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A beveridge curve show the relationship between unemployment and vacancy.

Some papers add additional variables like Real GDP, real interest rate, etc to test for the matching efficiency of the BC.

However when it comes to age structure. Some researchers use 1) Young Share in Unemployed, or 2) Young Share in labour force

What's the difference between 1) and 2)? How would a smaller young share in the unemployed vs the labour force affect the unemployment, vacancy and hence matching efficiency?

Thank you

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  • $\begingroup$ I don't understand, What are the alternatives? Counting young unemployed as unemployed, or counting young unemployed as out-of-labor-force? You say the second alternative is counting young unemployed in the labor force, but unemployed are in the labor force, so that's not a meaningful alternative. $\endgroup$ – FooBar Jun 8 '15 at 12:57
  • $\begingroup$ sorry, but I don't think you are reading the question carefully. The 2nd alternative is young share in the labour force, NOT young unemployed share in the labour force $\endgroup$ – user72728 Jun 8 '15 at 22:51
  • $\begingroup$ I am reading it quite carefully I can assure you, and this is not making sense to me. Apparently, these are not alternatives on how to deal with the same people (young unemployed), but something else. What that is I still didn't get. If you think it's just my lack of care, you can just wait until someone else answers this question. $\endgroup$ – FooBar Jun 8 '15 at 23:07

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