The cyclical behavior of equilibrium unemployment and vacancies revisited
Recently, a number of authors have argued that the standard search model cannot generate the observed business-cycle-frequency fluctuations in unemployment and job vacancies, given shocks of a plausible magnitude. We use data on the cost of vacancy creation and cyclicality of wages to identify the two key parameters of the model - the value of non-market activity and the bargaining weights. Our calibration implies that the model is, in fact, consistent with the data. JEL Classification: E24, E32, J41, J63, J64
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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Michael J. Pries, 2004.
"Persistence of Employment Fluctuations: A Model of Recurring Job Loss,"
Review of Economic Studies,
Oxford University Press, vol. 71(1), pages 193-215.
- Michael J. Pries, 2004. "Persistence of Employment Fluctuations: A Model of Recurring Job Loss," Review of Economic Studies, Wiley Blackwell, vol. 71(1), pages 193-215, 01.
- Christopher A. Pissarides, 1992.
"Search Unemployment with on-the-job Search,"
CEP Discussion Papers
dp0074, Centre for Economic Performance, LSE.
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