labor input, but it predicts a strong counterfactually negative long run relationship between inflation and unemployment … negative long run relationship between trend inflation and unemployment provides indirect evidence against the proposed …

rate and the unemployment rate? In the model, fluctuations are prominently driven by productivity shocks which are commonly … replicates the conditional volatility of job finding and unemployment, so that the Shimer critique does not apply. Instead the … shocks lead to a fall in job finding and an increase in unemployment thereby opposing the dynamics in the standard model …

This paper studies the role of labor market institutions in business cycle fluctuations. We develop a DSGE model with … search and matching frictions and incorporate a US unemployment insurance experience rating system. Layoff taxes based on … experience rating finance the cost of unemployment benefits and create considerable employment adjustment costs. Our framework …