The standard theory of equilibrium unemployment, the Mortensen-Pissarides search and matching model, cannot explain the … magnitude of the business cycle fluctuations in two of its central elements, unemployment and vacancies. Modifying the model to … make the present value of wages unresponsive to current labor market conditions amplifies fluctuations in unemployment and …

set of contingent claims conditional on this risk.We use the model to evaluate a tax-financed unemployment insurance … stochastic ones---generate rather limited unemployment effects, unless workers are close to indifferent between working and not …

One goal of extending the duration of unemployment insurance (UI) in recessions is to increase UI coverage in the face … of longer unemployment spells. Although it is a common concern that such extensions may themselves raise nonemployment …

-aversion reduces wages, unemployment, and investment. Unemployment insurance (UI) has the reverse effect due to market generated moral … hazard: insured workers seek high wage jobs with high unemployment risk. An economy with risk-neutral workers achieves …

impacts from optimal unemployment insurance policy. Here optimal policy is defined as that which maximizes total output and …

The Great Recession has renewed interest in Unemployment Insurance (UI) programs around the world. At the same time …

households to 5% for low-wealth households. The cost increases to approximately 8% for low-wealth households if unemployment … across all households, is very significant (2.2% of lifetime consumption). We finally show that a more generous unemployment … model in which output is partly demand determined, and therefore unemployment insurance stabilizes aggregate demand and …