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

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Author Info
Patacchini, Eleonora (University of Southampton)
Zenou, Yves () (University of Southampton, GAINS, CEPR and IZA Bonn)

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Abstract

A model is considered in which optimal search intensity is a result of a tradeoff between short-run losses due to higher search costs (more interviews, commuting…) and long-run gains due to a higher chance of finding a job. We show that this optimal search intensity is higher in areas characterized by larger cost of living and/or higher labor 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) labor 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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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 772.

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Length: 36 pages
Date of creation: May 2003
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Handle: RePEc:iza:izadps:dp772

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

Other versions of this item:

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
R1 - Urban, Rural, and Regional Economics - - General Regional Economics

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References listed on IDEAS
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.:
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  6. Burda, Michael C. & Profit, Stefan, 1996. "Matching across space: Evidence on mobility in the Czech Republic," Labour Economics, Elsevier, vol. 3(3), pages 255-278, October. [Downloadable!] (restricted)
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  7. Alan Manning, 2003. "The Real Thin Theory: Monopsony in Modern Labour Markets," CEP Discussion Papers dp0564, Centre for Economic Performance, LSE. [Downloadable!]
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  8. Wasmer, Etienne & Zenou, Yves, 2002. "Does City Structure Affect Job Search and Welfare?," Journal of Urban Economics, Elsevier, vol. 51(3), pages 515-541, May. [Downloadable!] (restricted)
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  15. George J. Stigler, 1961. "The Economics of Information," Journal of Political Economy, University of Chicago Press, vol. 69, pages 213. [Downloadable!] (restricted)
  16. Jackman, Richard & Savouri, Savvas, 1992. "Regional Migration in Britain: An Analysis of Gross Flows Using NHS Central Register Data," Economic Journal, Royal Economic Society, vol. 102(415), pages 1433-50, November. [Downloadable!] (restricted)
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Cited by:
(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. 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:
  2. 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:
  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. 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:
  5. 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:
  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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