U.S. CPS gross flows data indicate that in recessions firms actually increase their hiring rates from the pools of the unemployed and out of the labor force. Why so? The paper provides an explanation by studying the optimal recruiting behavior of the representative firm. This behavior is a...

Remarks at the Quarterly Regional Economic Press Briefing, New York City.

We show that the inability of a standardly-calibrated stochastic labor search-and-matching model to account for the observed volatility of unemployment and vacancies extends beyond U.S. data to a set of OECD countries. We also argue that using cross-country data is helpful in evaluating the...

Remarks at the Quarterly Regional Economic Press Briefing, New York City.

It has been shown that under perfect competition and a Cobb-Douglas production function, a basic real business cycle model may exhibit indeterminacy and sunspot fluctuations when income tax rates are determined by a balanced-budget rule. This paper introduces in an otherwise standard real...

In this paper we analyze the synchronization between the business cycles of US and Mexican regions. Regional economic activity in Mexico is measured using regional coincident indexes recently developed at Banco de México, while US aggregate economic activity is measured with the national...

Ten years ago, the global financial crisis started to unwind in the USA and triggered the greatest recession since World War II. Although the crisis of 2007-08 was caused in the USA, their economy was not hit so hard in the Great Recession of 2009 as in Europe, and in particular in the Euro...