The labor search and matching model plays a growing role in macroeconomic analysis. This paper provides a critical, selective survey of the literature. Four fundamental questions are explored: how are unemployment, job vacancies, and employment determined as equilibrium phenomena? What...

I study the cyclical behavior of an equilibrium search model with endogenous job creation and destruction, with focus on the model's failure to match the observed cyclical volatility of unemployment. Job creation in the model is influenced by wages in new matches. I summarize microeconometric...

It is increasingly recognized that labour markets are pervasively imperfectly competitive, that there are rents to the employment relationship for both worker and employer. This chapter considers why it is sensible to think of labour markets as imperfectly competitive, reviews estimates on the...

This paper develops a joint evaluation of vocational training and unemployment insurance. This allows to analyze how these schemes complment each other from the viewpoints of labor market indicators and of welfare. For this purpose, a general equilibrium matching model is built where workers are...

This paper is concerned with the general equilibrium effects of active labor market programs and the unemployment insurance system (the replacement ratio and the level of sanctions). It develops an equilibrium job matching model where active programs and the rate of sanctions have an amiguous...

Does the search and matching model fit aggregate U.S. labor market data? While the model has become an important tool of macroeconomic analysis, recent literature pointed to some failures in accounting for the data. This paper aims to answer two questions: (i) Does the model fit the data, and,...

We show that worker wellbeing is not only related to the amount of compensation workers receive but also how they receive it. While previous theoretical and empirical work has often been pre-occupied with individual performance-related pay, we here demonstrate a robust positive link between the...

The paper presents an econometric evaluation of the effects of subsidised non-profit temporary employment agencies - a programme of the West German active labour market policy - on individual labour market outcomes. The empirical analysis is based on individual data from files for...

We present a new and simple empirical methodology to identify relative wage rigidity dynamics. The methodology is applied to data from the Polish Labour Force Survey for the period 1994 to 1998. We estimate ceteris paribus changes in relative wage and unemployment differentials for various...

This paper investigates whether and in what sense the west German wage structure has been "rigid" in the 1990s. To test the hypothesis that a rigid wage structure has been responsible for rising low-skilled unemployment, I propose a methodology which makes less restrictive identifying...