The Matching Process in Labour Markets in Transition

This paper uses the flow approach to investigate the way in which the transition of the Czech and Slovak economies influences the regional labour markets in the two countries. From estimates of matching functions we conclude that in most regions the labour markets are still in transition. We also examine the role of structural shocks as sources of shifts in unemployment-vacancy relationship in the Czech Republic. The evidence in support of structural hypothesis appears to be sensitive to the level of aggregation. The results are reversed when proceed to finer levels of disaggregation.