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Demand uncertainty mismatch and (un)employment

Author

Listed:
  • Jellal, Mohamed
  • Thisse, Jacques-François
  • Zenou, Yves

Abstract

Heterogeneous firms facing demand-induced price fluctuations imperfectly compete for heterogeneous workers. It is shown that unemployment may arise in equilibrium because of the combination of uncertainty on product price and mismatch between workers’ skills and firms’ job requirements.

Suggested Citation

  • Jellal, Mohamed & Thisse, Jacques-François & Zenou, Yves, 2005. "Demand uncertainty mismatch and (un)employment," MPRA Paper 38437, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:38437
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    File URL: https://mpra.ub.uni-muenchen.de/38437/1/MPRA_paper_38437.pdf
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    References listed on IDEAS

    as
    1. Blanchard, Olivier & Wolfers, Justin, 2000. "The Role of Shocks and Institutions in the Rise of European Unemployment: The Aggregate Evidence," Economic Journal, Royal Economic Society, vol. 110(462), pages 1-33, March.
    2. Hamilton, Jonathan & Thisse, Jacques-Francois & Zenou, Yves, 2000. "Wage Competition with Heterogeneous Workers and Firms," Journal of Labor Economics, University of Chicago Press, vol. 18(3), pages 453-472, July.
    3. Lars Ljungqvist & Thomas J. Sargent, 1998. "The European Unemployment Dilemma," Journal of Political Economy, University of Chicago Press, vol. 106(3), pages 514-550, June.
    4. Rosen, Sherwin, 1985. "Implicit Contracts: A Survey," Journal of Economic Literature, American Economic Association, vol. 23(3), pages 1144-1175, September.
    5. Sandmo, Agnar, 1971. "On the Theory of the Competitive Firm under Price Uncertainty," American Economic Review, American Economic Association, vol. 61(1), pages 65-73, March.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Xavier Wauthy & Yves Zenou, 2002. "How Does Imperfect Competition in the Labor Market Affect Unemployment Policies?," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 4(3), pages 417-436, July.
    2. Elias Oikarinen, 2009. "Dynamic linkages between housing and lot prices: Empirical evidence from Helsinki," Discussion Papers 53, Aboa Centre for Economics.
    3. Jellal, Mohamed & Zenou, Yves, 1999. "Efficiency wages and the quality of job matching," Journal of Economic Behavior & Organization, Elsevier, vol. 39(2), pages 201-217, June.
    4. Laurence Rioux, 2000. "Human Capital, Local Labor Markets and Regional Interaction," Econometric Society World Congress 2000 Contributed Papers 1740, Econometric Society.
    5. Jellal, Mohamed, 2012. "Maroc éducation et emploi une analyse théorique [Morocco education and employment a theory]," MPRA Paper 38465, University Library of Munich, Germany.

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    More about this item

    Keywords

    Skill mismatch; Price uncertainty; Unemployment equilibrium;
    All these keywords.

    JEL classification:

    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts

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