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Agglomeration Effects on Job Matching Efficiency: Evidence from Japan

Author

Listed:
  • Yudai Higashi

    (Graduate School of Humanities and Social Sciences, Okayama University and Research Institute for Economics and Business Administration, Kobe University, JAPAN)

Abstract
This paper examines the effect of agglomeration on the regional efficiency of matching of job seekers and vacancies by using Japanese regional panel data. We find that a higher population density improves or at least does not deteriorate regional matching efficiency for most of the sample periods, suggesting that the benefit of agglomeration tends to be significant. However, the effect is significantly negative in 2011 when a serious earthquake and tsunami occurred in Japan, suggesting that the congestion effect is superior to the benefit of agglomeration when labor markets suffer from damages, such as those caused by natural disasters.

Suggested Citation

  • Yudai Higashi, 2021. "Agglomeration Effects on Job Matching Efficiency: Evidence from Japan," Discussion Paper Series DP2021-03, Research Institute for Economics & Business Administration, Kobe University.
    • Handle: RePEc:kob:dpaper:dp2021-03
    as

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    File URL: https://www.rieb.kobe-u.ac.jp/academic/ra/dp/English/DP2021-03.pdf
    File Function: First version, 2021
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    References listed on IDEAS

    as
    1. Christopher A. Pissarides & Barbara Petrongolo, 2001. "Looking into the Black Box: A Survey of the Matching Function," Journal of Economic Literature, American Economic Association, vol. 39(2), pages 390-431, June.
    2. Andini, Monica & de Blasio, Guido & Duranton, Gilles & Strange, William C., 2013. "Marshallian labour market pooling: Evidence from Italy," Regional Science and Urban Economics, Elsevier, vol. 43(6), pages 1008-1022.
    3. Christopher A. Pissarides, 2000. "Equilibrium Unemployment Theory, 2nd Edition," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262161877, April.
    4. Kano, Shigeki & Ohta, Makoto, 2005. "Estimating a matching function and regional matching efficiencies: Japanese panel data for 1973-1999," Japan and the World Economy, Elsevier, vol. 17(1), pages 25-41, January.
    5. Di Addario, Sabrina, 2011. "Job search in thick markets," Journal of Urban Economics, Elsevier, vol. 69(3), pages 303-318, May.
    6. Abel, Jaison R. & Deitz, Richard, 2015. "Agglomeration and job matching among college graduates," Regional Science and Urban Economics, Elsevier, vol. 51(C), pages 14-24.
    7. Yudai Higashi, 2020. "Effects of region-specific shocks on labor market tightness and matching efficiency: evidence from the 2011 Tohoku Earthquake in Japan," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 65(1), pages 193-219, August.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Job search; Matching function; Agglomeration; Local labor market;
    All these keywords.

    JEL classification:

    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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