When job search takes place across labour markets, the standard flow approach to labour market analysis fails to uncover the effectiveness at which workers are matched to available jobs. A spatially augmented matching function is backed by a spatial search model with endogenous search intensity....

Functional delineated labour market regions are needed for regional economic analyses. In dependence of the definition of regions economic regions in space can be seen as rich or poor areas. In addition to this statistical and econometric reasons argue for using functional labour market regions....