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A cross-country comparison of labor market frictions

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Abstract

In this paper we define and estimate measures of labor market frictions using data on job durations. We compare different estimation methods and different types of data. We propose and apply an unconditional inference method that can be applied to aggregate duration data. It does not require wage data, it is invariant to the way in which wages are determined, and it allows workers to care about other job characteristics. The empirical analysis focuses on France, but we perform separate analyses for the USA, the UK, Germany and the Netherlands. We quantify the monopsony power due to search frictions and we examine the policy effects of the minimum wage, unemployment benefits and search frictions.

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Bibliographic Info

Paper provided by IFAU - Institute for Evaluation of Labour Market and Education Policy in its series Working Paper Series with number 2002:22.

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Length: 25 pages
Date of creation: 04 Dec 2002
Date of revision:
Publication status: Published in Journal of the European Economic Association, 2003, pages 224-244.
Handle: RePEc:hhs:ifauwp:2002_022

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Related research

Keywords: Wages; search frictions; cross-country comparisons; monopsony power; minimum wage; job search; mobility; labour market policy;

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Cited by:
  1. Addison, John T. & Portugal, Pedro, 2001. "Unemployment Duration: Competing and Defective Risks," IZA Discussion Papers 350, Institute for the Study of Labor (IZA).
  2. Pierre Cahuc & Fabien Postel-Vinay & Jean-Marc Robin, 2003. "Wage bargaining with on-the-job search : theory and evidence," Research Unit Working Papers 0212, Laboratoire d'Economie Appliquee, INRA.
  3. Julien Prat, 2006. "The Rate of Learning-by-Doing: Estimates from a Search-Matching Model," 2006 Meeting Papers 647, Society for Economic Dynamics.

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