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The Rise in Danish Unemployment: Reallocation or Mismatch?

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  • Karsten Albæk

    (Institute of Economics, University of Copenhagen)

  • Henrik Hansen

    (Institute of Economics, University of Copenhagen)

Abstract

The two main competing theories for the outward shift in the uv-curve are investigated: Increased separations from employment at a given employment level (reallocation) and decreased levels of hires, given unemployment and vacancies (mismatch). Shifts in the uv-curve and the hiring function are modelled by smooth transition functions, and the hypothesis of analogous shifts in the two curves is tested and accepted. This is interpreted as evidence in favor of the mismatch hypotheses.

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Bibliographic Info

Paper provided by University of Copenhagen. Department of Economics. Centre for Applied Microeconometrics in its series CAM Working Papers with number 2004-13.

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Length: 18 pages
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Publication status: Published in: Oxford Bulletin of Economics and Statistics, 2004, 66(4), pp 515-536
Handle: RePEc:kud:kuieca:2004_13

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Cited by:
  1. Sanna-Mari Hynninen & Aki Kangasharju & Jaakko Pehkonen, 2006. "Regional Matching Frictions and Aggregate Unemployment," ERSA conference papers ersa06p416, European Regional Science Association.
  2. Heidi Soininen, 2007. "Finnish Evidence of Changes in Labor Market Matching," Finnish Economic Papers, Finnish Economic Association, vol. 20(1), pages 57-71, Spring.

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