Efficiency of Expert-Mediated Job Matching

Abstract

The No. 96 Convention of the International Labour Organization (ILO), which had prohibited for-profit job matching intermediaries since its enforcement in 1933 among ratified countries, was finally abolished in 1997. It was expected that the expansion of institutionalized job matching intermediaries can improve the match efficiency. This paper uses the proprietary business-level micro data from one of the largest job matching intermediaries operating in Japan and quantifies the efficiency gain from the experts' efforts in the intermediary. Moreover, we study specifically what type of search friction experts in the intermediary successfully reduce. To do so, we develop an empirical structural model of job matching after recommendations by experts, job applications by workers, and interview call decisions by firms. We then uncover the key parameters governing the entire process such as the preference for matches, cost of applications and interviews, the information update at the interview, and the prediction power of expert recommendations for match qualities using our novel data. With policy experiments based on the estimated model, we show how the match efficiency increased by the experts' recommendations and its heterogeneous impacts across worker, firm, and match characteristics.

About the presenter’s visit

Dr Kohei Kawaguchi will be visiting the School of Economics on Friday 10^th May 2019.  While here he will be using room 520A Colin Clark Building.  If you would like to meet with him or have lunch or dinner with him please contact Dr Satoshi Tanaka who will be his host while at The University of Queensland.  Dr Tanaka can be contacted on s.tanaka@uq.edu.au.