Boeri, Tito; Garibaldi, Pietro; Moen, Espen R - C.E.P.R. Discussion Papers - 2014
The Great Recession has indicated that firms' leverage and access to finance are important for hiring and firing … both partial and general equilibrium. We find that if labor market frictions disappear, so does the motive for firms to … positions of European firms. Yet, in the Diamond Mortensen Pissarides (DMP) model there is no role for finance. All projects …