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Contracts vs. Salaries in Matching

Echenique, Federico (2010) Contracts vs. Salaries in Matching. Social Science Working Paper, 1322. California Institute of Technology , Pasadena, CA.

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Firms and workers may sign complex contracts that govern many aspects of their interactions. I show that when firms regard contracts as substitutes, bargaining over contracts can be understood as bargaining only over wages. Substitutes is the assumption commonly used to guarantee the existence of stable matchings of workers and firms.

Item Type:Report or Paper (Working Paper)
Additional Information:I thank Vince Crawford, Flip Klijn, Scott Kominers, and Michael Ostrovsky for very useful comments. I am also very grateful to three anonymous referees for their thoughtful questions and suggestions.
Group:Social Science Working Papers
Subject Keywords:Contracts, Substitutes, Gross Substitutes, Stable Matching
Classification Code:JEL classication numbers: C78
Record Number:CaltechAUTHORS:20101008-093110872
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Usage Policy:No commercial reproduction, distribution, display or performance rights in this work are provided.
ID Code:20348
Deposited By: Katherine Johnson
Deposited On:08 Oct 2010 16:39
Last Modified:26 Dec 2012 12:30

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