Search and Matching on the Labor Market:
Recent Developments and Avenues for Future Research


Organizers: René Fahr (IZA, Bonn) and Uwe Sunde (IZA, Bonn)
Place: IZA, Schaumburg-Lippe-Str. 7-9, Bonn, Germany
Date: Nov. 14-15, 2003

Aim of the Workshop:

Most labor markets are characterized by the simultaneous occurrence of unemployment and unfilled vacancies. Moreover, many matches are dissolved shortly after being formed as a consequence of low productivity of the employer-employee match or of successful on-the-job search of employees. Many economic contributions have empirically and theoretically investigated the search and matching process on the labor market, and have identified various types of search frictions and inefficiencies in the matching process: information asymmetries or incomplete information, coordination problems, regional and occupational immobility, or frictions arising as an endogenous outcome of individually rational search behavior. While early research has mainly focused on the aggregate patterns of matching frictions, more recent contributions develop microfoundations and investigate the matching process on disaggregate levels. Despite the considerable research effort, there are still unresolved issues. For instance, does the efficiency of search depend on the size of the labor market? How does search behavior explain observed mobility patterns? What is the role of technological change in the search process?

The nature of labor market mismatch undeniably plays a crucial role for economic policy. However, it is not clear whether and how policymakers can and should improve matching and reduce labor market frictions. How can individuals' search skills be improved for the search process in order to find better matches faster, e.g. through education and training programs? Should policy initiatives be targeted at certain groups?

The workshop is intended to bring together a group of researchers in the field of search and matching in a relaxed atmosphere and to provide an opportunity to discuss their recent research, as well as to point out open questions and possible directions for future research.


Additional event to which all participants are invited:
Thursday, November 13:
17:30 - 19:00 Bonn Economics Research Seminar:
Ken Burdett (University of Pennsylvania):
Equilibrium Wage-Tenure Contracts with Heterogeneous Firms (joint with Melvyn Coles)
Place:  Bonn University, Juridicum, Room R055 (about 100 meters from IZA)

Friday, November 14:

12:00 - 13:00 Welcome and Lunch
13:00 - 14:00 Melvyn Coles (Insitute for Economic Analysis and IZA) and Adrian Masters (University at Albany)
"Duration Dependent Unemployment Insurance and Stabilisation Policy"

Discussant: Jim Albrecht (Georgetown University and IZA)

14:00 - 15:00 Jim Albrecht (Georgetown University and IZA), Axel Anderson (Georgetown University), Eric Smith (University of Essex) and Susan Vroman (Georgetown University and IZA)
"A Matching Model of the Housing Market: Searching for a Motivated Partner"

Discussant: Uwe Sunde (IZA)

15:00 - 15:30 Coffee / Tea Break

15:30 - 16:30 Grégory Jolivet (University of Paris 1 and IZA), Fabien Postel-Vinay (INRA) and Jean-Marc Robin (University of Paris 1 and IZA)
"Wage Distributions and Wage Dynamics in Europe and the US: Lessons from a Simple Job Search Model"

Discussant: Marco Leonardi (IZA)

16:30 - 17:30 Pietro Garibaldi (Bocconi University and IZA) and Etienne Wasmer (Free University of Brussels and IZA)
"Equilibrium Employment in a Model of Imperfect Labour Market"

Discussant: Christian Holzner (ifo)

17:30 - 18:00 Coffee / Tea Break

18:00 - 19:00 Simon Burgess (University of Bristol and IZA)
"The Reallocation of Labour: Theory and Evidence "

Discussant: René Fahr (University of Cologne and IZA)

Saturday, November 15:

8:45 - 9:45 Jim Albrecht (Georgetown University and IZA), Pieter Gautier (Erasmus University Rotterdam and IZA) and Susan Vroman (Georgetown University and IZA)
"Equilibrium Directed Search with Multiple Applications"

Discussant: Klaus Kultti (University of Helsinki)

9:45 - 10:45 Pieter Gautier (Erasmus University Rotterdam and IZA) and José Moraga-González (Erasmus University Rotterdam and Tinbergen Institute)
"Strategic Wage Setting and Undirected Search with Multiple Applications"

Discussant: Pierre Cahuc (University of Paris 1 and IZA)

10:45 - 11:00 Coffee / Tea Break

11:00 - 12:00 Etienne Wasmer (Free University of Brussels and IZA)
"Interpreting Europe and US Labour Market Differences: The Specificity of Human Capital Investments"

12:00 - 13:00 Andreas Hornstein (Federal Reserve Bank of Richmond), Per Krusell (University of Rochester) and Giovanni L.Violante (New York University)
"A Quantitative Study of the Replacement Problem in Frictional Economies"

Discussant: Winfried Koeniger (IZA)

13:00 - 14:00 Lunch

14:00 - 15:00 Melvyn Coles (Institute for Economic Analysis and IZA) and Barbara Petrongolo (London School of Economics and IZA)
"Testing Unemployment Theories Using Matching Data"

Discussant: Christian Belzil (IZA)

15:00 - 16:00 Klaus Kultti (University of Helsinki), Antti Miettunen (Helsinki School of Economics) and Juha Virrankoski (Helsinki School of Economics)
"Physical Search"

Discussant: Melvyn Coles (Institute for Economic Analysis and IZA)

16:00 - 16:30 Coffee / Tea Break

16:30 - 17:30 Pierre Cahuc (University of Paris 1 and IZA) and Grégory Jolivet (CREST)
"Do We Need More Stringent Employment Protection Legislations?"

Discussant: Andreas Hornstein (Federal Reserve Bank of Richmond)

17:30 - 18:30 Jan Boone (Tilburg University) and Jan van Ours (Tilburg University and IZA)
"Efficient Active Labor Market Policies"

Discussant: Susan Vroman (Georgetown University and IZA)

20:00 Conference Dinner "Im Stiefel", Bonngasse 30


The workshop is organized and funded by IZA. Participants will be reimbursed for a return journey to the conference, in accordance with IZA standard guidelines, and for subsistence and accommodation.


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