Disaggregating the Matching Function

49 Pages Posted: 15 Dec 2016

See all articles by Peter A. Diamond

Peter A. Diamond

Massachusetts Institute of Technology (MIT) - Department of Economics; National Bureau of Economic Research (NBER); CESifo (Center for Economic Studies and Ifo Institute)

Aysegul Sahin

Federal Reserve Bank of New York

Multiple version iconThere are 3 versions of this paper

Date Written: December 12, 2016

Abstract

The aggregate matching (hiring) function relates gross hires to labor market tightness. Decompositions of aggregate hires show how the hiring process differs across different groups of workers and of firms. Decompositions include employment status in the previous month, age, gender and education. Another separates hiring between part-time and full-time jobs, which show different patterns in the current recovery. Shift-share analyses are done based on industry, firm size and occupation to show what part of the residual of the aggregate hiring function can be explained by the composition of vacancies. The hiring process appears to shift as a recovery starts, coinciding with shifts in the Beveridge curve. The paper also discusses some issues in the modeling of the labor market.

Keywords: Trade, International Conflicts, War, Exhaustible Resources

JEL Classification: F10, F51, H56, Q32

Suggested Citation

Diamond, Peter A. and Sahin, Aysegul, Disaggregating the Matching Function (December 12, 2016). MIT Department of Economics Working Paper No. 16-12. Available at SSRN: https://ssrn.com/abstract=2884984 or http://dx.doi.org/10.2139/ssrn.2884984

Peter A. Diamond (Contact Author)

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Aysegul Sahin

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