Accounting for Endogeneity in Matching Function Estimation

Daniel Borowczyk-Martins, Grégory Jolivet, Fabien Postel-Vinay

Publikation: Bidrag til tidsskriftTidsskriftartikelForskningpeer review

Abstrakt

We show that equilibrium matching models imply that standard estimates of the matching function elasticities are exposed to an endogeneity bias, which arises from the search behavior of agents on either side of the market. We offer an estimation method which, under certain structural assumptions about the process driving shocks to matching efficiency, is immune from that bias. Application of our method to the estimation of a basic version of the matching function using aggregate U.S. data from the Job Openings and Labor Turnover Survey (JOLTS) suggests that the bias can be quantitatively important.
OriginalsprogEngelsk
TidsskriftReview of Economic Dynamics
Vol/bind16
Udgave nummer3
Sider (fra-til)440-451
ISSN1094-2025
DOI
StatusUdgivet - 2013
Udgivet eksterntJa

Emneord

  • Matching function estimation
  • Unemployment
  • Vacancies
  • Job finding

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