Random social networks, unemployment and wage inequality

Empirical studies of labor markets show that social contacts are an important source of job-related information. At the same time, wage differences among workers may be explained only in part by differences in individual background characteristics. Such findings motivate our model in which differences in "social connectedness" among otherwise identical workers result in wage inequality and differences in unemployment rates. The model of this paper allows for heterogeneity in the number of connections among workers within the Pissarides model of labor market turnover. The paper derives conditions for which a unique labor market equilibrium exists. It also shows that such heterogeneity has important consequences. Workers with more connections both receive a higher wage and face a lower rate of unemployment at equilibrium. For the specific cases in which connections follow Poisson and negative binomial distributions our numerical results show that variability in connections can produce substantial variation in labor market outcomes. One lesson from the computational analysis is that (changes in) the social structure sometimes affect labor market outcomes in nontrivial ways. For example, when society becomes more connected, the average unemployment level falls but the unemployment rate of workers with few connections rises

Social networking and individual outcomes beyond the mean field case

We study individually optimized continuous outcomes in a dynamic environment in the presence of social interactions, and where the interaction topology may be either exogenous and time varying, or endogenous. The model accommodates more general social effects than those of the mean-field type. We address endogenous networking by assuming that each individual chooses the weights she attaches to the characteristics and the decisions of other agents. This amounts to choosing the elements of a row of a weighted adjacency matrix. Endogenous social networking thus involves simultaneity between decisions and patterns of directed social interactions

An empirical investigation on the dynamics of qualitative decisions of firms

SIGLEAvailable from British Library Document Supply Centre-DSC:3597.980895(UWS-DE-DP--96-06) / BLDSC - British Library Document Supply CentreGBUnited Kingdo

Strategic game models of economic integration

SIGLEAvailable from British Library Document Supply Centre- DSC:3597.1206(LSE-CEP-DP--208) / BLDSC - British Library Document Supply CentreGBUnited Kingdo

Preparation and characterisation of a novel redox polymer based on salicyl-N-phenylene diamine

Abstract. In this paper we introduce and study a model that considers the job market as a two-sided matching market, and accounts for the importance of social contacts in finding a new job. We assume that workers learn only about positions in firms through social contacts. Given that information structure, we study both static properties of what we call locally stable matchings, a solution concept derived from stable matchings, and dynamic properties through a reinterpretation of Gale-Shapley’s algorithm as myopic best response dynamics. We prove that, in general, the set of locally stable matching strictly contains that of stable matchings and it is in fact NP-complete to determine if they are identical. We also show that the lattice structure of stable matchings is in general absent. Finally, we focus on myopic best response dynamics inspired by the Gale-Shapley algorithm. We study the efficiency loss due to the informational constraints, providing both lower and upper bounds.