A well-known fact in the time series of aggregate output is the persistence of shocks. This paper argues that the empirical relation between the expected growth rate of a firm and its size provides a microfoundation of aggregate persistence. In fact, the empirical evidence claims that small...

The purpose of this note is to explore the problem of non-convex labor supply decision in an economy with imperfect observability of work effort, and the need to use efficiency wages to prevent shirking as in Shapiro and Stiglitz (1984). In addition, the paper and explicitly performs the...

The purpose of this note is to explore the problem of a non-convex labor supply decision in an economy with unobservable e ort and incentive ("fair") wages a la Danthine and Kurmann (2004), and explicitly perform the aggregation presented there without a formal proof, and thus provide - starting...

The purpose of this note is to explore the problem of a non-convex labor supply decision in an economy with unobservable effort and incentive ("fair") wages a la Danthine and Kurmann (2004), and explicitly perform the aggregation presented there without a formal proof, and thus provide -...

This paper presents a method for aggregation across markets in a Non-Walrasian model, focusing mainly on labor markets. The method utilizes a probabilistic approach based on aggregating across virtual price functions instead of demand functions or budget shares as is normally done. By assuming...

The purpose of this paper is to explore the problem of non-convex labor supply decision in an economy where households feature consumption habits. We show how lotteries as in Rogerson (1988) can again be used to convexify consumption sets, and aggregate over individual preferences. The presence...

The purpose of this paper is to explore the problem of non-convex labor supply decision in an economy with both discrete and continuous labor decisions. In contrast to the setup in Vasilev (2016a), here each household faces a sequential labor market choice - an indivisible labor supply choice in...

The purpose of this note is to explore the problem of a non-convex labor supply decision in an economy with reciprocity in labor relations ("gift exchange") a la Danthine and Kurmann (2010), and explicitly perform the aggregation presented in Vasilev (2017) without a formal proof, and thus...

The purpose of this note is to explore the problem of non-convex labor supply decision in an economy with imperfect observability of work e ffort, and the need to use e fficiency wages to prevent shirking as in Shapiro and Stiglitz (1984). In addition, the paper and explicitly performs the...

The purpose of this note is to explore the problem of non-convex labor supply decision in an economy with reciprocity in labor relations ("gift exchange") a la Danthine and Kurmann (2010), and explicitly perform the aggregation presented in Vasilev (2017) without a formal proof, and thus provide...