No One Likes to Be Second Choice

A decision maker wishes to fill a vacancy with a fixed wage. Candidates who are more valuable to the decision maker are less likely to be available. The candidates suffer a disutility from filling the position when they are ranked low on the decision maker’s preference list. However, the decision maker’s preferences are his private information. Therefore, the candidates infer the decision maker’s preference list from information revealed by the number of failed offers. We explore the adverse effect of the social component in the candidates’ preferences on the decision maker’s ability to recruit a suitable candidate.