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Sector-specific productivity shocks in a matching model

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  • Wesselbaum, Dennis

Abstract

Endogenous separation matching models have the shortcoming that they are barely able to replicate the Beveridge curve (i.e. the negative correlation between unemployment and vacancies) and business cycle statistics jointly. This paper builds upon the sectoral shock literature and combines its insights with the standard endogenous separation matching approach. We show that sectoral shocks can generate an aggregate Beveridge curve and perform reasonably well in explaining business cycle facts, especially compared to the one-sector baseline model.

Suggested Citation

  • Wesselbaum, Dennis, 2010. "Sector-specific productivity shocks in a matching model," Kiel Working Papers 1585 [rev.], Kiel Institute for the World Economy (IfW Kiel).
    • Handle: RePEc:zbw:ifwkwp:1585r
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    Cited by:

    1. Lee, Kangoh, 2022. "Unemployment insurance, mobile capital, output, and distributive effects," Economic Modelling, Elsevier, vol. 115(C).
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    3. Matsue, Toyoki, 2022. "Role of worker flows in the relationship between job offers and employment," MPRA Paper 115316, University Library of Munich, Germany.

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    More about this item

    Keywords

    Beveridge Curve; Endogenous Separations; Sectoral Productivity Shock;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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