On-the-Job Search and the Beveridge Curve
IMF Working Papers, February 1, 2002
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Bibliographic details
- Authors: Andrés Fuentes
- Published: February 1, 2002
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781451845587.001
Overview
- This paper presents a theoretical and empirical investigation of the role on-the-job search plays in explaining shifts of the unemployment-vacancies relationship (the Beveridge curve).
- The paper shows that the direction of the shift depends on the parameters of the matching model, regardless of the assumptions made on the relative search effectiveness of employed and unemployed searchers.
- The empirical strategy estimates a Beveridge Curve equation with a panel of British regions controlling for unobserved aggregate unemployment effects.
- The paper finds evidence that the rise in on-the-job search in the 1980s has shifted the Beveridge Curve outwards.
Key findings
- The direction of Beveridge Curve shifts depends on the parameters of the matching model and is not determined solely by assumptions about the relative search effectiveness of employed and unemployed searchers.
- Empirical estimates using a panel of British regions, with controls for unobserved aggregate unemployment effects, indicate:
- Evidence that the rise in on-the-job search in the 1980s has shifted the Beveridge Curve outwards.
Methodology and scope
- Theoretical component: analysis within a matching model framework to determine how on-the-job search affects the unemployment-vacancies relationship.
- Empirical component: estimation of a Beveridge Curve equation using a panel of British regions and controls for unobserved aggregate unemployment effects.
- Subject coverage includes: Employment, Labor, Labor force, Labor markets, Unemployment, Unemployment rate.
- Keywords explicitly associated with the paper: Employment, job search, job searcher, job turnover, Labor force, Labor markets, Labour Force Survey unemployment count, Matching models, replacement ratio, steady state unemployment-vacancies relationship, Unemployment, Unemployment rate, unemployment vacancies relationship, vacancies, WP.
Implications
- Changes in on-the-job search intensity can materially affect the observed unemployment-vacancies relationship (the Beveridge Curve).
- Accounting for on-the-job search and model parameterization is important when interpreting shifts in the Beveridge Curve in empirical work.
Source: On-the-Job Search and the Beveridge Curve — https://www.imf.org/en/publications/wp/issues/2016/12/30/on-the-job-search-and-the-beveridge-curve-15632
Content in this bundle
- On-the-Job Search and the Beveridge Curve - WP/02/37