labor market frictions. We characterize the distributions of employment, unemployment, wages and income within and between … sectors as a function of structural parameters. We find that greater firm heterogeneity increases unemployment, wage … inequality and income inequality, whereas greater worker heterogeneity has ambiguous effects. We also find that labor market …

"Shimer's calibrated version of the Mortensen-Pissarides model generates unemployment fluctuates much smaller than the … has been challenged by Costain and Reiter, who say it generates unrealistically big differences in unemployment from the … labor market in the Kydland-Prescott model, especially ones incorporating household production, like Benhabib, Rogerson and …