In the two-sided search model, the size of the labour force is positively related to
A) the expected payoff to searching for work.
B) the population growth rate.
C) the ratio of males to females in the labour force.
D) the expected cost to searching for work.
E) the benefits of non-participation.

Question

Quizplus · Accepted Answer

In the two-sided search model, the size of the labour force is positively related to the expected payoff to searching for work. This means that as the expected payoff increases, more individuals will enter the labour force as they perceive the benefits of finding a job to be greater.

In the Two-Sided Search Model, the Size of the Labour