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Search Intensity, Cost of Living and Local Labour Markets in Britain

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Author Info
Patacchini, Eleonora
Zenou, Yves

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Abstract

A model is considered in which optimal search intensity is a result of a trade-off between short-run losses due to higher search costs (more interviews, commuting...) and long-run gains due to a higher chance to find a job. We show that this optimal search intensity is higher in areas characterized by larger cost of living and/or higher labour market tightness. We then test this model using county-level data in England for the period 1991-2000. As predicted by the theoretical model, both the county cost of living and the county labour market tightness are found to have a positive and significant effect on the county search intensity. We also find positive spatial correlation between counties (i.e. clustering of counties with similar level of search intensity) and strong spatial spillover effects.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 3722.

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Date of creation: Jan 2003
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Handle: RePEc:cpr:ceprdp:3722

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Related research
Keywords: dynamic panel data; GMM estimation; job matching; measurement errors; search intensities; spatial correlation;

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Find related papers by JEL classification:
C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data
D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search, Learning, and Information
J64 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Unemployment: Models, Duration, Incidence, and Job Search
R10 - Urban, Rural, and Regional Economics - - General Regional Economics - - - General

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(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Eva, MORENO-GALBIS & Henri R., SNEESSENS, 2004. "Low-Skilled Unemployment, Capital-Skill Complementarity and Embodied Technical Progress," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2004025, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES). [Downloadable!]
    Other versions:
  2. Gobillon, Laurent & Magnac, Thierry & Selod, Harris, 2007. "The Effect of Location on Finding a Job in the Paris Region," IDEI Working Papers 433, Institut d'Économie Industrielle (IDEI), Toulouse, revised Mar 2009. [Downloadable!]
    Other versions:
  3. GOBILLON Laurent & SELOD Harris, 2007. "The effects of segregation and spatial mismatch on unemployment: evidence from France," Research Unit Working Papers 0702, Laboratoire d'Economie Appliquee, INRA. [Downloadable!]
    Other versions:
  4. Gobillon, Laurent & Selod, Harris & Zenou, Yves, 2005. "The mechanisms of spatial mismatch," CEPR Discussion Papers 5346, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  5. Sabrina Di Addario, 2005. "Job Search in Thick Markets: Evidence from Italy," Development Working Papers 198, Centro Studi Luca d\'Agliano, University of Milano. [Downloadable!]
    Other versions:
  6. Eva, MORENO-GALBIS, 2004. "Unemployment and Endogenous Growth with Capital-Skill Complementarity," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2004001, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES). [Downloadable!]
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