Matching across space: evidence from Finland

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Matching across space: evidence from Finland

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Sanna-Mari Ahtonen ()

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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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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This paper has been announced in the following NEP Reports:

NEP-ALL-2005-11-09 (All new papers)
NEP-GEO-2005-11-09 (Economic Geography)
NEP-URE-2005-11-09 (Urban & Real Estate Economics)

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