Valuation and Matching: A Conventionalist Explanation of Labor Markets by Firms' Recruitment Channels

Abstract

In line with the conventionalist works on recruitment and intermediation in the labor market, this article argues that, in order to shape uncertainty about the quality of matching, recruitment channels used by firms rely on "investments in forms." The first investment corresponds to the definition of the boundaries of the labor market (i.e., the outline of the labor supply from the firm's point of view); the second one corresponds to the format of information (i.e., the "standard" or "personalized" language used by channels to convey information). The firm’s resort to a given channel is explained by its internal organization and its valuation of what is a good applicant (depending on its "labor quality con-vention"). By crossing-over the two types of investment in forms, we distinguish four matching dynamics. Each type of dynamics is illustrated by examples coming from a qualitative survey of recruitment practices in four French service oriented sectors.