Journal of Labor Economics Vol. 44 No. 2 2026
Strategic Wage Posting, Market Power, and Mismatch
Abstract
This paper analyzes the effects of firms posting multiple but varying numbers of vacancies, hence differing in their market power, in professional labor markets. I find that strategic wage posting does, in general, not result in an efficient assignment of workers to firms. This is because firms with a larger number of vacancies pay on average lower wages than their competitors due to a lack of within-firm rivalry. If highly productive firms hire more, the resulting welfare loss due to mismatch may be substantial. Moreover, I provide a potential explanation why firms post uniform wages, missing out on more skilled workers.
- DOI
- 10.1086/733046
- Volume
- 44
- Issue
- 2
- Pages
- 481-514
- Language
- en
- Sources
- semanticscholar openalex crossref