This paper studies the optimal timing of unemployment insurance subsidies in a McCall search model. Risk-averse workers … sequentially sample random job opportunities. Our model distinguishes unemployment subsidies from consumption during unemployment … stationary search problems, the optimal subsidies are independent of unemployment duration. In contrast, when workers are …

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 …

rate in particular contain implicit theories of unemployment. In some cases, the theory is explicit. When the nominal rate … employment, and higher unemployment. Quite separately, the Diamond-Mortensen-Pissarides model is a widely accepted and well …-developed account of turnover, wage determination, and unemployment. The DMP model is a clashing theory of unemployment, in the sense …

-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 …

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 …

.S. labor market slack and show that underemployment and hidden unemployment currently account for the bulk of the U … conventional measure of the unemployment rate (that is, the number of individuals who are not working at all and actively searching … for a job). Rather, assessments of the employment gap should reflect the incidence of underemployment (that is, people …

government budget to study the deadweight loss of two unemployment insurance policies. Experimental and quasi …