This study addresses two conceptual issues in measuring recruitment elasticity: defining outcomes by matches rather than applications, and conditioning on workers observing posted wages. Using data from Japan's largest job matching intermediary tracking complete matching processes, we find recruitment elasticities around 1 for upper-wage workers but insignificant for lower-wage workers, indicating substantial employer market power. Wages significantly affect outcomes only at the application stage, not at subsequent interview or offer stages, consistent with directed search theory. These findings reveal heterogeneous monopsony power across worker segments with important implications for labor market policy.
Kambayashi et al. (Wed,) studied this question.