I study the welfare cost of business cycles in a complete-markets economy where some people are more risk averse than others. Relatively more risk-averse people buy insurance against aggregate risk, and relatively less risk-averse people sell insurance. These trades reduce the welfare cost of...

In the extensive job search literature, studies assume either sequential or non-sequential search. Which assumption is more reasonable? This paper introduces a novel method to test the hypothesis that firms search sequentially based on the relationship between the number of (rejected) job...

The paper studies how social connections affect firm-level hiring decisions and performance. We characterize the social connections of firms' employees using register data and for causal identification we use job displacements, which create directed positive shocks towards connected firms by...

This paper contributes to the existing literature on ethnic discrimination of immigrants in hiring by addressing the central question of what employers act on in a job application. The method involved sending qualitatively identical resumes signalling belonging to different ethnic groups to...

In this study, we investigate the nexus between career risk aversion and unemployment duration based on German survey data (GSOEP). Using a direct measurement of career risk aversion, we do not find a statistically significant linear effect from risk aversion on unemployment duration. However,...

Using the large-scale German Socio-Economic Panel, this note reports direct empirical evidence for significant correlations between risk aversion and labour market outcomes (full-time employment, temporary agency work, fixed-term contracts, employer change, quits, training, wages, and job...

The VIX, the stock market option-based implied volatility, strongly co-moves with measures of the monetary policy stance. When decomposing the VIX into two components, a proxy for risk aversion and expected stock market volatility (“uncertainty”), we find that a lax monetary policy decreases...

Implied volatility indices should have information about risk parameters, once they are cleansed of the influence of normal volatility dynamics and macro-economic uncertainty. Building on intuition from the dynamic asset pricing literature, we uncover unobserved risk aversion and fundamental...