Carlsson, Mikael; Messina, Julián; Nordström Skans, Oskar - 2021
This paper analyzes how labor ows respond to permanent idiosyncratic shifts in rm-level production functions and demand …-level employment decisions. In contrast, the paper documents rapid and substantial employment adjustments through hires and separations … in response to rm-level demand shocks. The choice of adjustment margin depends on the sign of the shock: rms adjust …