The probability of finding a job is
A) decreasing in the efficiency of the matching function.
B) increasing in market tightness.
C) increasing in the ratio of consumers searching to firms.
D) decreasing in market tightness.
E) constant across all levels of market tightness.

Question

Quizplus · Accepted Answer

Market tightness refers to the ratio of vacancies to job seekers. As market tightness increases, the probability of finding a job also increases. This is because more vacancies are available compared to the number of job seekers competing for them, making it easier for individuals to find a suitable job. On the other hand, decreasing market tightness makes it harder for job seekers to find employment opportunities, reducing their probability of finding a job.

The Probability of Finding a Job Is