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  4. June 2001
  5. Looking into the Black Box: A Survey of the Matching Function

Journal of Economic Literature

ISSN 0022-0515 (Print) | ISSN 2328-8175 (Online)

Looking into the Black Box: A Survey of the Matching Function

  • Barbara Petrongolo
  • Christopher A. Pissarides
Journal of Economic Literature
vol. 39, no. 2, June 2001
(pp. 390–431)
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Abstract

This paper surveys the microfoundations, empirical evidence, and estimation issues underlying the aggregate matching function. There is no consensus yet on microfoundations but one is emerging on estimation. An aggregate, constant returns, Cobb-Douglas matching function with hires as a function of vacancies and unemployment has been successfully estimated for several countries. Recent work has utilized disaggregated data to go beyond aggregate estimates, with many refinements and suggestions for future research. The paper discusses spatial aggregation issues, and implications of on-the-job search and of the timing of stocks and flows for estimated matching functions.

Citation

Petrongolo, Barbara, and Christopher A. Pissarides. 2001. "Looking into the Black Box: A Survey of the Matching Function." Journal of Economic Literature 39 (2): 390–431. DOI: 10.1257/jel.39.2.390

JEL Classification

  • J41 Labor Contracts
  • E24 Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital