Equilibrium Search with Time-Varying Unemployment Benefits
AbstractIn this paper, we show how time-varying unemployment benefits can generate equilibrium wage dispersion in an economy in which identical firms post wages and homogeneous workers search for acceptable offers. We allow for matching frictions and for free entry and exit of vacancies, and we model time-varying unemployment benefits in a simple and natural way. We characterize the equilibrium, and we derive the comparative statics effects of changes in the unemployment compensation system on the equilibrium wage distribution and the unemployment rate.
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Bibliographic InfoPaper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 487.
Date of creation: 2001
Date of revision:
Other versions of this item:
- James Albrecht & Susan Vroman, 2005. "Equilibrium Search With Time-Varying Unemployment Benefits," Economic Journal, Royal Economic Society, vol. 115(505), pages 631-648, 07.
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