The returns to scale in the matching function play an important role in models with endogenous search effort. Due to positive externalities, increasing returns to scale in matching can support high or low activity equilibrium in the labour market. In this study, we examine this issue using panel...

This paper analyses the connection between aggregate economic fluctuations and regional productivity convergence in Finland during the period 1988-95. Markov chain transition matrices and mobility indices were used to examine the regional distribution of productivity. The results indicated that...