TY  - RPRT
        AU  - Cai, Xiaoming
AU  - Gautier, Pieter A.
        TI  - Sorting in a Market for Lemons
        PY  - 2026/Oct/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 18985
        UR  - https://www.iza.org/index.php/publications/dp18985
        AB  - Search frictions normally raise the bar for sorting: both random and directed search require complementarities strictly stronger than the supermodularity that suffices in Becker's (1973) frictionless model. We introduce private information into this setting: firms post wages without observing worker productivity, while better workers have better outside options, creating a market for lemons (Akerlof 1970). We show that this information friction pushes sorting the other way: attracting high-productivity workers without attracting low-productivity ones requires a higher wage paired with a lower job-finding probability, so vacancies fill faster. This strict ranking of vacancy-filling rates sorts the market positively whenever output is complementary in worker and firm quality. Becker's condition therefore suffices once more, and private information makes positive sorting
easier to sustain than complete information does.
        KW  - competitive search
KW  - adverse selection
KW  - screening
KW  - sorting
KW  - positive assortative matching
        ER  -