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Consumption and Savings with Unemployment Risk: Implications for Optimal Employment Contracts
Pissarides, Christopher A. - Centre for Economic Performance, LSE - 2002
This paper derives optimal employment contracts when workers are risk averse and there are employment and unemployment risks. Without income insurance, consumption rises during employment and falls during unemployment. Optimal employment contracts offer severance compensation to smooth...
Persistent link: https://www.econbiz.de/10005017148
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The Household Effects of Government Spending
Giavazzi, Francesco; McMahon, Michael - Centre for Economic Performance, LSE - 2012
This paper provides new evidence on the effects of fiscal policy by studying, using household-level data, how households respond to shifts in government spending. Our identification strategy allows us to control for time-specific aggregate effects, such as the stance of monetary policy or the...
Persistent link: https://www.econbiz.de/10009649752
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A Model of Aggregate Demand and Unemployment
Michaillat, Pascal; Saez, Emmanuel - Centre for Economic Performance, LSE - 2013
We present a static model of aggregate demand and unemployment. The economy has a nonproduced good, a produced good, and labor. Product and labor markets have matching frictions. A general equilibrium is a set of prices, market tightnesses, and quantities such that buyers and sellers optimize...
Persistent link: https://www.econbiz.de/10010682991
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The Objective Benefits of Subjective Well-Being
Neve, Jan-Emmanuel De; Diener, Ed; Tay, Louis; Xuereb, Cody - Centre for Economic Performance, LSE - 2013
The aim of this paper is to survey the "hard" evidence on the effects of subjective well-being. In doing so, we complement the evidence on the determinants of well-being by showing that human well-being also affects outcomes of interest such as health, income, and social behaviour. Generally, we...
Persistent link: https://www.econbiz.de/10010685645
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Wage growth and productivity growth: the myth and reality of 'decoupling'
Pessoa, Joao Paulo; Reenen, John Van - Centre for Economic Performance, LSE - 2013
Pessoa and John Van Reenen. Their investigation of claims that wage growth has become 'decoupled' from productivity growth … education distribution will boost productivity and real wages. …
Persistent link: https://www.econbiz.de/10010721423
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The Macroeconomic Role of Unemployment Compensation
Blumkin, Tomer; Hadar, Yossi; Yashiv, Eran - Centre for Economic Performance, LSE - 2009
enhancing the assignment of workers to jobs in the face of firm productivity heterogeneity and skill-biased technological change …. It shows that in order to do so policy needs to be a function of the properties of the firm's productivity distribution … emerging from the analysis is that the degree of firm productivity heterogeneity, in terms of skewness and variance, matters …
Persistent link: https://www.econbiz.de/10005797298
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Decoupling of Wage Growth and Productivity Growth? Myth and Reality
Pessoa, Joao Paulo; Reenen, John Van - Centre for Economic Performance, LSE - 2013
It is widely believed that in the US wage growth has fallen massively behind productivity growth. Recently, it has also … track real labour productivity growth (value added per hour), so net decoupling should only occur if labour's share falls as …
Persistent link: https://www.econbiz.de/10010702081
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Policy Uncertainty and Precautionary Savings
Giavazzi, Francesco; McMahon, Michael F. - Centre for Economic Performance, LSE - 2008
In 1997 Chancellor Kohl proposed a major pension reform: he pushed the law through Parliament explaining that the German PAYG system had become unsustainable. One limitation of the new law - one that is crucial for our identification strategy - is that it left the generous pension entitlements...
Persistent link: https://www.econbiz.de/10005151059
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Debt and Incomplete Financial Markets: A Case for Nominal GDP Targeting
Sheedy, Kevin D. - Centre for Economic Performance, LSE - 2013
Financial markets are incomplete, thus for many agents borrowing is possible only by accepting a financial contract that specifies a fixed repayment. However, the future income that will repay this debt is uncertain, so risk can be inefficiently distributed. This paper argues that a monetary...
Persistent link: https://www.econbiz.de/10010643604
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Labour Market Performance and Start-Up Costs: OECD Evidence
Lopez-Garcia, Paloma - Centre for Economic Performance, LSE - 2002
This paper is intended to make a contribution to the empirical literature explaining the rise ofunemployment since the 1970s in western economies by means of interactions betweenshocks and institutions. The contribution is twofold. First, the impact of a general feature ofdeveloped economies...
Persistent link: https://www.econbiz.de/10005016766