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Matching Bias in Labor Demand Estimation

Giovanna Aguilar Andía () and Silvio Rendon ()

No 3076, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Using a matched firm-worker dataset, we show both theoretically and empirically that positive assortative matching between firms and workers leads to an underestimation of the absolute value of wage elasticity of labor demand.

Keywords: labor demand estimation; employment; matching (search for similar items in EconPapers)
JEL-codes: J23 J32 (search for similar items in EconPapers)
Pages: 10 pages
Date: 2007-09
New Economics Papers: this item is included in nep-lab
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Published - published in: Economics Letters, 2008, 100 (2), 297-299

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