On the Game-Theoretic Foundations of Competitive Search Equilibrium

40 Pages Posted: 20 Jan 2012

See all articles by Manolis Galenianos

Manolis Galenianos

Royal Holloway, University of London

Philipp Kircher

University of Pennsylvania - Department of Economics; IZA Institute of Labor Economics

Date Written: January 19, 2012

Abstract

We provide a unified directed search framework with general production and matching specifications that encompasses most of the existing literature. We prove the existence of sub-game perfect Nash equilibria in pure firm strategies in a finite version of the model. We use this result to derive a more complete characterization of the equilibrium set for the finite economy and to extend convergence results as the economy becomes large to general production and matching specifications. The latter extends the micro-foundations for the standard market-utility assumption used in competitive search models with a continuum of agents to new environments.

Suggested Citation

Galenianos, Manolis and Kircher, Philipp, On the Game-Theoretic Foundations of Competitive Search Equilibrium (January 19, 2012). Available at SSRN: https://ssrn.com/abstract=1988561 or http://dx.doi.org/10.2139/ssrn.1988561

Manolis Galenianos

Royal Holloway, University of London ( email )

Horton Building
Department of Economics
Egham, Surrey TW20 0EX
United Kingdom

HOME PAGE: http://www.manolis-galenianos.org/

Philipp Kircher (Contact Author)

University of Pennsylvania - Department of Economics ( email )

Ronald O. Perelman Center for Political Science
133 South 36th Street
Philadelphia, PA 19104-6297
United States
215-898-6777 (Phone)
215-573-2057 (Fax)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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