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Equilibrium Unemployment

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Abstract

A search-theoretic model of equilibrium unemployment is constructed and shown to be consistent with the key regularities of the labor market and business cycle. The two distinguishing features of the model are: (i) the decision to accept or reject jobs is modeled explicitly, and (ii) markets are incomplete. The model is well suited to address a number of interesting policy questions. Two such applications are provided: the impact of unemployment insurance, and the welfare costs of business cycles.

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File URL: http://rcer.econ.rochester.edu/RCERPAPERS/rcer_479.pdf
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Bibliographic Info

Paper provided by University of Rochester - Center for Economic Research (RCER) in its series RCER Working Papers with number 479.

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Length: 64 pages
Date of creation: Feb 2001
Date of revision:
Publication status: Forthcoming, Journal of Monetary Economics
Handle: RePEc:roc:rocher:479

Contact details of provider:
Postal: University of Rochester, Center for Economic Research, Department of Economics, Harkness 231 Rochester, New York 14627 U.S.A.

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Keywords: Search; Incomplete Markets; Business Cycles; Unemployment Insurance; Welfare Costs of Business Cycles.;

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References

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  48. repec:cup:macdyn:v:1:y:1997:i:2:p:355-86 is not listed on IDEAS
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