A test between unemployment theories using matching data
By: Melvyn Coles, B. Petrongolo.
Contributors: Petrongolo, B.; London School of Economics and Political Science. Centre for Economic Performance.
Series: Discussion paper ;; no. 570; Discussion paper (London School of Economics and Political Science. Centre for Economic Performance : Online) ;; no. 570.
Publisher: Centre for Economic Performance, London School of Economics and Political Science
Published: 2003
Place of publication: [London]
Language: eng
Format: Electronic resource
Subjects: Unemployment -- Econometric models.; Matching theory.
Description: "This paper tests whether aggregate matching is consistent with unemployment being mainly due to search frictions or due to job queues. Using U.K. data and correcting for temporal aggregation bias, estimates of the random matching function are consistent with previous work in this field, but random matching is formally rejected by the data. The data instead support 'stock-flow' matching. Estimates find that around 40 per cent of newly unemployed workers match quickly - they are interpreted as being on the short-side of their skill markets. The remaining workers match slowly, their re-employment rates depending statistically on the inflow of new vacancies and not on the vacancy stock. Having failed to match with existing vacancies, these workers wait for the arrival of new job vacancies. The results have important policy implications, particularly with reference to the design of optimal unemployment insurance programs"--London School of Economics web site.
Notes: Includes bibliographical references.
Title from summary page as viewed on 1/7/2005.
Also available in print.
System requirements: Adobe Acrobat Reader.
Mode of access: World Wide Web.