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| Maxime Liégey |
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| ''Search externalities and management policies'' |
| ( 2021, Vol. 41 No.4 ) |
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| How can externalities in the labor market interact with firms' adoption of Human Resource Management (HRM) policies ? I build a search-and-matching model in which managers supervise teams of workers and intervene in the output process, in order to account for the equilibrium determination of managers' choice between labor-hoarding versus labor-churning HRM policies. I show that, if congestion externalities on workers' side are strong enough, they are willing to accept moderate wages provided the job-finding rate is high enough. This induces managers to adopt labor-hoarding HRM policies, which fosters manager entry into the market. The model thus establishes a testable result, namely, a positive relationship between the strength of congestion externalities on workers' side, and firms' propensity to adopt labor-hoarding HRM policies. |
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| Keywords: Search-and-Matching, Human Resource Management Policies, Worker Turnover |
JEL: J6 - Mobility, Unemployment, and Vacancies: General
L2 - Firm Objectives, Organization, and Behavior: General |
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| Manuscript Received : Dec 29 2021 | | Manuscript Accepted : Dec 29 2021 |
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