An equilibrium model is developed to study the interaction of the business cycle, unemployment insurance (UI), and the labor market for young men in Canada. The model combines optimal job offer, layoff, and recall decisions within a numerically solved and restricted Bayesian-Nash equilibrium. We...

We develop a numerically solved equilibrium model of the labor market to study the effect of unemployment insurance (UI) over the business cycle. This model combines sequential job search, optimal job offer, layoff, and recall decisions, an aggregate productivity cycle, and details of an actual...

Asymmetry has been well documented in the business cycle literature. The asymmetric business cycle suggests that major macroeconomic series, such as a country's unemployment rate, are non-linear and, therefore, the use of linear models to explain their behavior and forecast their future values...