The separation of market and price in some free competitions and its related solution to the over-application problem in the job market

Abstract

According to common understanding, in free completion of a private product, market and price, the two main factors in the competition that leads to economic efficiency, always exist together. This paper, however, points out the phenomenon that in some free competitions the two factors are separated hence causing inefficiency. For one type, the market exists whereas the price is absent, i.e. free, for a product. An example of this type is the job application market where the problem of over-application commonly exists, costing recruiters much time in finding desired candidates from massive applicants, resulting in inefficiency. To solve the problem, this paper proposes a solution that the recruiters charge submission fees to the applications to make the competition complete with both factors, hence enhancing the efficiency. For the other type, the price exists whereas the market is absent for a product. An example of this type is the real estate agent market, where the price of the agents exists but the market, i.e. the facility allowing the sellers' information to be efficiently discovered, is largely absent, also causing inefficiency. In summary, the contribution of this paper consists of two aspects: one is the discovery of the possible separation of the two factors in free competitions; the other is, thanks to the discovery, a solution to the over-application problem in the job market.