces public and private goods. Each agent consumes the public goods produced by the coalition to which he belongs, and private goods. His preferences are represented by a utility function which is strictly increasing in private goods and continuous in private as well as public goods, but which depends upon the coalition in an arbitrary way. Our initial interest was to study the of coalitions in this model. Section 3 is devoted to that topic. However, in the course of our study, we encountered an

This article examines past evaluations of government training programs for the economically disadvantaged and offers an agenda for future research. It is found that government training programs are producing modest increases in earnings for adult men and women, but are probably not producing positive effects for youth. Future research must better document links between program-provided training and acquisition of valuable skills and must explore potential returns from increased scale. The recent adoption of random assignment has improved the accuracy of field evaluations but would benefit from an economic theory of evaluation to guide research into increasing training effectiveness.

The task is an analysis of the traditional labor supply model using several competing methodologies. The approach is a step-by-step exploration of alternative labor supply estimating equations that attempts to identify the independent (marginal) effect of each particular change in the form of these equations. By systematically exploring what difference each of these changes makes to the parameter estimates, one can isolate which factors strongly affect estimated response parameters. Results from existing research can then be evaluated within a larger context, and future research can concentrate on resolving those methodological issues that do make a difference.