Measuring Labor Market Frictions: A Cross-Country Comparison

31 Pages Posted: 21 Aug 2003

See all articles by Geert Ridder

Geert Ridder

University of Southern California

Gerard J. van den Berg

VU University Amsterdam - Department of Economics; Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics; Tinbergen Institute

Date Written: July 2003

Abstract

In this paper we define and estimate measures of labor market frictions using data on job durations. We compare different estimation methods and different types of data. We propose and apply an unconditional inference method that can be applied to aggregate duration data. It does not require wage data, it is invariant to the way in which wages are determined, and it allows workers to care about other job characteristics. The empirical analysis focuses on France, but we perform separate analyses for the USA, the UK, Germany and the Netherlands. We quantify the monopsony power due to search frictions and we examine the policy effects of the minimum wage, unemployment benefits and search frictions.

Keywords: Wages, Search Frictions, Cross-country Comparisons, Monopsony Power, Minimum Wage, Job Search, Mobility, Labor Market Policy

JEL Classification: J6, J3, C4, C5

Suggested Citation

Ridder, Geert and van den Berg, Gerard J., Measuring Labor Market Frictions: A Cross-Country Comparison (July 2003). IZA Discussion Paper No. 814. Available at SSRN: https://ssrn.com/abstract=434520

Geert Ridder

University of Southern California ( email )

Kaprielian Hall
Los Angeles, CA 90089
United States
213-740-2110 (Phone)
213-740-8543 (Fax)

Gerard J. Van den Berg (Contact Author)

VU University Amsterdam - Department of Economics ( email )

De Boelelaan 1105
1081 HV Amsterdam
Netherlands
+31 20 444 6132 (Phone)
+32 20 444 6020 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Tinbergen Institute

Burg. Oudlaan 50
Rotterdam, 3062 PA
Netherlands

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