The department congratulates Edgar Preugschat, Ph.D., on his habilitation

In his habilitation thesis, Mr. Preugschat examines markets that are characterized by search and matching frictions. Such frictions arise from coordination and information problems and mean that supply and demand do not always coincide - rationing can be the result. One branch of this literature, the so-called directed search paradigm, assigns a special allocative role to prices: market participants weigh up the price of a transaction against the probability of being able to carry it out at all.

The paper includes three applications of this theory:

1. Unemployment and stigmatization:
   The first paper shows how the duration of unemployment can lead to rational stigmatization. If companies are unable to accurately assess the productivity of workers, unemployment serves as a signal of lower productivity - with the result that applicants with longer periods of unemployment are less likely to be hired.

2. Competition clauses in knowledge-intensive industries:
   The second paper examines the extent to which competition clauses in employment contracts - i.e. regulations to protect highly qualified skilled workers from being poached - are efficient. The central trade-off is between the private returns on knowledge on the one hand and the efficient diffusion of knowledge on the other - in the context of a labor market characterized by matching frictions.

3. Price transparency in the matching model:
   The third paper presents an experimental investigation of a theoretical matching model in which - counterintuitively - higher price transparency can lead to higher market prices. The experiment confirms this surprising prediction and shows a randomization behavior of participants at the individual level that is consistent with theory.

The Department of Business and Economics congratulates Mr. Preugschat on this outstanding achievement and wishes him continued success and enjoyment in his research.