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The Beveridge Curve

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  • Yashiv, Eran

    ()
    (Tel Aviv University)

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    Abstract

    The Beveridge curve depicts a negative relationship between unemployed workers and job vacancies, a robust finding across countries. The position of the economy on the curve gives an idea as to the state of the labour market. The modern underlying theory is the search and matching model, with workers and firms engaging in costly search leading to random matching. The Beveridge curve depicts the steady state of the model, whereby inflows into unemployment are equal to the outflows from it, generated by matching.

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    Bibliographic Info

    Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2479.

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    Length: 8 pages
    Date of creation: Dec 2006
    Date of revision:
    Publication status: published in: L. Blume and S. N. Durlauf (eds), The New Palgrave Dictionary of Economics, 2nd edition, Palgrave Macmillan, 2008
    Handle: RePEc:iza:izadps:dp2479

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    Related research

    Keywords: wage inflation; vacancies; unemployment; Phillips curve; matching function; job search; business cycle;

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    1. Barbara Petrongolo & Christopher A. Pissarides, 2000. "Looking Into the Black Box: A Survey of the Matching Function," CEP Discussion Papers dp0470, Centre for Economic Performance, LSE.
    2. Yashiv, Eran, 2006. "Search and Matching in Macroeconomics," CEPR Discussion Papers 5459, C.E.P.R. Discussion Papers.
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