Search Activities, Cost of Living and Local Labor Markets

Eleonora Patacchini and Yves Zenou ()

No 607, Working Paper Series from 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.

Keywords: Job Matching; Search Intensities; Spatial Correlation (search for similar items in EconPapers)
JEL-codes: C21 J64 R10 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-geo and nep-ure
Date: Written 2003-11-14
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Related works:
Journal Article: Search activities, cost of living and local labor markets (2006)
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Persistent link: http://EconPapers.repec.org/RePEc:hhs:iuiwop:0607

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