This study investigates how externalities from downstream competition shape sorting in upstream labor markets. I model this as a two-stage game: A first stage of simultaneous one-to-one matching between firms and managers and a second stage of Cournot competition among matched pairs. If a firm’s technology and human capital are strategic complements, it is rational for each firm-manager pair to expect that the remaining agents will form a positive assortative matching (PAM), and the PAM on the grand market is a stable matching under rational expectations. The PAM remains stable even when they are strategic substitutes but the substitutive effect is moderate. However, if the substitutive effect is sufficiently strong, a negative assortative matching is stable. Social welfare induced by stable matchings is discussed.

中文翻译：

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下游竞争与上游劳动力市场匹配

本研究调查下游竞争的外部性如何影响上游劳动力市场的排序。我将此建模为一个两阶段博弈：第一阶段是公司和经理之间同时进行一对一匹配，第二阶段是匹配对之间的古诺竞争。如果一个企业的技术和人力资本是战略互补的，那么每个企业-经理对期望剩余的代理人会形成正分类匹配（PAM）是合理的，并且大市场上的PAM是理性预期下的稳定匹配. 即使是战略替代品，PAM 也保持稳定，但替代效果适中。但是，如果替代效应足够强，则负分类匹配是稳定的。讨论了由稳定匹配引起的社会福利。