This paper provides a critique of the "unemployment invariance hypothesis", according to which the behavior of the … labor market ensures that the long-run unemployment rate is independent of the size of the capital stock, productivity, and … equilibrating mechanisms to ensure unemployment invariance and that other markets may perform part of the equilibrating process as …

This paper argues that there is a nonzero inflation-unemployment tradeoff in the long-run due to frictional growth, a … unemployment. Hence, we estimate an interactive dynamics model for the US that includes wage-price setting and labour market … equations. We then evaluate the inflation-unemployment tradeoff and assess the impact of productivity, money growth, budget …

empirical regularities that the conventional matching model cannot. -- Matching ; incentives ; adjustment costs ; unemployment …