Matching frictions and distorted beliefs: evidence from a job fair experiment
File(s)
Accepted version
Author(s)
Type
Journal Article
Abstract
We evaluate the impacts of a randomized job-fair intervention in which jobseekers and employers can meet at low cost. The intervention generates few hires, but it lowers participants’ expectations and causes both firms and workers to invest more in search as predicted by a theoretical model; this improves employment outcomes for less-educated jobseekers. Through a unique two-sided belief-elicitation survey, we confirm that firms and jobseekers have over-optimistic expectations about the market. This suggests that, beyond slowing down matching, search frictions have a second understudied cost: they entrench inaccurate beliefs, further distorting search strategies and labour-market outcomes.
Date Issued
2025-10-01
Date Acceptance
2025-04-04
Citation
The Economic Journal, 2025, 135 (671)
ISSN
0013-0133
Publisher
Oxford University Press (OUP)
Journal / Book Title
The Economic Journal
Volume
135
Issue
671
Copyright Statement
© The Author(s) 2025. Published by Oxford University Press on behalf of Royal Economic Society. This is the author’s accepted manuscript made available under a CC-BY licence in accordance with Imperial’s Research Publications Open Access policy (www.imperial.ac.uk/oa-policy)
License URL
Publication Status
Published
Date Publish Online
2025-04-21