Template-Type: ReDIF-Paper 1.0
Title: The Balance Condition in Search-and-Matching Models
Author-Name: Stephan Lauermann
Author-Email: s.lauermann@uni-bonn.de
Author-Name: Georg Nöldeke
Author-Email: georg.noeldeke@unibas.ch
Author-Name: Thomas Tröger
Author-Email: troeger@uni-mannheim.de

Classification-JEL: 
Keywords: Search, Matching, Steady State

Abstract: Most of the literature that studies frictional search-and-matching models with 
heterogeneous agents and random search investigates steady-state equilibria. Steady-state 
equilibrium requires, in particular, that the flows of agents into and out of the population 
of unmatched agents balance. We investigate the structure of this balance condition, 
taking agents' matching behavior as given. Building on the "fundamental matching lemma" for 
quadratic search technologies in Shimer and Smith (2000), we establish existence, uniqueness, 
and comparative-static properties of the solution to the balance condition for any search 
technology satisfying minimal regularity conditions. Implications for the existence and 
structure of steady-state equilibria are noted.

Note: 
Length: 29
Creation-Date: 2019-08
Revision-Date: 
File-URL: https://www.crctr224.de/research/discussion-papers/archive/dp120
Handle: RePEc:bon:boncrc:CRCTR224_2019_120