This paper shows how uninsurable unemployment risk is crucial to qualitatively and quantitatively match macro responses … to uncertainty shocks. Empirically, uncertainty shocks i) generate deflationary pressure; ii) have considerably negative … jointly attain these results. Uncertainty shocks induce households' precautionary saving and firms' precautionary pricing …

labor market and examines the implications of joint household decision-making for cyclical fluctuations in the unemployment …, and find that joint household decision-making contributes to the counter-cyclicality of women’s unemployment rate, but not …

volatility of vacancies and unemployment. This channel can be relevant if the lack of insurance is large enough so that the … earnings variance and persistence in the unemployment state that result in a large degree of self-insurance …

In this paper, I show that the decline in household consumption during unemployment spells depends on both liquid and … illiquid asset positions. I also provide evidence that unemployment spells predict the withdrawal of illiquid assets …, particularly when households have few liquid assets. Motivated by these findings, I embed endogenous unemployment risk in a two …