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Modelling Exits from Unemployment in Eastern Germany: A Matching Function Approach

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  • Burda, Michael C

Abstract

A matching function approach is applied to unemployment exit data from a panel of Eastern German labour office districts since monetary union. With comparable West German data, such a matching function exhibits constant returns, is stable, and can account for at least three-quarters of the variance of exits from unemployment. In contrast, the Eastern German matching function exhibits increasing returns, and vacancies enter the function insignificantly or with incorrect sign. These estimates also differ significantly from those for the Czech Republic, discounting explanations related to the transformation per se . When the effects of special labour market measures introduced since monetary union are accounted for, Eastern German estimates resemble those of the Czech Republic, i.e. they exhibit constant to mildly decreasing returns.

Suggested Citation

  • Burda, Michael C, 1993. "Modelling Exits from Unemployment in Eastern Germany: A Matching Function Approach," CEPR Discussion Papers 800, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:800
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    Citations

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    Cited by:

    1. Stefan Profit & Stefan Sperlich, 2004. "Non-uniformity of job-matching in a transition economy - A nonparametric analysis for the Czech Republic," Applied Economics, Taylor & Francis Journals, vol. 36(7), pages 695-714.
    2. Aomar Ibourk & Sergio Perelman, 2001. "Frontières d'efficacité et processus d'appariement sur le marché du travail au Maroc," Économie et Prévision, Programme National Persée, vol. 150(4), pages 33-45.
    3. Lottmann, Franziska, 2012. "Spatial dependencies in German matching functions," Regional Science and Urban Economics, Elsevier, vol. 42(1-2), pages 27-41.
    4. Chase, Robert S., 1995. "Women's Labor Force Participation During and After Communism: A Study of the Czech Republic and Slovakia," Center Discussion Papers 28405, Yale University, Economic Growth Center.
    5. Rama, Martin, 1998. "How Bad Is Unemployment in Tunisia? Assessing Labor Market Efficiency in a Developing Country," The World Bank Research Observer, World Bank, vol. 13(1), pages 59-77, February.
    6. Steiner, Viktor, 1993. "Long-term unemployment during the transition to a market economy: Eastern Germany after unification," ZEW Discussion Papers 93-14, ZEW - Leibniz Centre for European Economic Research.
    7. Yosra Koubaa, 2017. "Tunisian Labor Market and Regional Heterogeneity: Application of PSTR Model," International Journal of Regional Development, Macrothink Institute, vol. 4(1), pages 1-51, December.

    More about this item

    Keywords

    Eastern Germany; Gross Flow; Matching Function; Unemployment;
    All these keywords.

    JEL classification:

    • J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts

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