Building a model with three imperfect markets - goods, labor and credit - representing a product's life-cycle, we find … that goods market frictions drastically change the qualitative and quantitative dynamics of labor market variables. The … search models of the labor market fail in one of the two dimensions. Two factors related to goods market frictions generate …

labor market in which workers? location in an agglomeration depends on commuting costs, the endogenous price of land and the … land and labor markets are solved for simultaneously. We then compare this decentralized equilibrium to a social planner … interaction between land and labor markets, and decompose the equilibrium unemployment rate into two parts: a pure non-spatial one …

Labor market frictions are not the only possible factor responsible for high unemployment. Credit market imperfections …. This paper shows that labor and credit market imperfections interact in a complementary way - which may explain why … European and US unemployment differ so much when labor markets have become more similar at the margin in Europe and the US. To …