Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/216398 
Year of Publication: 
2020
Series/Report no.: 
IZA Discussion Papers No. 13086
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
We set up a model with search and matching frictions to understand the effects of employment and wage policies, as well as nepotism in hiring in the public sector, on unemployment and rent seeking. Conditional on inefficiently high public-sector wages, more nepotism in public-sector hiring lowers the unemployment rate because it limits the size of queues for public-sector jobs. Wage and employment policies impose an endogenous constraint on the number of workers the government can hire through connections.
Subjects: 
public-sector employment
nepotism
public-sector wages
unemployment
queues
JEL: 
E24
J31
J45
J64
Document Type: 
Working Paper

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