We develop a model of firm dynamics with random search in the labor market where hiring firms exert recruiting effort … more in recruiting activities and achieve higher job-filling rates. In equilibrium, individual decisions of hiring firms …

job creation. In periods when labor demand and supply are in balance, either hiring credits or worker subsidies can be … used to boost employment - hiring credits by reducing labor costs for employers, and worker subsidies by raising the … economic returns to work. Historically, both types of policies have been used in pursuit of distributional goals as well, with …

also a downward rigid wage for new hires. The downward rigidity in the hiring wage magnifies the response of unemployment …

major intermediate input into expanding plant capacity, investment goods, is coutercyclical. The ratio of these prices is … Tobin's q. We interpret the fact that Tobin's q differs from unity at all reflects that there are diminishing returns to … expanding plant capacity by installing investment goods (`adjustment costs'). Also, its numerator and denominator have such …

volatility in a manner that is highly indicative of political risk. Firms exposed to political risk retrench hiring and … investment and actively lobby and donate to politicians. Interestingly, the vast majority of the variation in our measure is at …

The market for high yield (below investment-grade) corporate bonds developed in the middle 1980s. We show that, since …