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Matching across space: evidence from Finland

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  • Sanna-Mari Ahtonen

Abstract

This paper studies spatial aspects in local labour markets in Finland from the perspective of a matching approach. The monthly data comprise 173 Local Labour Office are as over a 12-year period between January 1991 and August 2002. The basic matching function is extended to account for spatial spill-overs between the local labour markets. The role of population density in the matching process is also examined. According to results, the Finnish local labour markets suffer from a strong congestion effect among job seekers, and spatial spill-overs even strengthen the congestion. An open vacancy is filled much easier than a job seeker is employed. The results show that the matching efficiency is remarkable lower in dense areas than elsewhere, which indicates that mismatch is a problem in the local labour markets with high population density. When taking population density into account, returns to scale in the matching function are constant. Keywords: matching, spatial spill-over, population density, returns to scale, Finland

Suggested Citation

  • Sanna-Mari Ahtonen, 2004. "Matching across space: evidence from Finland," ERSA conference papers ersa04p205, European Regional Science Association.
    • Handle: RePEc:wiw:wiwrsa:ersa04p205
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    Cited by:

    1. Gina Cristina Dimian & Bogdan Ileanu & Josef Jablonský & Jan Fábry, 2013. "Analysis of European Labour Market in the Crisis Context," Prague Economic Papers, Prague University of Economics and Business, vol. 2013(1), pages 50-71.

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    Keywords

    matching; spatial spill-over; population density; returns to scale; finland;
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