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Search Activities, Cost of Living and Local Labor Markets

Author

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  • Patacchini, Eleonora

    () (University of Southampton)

  • Zenou, Yves

    () (The Research Institute of Industrial Economics)

Abstract

A model is considered in which optimal search intensity is a result of a trade off between short run losses due to higher search costs (more interviews, commuting...) and long-run gains due to a higher chance of finding a job. We show that this optimal search intensity is higher in areas characterized by larger cost of living and/or higher labor market tightness. This model is then tested for England on sub-regional data. We estimate a spatial error model and we find that both the local cost of living and the local labor market tightness are found to have a positive and significant effect on unemployed average search intensity. These findings are consistent with the prediction of the theoretical model.

Suggested Citation

  • Patacchini, Eleonora & Zenou, Yves, 2003. "Search Activities, Cost of Living and Local Labor Markets," Working Paper Series 607, Research Institute of Industrial Economics.
  • Handle: RePEc:hhs:iuiwop:0607
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    References listed on IDEAS

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    1. Manning, Alan, 2003. "The real thin theory: monopsony in modern labour markets," Labour Economics, Elsevier, vol. 10(2), pages 105-131, April.
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    Cited by:

    1. Munford, L.; & Rice, N.; & Roberts, J.; & Jacob, N.;, 2018. "The disutility of commuting? The effect of gender and local labour markets," Health, Econometrics and Data Group (HEDG) Working Papers 18/14, HEDG, c/o Department of Economics, University of York.
    2. Laurent Gobillon & Thierry Magnac & Harris Selod, 2011. "The effect of location on finding a job in the Paris region," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 26(7), pages 1079-1112, November.
    3. repec:oup:oxecpp:v:69:y:2017:i:3:p:734-757. is not listed on IDEAS
    4. GOBILLON Laurent & SELOD Harris, 2007. "The effects of segregation and spatial mismatch on unemployment: evidence from France," Research Unit Working Papers 0702, Laboratoire d'Economie Appliquee, INRA.
    5. Jennifer Roberts & Karl Taylor, 2017. "Intra-household commuting choices and local labour markets," Oxford Economic Papers, Oxford University Press, vol. 69(3), pages 734-757.
    6. Gobillon, Laurent & Magnac, Thierry & Selod, Harris, 2007. "The Effect of Location on Finding a Job in the Greater Paris Area," IZA Discussion Papers 2848, Institute for the Study of Labor (IZA).
    7. Harris Selod & Laurent Gobillon, 2007. "Les déterminants locaux du chômage en région parisienne," Économie et Prévision, Programme National Persée, vol. 180(4), pages 19-38.
    8. Yannick L'Horty & Emmanuel Duguet & Loïc Du Parquet & Pascale Petit & Florent Sari, 2011. "The effect of place of residence on access to employment : a field experiment on qualified young job applicants in Ile-de-France," Working Papers halshs-00812113, HAL.
    9. Détang-Dessendre, Cécile & Gaigné, Carl, 2009. "Unemployment duration, city size, and the tightness of the labor market," Regional Science and Urban Economics, Elsevier, vol. 39(3), pages 266-276, May.
    10. Di Addario, Sabrina, 2011. "Job search in thick markets," Journal of Urban Economics, Elsevier, vol. 69(3), pages 303-318, May.
    11. Zenou, Yves, 2009. "Search in cities," European Economic Review, Elsevier, vol. 53(6), pages 607-624, August.

    More about this item

    Keywords

    Job Matching; Search Intensities; Spatial Correlation;

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General

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