Search Intensity, Cost of Living and Local Labor Markets in Britain

Eleonora Patacchini and Yves Zenou

No 772, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: A model is considered in which optimal search intensity is a result of a tradeoff 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. We then test this model using county-level data in England for the period 1991-2000. As predicted by the theoretical model, both the (county) cost of living and the (county) labor market tightness are found to have a positive and significant effect on the (county) search intensity. We also find positive spatial correlation between counties (i.e. clustering of counties with similar level of search intensity) and strong spatial spillover effects.

Keywords: job matching; search intensities; dynamic panel data; GMM estimation; spatial correlation; measurement errors (search for similar items in EconPapers)
JEL-codes: C23 D83 J64 R1 (search for similar items in EconPapers)
Pages: 36 pages
Date: 2003-05
New Economics Papers: this item is included in nep-eec, nep-geo, nep-lab and nep-ure
References: Add references at CitEc
Citations: View citations in EconPapers (8)

Published - published in: Regional Science and Urban Economics, 2006, 36(2), 227-248

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Working Paper: Search Intensity, Cost of Living and Local Labour Markets in Britain (2003)
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