A labor matching model with nominal rigidities can match short-run movements in labor's share with some success. However, it cannot explain much of the behavior of employment, vacancies, and job flows in postwar US data without resorting to additional shocks beyond monetary policy and...

Since the mid-seventies, the general public of some European countries has been listening to a growing chorus of economists and politicians who lament the rising regional imbalances of unemployment. The chorus is especially large in Britain and West Germany where both an approximate north-south...

This paper is no more than a critical note on the mismatch philosophy. Its main point is that, under empirically acceptable assumptions, all measures developed so far - and probably all measures likely to emerge from refining the mismatch tools - are bound to seriously underestimate the extent...

The main point of this paper will be that West German unemployment in the late 1980's has a curious double character: while its genesis is largely determined by the macroeconomic events of the last two decades - two stabilization crises and one wage revolution -, its current state reveals...

By historical standards, the 1980's have been a time of high unemployment in West Germany. Not surprisingly, they have also been a boom period for theories about unemployment and policy proposals against it. This paper is an attempt in stocktaking: We shall try to sort out which of the most...

We distinguish and assess three fundamental views of the labor market regarding the movements in unemployment: (i) the frictionless equilibrium view; (ii) the chain reaction theory, or prolonged adjustment view; and (iii) the hysteresis view. While the frictionless view implies a clear...

This paper argues that there is a nonzero inflation-unemployment tradeoff in the long-run due to frictional growth, a phenomenon that encapsulates the interplay of nominal staggering and money growth. The existence of a downward-sloping long-run Phillips curve suggests the development of a...

Persistently high unemployment rates in Germany have led to a long-running controversy on the causes of the unemployment problem. This paper aims to re­view the contribution of Keynesian and monetarist theories to this controversy and explores empirically their implications for the explanation...

Inflation and unemployment are central issues in macroeconomics. While progress has been made on these issues recently using models that explicitly incorporate search-type frictions, existing models analyze either unemployment or inflation in isolation. We develop a framework to analyze...