The Beveridge Curve : A comparison between the three largest labour market regions in Sweden; Stockholm-, Västra Götaland- and Skåne county and the effect of the building of the Öresund Bridge on the labour market matching efficiency of Skåne county.

Abstract: This paper investigates the relationship between vacant job positions and unemployed workers, illustrated by the Beveridge curve, a tool for observing the matching process and the condition of a labour market. The Swedish case is studied together with its three largest labour market regions, i.e., Stockholm-, Västra Götaland- and Skåne county. A comparison opens up a discussion of whether local labour markets with similar characteristics located in different parts of the country behave similarly or in what way they distinguish. Furthermore, these three regions are expected to influence the Swedish Beveridge curve to a larger extent, which is also examined in the paper. In addition, the effect of an exogenous shock, such as the building of the Öresund Bridge, expanding the labour market of Skåne county by connection to another metropolitan area, Copenhagen, is studied. This is done by comparing the matching efficiency before and after the bridge is opened. Moreover, the effect in Skåne is then analysed in accordance with the same period for the other regions included, to get an indication of whether the bridge alone provides a change in matching efficiency or if changes are connected to national events that influence all regions similarly.  The analysis is based on monthly data from year 1996-2020, collected from the Swedish Public Employment service and Statistics Sweden, primarily. Graphical illustrations of the Beveridge curve in combination with OLS regressions provide concluding results that the Beveridge curves for the three regional labour markets observed are shaped rather similarly and experience shifts and movements during the same time points, generally. Skåne county is the exception and experience more horizontal and vertical movements compared to Stockholm- and Västra Götaland county and the Swedish average. Furthermore, there are statistically significant estimates ensuring the negative relationship between unemployment- and vacancy rate, i.e., a downward sloping Beveridge curve for all regions. Not enough evidence on the effect of the Öresund Bridge on the matching efficiency of Skåne county is provided to present a valid conclusion regarding this topic.