It is possible to construct a panel of labour market flows from the first wave of the British Household Panel Study. Using this data, a three-state Markov model of labour market transitions is specified and estimated, using the proportional hazard function approach. The three states considered...

The authors analyze markets where each of n buyers wants to buy one unit and each of m sellers wants to sell one or more units of an indivisible good. Sellers first set prices, then buyers choose which sellers to visit. There are equilibria where each buyer visits sellers at random and faces a...

We extend simple search models of crime, unemployment, and inequality to incorporate on-the-job search. This is valuable because, although simple models are useful, on-the-job search models are more interesting theoretically and more relevant empirically. We characterize the wage distribution,...

The unique equilibrium solution to a game in which a continuum of individual employers choose permanent wage offers and a continuum of workers search by sequentially sampling from the set of offers is characterized. Wage dispersion is a robust outcome provided that workers search while employed...

There are two facts about the world that we take as given: First the "law of one price" is false -- one can find many different prices for what appears to be, beyond reasonable doubt, the same good. Second, prices are set in nominal terms and appear, beyond reasonable doubt, to be sticky -- some...

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We study the effect of menu costs on the pricing behavior of sellers and on the cross-sectional distribution of prices in the search-theoretic model of imperfect competition of Burdett and Judd (1983). We find that, when menu costs are small, the equilibrium is such that sellers follow a (Q, S,...