Occupation-specific matching efficiency

Based on rich administrative data from Germany, we address the differences in occupation specific job-matching processes where an occupation consists of jobs that share extensive commonalities in their required skills and tasks. These differences can be explained by the degree of standardization (determined by the existence of certifications or legal regulations) in an occupation and the diversity of tasks in an occupation. We find that the matching efficiency improves with higher degrees of standardization and lower task diversity. We discuss the possible mechanisms of these empirical findings in a search theoretic model: as the standardization of an occupation increases or the diversity of tasks decreases, search costs decrease and the optimal search intensity increases. However, the model reveals that higher search intensities can have positive or negative effects on the matching efficiency. We discuss the conditions under which the empirical results can be predicted.