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Matching across space: evidence from Finland

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  • Sanna-Mari Ahtonen

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    Abstract

    This paper studies spatial aspects in local labour markets in Finland from the perspective of a matching approach. The monthly data comprise 173 Local Labour Office are as over a 12-year period between January 1991 and August 2002. The basic matching function is extended to account for spatial spill-overs between the local labour markets. The role of population density in the matching process is also examined. According to results, the Finnish local labour markets suffer from a strong congestion effect among job seekers, and spatial spill-overs even strengthen the congestion. An open vacancy is filled much easier than a job seeker is employed. The results show that the matching efficiency is remarkable lower in dense areas than elsewhere, which indicates that mismatch is a problem in the local labour markets with high population density. When taking population density into account, returns to scale in the matching function are constant. Keywords: matching, spatial spill-over, population density, returns to scale, Finland

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    Bibliographic Info

    Paper provided by European Regional Science Association in its series ERSA conference papers with number ersa04p205.

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    Date of creation: Aug 2004
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    Handle: RePEc:wiw:wiwrsa:ersa04p205

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    1. Blanchard, O.J. & Diamond, P., 1990. "Ranking, Unemployment Duration, And Wages," Working papers 546, Massachusetts Institute of Technology (MIT), Department of Economics.
    2. Burgess, Simon & Profit, Stefan, 2001. "Externalities in the matching of workers and firms in ritain," Labour Economics, Elsevier, vol. 8(3), pages 313-333, June.
    3. Lourens Broersma, 1997. "Competition between employed and unemployed job searchers: is there a difference between the UK and The Netherlands?," Applied Economics Letters, Taylor & Francis Journals, vol. 4(3), pages 199-203.
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    6. Coles, Melvyn G & Smith, Eric, 1996. "Cross-Section Estimation of the Matching Function: Evidence from England and Wales," Economica, London School of Economics and Political Science, vol. 63(252), pages 589-97, November.
    7. 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.
    8. Barbara Petrongolo, 1998. "Re-employment Probabilities and Returns to Matching," CEP Discussion Papers dp0406, Centre for Economic Performance, LSE.
    9. Lindeboom, M. & Ours, J.C. & Renes, G., 1991. "Matching employers and workers : an empirical analysis on the effectiveness of search," Serie Research Memoranda 0063, VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics.
    10. Burda, Michael C & Profit, Stefan, 1996. "Matching Across Space: Evidence on Mobility in the Czech Republic," CEPR Discussion Papers 1364, C.E.P.R. Discussion Papers.
    11. Jari RitsilAa & Mika Haapanen, 2003. "Where do the highly educated migrate? Micro-level evidence from finland," International Review of Applied Economics, Taylor & Francis Journals, vol. 17(4), pages 437-448.
    12. Burdett, Kenneth & Coles, Melvyn G & van Ours, Jan C, 1994. "Temporal Aggregation Bias in Stock-Flow Models," CEPR Discussion Papers 967, C.E.P.R. Discussion Papers.
    13. Aki Kangasharju & Jaakko Pehkonen & Sari Pekkala, 2005. "Returns to scale in a matching model: evidence from disaggregated panel data," Applied Economics, Taylor & Francis Journals, vol. 37(1), pages 115-118.
    14. 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.
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    Cited by:
    1. Gina Cristina Dimian & Bogdan Ileanu & Josef Jablonský & Jan Fábry, 2013. "Analysis of European Labour Market in the Crisis Context," Prague Economic Papers, University of Economics, Prague, vol. 2013(1), pages 50-71.

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