Heterogeneity, matching and unemployment.

Summary The matching theory aims to account for the processes of encounter and association between unemployed job seekers and firms that hold vacant jobs. It allows us to explain the equilibrium unemployment rate as a function of the parameters of the economy. Individuals entering the labor market find a job after a period of unemployment, but in the meantime others have become unemployed. It is this flow of new unemployed and the time required to find a job that gives a still positive level of unemployment. Within this framework, it is possible to study different problems resulting from the heterogeneity of individual characteristics and behaviors of agents. Similarly, the level of qualification has a significant influence on the career path of workers. The choice of agents present on the labor market to remain employed or to create a firm influences the level of employment. Indeed, a high level of unemployment may result from insufficient firm creation.