We revisit the hypothesis that cyclical fluctuations in unemployment are caused by shocks to the discount rate. We use … a rich search-theoretic model of the labor market in which the UE, EU and EE rates are all endogenous. Analytically, we … in the EU rate. The response of the unemployment rate is minuscule. These findings are at odds with the actual behavior …

modest increase in unemployment. Despite these forces, we conclude that the problems facing the U.S. labor market are …From the perspective of a wide range of labor market outcomes, the recession that began in 2007 represents the deepest … downturn in the postwar era. Early on, the nature of labor market adjustment displayed a notable resemblance to that observed …

The aggregate neoclassical growth model - with a labor income tax or "labor market distortion" that began growing at … the end of 2007 as its only impulse - produces time series for aggregate labor usage, consumption, investment, and real …, but merely because labor is falling and labor is complementary with capital in the production function. Through the lens …

vacancy-unemployment ratio and labor productivity have nearly the same variance. I establish this claim both using analytical …-cycle-frequency fluctuations in unemployment and job vacancies in response to shocks of a plausible magnitude. In the U.S., the vacancy-unemployment … ratio is 20 times as volatile as average labor productivity, while under weak assumptions, search models predict that the …

the unskilled. By contrast, in Europe it is undoubtedly the rise and persistence of unemployment. Technology has been … identified as a key reason for the rising US wage inequality, while labor market rigidities are often cited as a key reason for … European unemployment. This paper seeks to provide a unified account of these major factor market developments. It models the …

We measure the impact of labor market referral networks defined by residential neighborhoods on re-employment following … labor market network that includes not only the number of employed neighbors of a laid off worker, but also the gross hiring … some evidence that local labor market networks are linked to re-employment following mass layoffs for lower-earning workers …

This paper investigates the potential reasons for the surprisingly different labor market performance of the United … States, Canada, Germany, and several other OECD countries during and after the Great Recession of 2008-09. Unemployment rates … increased moderately in Canada. More recent data also show that, unlike Germany and Canada, the U.S. unemployment rate remains …

-when the incentive for job creation falls, the labor market slackens and unemployment rises. Employers recover their … claims on business income also rise. According to the leading view of unemployment-the Diamond-Mortensen-Pissarides model … when the discount rate rises. Thus high discount rates imply high unemployment. This paper does not explain why the …

The Great Recession tested the ability of the "great U.S. jobs machine" to limit the severity of unemployment in a … major economic downturn and to restore full employment quickly afterward. In the crisis the American labor market failed to … live up to expectations. The level and duration of unemployment increased substantially in the downturn and the growth of …

This paper uses a sample of 116 recession episodes in developed and emerging market economies to compare the labor …-market recovery during financial crises with that of other recession episodes. It documents two new stylized facts. First, labor …-market recovery from financial crises is characterized by either higher unemployment ("jobless recovery") or a lower real wage …