An iteration process for calculating labour market flows

Nissim Ben David

Applied Economics, 2010, vol. 42, issue 29, 3761-3766

Abstract: This article presents a technique for calculating labour market flows, given labour market stocks of workers and nonemployed agents at the beginning and at the end of a certain period of time. I build a system of equations that define the stocks as a product of the flows. For a vector of stocks Y and a vector of flows X, the system of equations is defined as Y = A*X. However, the system is not solvable (the flows cannot be identified) due to singularity of the matrix A. I suggest an iteration process that enables us to solve the system and identify the flows given a chosen negligible deviation from the true flows.

Date: 2010
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DOI: 10.1080/00036840802359924

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