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Wage Rigidity and Job Creation
Haefke, Christian; Sonntag, Marcus; van Rens, Thijs - Institute for the Study of Labor (IZA) - 2008
Standard macroeconomic models underpredict the volatility of unemployment fluctuations. A common solution is to assume wages are rigid. We explore whether this explanation is consistent with the data. We show that the wage of newly hired workers, unlike the aggregate wage, is volatile and...
Persistent link: https://www.econbiz.de/10005233819
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The Beveridge Curve
Yashiv, Eran - Institute for the Study of Labor (IZA) - 2006
underlying theory is the search and matching model, with workers and firms engaging in costly search leading to random matching …
Persistent link: https://www.econbiz.de/10005763504
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Do Emotions Improve Labor Market Outcomes?
Goette, Lorenz; Huffman, David - Institute for the Study of Labor (IZA) - 2005
the inflation rate, but they very seldom cut nominal wages. This pattern suggests that workers exhibit a special … compare the inflation rate to the wage change before it becomes clear whether the change increases or decreases utility, thus … inflation rate. Although emotions may benefit individual workers, by strengthening their bargaining position and preventing wage …
Persistent link: https://www.econbiz.de/10005763663
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The Unemployment Inflation Trade-Off in the Euro Area
Linzert, Tobias - Institute for the Study of Labor (IZA) - 2005
This paper analyzes the relationship between unemployment and wage inflation for 10 of the euro area countries. The … combination of low wage inflation and high unemployment in Europe is usually attributed to a rise in the natural rate of … unemployment that may account for a changing pattern in the unemployment inflation tradeoff. Moreover, it analyzes whether the …
Persistent link: https://www.econbiz.de/10005703542
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Fairness Considerations in Labor Union Wage Setting: A Theoretical Analysis
Strifler, Matthias; Beissinger, Thomas - Institute for the Study of Labor (IZA) - 2012
We consider a theoretical model in which unions not only take the outside option into account, but also base their wage-setting decisions on an internal reference, called the fairness reference. Wage and employment outcomes and the shape of the aggregate wage-setting curve depend on the weight...
Persistent link: https://www.econbiz.de/10010570796
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Labor Market Reforms and Current Account Imbalances: Beggar-Thy-Neighbor Policies in a Currency Union?
Baas, Timo; Belke, Ansgar - Institute for the Study of Labor (IZA) - 2014
Member countries of the European Monetary Union (EMU) initiated wide-ranging labor market reforms in the last decade. This process is ongoing as countries that are faced with serious labor market imbalances perceive reforms as the fastest way to restore competitiveness within a currency union....
Persistent link: https://www.econbiz.de/10010959728
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What Do Participation Fluctuations Tell Us About Labor Supply Elasticities?
Haefke, Christian; Reiter, Michael - Institute for the Study of Labor (IZA) - 2011
In this paper we use information on the cyclical variation of labor market participation to learn about the aggregate labor supply elasticity. For this purpose, we extend the standard labor market matching model to allow for endogenous participation. A model that is calibrated to replicate the...
Persistent link: https://www.econbiz.de/10009353615
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An Incentive Theory of Matching
Brown, Alessio J. G.; Merkl, Christian; Snower, Dennis J. - Institute for the Study of Labor (IZA) - 2009
This paper presents a theory explaining the labor market matching process through microeconomic incentives. There are …
Persistent link: https://www.econbiz.de/10004961441
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Endogenous Labor Market Participation and the Business Cycle
Haefke, Christian; Reiter, Michael - Institute for the Study of Labor (IZA) - 2006
Existing models of equilibrium unemployment with endogenous labor market participation are complex, generate procyclical unemployment rates and cannot match unemployment variability relative to GDP. We embed endogenous participation in a simple, tractable job market matching model, show...
Persistent link: https://www.econbiz.de/10005703253
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More on Unemployment and Vacancy Fluctuations
Mortensen, Dale T.; Nagypál, Éva - Institute for the Study of Labor (IZA) - 2005
Shimer (2005a) argues that the Mortensen-Pissarides equilibrium search model of unemployment explains only about 10% of the response in the job-finding rate to an aggregate productivity shock. Some of the recent papers inspired by his critique are reviewed and commented on here. Specifically, we...
Persistent link: https://www.econbiz.de/10005703663