It’s a match? : A comparison of the aggregated job-matching efficiency in urban and rural regions in Sweden

Abstract: The purpose of this thesis is to examine if there is a difference between Swedish urban and rural regions in terms of job-matching efficiency. The thesis employs the Beveridge curve with unemployment rate as the dependent variable as a framework and a longitudinal dataset covering 60 regions and the period 1998-2015. Two aspects of the job-matching efficiency are considered; the determinants of unemployment and the temporal changes in the job-matching efficiency. Considering the determinants of unemployment, some differences between urban and rural regions are detected. The results indicate that the mean age of a region’s population is negatively related to the unemployment rate while the share of women in the labor force is positively related in both types of regions. According to the Beveridge curve, this implies that the job-matching efficiency increases with a higher mean age while a higher share of women in the labor force decreases the matching efficiency. However, both variables are significantly stronger related to the unemployment rate in urban regions. Education is found to be positively associated with unemployment rate in urban regions while insignificant in rural ones. Lastly, no major difference between the two types of regions regarding the changes or position of the Beveridge curve are found. This implies that the job-matching efficiency is similar and change simultaneously in both urban and rural regions.