Title: Unemployment and Vacancy in the Hong Kong Labor Market
Reference Number: 1006
Publication Date: February 2000
JEL Classifcation: E24, J60, J63

Charles Ka Yie Leung, Weslie Yuk Fai Chan
Chinese University of Hong Kong

Chung Yie Tse
University of Hong Kong

This paper combines unemployment and vacancy data to analyze the efficiency of the Hong Kong labor market for the period 1976 to 1977. We confirm that the negative relationship between unemployment and vacancy, commonly known as the Beveridge curve, applies to the Hong Kong labor market. There was an inward shift of the Beveridge curve around 1982, which implies falling match fractions since then. We also find systematic evidence that Hong Kong has been close to full employment for on average, around eighty percent of unemployment in the period was due to structural and frictional unemployment with only twenty percent attributable to cyclical unemployment.

Published in Applied Economics Letters 9 (2002), pp. 221-229.

Key words: Unemployment, vacancy, Hong Kong labor market

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Last modified: 01/23/2007