A simple model evaluating a firm’s optimal employment reaction to an imminent recession is presented. Firing costs shelter employment – and this effect is typically amplified by uncertainty due to an option value of waiting. However, this job protection effect is reduced if the expected...

This paper investigates how persistent changes in trust caused by the Great Recession have affected how governments and citizens across Europe responded to the next global crisis: the COVID-19 pandemic. We show that increases in individualism and mistrust towards institutions caused by...

This paper empirically analyzes the effects of immigration on the schooling decisions of natives. We employ household-level data for Spain for years 2000-2012, a period characterized by a large immigration wave and a severe recession. Our estimates reveal that Spanish households responded to...