In this paper, we present a simple, reduced-form model of comovements in real activity and worker flows and use it to uncover the trend changes in these flows, which determine the trend in the unemployment rate. We argue that this trend rate has several key features that are reminiscent of a...

This paper assesses whether labor market frictions, in the form of searching and matching, can help explain movements in the labor wedge - the gap between the marginal rate of substitution (MRS) and the marginal productivity of labor in a perfectly competitive business cycle model. Results...

This paper proposes an empirical method for estimating a long-run trend for the unemployment rate that is grounded in the modern theory of unemployment. I write down an unobserved-components model and identify the cyclical and trend components of the underlying unemployment flows, which in turn...

This paper studies amplification of productivity shocks in labor markets through on-the-job-search. There is incomplete information about the quality of the employee-firm match which provides persistence in employment relationships and the rationale for on-the-job search. Amplification arises...

This paper constructs a multiple-shock version of the Mortensen-Pissarides labor market search model to investigate the basic model's well-known tendency to under predict the volatility of key labor market variables. Data on U.S. job finding and job separation probabilities are used to help...

We present a model with search frictions and heterogeneous agents that allows us to decompose the overall increase in US wage inequality in the last 30 years into its within- and between-firm and skill components. We calibrate the model to evaluate how much of the overall rise in wage inequality...

Using a unique data set and a novel identification strategy we explore the effect of the state-level minimum wage increases on firms' existing and new vacancy postings. Utilizing occupation-specific county-level vacancy data from the Conference Board's Help Wanted Online for 2005-2018, we show...

This paper measures flow rates into and out of unemployment for Turkey and uses them to estimate the unemployment rate trend, that is, the unemployment rate to which the economy converges in the long run. In doing so, the paper explores the role of labor force participation in determining the...

We estimate trend unemployment rates for Ohio, Pennsylvania, Kentucky, and West Virginia, states that span parts of the Fourth District of the Federal Reserve System. Our estimated unemployment rate trend for the District as a whole stood at 5.7 percent in 2020:Q1 compared to a 4.7 percent...