JOB SEARCH IN THICK MARKETS: EVIDENCE FROM ITALY

I analyze empirically the effects of both urban and industrial agglomeration on men’s andwomen’s search behavior and on the efficiency of matching. The analysis is based on the ItalianLabor Force Survey micro-data, which covers 520 randomly drawn Local Labor Market Areas(66 per cent of the total) over the four quarters of 2002. I compute transition probabilitiesfrom non-employment to employment by jointly estimating the probability of searching and theprobability of finding a job conditional on having searched, and I test whether these are affectedby urbanization, industry localization, labor pooling and family network quality. In general, themain results indicate that urbanization and labor pooling raise job seekers’ chances of findingemployment (conditional on having searched), while industry localization and family networkquality increase only men’s. Moreover, neither urban nor industrial agglomeration affect nonemployedindividuals’ search behavior; although men with thicker family networks search moreintensively....