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Reciprocity and matching frictions

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  • Wesselbaum, Dennis

Abstract

We build a RBC endogenous separation matching model and introduce efficiency wages along the lines of Akerlof (1982). While the standard endogenous separation matching model reveals shortcomings in explaining correlations and volatilities jointly, this approach performs reasonably well along both dimensions. The proper introduction of real rigidities can consistently enhance the performance of the (endogenous separation) matching model.

Suggested Citation

  • Wesselbaum, Dennis, 2010. "Reciprocity and matching frictions," Kiel Working Papers 1616, Kiel Institute for the World Economy (IfW).
  • Handle: RePEc:zbw:ifwkwp:1616
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    References listed on IDEAS

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    Cited by:

    1. Martin, Christopher, 2015. "Search Frictions, Efficiency Wages and Equilibrium Unemployment," Department of Economics Working Papers 45163, University of Bath, Department of Economics.
    2. Robert Jump, 2014. "A Fair Wage Explanation of Labour Market Volatility," Studies in Economics 1413, School of Economics, University of Kent.

    More about this item

    Keywords

    Efficiency Wages; Endogenous Separations; Search and Matching;

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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