Messyeconomics is what Ezra Klein calls it. The economists sharing this year’s Nobel prize won for their work on how the process of matching of workers to jobs can explain why high unemployment can be high while at the same time there are new hires. Their key insight is that neither workers nor jobs are homogeneous.
Just as in searching for a marriageable mate or a suitable house, the matching process is protracted because at least one side of the market takes time learning about the characteristics of the other. This insight can branch of in several directions — for example, can potential workers hide undesirable characteristics? what does a worker’s job history tell his potential employer? what happens when it is difficult to fire workers? do current employers slant recommendation letters to shed themselves of employees who have not worked out? are some employers better informed than others?
The earlier item today on The Lead on the placement practices of the Catholic Diocese of Chicago can be looked at from the perspective of job matching. Why might priests who have been credibly accused of child abuse be assigned to churches in neighborhoods where there is a relatively high proportion of minorities, and relatively low income? In terms of the economic framework of matching with asymmetric information an answer easily suggests itself.
First note that matches are made by assignment at the diocesan level, not by the parishes doing a search. Parishes and schools in wealthier neighborhoods are better connected to the old boy network (which gives them information, favoritism, and voice), and are more likely to invest in learning about who is likely to be assigned and to spend more in the lobbying process. In addition, priests have preferences for plum positions and the diocese likely uses job assignment to reward priests it wants to retain or groom for promotion. Poorer parishes know they are getting lemons but they don’t know what makes their priest a lemon — is he just of low talent or is he likely to be a child abuser?
The diocese may outwit itself. On the one hand, holding all else equal, assigning a likely child abuser to a poor parish means he will be less likely to be discovered. On the other hand, all else is not equal. A child abuser would take advantage of that situation, increasing the odds that he would eventually be caught and bring shame on the diocese.