Michaillat, Pascal
(2012)
Do matching frictions explain unemployment?: not in bad times.
American Economic Review, 102 (4).
pp. 1721-1750.
ISSN 0002-8282
Full text not available from this repository.
Abstract
This paper models unemployment as the result of matching frictions and job rationing. Job rationing is a shortage of jobs arising naturally in an economic equilibrium from the combination of some wage rigidity and diminishing marginal returns to labor. During recessions, job rationing is acute, driving the rise in unemployment, whereas matching frictions contribute little to unemployment. Intuitively, in recessions jobs are lacking, the labor market is slack, recruiting is easy and inexpensive, so matching frictions do not matter much. In a calibrated model, cyclical fluctuations in the composition of unemployment are quantitatively large.
| Item Type: |
Article
|
| Official URL: |
http://www.aeaweb.org/ |
| Additional Information: |
© 2012 American Economic Association |
| Divisions: |
Economics
Centre for Economic Performance |
| Subjects: |
H Social Sciences > HB Economic Theory
H Social Sciences > HD Industries. Land use. Labor |
| JEL classification: |
E - Macroeconomics and Monetary Economics > E2 - Consumption, Saving, Production, Employment, and Investment > E24 - Macroeconomics: Employment; Unemployment; Wages; Intergenerational Income Distribution (includes wage indexation)
E - Macroeconomics and Monetary Economics > E3 - Prices, Business Fluctuations, and Cycles > E32 - Business Fluctuations; Cycles
J - Labor and Demographic Economics > J4 - Particular Labor Markets > J41 - Contracts: Specific Human Capital, Matching Models, Efficiency Wage Models, and Internal Labor Markets
J - Labor and Demographic Economics > J6 - Mobility, Unemployment, and Vacancies > J64 - Unemployment: Models, Duration, Incidence, and Job Search |
| Date Deposited: |
20 Feb 2012 16:18 |
| Last Modified: |
12 Dec 2024 00:05 |
| URI: |
http://eprints.lse.ac.uk/id/eprint/41957 |
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