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Nonlinear dynamics in a structural model of employment

Burgess, Simon (1991) Nonlinear dynamics in a structural model of employment. CEP discussion paper, 37. Centre for Economic Performance, London School of Economics and Political Science, London, UK.

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Identification Number: 37

Abstract

Search and matching models imply that firms'' employment adjustment costs depend on the tightness on the labour market, giving rise to endogenous or nonlinear dynamics in employment. This paper sets this argument out in detail, estimating a model simultaneously explaining the long-run level of employment and the nonlinear dynamics. The main implications of the estimated model are (i) the effect of a given shock to the long run level of employment is markedly different at different levels of employment, and (ii) asymmetric business cycles result with the downswing in employment being sharper and deeper than the upswing.

Item Type: Monograph (Discussion Paper)
Official URL: http://cep.lse.ac.uk
Additional Information: © 1991 The Author
Subjects: H Social Sciences > HD Industries. Land use. Labor
Sets: Collections > Economists Online
Research centres and groups > Centre for Economic Performance (CEP)
Series: Working Papers > CEP Discussion Papers
Date Deposited: 21 Aug 2008 14:22
Last Modified: 28 Feb 2013 12:16
URI: http://eprints.lse.ac.uk/id/eprint/21099

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