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Labour Market Dynamics in Australia
Author(s) -
Wesselbaum Dennis
Publication year - 2014
Publication title -
australian economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.308
H-Index - 29
eISSN - 1467-8462
pISSN - 0004-9018
DOI - 10.1111/1467-8462.12042
Subject(s) - beveridge curve , economics , matching (statistics) , econometrics , bayesian probability , value (mathematics) , dynamics (music) , bayes estimator , standard deviation , bargaining power , statistics , microeconomics , mathematics , unemployment , macroeconomics , physics , unemployment rate , acoustics
This article estimates a stylised search‐and‐matching model on data for Australia, covering the period 1978–2008. Using Bayesian methods, I find that the model does a fairly good job in replicating the data. Surprisingly, I find a large value for the worker's bargaining power and low vacancy‐posting costs. The model generates a strong Beveridge curve and matches the standard deviations of all variables but vacancies. I identify technology and separation shocks to be the main drivers of fluctuations .