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A discrete choice approach to labor market matching

Author

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  • Joern Kleinert

    (University of Graz, Austria)

Abstract

A match in the labor market results from a two-sided discrete choice of workers and firms. On the one side, heterogeneous workers choose to apply to firms' offers which correspond well to their abilities, education, training (all closely related to job seeker's occupation), interests, and job expectations. On the other side, heterogeneous firms choose from applications received their employees depending on their occupation or work experience, special skills, and expected fit into the existing team. Each side makes discrete choices. In this way, I model labor market search and matching with mismatches as one possible result. Labor market outcomes are thereby strongly affected by non-labor market influences, such as education decisions and sector shifts in the goods market.

Suggested Citation

  • Joern Kleinert, 2026. "A discrete choice approach to labor market matching," Graz Economics Papers 2026-16, University of Graz, Department of Economics.
    • Handle: RePEc:grz:wpaper:2026-16
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    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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