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Regional Dependencies in Job Creation: An Efficiency Analysis for Western Germany

  • Fahr, René

    ()

    (University of Paderborn)

  • Sunde, Uwe

    ()

    (University of Munich)

This paper investigates the efficiency of the matching process between job seekers and vacancy posting firms in West-Germany, using variation across labor market regions and across time. The results of a stochastic frontier analysis shed new light on extent and regional differences of search frictions, on potential determinants of frictional inefficiencies and on the consequences of German reunification for the matching process. The paper also presents novel evidence on the complex interactions between spatial contingencies among regional labor markets: matching efficiency decreases with spatial autocorrelation in hiring, implying indirect evidence for crowding externalities.

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File URL: http://ftp.iza.org/dp1660.pdf
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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 1660.

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Length: 34 pages
Date of creation: Jul 2005
Date of revision:
Publication status: published in: Applied Economics, 2006, 38 (10), 1193-1206
Handle: RePEc:iza:izadps:dp1660
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  1. Sergio Destefanis & Raquel Fonseca, 2007. "Matching Efficiency and Labour Market Reform in Italy: A Macroeconometric Assessment," LABOUR, CEIS, vol. 21(1), pages 57-84, 03.
  2. Fahr, René & Sunde, Uwe, 2004. "Occupational job creation: Patterns and implications," Munich Reprints in Economics 20488, University of Munich, Department of Economics.
  3. Burgess, Simon & Profit, Stefan, 1998. "Externalities in the Matching of Workers and Firms in Britain," CEPR Discussion Papers 1854, C.E.P.R. Discussion Papers.
  4. Sergio Destefanis & Raquel Fonseca, 2006. "Labour Market Reform and the Beveridge Curve across Italian Regions," AIEL Series in Labour Economics, in: Floro Ernesto Caroleo & Sergio Destefanis (ed.), The European Labour Market. Regional Dimensions, edition 1, chapter 6, pages 147-163 AIEL - Associazione Italiana Economisti del Lavoro.
  5. Christopher A. Pissarides & Barbara Petrongolo, 2001. "Looking into the Black Box: A Survey of the Matching Function," Journal of Economic Literature, American Economic Association, vol. 39(2), pages 390-431, June.
  6. G. Karagiannis & P. Midmore & V. Tzouvelekas, 2002. "Separating Technical Change from Time-Varying Technical Inefficiency in the Absence of Distributional Assumptions," Journal of Productivity Analysis, Springer, vol. 18(1), pages 23-38, July.
  7. Battese, G E & Coelli, T J, 1995. "A Model for Technical Inefficiency Effects in a Stochastic Frontier Production Function for Panel Data," Empirical Economics, Springer, vol. 20(2), pages 325-32.
  8. van Ours, J.C. & Broersma, L., 1999. "Job searchers, job matches and the elasticity of matching," Other publications TiSEM c199f354-b73c-49b6-84f6-e, Tilburg University, School of Economics and Management.
  9. Broersma, L. & van Ours, J.C., 1998. "Job Searchers, Job Matches and the Elasticity of Matching," Discussion Paper 1998-72, Tilburg University, Center for Economic Research.
  10. van Ours, J.C. & Gorter, C., 1994. "Matching Unemployment and Vacancies in Regional Labour Markets; an empirical analysis for the Netherlands," Other publications TiSEM 63318c4d-4008-4f29-94eb-a, Tilburg University, School of Economics and Management.
  11. Fahr, René & Sunde, Uwe, 2002. "Employment Status, Endogenous Regional Mobility, and Spatial Dependencies in Labor Markets," IZA Discussion Papers 521, Institute for the Study of Labor (IZA).
  12. Gross, Dominique M., 1997. "Aggregate job matching and returns to scale in Germany," Economics Letters, Elsevier, vol. 56(2), pages 243-248, October.
  13. Pekka Ilmakunnas & Hanna Pesola, 2003. "Regional Labour Market Matching Functions and Efficiency Analysis," LABOUR, CEIS, vol. 17(3), pages 413-437, 09.
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