Consumer Choice & Behavioral

Finding Amy a Date

Search theory describes how mutually beneficial transactions are achieved when there are a variety of heterogeneous options available. Throughout this particular episode, Amy deals with people trying to help her find a partner, but she’s not well informed of their quality. Matching markets often involve some form of imperfect information that participants must face when trying to decide to transact.


Selecting a Santa

Glenn is interviewing different candidates for the store’s open Santa position. One of candidates was trained by a legend who worked at the Chicago Macy’s and feels he has amassed enough human capital to be perfect for the Cloud 9 position. The interviewing process takes time and includes costs that aren’t monetary. Glenn could spend his day managing his employees, but he’s spending his time searching for a good match.

Labor Principles

Interviewing Management Candidates

While interviewing candidates for the assistant manager position, Amy and Glenn try to learn more about the potential candidates’ ability to move into this new role. They are surprised by the applicants, namely that the pharmacist is interested in switching roles or by Marcus’s accidental admission of stolen property. The interviewing process can be costly because it takes time and effort to find a good “match” for the company. Interviewing candidates from the pool of current employees helps reduce the cost of finding a worker, but it still requires Glenn and Amy to take time away from the floor to interview people.