This paper examines the problem of non-existence of a single-wage equilibrium in a simple search model with asymmetric information. A pure-strategy, symmetric Nash equilibrium fails to exist because adverse selection arising from steady-state considerations causes a non-concavity in the payoff function.
Review of Economic Studies
Non–Existence of Single–Wage Equilibria in Search Models with Adverse Selection
Journal Article
Reference
Albrecht, James W. and Susan B. Vroman (1992). “Non–Existence of Single–Wage Equilibria in Search Models with Adverse Selection”. Review of Economic Studies 59(3), 617–624. doi.org/10.2307/2297867
Albrecht, James W. and Susan B. Vroman (1992). “Non–Existence of Single–Wage Equilibria in Search Models with Adverse Selection”. Review of Economic Studies 59(3), 617–624. doi.org/10.2307/2297867
Authors
James W. Albrecht, Susan B. Vroman
