U.S. CPS gross flows data indicate that in recessions firms actually increase their hiring rates from the pools of the unemployed and out of the labor force. Why so? The paper provides an explanation by studying the optimal recruiting behavior of the representative firm. This behavior is a...

There exists a persistent disagreement in the literature over the effect of business cycles on economic growth. This paper offers a solution to this disagreement, suggesting that volatility carries a positive direct effect, but also a negative indirect effect, operating through the insurance...

Countercyclical unemployment benefit extensions in the United States act as a propagation mechanism, contributing to both the high persistence of unemployment and its weak correlation with productivity. We show this by modifying an otherwise standard frictional model of the labor market to...

Recent dynamic contracting models of downward real wage rigidity with "equal treatment" – newly hired workers cannot price themselves into jobs by undercutting incumbents – imply that real wages are relatively rigid in "bad" times but upwardly flexible during "good" times. We use an...

We develop an adjustment procedure to construct U.S. monthly time series of involuntary part-time employment stocks and flows from 1976 until today. Armed with these new data, we provide a comprehensive account of the dynamics of involuntary part-time work. Transitions from full-time to...

We propose a highly tractable way of analyzing business cycles in an environment with random job search both off- and and on-the-job (OJS). Ex post heterogeneity in productivity across jobs generates a job ladder. Firms Bertrand-compete for employed workers, as in the Sequential Auctions...

This paper analyzes Germany's unusual labor market experience during the Great Recession. We estimate a general equilibrium model with a detailed labor market block for post-unification Germany. This allows us to disentangle the role of institutions (short-time work, government spending rules)...

This study uses aggregate data for 23 OECD countries over the 1960-1997 period to examine the relationship between macroeconomic conditions and fatalities. The main finding is that total mortality and deaths from several common causes increase when labor markets strengthen. For instance,...

Using a large panel of administrative records this study confirms the predictions of the ranking model of Blanchard and Diamond (1994) that an individual?s probability of leaving unemployment decreases with unemployment duration and increases with economic growth. However, the ranking model of...

This study examines individuals? unemployment experiences from the age of 18 up to the age of 35 using a large panel of administrative records on unemployment related benefit claims of men in the United Kingdom over the past two decades. The main focus is on the extent to which individuals?...