This paper evaluates complementarities of labor market institutions and the business cycle in the context of a stochastic dynamic general equilibrium model economy. Matching between workers and vacancies with endogenous time spent in search, Nash-bargained wages, payroll taxation, and...

This paper evaluates the role of preference shocks during the Great Depression in Germany. From Euler equation residuals, I am able to identify a series of contractionary shocks that struck the German economy from 1929 to 1932. I apply the sequence of these taste innovations to a dynamic...