Accounting For Endogenous Search Behavior in Matching Function Estimation

Fabien Postel-Vinay, Gregory Jolivet and Daniel Borowczyk-Martins

No 8471, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: We show that equilibrium matching models imply that standard estimates of the matching function elasticities are exposed to an endogeneity bias, which arises from the search behavior of agents on either side of the market. We offer an estimation method which, under certain assumptions, is immune from that bias. Application of our method to the estimation of a basic version of the matching function using aggregate U.S. data from the Job Openings and Labor Turnover Survey (JOLTS) suggests that the bias is quantitatively important.

Keywords: Job finding; Matching function estimation; Unemployment; Vacancies (search for similar items in EconPapers)
JEL-codes: J63 J64 (search for similar items in EconPapers)
Date: 2011-07
New Economics Papers: this item is included in nep-dge and nep-ecm
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Citations: View citations in EconPapers (10)

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Working Paper: Accounting For Endogenous Search Behavior in Matching Function Estimation (2011)
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