DP14727 Recruitment Policies, Job-Filling Rates and Matching Efficiency

Author(s): Carlos Carrillo-Tudela, Gartner Hermann, Leo Kaas
Publication Date: May 2020
Keyword(s): Labor market matching, Recruitment, Vacancies
JEL(s): E24, J23, J63
Programme Areas: Labour Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=14727

Recruitment behavior is important for the matching process in the labor market. Using unique linked survey-administrative data, we explore the relationships between hiring and recruitment policies. Faster hiring goes along with higher search effort, lower hiring standards and more generous wages. To analyze the mechanisms behind these patterns, we develop a directed search model in which firms use different recruitment margins in response to productivity shocks. The calibrated model points to an important role of hiring standards for matching efficiency and for the impact of labor market policy, whereas search effort and wage policies play only a minor role.