The S. C. Tsiang Macroeconomics Workshop: Shu Lin Wee

Thursday, November 30, 2017 at 11:40am to 1:10pm

Uris Hall, 498
Central Campus

Shu Lin Wee
Carnegie Mellon University

Rational Inattention in Hiring Behavior (joint w/Sushant Acharya)

Abstract: We provide an information-based theory of match efficiency. Rationally inattentive firms have limited capacity to process information and cannot perfectly identify suitable applicants. As losses from hiring the wrong worker are amplified in a recession, firms seek to be more selective in their hiring. Inability to obtain sufficient information about applicants causes firms to err on the side of caution and accept fewer applicants in order to avoid hiring unsuitable workers. Pro-cyclical acceptance rates drive a wedge between meeting and hiring rates, driving fluctuations in match efficiency. Quantitatively, our model accounts for changes in measured match efficiency in the data.

Event Type

Class/ Workshop

Departments

Economics

Tags

EconMacro, economics, EconSeminar

Hashtag

#CornellEcon

Contact E-Mail

alg5@cornell.edu

Contact Name

Amy Moesch

Contact Phone

607-255-5617

Speaker

Shu Lin Wee

Speaker Affiliation

Carnegie Mellon University

Open To

Cornell Economics Community (List Serve Members)

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