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How Broadband Internet Affects Labor Market Matching

Author

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  • Manudeep Bhuller
  • Andreas R. Kostol
  • Trond C. Vigtel

Abstract

How the internet affects job matching is not well understood due to a lack of data on job vacancies and quasi-experimental variation in internet use. This paper helps fill this gap using plausibly exogenous roll-out of broadband infrastructure in Norway, and comprehensive data on recruiters, vacancies and job seekers. We document that broadband expansions increased online vacancy-postings and lowered the average duration of a vacancy and the share of establishments with unfilled vacancies. These changes led to higher job-finding rates and starting wages and more stable employment relationships after an unemployment-spell. Consequently, our calculations suggest that the steady-state unemployment rate fell by as much as one-fifth.

Suggested Citation

  • Manudeep Bhuller & Andreas R. Kostol & Trond C. Vigtel, 2019. "How Broadband Internet Affects Labor Market Matching," CESifo Working Paper Series 8022, CESifo.
    • Handle: RePEc:ces:ceswps:_8022
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    3. Bauer, Anahid & Feir, Donn. L. & Gregg, Matthew T., 2022. "The tribal digital divide: Extent and Explanations," Telecommunications Policy, Elsevier, vol. 46(9).
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    5. Gürtzgen, Nicole & (né Nolte), André Diegmann & Pohlan, Laura & van den Berg, Gerard J., 2021. "Do digital information technologies help unemployed job seekers find a job? Evidence from the broadband internet expansion in Germany," European Economic Review, Elsevier, vol. 132(C).
    6. Campbell, Richard Cole, 2024. "Need for speed: Fiber and student achievement," Telecommunications Policy, Elsevier, vol. 48(6).
    7. Balgobin, Yann & Dubus, Antoine, 2022. "Mobile phones, mobile Internet, and employment in Uganda," Telecommunications Policy, Elsevier, vol. 46(5).
    8. Yu, Li & Ma, Tiemeng & Wu, Sirong & Lyu, Zhuoyang, 2023. "How does broadband internet affect firm-level labor misallocation: The role of information frictions," China Economic Review, Elsevier, vol. 82(C).
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    More about this item

    Keywords

    unemployment; information; job search; matching;
    All these keywords.

    JEL classification:

    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software

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