The paper demonstrates how trade between developing countries can cause the divergence of long-run growth among these countries. The model describes two symmetric countries trading with each other and the industrial rest of the world. Bilateral trade occurs at any moment if the countries have...

In this paper we extend models of “search market equilibrium” to incorporate general equilibrium considerations. The model we treat is one with a single product market and a single labor market. Imperfectly informed individuals follow optimal strategies in searching for a suitably low price...

How are inflation and unemployment related in the long run? Are they negatively correlated, as in the so-called naive Phillips curve theories or uncorrelated, "as in the neo-liberals' view or are they positively correlated as Friedman suggested in his Nobel lecture? <p> In this paper inflation is...</p>

Post World War II European welfare states experienced several decades of relatively low unemployment, followed by a plague of persistently high unemployment since the 1980's. We impute the higher unemployment to welfare states' diminished ability to cope with more turbulent economic times, such...

This paper develops a simple general equilibrium model with sequential search in which a non-degenerate wage offer distribution is endogenously determined. We use this model to analyze the comparative statics effects of increases in unemployment compensation on the unemployment rate and...

In this article it is shown that when the effects of an increase in unemployment subsidies are studied in a general equilibrium framework, unemployment increases far less than in a "partial-partial" model, or may even decrease.

In what follows, we examine the consequences of the development for the reorganization of work, the breack-down of occupational barriers, the transformation of job opportunities, and the implications for inequality in the labor market.

The paper examines the determinants of the division of labor within firms. It provides an explanation of the pervasive observed changes in work organization away from the traditional functional departments and towards multi-tasking and job rotation.

Investigating the robustness of the skill-biased technical change hypothesis, this analysis incorporates two novel features. First, effective labor is modeled as the product of a quantity measure - number of employees with a given level of education - and a quality index, depending on, i.a.,...