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How can vacancy statistics be used to measure friction in job matching and the effects of friction on unemployment? First, measure deviations from instantaneous hirings by the average duration of recruitment as measured by the number of job vacancies divided by the number of hirings per month....

Firms create ‘vacancies’ in one sense (recruitment processes) in order to avoid ‘vacancies’ in another sense (unmet demand). The paper clarifies the different roles of these two concepts in labour market analysis, not only when interpreting Beveridge curves and matching functions, but...

While the matching function relates hirings (H) to vacancies (V) and unemployment, the duration function relates the average duration of vacancies as measured by V/H to unemployment. Shifts of the duration function are equivalent to shifts of the matching function but easier to interpret....

This paper first clarifies the distinction between vacancies as ‘job openings’ (recruitment processes), which are measured in traditional vacancy statistics, and vacancies as ‘unfilled jobs’ (unmet labour demand). It then presents a method of measuring unmet demand in enterprise surveys...

This paper proposes an alternative to the traditional model of supply and demand in markets where consumers take prices as given. Within the framework of “no side payments and partial preplay communication” firms are assumed to decide non-cooperatively on production and marketing while the...