paper, we present a model with equilibrium unemployment which has three distinctive properties. First, using a search and …, which allows the model to reproduce the fluctuations of unemployment over the business cycle. And third, the model implies a … reasonable elasticity of steady state unemployment with respect to changes in benefits. The calibration of the model implies low …

employment and hours affecting inflation dynamics via marginal costs. We find that the response of unemployment and inflation to … persistent movements of aggregate inflation. Moreover, the impact of a monetary policy shock on unemployment and inflation …