TY  - RPRT
        AU  - Fontaine, Francois
        TI  - Why Are Similar Workers Paid Differently? The Role of Social Networks
        PY  - 2005/Sep/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 1786
        UR  - https://www.iza.org/publications/dp1786
        AB  - We provide a matching model where identical workers are embedded in ex-ante identical social networks. Job arrival rate is endogenous and wages are bargained. We study the evolution of networks over time and characterize the equilibrium distribution of unemployment rates across networks. We emphasize that wage dispersion arises endogenously as the consequence of the dynamics of networks, firms’ strategies and wage bargaining. Moreover, contrary to a generally accepted idea, social networks do not necessary induce stickiness in unemployment dynamics. Our endogenous matching technology shows that the effects of networks on the dynamics mostly hinge on search externalities. Our endogenous framework allows us to quantify these effects.  
        KW  - wage dispersion
KW  - matching
KW  - social networks
        ER  -