Status value depending on economy-wide title prevalence

Characterize equilibrium behavior and welfare when the additional utility from receiving the managerial job title depends on the number of individuals in the overall economy who hold that title.

Background

The model treats the status benefit from receiving the managerial title as a fixed parameter. The conclusion proposes making that benefit endogenous to the prevalence of the title in the broader economy. The authors conjecture that the main results would be largely unchanged because an individual firm would internalize only a negligible effect of its own title-inflation decision on the economy-wide status value, but this conjecture is not established.