Swanson, Eric T. (contributor) - 2006
economic shock.
At time t, shocks to the economy are realized, and labor L
it
is adjusted by firms
in response. In contrast to … capital, labor is assumed to be freely mobile both between
sectors and in and out of the labor force within the period, as in … sectors to equalize the expected marginal product of capital in period t+1;
as with labor L
it
, this follows from the perfect …