Regional dependencies in job creation : an efficiency analysis for Western Germany

René Fahr; Uwe Sunde

This paper investigates the efficiency of the matching process between job seekers and vacancy posting firms in West-Germany, using variation across labor market regions and across time. The results of a stochastic frontier analysis shed new light on extent and regional differences of search frictions, on potential determinants of frictional inefficiencies and on the consequences of German reunification for the matching process. The paper also presents novel evidence on the complex interactions between spatial contingencies among regional labor markets: matching efficiency decreases with spatial autocorrelation in hiring, implying indirect evidence for crowding externalities. -- regional unemployment ; stochastic frontier ; matching function ; spatial autocorrelation

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Year of publication:	July 2005
Other Persons:	Fahr, René (contributor) ; Sunde, Uwe (contributor)
Publisher:	Bonn : IZA
Subject:	Deutschland \| Germany \| Regionaler Arbeitsmarkt \| Regional labour market \| Matching \| Arbeitsuche \| Job search \| Nationale Einheit \| National unity \| Friktionelle Arbeitslosigkeit \| Frictional unemployment