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Job search in thick markets

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  • Di Addario, Sabrina

Abstract

I analyze empirically the effects of urban and industrial agglomeration on both search behavior and the efficiency of matching. The analysis is based on a unique panel data set from the Italian Labor Force Survey micro-data, covering 520 randomly drawn Local Labor Market Areas (66% of the total) over the four quarters of 2002. I compute transition probabilities from non-employment to employment by jointly estimating the probability of searching and the probability of finding a job conditional on having searched. I then test whether these are affected by market size, industrial variety and/or industry specialization. The main results indicate that market size and industry-specialization raise job seekers' chances of finding employment (conditional on having searched), while industrial variety is not significantly different from zero. Finally, the effect of agglomeration on non-employed individuals' search behavior cannot be significantly distinguished from zero.

Suggested Citation

  • Di Addario, Sabrina, 2011. "Job search in thick markets," Journal of Urban Economics, Elsevier, vol. 69(3), pages 303-318, May.
  • Handle: RePEc:eee:juecon:v:69:y:2011:i:3:p:303-318
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